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The Tyler Show
Q2 Washington Insights feat. Tyler Brown
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Washington, D.C., continues to shape the retirement planning landscape. In this quarterly update, Tyler De Haan and Tyler Brown discuss key policy, regulatory, and economic developments that could influence retirement planning strategies and client conversations in the months ahead.
Welcome to the Tyler Show. I'm your host, Tyler Dahan, and we have in studio with us Tyler Brown, the vice president of governmental affairs here for Salmon's Institutional Group. It's always a pleasure to have you here in studio. So thanks for joining us today, T Brown.
SPEAKER_01It's my pleasure, Tyler. Always great to be here.
SPEAKER_00So for the audience, got any big plans coming up? Any any fun things that are going on with the family here this summer?
SPEAKER_01Yeah, no, I I don't know that uh Sioux City, Iowa qu qualifies as a destination vacation, but I do have grandparents there who are going to, you know, you get to grandma and grandpa's house, you give them the kids, and you check out, right? So that's uh in some ways it's the best place to be at this particular moment.
SPEAKER_00Well, the other thing too about Sioux City, Iowa is it was the home office of the late show for many years. Remember that, David Letterman? Yeah.
SPEAKER_01No kidding. Yeah, yeah.
SPEAKER_00No, it was Sioux City. It was the city. Yeah.
SPEAKER_01Look it up, Google it. I'm gonna fact check you on that one. All right.
SPEAKER_00Yeah. So for the audience, you can fact check me as well. But yeah, David Letterman, it was the it was the home office of the late show for for a couple of years there in the 90s.
SPEAKER_01Okay. Yeah. All right, okay claim to fame. All right.
SPEAKER_00Then Sergeant Floyd.
SPEAKER_01Well, yeah, Sergeant Floyd, of course, yes. Now we've America's favorite obelisk uh is in uh in Sioux City. Yeah, yeah.
SPEAKER_00Well, for those of you, uh this is maybe your third or fourth time on the Tyler Show. Uh maybe this is your first time. Typically, what Tyler Brown and I do is we give you a rundown on what's going on in Washington, D.C. And we kind of do it in a format where we talk about regulation, we talk about legislation, then we talk about elections, and we circle it all back around, talk a little bit about the economy, give you some financial strategies that you might want to consider, and then we send you on your way here in about 20 to 25 minutes. So that's kind of the format we'll do again today here. And, you know, regulation for the longest time, we were talking a lot about regulation. There's a lot of stuff going down on the regulatory front. And now it's a little quieter. Yeah. But it doesn't mean that there aren't things that are kind of underneath the waves a little bit. So tell us a little bit about what you're uh looking at right now from a regulatory standpoint, anything that we need to be aware of.
SPEAKER_01Yeah, well, I mean, uh, you know, we certainly have seen some positive developments on the regulatory front, to your point. Um, I think the big one from our viewpoint is the uh Department of Labor's fiduciary rule. We had a you know long, drawn out, 10 plus year struggle with the Department of Labor regarding how you define who a fiduciary is and what kind of requirements apply. What are the different exemptions and what do they look like uh as it relates to those who are fiduciaries and uh had a really positive outcome on that. Uh, you know, the Biden administration had a rule that they came out with in 2024 that was highly problematic, that uh was uh ultimately struck down by the courts. Um and then in a notice of vagure, the Department of Labor not only rescinded that rule, but also uh fixed up some issues we had with back with the 2020 version of that fiduciary rule. So um really good to see uh from our vantage point. That's really been one of our top advocacy priorities since I started here at San at uh Salmons. And great to see some hopeful, hopefully some finality on that. Um, you know, they've been going, we've we've been uh playing ping pong on that issue for the last decade, as I as I said. So uh, you know, we're not we're gonna remain vigilant on it, but uh, but a really good outcome, uh, at least as it stands here today.
SPEAKER_00And I yeah, I think if we would go back to when that first happened, I think the outcome is about as good as we could have even have thought of. Oh, yeah, for sure. When that first, when that rule first dropped.
SPEAKER_01Yeah.
SPEAKER_00The the other thing too that I that I kind of wanted to bring up that I thought was kind of interesting was you and I were at a public policy forum just a couple of weeks ago at Drake University. Yeah and they were talking about Trump uh the Trump IRA, right? Oh, yeah. And it got me thinking a little bit about that is you know, one of the things that in a in an age where everything's very divisive, there is an area on financial security and retirement security that both parties really come together on. And so just kind of your thoughts on the Trump IRA or the Trump accounts or whatever you want to call them.
