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OVERNIGHT MONEY: Prime time
Days until Aug. 2 debt-ceiling deadline: 7
TUESDAY’S BIG STORY:
Get the popcorn ready. The debt-ceiling crisis is going primetime.
In less than 90 minutes, President Obama is poised to address the nation on the debt-ceiling crisis from the East Room — with House Speaker John Boehner (R-Ohio) set to rebut shortly thereafter.
The White House, in what has proven to be a busy Monday, has already thrown its support behind one of the latest plans to increase the $14.3 trillion debt limit, from Senate Majority Leader Harry Reid (D-Nev.), and against the Boehner proposal that only grants a hike through February or March.
Reid’s $2.7 trillion plan, which he laid out Monday, gets more than half of its savings off of interest payments and the expected troop drawdowns in Iraq and Afghanistan, while raising the debt ceiling through 2012. Obama and top congressional Democrats have said increasing the limit that much is necessary to give certainty to the economy and financial markets.
As it stands, the Senate Democratic leader tried to bring his entire caucus behind his plan, which does not include new revenues, at a Monday night meeting. Reid had been expected to file cloture on the bill on Monday, but appears, according to reports, not to have pulled the trigger.
On the other side of the Capitol, Boehner was facing a possible revolt from his right flank, with the head of the Republican Study Committee, Rep. Jim Jordan (R-Ohio), and others coming out against his plan because it doesn’t tie the debt-ceiling increase to a balanced-budget amendment passing Congress.
Rep. Kevin McCarthy of California, the House GOP whip, is working overtime to line up enough votes for the plan before the Wednesday vote, with the bill text to be released Monday night.
WHAT ELSE TO WATCH FOR:
On the floor: Meanwhile, the full House continues to debate the 2012 Interior and Environment appropriations bill, which Democrats say is the worst environmental bill to come before the House — ever. The bill contains 39 riders limiting the ability of the EPA to regulate; Democrats are attempting to strip out as many as possible.
The trio scheduled to be on hand are: Martin Gruenberg, tapped to replace Sheila Bair at the top of the Federal Deposit Insurance Corporation; Thomas Curry, the choice for next comptroller of the currency; and Roy Woodall, the pick for insurance expert on the new Financial Stability Oversight Council. Financial regulatory nominees have had a rocky road in confirmation battles lately — here’s looking at you, Peter Diamond and Richard Cordray — so keep an eye open to see if these three fare better.
Consumption!: Mike Huckabee, the former Arkansas governor and GOP presidential candidate, is one of a deep bench — nine witnesses overall — talking consumption taxes at House Ways and Means tomorrow. (Update: Make that 10!)
Huckabee and two others will discuss the Fair Tax, the idea of replacing federal taxes with a sizable national sales tax. The rest of the panelists will discuss the Value Added Tax, a consumption tax that has sparked skepticism from both the right and the left in this country. All that said, the VAT is quite popular in much of the rest of the industrialized world — where, perhaps not coincidentally, most countries also have a lower corporate tax rate.
If at first you don’t succeed ... Senate Finance is going back to the well for a hearing on deficit reduction, three weeks or so after the debate over the pending trade deals caused the postponement of a previously scheduled discussion. Peter Orszag, the former White House budget director, is not scheduled to testify this time around, but Finance will hear from liberal and conservative experts.
Speaking of which: The U.S. Chamber of Commerce is taking its case on those trade deals — with South Korea, Panama and Colombia — to Capitol Hill, holding a rally to help push for their passage. The agreements remained stalled due to disagreements over whether they should be linked to the Trade Adjustment Assistance program.
The briefing room: A more conservative group of congressional Republicans will be gathering tomorrow to unveil legislation that would tell the president what bills to pay if the government hits the debt ceiling. Under the bill, the administration would have to prioritize payments for debt service, Social Security and military pay before attending to other obligations. The RSC's Jordan, Sen. Jim DeMint of South Carolina and others will be on hand to roll out EFFCUSPASSA — that’s the Ensuring the Full Faith and Credit of the United States and Protecting America's Soldiers and Seniors Act, for those of you scoring at home.
Fed fulminating: Rep. Ron Paul (R-Texas) will return to the fertile grounds of Federal Reserve bashing on Tuesday, with his House Financial Services subcommittee exploring how the central bank’s monetary policy affects the economy.
Specifically, the panel will discuss inflation, unemployment and the potential for a third round of "quantitative easing." The Fed has said it is prepared to pump more stimulus into the economy if needed, but Ben Bernanke, the Fed chairman, has emphasized that nothing is in the works immediately. Thomas Hoenig, the president of the Federal Reserve Bank of Kansas City and no fan of the last QE experience, will be on hand to testify.
Risky renting: A second House Financial Services subcommittee will train its sights on the rent-to-own industry Tuesday, as lawmakers explore what regulators should or shouldn't be doing as they monitor the agency.
Preparing for the floor: The House Rules Committee will meet to set up a bill that wades in to the spat between Boeing and the National Labor Relations Board over whether the aerospace giant shifted work to a South Carolina plant to punish union action in Washington state.
Last week, the House Education and the Workforce Committee marked up legislation sponsored by Rep. Tim Scott (R-S.C.) that not only bars the NLRB from shifting Boeing work back to Washington, but prohibits “ordering any employer to close, relocate or transfer employment under any circumstance.”
Quick hits:
— Rep. Dennis Kucinich (D-Ohio) has a briefing of his own planned, titled “Eliminating the Debt and Creating Jobs without Raising Taxes.”
— Christine Lagarde, the new IMF chief, headlines an early morning Council on Foreign Relations conference call on the world economy.
— A Senate Judiciary subcommittee looks at the economic case for and against immigration reform.
— And dozens of religious figures head to the Hill for a prayer vigil on ensuring the poor don’t have to shoulder the burden of a debt deal.
Economic indicators:
— Standard & Poor's is scheduled to release its Case–Shiller 20-city home price index for May.
— The Commerce Department is slated to circulate its report on new privately owned one-family houses sold and for sale in June, as the housing market struggles to show any improvement.
— And the Conference Board is set to drop its consumer confidence index for July, a way to examine potential spending habits of consumers, which represents 70 percent of the economy.
BREAKING MONDAY:
It's not just in Washington: Concern about debt is everywhere. A new Associated Press/GfK poll found that one in five are worried about debt practically all the time, and more than one in three say they won't be able to pay off their credit card bill.
And a break from the debt ceiling: Rep. Shelley Berkley (D-Nev.), Ways and Means member and Senate candidate, has introduced her own bill to allow U.S. multinationals to bring offshore profits home at a reduced tax rate, Bloomberg reports.
The lowest possible rate in the bill, 5.25 percent, matches the rate in a previous holiday and the one called for in another House proposal in this area. But a company's rate could be as high as 25 percent under the plan, depending on its hiring practices.
WHAT YOU MIGHT HAVE MISSED:
On the Money’s Monday:
-- Jim DeMint on Reid/Boehner plans: They’re both no good.
-- IMF: The debt ceiling must be raised.
-- The White House turns its head toward criminal syndicates.
-- The IRS reverses course on its innocent-spouse policy.
-- Joint Economic Committee: 32 states added private-sector jobs in June.
-- House Oversight set to take a look at excess federal property.
-- And audit finds the IRS needs to tighten up on homebuyer credit.
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