Appropriations

By not filling low-priority positions, senator says government could save some employees from furloughs.

Congress returns for what promises to be a frenetic final week before the sequester hits, with no compromise in sight between the two parties.

President Obama spent the last week with Congress out of session hitting Republicans on the automatic spending cuts, and is demanding tax revenue be part of any replacement, while the GOP contends that they’ve come up with an acceptable alternative made up entirely of cuts.

This week the Senate will likely be occupied by dueling proposals to replace the $85 billion in cuts set to take effect on March 1, but it remains to be seen whether the two parties will scramble for a last-ditch compromise before Friday.

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Graham argued the cuts would "unvravel" the U.S. military, while Paul said sequestration was not "a real cut in spending."

A leading Republican opponent of sequestration on Friday conceded that cuts to the Pentagon are likely to be triggered in March despite his warnings about dire consequences for the military.

Rep. Buck McKeon (R-Calif.), the chairman of the House Armed Services Committee, said the question now facing lawmakers is how long the sequestered cuts will stay on the books.

"Sequester is going to kick in and as people see what it is ... that will hopefully force us" to come up with a solution for stopping them, McKeon told reporters during a breakfast in Washington.

He said lawmakers have "locked ourselves" into sequestration due to the impasse over how to replace the more than $1 trillion in automatic budget cuts that are coming over 10 years.

"We are going to be forced into it," McKeon said. "We have just not been able to get past the politics of it [all]."

The move leaves only four days to deal with the $85 billion sequester on their return.

Appropriations Chairman Rogers is preparing a continuing resolution that would prevent a government shutdown beyond March 27

“Read my lips: I am not interested in an eleventh-hour negotiation,” the Senate minority leader said.

If the full caucus approves the draft plan, it could be formally introduced on the floor Thursday, one aide said.

Most market professionals do not believe the White House and Congress will strike a deal to avoid automatic spending cuts, and the stock market will pay the price as a result.

A survey of money managers from the Potomac Research Group reveals split opinion among the investing world about the future of the nation's fiscal policy. Fifty-three percent of respondents expect sequester cuts to take effect beginning March 1, while 47 percent believe a deal will be struck in time to avoid them.

The financial industry is also divided when it comes to the impact of those cuts if they occur, as 51 percent of the 55 respondents believe the Dow Jones Industrial Average would drop at least 5 percent if the sequester occurs. Another 42 percent believe the stock market would experience little to no change if those billions of dollars' worth of cuts take effect.

The Capitol will be abuzz this week thanks to a slew of high-profile events.

Jack Lew’s bid to become the next Treasury secretary will be put to the test on Wednesday when he appears before the Senate Finance Committee.

So far, it does not look as if Republicans are mounting a major effort to block his confirmation, but the hearing will be the first chance for GOP lawmakers to grill Lew on a wide range of budget, tax and financial matters.

The evening before Lew’s testimony, President Obama will pay the Capitol a visit to deliver the first State of the Union address of his second term.

With major fights looming on sequestration and government funding, expect Obama to lay down his vision for the nation’s finances and contrast it with the GOP’s approach. Sen. Marco Rubio (R-Fla.) will deliver the Republican rebuttal.