SPEAKER_01Well, yeah, so two different things. Uh, but yes, Trump IRAs, uh, I'm glad you brought it up. Uh, it's something that has some bipartisan appeal in everything except maybe its name. I might, I might, you might see some uh some Democrats who don't love calling this uh uh you know a Trump a Trump IRA. But uh the gist of the idea is this uh, you know, you've got a lot of folks who maybe don't have access to an employer-sponsored retirement plan. Um, and we've got a new incentive that's kicking in here next year uh that will provide a federal match on retirement savings, um a 50% match for uh low and moderate income Americans that's refundable tax credit. So uh, you know, even those with very little or or no income tax liability would potentially still benefit from this retirement savings match. But the issue is, okay, what if they don't have a retirement account? Um so the uh the goal here is uh, you know, the the president has come out with uh or is it directed, has instructed the Treasury Department to uh create these accounts, to uh um have uh uh a website where you where you can have private sector IRAs with a maximum of uh uh 0.15% fees on those that uh that could be available to your your your lower middle income American who may not otherwise have access to a retirement account. And then they can take advantage of this savers match uh tax benefit that was created as part of the Secure Act 2.0. So it'll be interesting to see to track this over the next over the coming months. Um this is uh something that should be is supposed to be available uh starting next year. Um of course Trump accounts something different. But no, but but uh but I mean also named after the the current president. Um and uh and also I think something with some bipartisan appeal, although perhaps not in the name. Um this is uh a new uh savings account for uh designed for for young Americans, uh the youngest Americans. Uh so if you uh have a child that's born between uh I think 2025 and uh 2028, uh there is a uh uh you can uh get a Trump account, sign your kid up for a Trump account, and then there's a the federal government will put a thousand dollars of seed money into that account, uh, which you uh then can uh you know you'll you'll benefit from compounding interest uh throughout the uh the child's adolescence. And then uh when it's 18, it's turned over when you're 18, you're turned it's turned over to you. Um you can continue to just save and and have it could be you know a Roth IRA or or you can use it for homeownership. You can use it for other expenses. Um really interesting idea though, um, and one that uh will be interesting to watch. That that that program actually launches here formally in a couple weeks.
SPEAKER_00Um and and it's really interesting because again, when we were at this public policy forum, uh when we were they were talking about the Trump IRAs, this is something that Senator Warren was in favor, is in favor of. So you you you look at the bipartisanship. I mean, in it in a time where people always talk about how divisive the country is, when it comes to financial security and retirement security, uh, this is a bipartisan issue. And you can see that kind of in that that moment in the State of the Union where you had President Trump talking about the Trump IRA and you had Senator Warren, you know, applauding that. And so that that doesn't that doesn't happen very often.
SPEAKER_01No, yeah, it's it's one of the few areas of uh public policy right now where you've got some bipartisan agreement and the two parties willing to maybe you know put the gloves down and and uh work hand in hand.
SPEAKER_00Yeah, yeah. So let's let's talk a little bit about the legislative uh aspect. We we talked a little bit about regulatory, which has been quiet. And then now you have the legislative, which is we're past Memorial Day. So where we're filming right now, it's uh June 3rd of 2026. So we don't know what's gonna happen here in the next, you know, couple of weeks. But you know, the one thing that from a legislative standpoint is often when we get into primary season and then on into the general, there's usually unless there's something major going on, there's not a whole lot of legislating that's going on Capitol Hill. However, so I want to ask you two questions. The first question I want to ask you is is there anything that could potentially be signed or go through during this time frame between where we're at now through the end of the election? And then, interesting enough, because we have seen in some of the primaries. Uh, yesterday in the state of Iowa, we had our primary and I stayed up way too late last night. Same following a couple of the races that I was interested in. However, you have uh several people in Congress that are not going to be in the next Congress. So that makes it a little bit interesting from a lame duck session. Is there potentially that we might see some legislation come through there? Uh so those are the two questions. Anything now? And then what what are you seeing or what could potentially what what we might what might we want to keep our eye on during that lame duck session?
