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OVERNIGHT MONEY: House expected to wrap up budget work on Thursday
THURSDAY'S BIG STORY:
Halfway home: The House began work Wednesday with an aim to wrap up votes on Thursday on half a dozen alternatives to Budget Committee Chairman Paul Ryan's 2013 blueprint.
Compared with President Obama's budget, Ryan's (R-Wis.) plan includes $3.3 trillion in deficit cuts, spending cuts of $5.3 trillion and $2 trillion in lower taxes — reducing tax brackets to 10 percent and 25 percent — in the next 10 years.
The plan makes solid inroads on the deficit but doesn't achieve balance until 2040, leading conservative Republicans to offer a more stringent plan that would balance in five years.
The main GOP measure is expected to pass on Thursday — probably with mostly Republican votes, minus some more conservative members — but Ryan's proposal doesn't stand a chance in the Senate.
A significant vote is slated for later tonight, probably around 10 p.m., on a plan based on the Bowles-Simpson commission's recommendations from 2010, which would cut the deficit by $4 trillion over 10 years with a mix of new tax revenues and spending cuts.
If the proposal, introduced by by Reps. Jim Cooper (D-Tenn.) and Steven LaTourette (R-Ohio), fails to get many votes, it could set back efforts for a bipartisan grand bargain.
Republicans mostly stood by Ryan's budget during partisan debate on Wednesday — or backed the alternative that makes even steeper cuts.
Democrats are opposing Ryan's plan because they argue it places a heftier tax burden on the middle class, slashes safety-net programs such as food stamps and Medicaid and jeopardizes seniors' healthcare while providing a tax break to wealthier Americans.
The Ryan budget also lowers the discretionary spending cap, which has angered Democrats and the White House, who have argued that it reneges on last summer's debt-limit agreement.
"It is not bold, not bold to provide tax breaks to millionaires while ending the Medicare guarantee for seniors and sticking them with the bill for rising health carecosts," said top Budget Committee Democrat Rep. Chris Van Hollen of Maryland.
"It is certainly not brave to cut support for seniors in nursing homes, individuals with disabilities, and poor kids. And it is not fair to raise taxes on middle-income Americans, financed by another round of tax breaks for the very wealthy."
White House Budget Director Jeff Zients on Wednesday warned that the House GOP 2013 budget, coming to a vote on Thursday, cuts 2013 spending more than previously thought.
On its face, the budget cuts non-defense appropriations by 5 percent more next year than called for in the August debt deal. The budget cuts the top-line overall spending figure by $19 billion, to $1.028 trillion, while increasing defense spending by $8 billion.
Zients warns in a blog post that the cut is even deeper when the budget’s disaster aid and Pell Grant changes are factored in.
On Thursday, Democrats might once again play games with the Republican Study Committee budget when it comes to the floor.
House Minority Whip Steny Hoyer (D-Md.) is holding his cards close to his vest. His office isn’t saying whether he will use the same trick he employed last year, when Hoyer got most Democrats to vote “present” on the RSC budget rather than vote “no.” The plan almost forced the passage of the RSC budget, which Democrats derided as the GOP leadership budget “on steroids."
The RSC budget is much more conservative than the plan backed by GOP leaders — it cuts spending by $2.2 trillion more over 10 years than the budget authored by Ryan.
On Wednesday, votes are expected on a Rep. Mick Mulvaney (R-S.C.) alternative that contains top-line spending and revenue numbers found in Obama’s budget.
The White House called the amendment a “gimmick” and argued that the it does not deserve to pass.
WHAT ELSE TO WATCH FOR
And the nominees are ...: The Senate Banking Committee will vote Thursday on a whole batch of Obama nominees to fill key economic spots. Getting people into those vacancies at the financial regulators has been a bit of a tall order lately, even with Dodd-Frank implementation under way — several openings remain at top seats in several shops. Tomorrow, the panel will consider whether to advance two nominees to serve as Federal Reserve governors, one to join the Federal Deposit Insurance Corporation, another to head up the new Office of Financial Research and yet another to serve as the government's official bailout watchdog. Keep an eye on how staunch Republican opposition to the picks is, which would indicate whether these nominees have a chance of clearing the full Senate and getting the job.
Another day, another Cordray: Consumer watchdog Richard Cordray, fresh off the heels of his appearance at the U.S. Chamber of Commerce, will take his show before another tough crowd Thursday: House Republicans. The head of the Consumer Financial Protection Bureau (CFPB) will testify before the House Financial Services Committee tomorrow to deliver the semiannual report on his agency's operations. Expect Cordray to get plenty of questions about what the new bureau is up to, and well as plenty of opinions on whether the president's recess appointment of him was on the up and up.
So long, Professor Bernanke: Federal Reserve Chairman Ben Bernanke will wrap up his brief stint as a college lecturer on Thursday, delivering the last of four lectures on the central bank's role during the financial crisis. So far, the first three events have gone smoothly, with nary a spitball sent his way.
More budget exams: The Small Business and Entrepreneurship Committee will take a look at the Small Business Administration's $1.15 billion budget with Karen Mills, SBA administrator, and a whole group of others, including business leaders and Bill Shear, director of financial markets and community investment at the Government Accountability Office; Tony Wilkinson, president of the National Association of Government Guaranteed Lenders; Peggy Gustafson, SBA inspector general; and Winslow Sargeant, chief SBA counsel for advocacy.
Other budget work continues at the Senate Appropriations Committee with Agriculture Secretary Tom Vilsack on the agency's budget.
BREAKING NEWS
Moving on up: The House Ways and Means Committee on Wednesday approved a small-business tax cut on a party-line vote over loud Democratic objections that the measure would be a handout to companies that don’t need it.
During an at-times contentious markup, Ways and Means Chairman Dave Camp (R-Mich.) said that the proposed 20 percent deduction for qualifying small businesses would not be a substitute for tax reform, but would aid a broad range of companies.
“This deduction can free up resources so a small business can invest, hire another worker or provide a raise to an employee — something too many employers haven’t been able to do in this weak and slowly recovering economy,” Camp said.
LOOSE CHANGE
Twitterburst: In case you were wondering, Grover Norquist is not a big fan of this "grand bargain" idea.
The anti-tax activist and Americans for Tax Reform founder took to Twitter on Wednesday to deride the House proposal based on the Simpson-Bowles deficit commission, and to celebrate a new article recounting the demise of the talks between President Obama and Speaker John Boehner (R-Ohio) last year.
"@RepCharlesBass: One of a handful of Rs now supporting two trillion in tax hikes. New Hampshire must be so proud," one tweet read.
ECONOMIC INDICATORS
Initial Claims: The Department of Labor releases its weekly filings for jobless benefits. Claims have been reflecting a strengthening job market.
GDP: The Commerce Department will release its third measure of the nation's economic activity for the final three months of last year. The last estimate came in at 3 percent, and that is expected to remain unchanged, according to economists forecasts.
WHAT YOU MIGHT HAVE MISSED
— Frustration flows as members search for answers on MF Global
— Democrat calls for NLRB investigation
— Cordray to Chamber: I come in peace
— CEOs say Washington is putting brakes on economic recovery
— Senators aim to smooth veterans' transition into the workforce
— Refinancings drop as government activity falls
— White House: No decision made on tapping emergency oil stockpiles
— Rep. Mica calls on Dems to support short-term highway bill
Catch us on Twitter: @VickoftheHill, @peteschroeder, @elwasson and @berniebecker3
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