FRIDAY’S BIG STORY:
Chamber chat: The U.S. Chamber of Commerce will be out with its quarterly economic briefing Friday. Martin Regalia, the Chamber’s in-house economist, will offer his take on where the economy is headed, as will top economists from the American Trucking Association, the American Petroleum Institute, and housing giant Freddie Mac.
The briefing will come on the heels of the Commerce Department’s eye-opening report on the economic growth of the last quarter of 2012. Or, to be more precise, the lack of it. The new report showed the economy actually shrank by 0.1 percent in the fourth quarter, driven primarily by a tightening on federal spending, especially in the defense industry, which saw a 22 percent dip. Some pointed to the report as proof that uncertainty over the “fiscal cliff” and the pending sequester were weighing on the economy. But others found plenty of silver lining throughout, as solid gains in other economic sectors indicated a recovery continuing to gain steam in more fundamental areas.
On Thursday, President Obama told House members that he is ready to strap on the gloves and get into it with Republicans over the looming fight to replace the sequester, set to take effect March 1. Democrats are looking to replace those cuts with a combination of spending cuts and tax increases, and Obama said he was confident the public would give them the thumbs-up over Republicans, who are setting their sights on entitlement programs.
"If that's an argument they want to have in the court of public opinion, that is an argument I'm more than willing to engage in,” Obama said.
The Senate will be doing a bit more work on Friday in session, but no major votes are expected until Monday, when the chamber will tackle the Violence Against Women Act.
WHAT ELSE TO WATCH FOR
Dissecting Dodd: The American Enterprise Institute will take a hard look at Wall Street reform tomorrow, hosting a panel discussion on just what the Dodd-Frank financial reform law may or may not be accomplishing. The financial overhaul aimed to keep a close eye on highly interconnected firms, but AEI is positing that the real threat might be how financial distress can spread via contagion. Scott Alvarez, general counsel of the Federal Reserve Board, will be among those on hand to offer his take.
The Postman cometh: Fresh on the heels of the U.S. Postal Service's announcement that it is looking to scrap Saturday delivery for everything but packages, the U.S. Senate Committee on Homeland Security and Government Affairs announced it would hold a Feb. 13 hearing to explore the mail carrier's troubled finances. As soon as Postmaster General Patrick Donahoe announced the plan to scuttle Saturday service, members of Congress started crying foul, contending only lawmakers can tell the USPS to change its delivery schedule. Donohue will be on hand to answer to that criticism, as will Reps. Darrell Issa (R-Calif.) and Elijah Cummings (D-Md.), the chairman and ranking member of the House Oversight Committee, respectively. The Senate cleared a comprehensive postal reform bill last Congress, but the House failed to offer up its own alternative. Postal union officials will also be on hand to offer their take.
Wall Street watch: The Senate Banking Committee announced late Thursday that it has a hot, hot Valentine’s Day lined up. The panel will be having an intimate morning with some of the nation’s top financial regulators, as they continue their oversight of the Dodd-Frank financial reform law. Head honchos from the Treasury, Federal Reserve, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency, Consumer Financial Protection Bureau, Securities and Exchange Commission and Commodity Futures Trading Commission will make up an all-star panel of rule writers working to get the Wall Street makeover into place.
Republicans continue to air concerns about the law and the new regulations that come with it, while Democrats worry that rules implementing the provisions might not be strict enough. Expect a grilling on both ends at the hearing.
Also of note is that the hearing will mark the first time CFPB Director Richard Cordray will appear before Congress after a federal appeals court struck down a trio of President Obama’s recess appointments to the National Labor Relations Board. Cordray’s recess appointment was made the same day, leading many to believe it is just a matter of time until he receives the same treatment. It will also mark his first appearance since Senate Republicans renewed their vow to block any nominee to head the CFPB without major changes to its structure — the president re-nominated Cordray for a full-length, Senate-confirmed stint on the job in January. So don't expect GOP lawmakers to hand him a teddy bear or box of chocolates when he takes a seat at the dais.
Deficit on a diet: The Congressional Budget Office (CBO) released some piping-hot deficit figures Thursday afternoon, and the news was positive. The CBO found that the federal deficit in January was down to only $2 billion, compared to $27 billion one year prior. New tax revenue stemming from the deal on the “fiscal cliff” helped close the gap, as the government pulled in 15 percent more following the hike in rates and expiration of the payroll tax cut.
Whole Trade: The Commerce Department will be out with monthly whole trade numbers for December.
International Trade: The Bureau of Economic Analysis will release its December figures for international trade in goods and services.
WHAT YOU MIGHT HAVE MISSED
— Reid: Postal Service move would be ‘crippling blow’
— Economist Zandi sees more moderate effects of spending sequester
— Private equity group defends carried interest break
— White House decries Boehner’s ‘list of demands’ on sequester
— Liberals introduce bill to end tax deferral on foreign income
— Waters: Government needs to get tougher with Wall Street
— Dems renew call for new FHFA head
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