SPEAKER_01Yeah, well, no, it's uh it's a great question. Uh yeah, there are there are some things that are kind of on the must-pass list for Congress still before they they really check out for the year. And I think first among those for Republicans is is putting their second reconciliation package to bed, finally, finalizing that. So this is uh uh largely spending on uh immigration enforcement. Uh there's some defense spending in there as well. It's a pretty narrow package, but uh that had been uh caught up in some unrelated uh issues. So I'll leave it at that. Uh, that have uh may or may not be resolved now. Um and uh so I I think leader Thune is hoping to get that on the floor of the Senate here in the next few days. And uh we'll we'll see what happens with that. That maybe not quite as relevant to our world, but that is something that has to get done. Um and then there's talk still that maybe they'll try to a third bite at the apple with reconciliation and try to do uh, you know, another you know, tax and spending package at some point. I'm very skeptical that that will happen, but we'll obviously be keeping a really close eye on that. Um, you know, as you think about things like uh you know retirement security, there's a lot of uh things on our wish list that we'd love to see Congress passed um as part of maybe a third retirement or third reconciliation bill. So keep a close eye on that, certainly. But that's probably more of a lame duck thing, I would guess, if they do have any chance. And even then, I'm skeptical. But uh but there are a lot of there are other things out there. Uh there's a housing package that uh the House and the Senate have passed competing versions that uh they need to reach consensus on. But at some point you you think they're probably gonna get there. Um, and of course, your annual defense authorization bill, you've got a farm bill, there's other things out there, but uh yeah, I we're pretty well uh we're we're getting close to checkout time uh as it relates to you know between now and the election, uh, you know, folks are kind of antsy to get home and campaign, I think. Yeah.
SPEAKER_00Yeah, and and and that kind of moves us from the legislative aspect right straight into the election. That's probably maybe what some of our viewers are interested in right now. So we have a next couple of weeks where a lot of states are going to be doing their their primary elections. California had it yesterday, state of Iowa had it yesterday. I'm sure several other states did too. Those are the two that just popped to the top of my mind. But as we move kind of through primary season, and we've talked about it last time, where you have historical headwinds for Republicans because Republicans control the White House, the Senate, and the House. And then historically, you know, this isn't a Republican or Democratic thing. It's just historically the party that's not in power tends to have more enthusiasm. And that will often lead to them taking some seats in either the House and the Senate. So with that being said, and then you also on top of that, you have the the redistricting wars or the gerrymandering wars, whichever you want to say. So you have that on top of what's going on. So walk us through a little bit. I think first with the house, what do you what do you what are you seeing in the house, at least right now? Uh obviously we don't know who the general election candidates are yet, but we kind of have a sense. And then, and then second, what what's going on in the in the Senate? Because the Senate, as we we've talked about in the past, it's a completely different animal when it comes to campaigning.
SPEAKER_01For sure. Yeah. So I mean, the House typically would, you know, follow the underlying national sentiment. Um, you know, if Democrats have the overall advantage now on the national level, I mean you would you would kind of assume that the House is going to trend toward Democrats. So that's what is being broadly being expected, I think, by most, by most folks. Uh right now, prediction market uh Cal She has uh the odds of Democrats controlling the House at 79%. That seems about right to me. I don't know. That seems about right. I think markets have priced that incorrectly. Um that being said, you mentioned redistricting. I mean, uh overall, Republicans are probably gonna gain seats from the the back and forth uh wars over redistricting and gerrymandering. There was a couple uh maps that got struck down by courts, one in Virginia in particular, that is really impactful. Um whereas uh some Republican maps have been allowed to stand uh through the courts. So I I think ultimately that's probably a little bit of a net benefit for Republicans, but I do think one thing that's important to note as it relates to the House that's different from previous elections where you might see more of a of a wave where you have a big majority come in for one party. 94, 06, yeah, yeah, 06 or or even uh, you know, uh 10, 2010, right? 2010. Yeah. Those days are probably past us just by just based on the fact that, you know, the map, everything's so polarized in the United States right now, and the way the maps have been drawn at this point, uh, you know, there's just not many realistic pickup opportunities for either party. Everyone's pretty entrenched. So here's a here's a staff where you if you look at Cook Cook Political Report has ratings of, you know, is this a safe Republican seat, a safe Democrat seat? Uh, if you were to combine all of the solid, likely, lean Democrat seats with all the toss-up seats and all the lean Republican seats, that only gets you to 230 seats for Democrats. That's not a that's that's only a you know 12 seat edge. That's not a very big majority. So uh that would be a wave election, right? Is it's not gonna give you the kind of majority that you would have seen in past years. So I think that's notable. Like whoever, whatever party wins the control of the house is gonna have a really tough job. Uh Mike Johnson knows all too well. Uh it's very, very difficult to keep the house in line when you have a tight majority like that. So I think that's just a notable trend going forward that'll impact both parties.
