The State of the Union Is...

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The state of the union is strong, U.S. President Donald Trump will presumably tell the country tonight. The state of his legislative agenda is significantly weaker.

Trump salvaged his first year in office by signing a broad tax overhaul into law late last year — and he’ll surely remind voters of that accomplishment in his speech. But growing budget deficits and November’s midterm elections may leave the president and Congressional Republicans without much to brag about.

House Speaker Paul Ryan’s long-desired welfare overhaul is already off the table. Next to go may be Trump’s infrastructure development plan, a proposal he’s scaled back. The nation’s almost $21 trillion of debt leaves little money for Republicans to spend after a promised defense build-up to counter the likes of China, North Korea and Russia.

In a nod to that reality, Trump’s speech may feature much less of a laundry list of proposals and congressional requests than seen from his predecessors. He’ll touch on trade, national security and immigration — all familiar signposts of his presidency so far. And it’s a safe bet that he’ll mention the stock market’s performance since his election.

Before Trump’s inauguration, Bloomberg picked the best indicators to judge the impact of his policies and determine whether the economy is living up to his pre-election promises. Since then, we’ve been tracking those indicators. Click here to see if they’re doing great, just all right or worse.
Photographer: Jim Lo Scalzo/EPA

Global Headlines

Trump vs. Justice | The president’s furor over the Russia investigation erupted on Air Force One last week after he learned a top Justice Department official had warned it would be “extraordinarily reckless” to release a congressional memo that could undercut the probe, Jennifer Jacobs exclusively reports. A U.S. House committee voted along party lines yesterday to release the document, which alleges the FBI and Justice Department pursued the Russia probe under false pretenses.

Russian roll call | The U.S. Treasury Department published the names of Russian oligarchs and officials with close ties with President Vladimir Putin — 114 senior political figures and 96 billionaires — as required by a sanctions law passed last summer. The department underlined it wasn’t leveling new restrictions on the Russian elite. That may have eased pressure on the country’s bonds but probably not questions about the Trump administration’s policy toward Putin.

No Asian holiday | Prime Minster Theresa May is on her way to China — 50 business leaders in tow — as she seeks alternative sources of trade and investment after Britain leaves the European Union. But she’s unlikely to escape turmoil back home, including a possible leadership challenge, fresh leaks about the high price of Brexit and opposition leader Jeremy Corbyn’s rival vision for the political divorce.

Taiwan Strait turbulence | Two Chinese airlines canceled more than 170 extra flights to Taiwan next month after failing to gain approval from officials on the island that Beijing views as a province. Part of a month-long aviation tit-for-tat over control of the Taiwan Strait, the tensions between Beijing and the China-skeptic government in Taipei risk hurting ordinary people during the key Lunar New Year holiday.

Holy City, changing | The number of employed east Jerusalem Arabs is rising, more are learning Hebrew and salary gaps with the city’s Jewish population are narrowing. Gwen Ackerman and Fadwa Hodali look at how economics is reweaving the tapestry of the fractious city, and how that helps explain the relative calm since Trump’s decision to recognize it as the capital of Israel.

And finally... Acts of defiance can take on a life of their own in today’s social-media driven political age. Just as Trump’s criticism of football players caused a new wave of pre-game kneeling, Iran’s recent unrest has revived an internet meme aimed against the religious establishment. In the last few days, Iranians have been circulating pictures of women holding their compulsory veils at the end of sticks. A similar image surfaced late last year and went viral during December’s widespread anti-government protests.

— With assistance by Michael Winfrey

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