SPEAKER_00Yeah, that's not gonna be a job that you're gonna want to have as Speaker of the House, where you you have a 12-seat majority and you got to get everybody on board and just a handful of defectors is going to create, you know, legislative chaos.
SPEAKER_01Right. Absolutely. You're absolutely right. Yeah.
SPEAKER_00So let's talk a little bit about the Senate because that is a different animal.
SPEAKER_01Yep.
SPEAKER_00And a little bit different campaigning. So tell us a little bit about the map. What are you seeing in those races? Because right now it's it's really coming down to probably you say like a handful of different states is really gonna, you know, really decide whether or not the Republicans can maintain control of the Senate or whether or not the Democrats can flip control there.
SPEAKER_01Yeah. No, I mean Republicans have an awesome map, to your point. Um, you know, because Senators only up every six years, um, you know, it just so happens that this year is a really favorable setup for Republicans where they they already are coming in with the advantage in the Senate and they've got they're only playing defense in a couple seats and they're playing offense. In theory, they're playing offense in quite a few seats. Um now you always it always gets more complicated the closer you get to election day, right? Um and we've seen that. Uh, you know, Democrats thought they had an awesome pickup opportunity in Maine. Typically a you know, pretty blue state. Susan Collins, though, has been an very independent voice, and they happen to nominate somebody who's got a checkered history to say the least. I yeah, I think checkered history is maybe a polite way to put it. Um so you know, candidate quality matters. Uh, you know, that's that's one one factor. And I mean, North Carolina is another example where Republicans, uh, you know, Democrats have a pretty strong candidate that I think Republicans are going to struggle to compete with, even though it's a state that maybe slightly favors Republicans in a typical year. Um but and then you've got states like uh Alaska and Iowa that you know you might not think of as being battleground states, but given uh the underlying uh sentiment um economics uh underplaying the election, I I think uh maybe could come into play. You've got a seat like state like Texas, uh, which has been all over the news, obviously, where uh candidate quality could could be a factor as well uh for Republicans. So um a lot of variables there. And um, and then you you know there's a few different opportunities maybe for Republicans to play offense in states like Michigan. I think Georgia will be tough. But um ultimately, though, I think Republicans probably do hang on to the Senate. Uh if you when you weigh all these things together, um, it's probably just too favorable of an of a map for Democrats to overcome. And so prediction markets have the Senate right now at uh 58% chance that Republicans retain it, which I also think is about right. I I think it's more likely that Democrats win the House than it is Republicans retain the Senate. So that seems about right, but likely split government.
SPEAKER_00And the one thing I would also note, too, is that typically uh in an election year, an incumbent's gonna win 90% of the time. And so if you look at just the Senate map there and you look at all the incumbents, now that that's not gonna help you in Texas, that's not gonna help you in Iowa, but you know, Alaska, Georgia, I mean, uh North Carolina is a taught is now uh is an open seat.
SPEAKER_01Yeah.
SPEAKER_00Um, but you know, you look at the incumbency and the advantage that that that usually has, that also plays a plays a part too.
SPEAKER_01So there's yeah, yeah. I think a couple other really interesting notes, just not to geek out too much, but we're getting close to election day. So uh it's only a few months away. Uh Nebraska, a state that uh you wouldn't expect. Uh there's a it's probably gonna be an independent that is uh that almost pulled off an upset of Deb Fisher a couple years ago, who's gonna be running against uh uh running against uh the Republican there. So that that'll be an interesting race to watch. And then Alaska, there's a crazy story right now where you've got uh Senator Dan Sullivan competing in a primary against another guy named Dan Sullivan who has the same exact campaign logo as it as it's really pretty wild stuff. Yeah, no, this is real. Look it up, it's it's pretty amazing. So there's all kinds of variables like that that could change things between now and then. We'll we'll see. Interesting. Yeah.
SPEAKER_00Well, and the other thing too, and I and this has been brought up quite a bit is I always think of of James Carville, right? You know, the the Rage and Cajun, um, early to mid-90s, and he, you know, he's famous for saying it's it's all about the economy, stupid, right? Yeah so not necessarily about what the economic sediment is today, but it is kind of what the economic sediment is going to be in in September. And I and I and I I I I think you might have said this with with the absentee balloting that goes on and and the mail-in balloting, uh candidates really have to make their final pitch really by the end of September because you have all of the the the balloting, the people are actually starting to to to fill out their their election ballots at that point in time. So what where's the economy at in September? Where where are gas prices in September?
SPEAKER_01Um, I think that's gonna play a play a big role in and where and where the election is very lucky for Republicans that uh yeah, we've got a few more months uh for the economy to develop into hopefully a better scenario for them, right? It's uh I think I think they're all breathing a sigh of relief that uh you know, hopefully today's gas prices aren't gas prices in uh October. Right.
SPEAKER_00And I think that's that's the that's the unique thing where it's kind of interesting to see that right now, because if you're looking at gas prices the way the gas prices come down, you know, they they don't they don't shoot up, they don't go up as fast as they they cut, you know, they come down like a feather, right? And so really with with what's going on in Iran, you know, how long, you know, they really got about eight weeks to figure this out before otherwise the gas prices are gonna be what the gas prices are. So I think that from an economic standpoint, that that's the biggest thing I think a lot of people people are uh are are concerned about is you know how how is what's my wallet look like? And you know, I'll vote you know on a candidate based off of you know how things are going for for me financially. And that that can play a play a part into this uh 20 and uh 26 election. So um a couple other things too that I just want to note, and you know, we've talked about this on the show is that typically in midterm election years, you see the market be a little bit more volatile. It tends to mirror, be very, very sensitive to headline news. So, with that, some of the financial strategies that people might want to consider is, you know, first of all, diversification. You know, whether that's a diversification of an asset class, money manager, strategy, diversification can be a key both on the qualified side and the non-qualified side. And then if maybe that diversification isn't really necessarily going to help you sleep at night, then you have different types of strategies that have floors and buffers that can be helpful and kind of help you uh manage that volatility if the market, you know, is going up and down quite a bit and you just you just can't sleep at night. One other thing, too, that I was I was talking to somebody the other day that I thought was interesting. Um well, not that I thought was interesting, but I but I but I but it was very similar to what what had happened uh two years ago, where I was talking to somebody about the fact that the markets were at all-time highs. And in my career, my 20 plus career, uh, we had interest rates at at at least 20 year highs. And so that was a really uh interesting environment where people that were looking for consistent streams of income could generate some pretty nice consistent streams of income. And you had that window for about 18 months, and then interest rates started to come down and now they're starting to tick back up again. So those individuals that were thinking about consistent streams of income that maybe didn't do anything, or people that are getting close to retirement now that weren't quite thinking about it two years ago, this window is starting to open up again where people can kind of look at that consistent stream of income because you have markets sitting at all-time highs and you have interest rates um at least pretty close to at least in my career, 20-year career, at all-time highs there too. So some different things to kind of think about as you know, you're you're kind of a weighing in the election, the economy, and financial planning, because they're all they're all kind of married together a little bit. So um, Tyler, uh, you know, we talked, we covered a lot of stuff here today. Uh, elections, we've talked about the regulatory environment, we talked about legislation. Any final thoughts to share with the audience here about maybe things to think about as they're getting close to their 4th of July barbecues and things that they can talk about that might, you know, make people think, wow, this person is really in the know.
SPEAKER_01Well, I don't know if uh, you know, monetary policy is something you want to bring up in your barbecue, but I do feel really bad for uh depends on the barbecue, though. Yeah, well, yeah. I do feel really bad for new Fed chair Kevin Wars, who's got a, you know, certainly had been hoping to be able to come in and cut interest rates and uh then you inherit what what he's inherited with regard to gas prices and inflation. And it's pretty tough to see them doing that right now. So I it's uh, you know, and how that leads to interactions with uh, you know, with a certain man down the street uh in the West Wing, I I don't know. It'll be interesting.
SPEAKER_00But one thing you'll say about President Trump is he knows how to use the bully pulpit. Uh, it certainly he knows how to use the bully pulpit.
SPEAKER_01Yeah, yeah, yeah. Awesome. Well, thank you, Todd.
SPEAKER_00Yeah, well, thanks for having us. And you know, just so grateful for everybody uh joining us here and supporting us here at the Tyler Show, and then also with Salmon's institutional group. And as we sit here and we close, uh, we just want to thank you for for your support and your viewership. And from the Tyler Show, I'm Tyler Dehan. Until next time.