Optimism among small businesses dropped in December despite more certainty on the tax front and a change in House leadership. 

The Index of Small Business Optimism fell 0.6 points to 92.6 last month even with other positive economic news, including an increase in holiday retail sales, according to a report released on Tuesday by the National Federation of Independent Businesses.

The index has remained at recessionary levels for 36 straight months and only once eclipsed 90 besides last month, hitting 93.6 in November, the highest level since Nov. 2007.

"With weak sales prospects, hiring or spending on capital projects have little likelihood of paying off and therefore will not happen," the report said. "With the small business sector on the sidelines, it is hard to get national growth above the 2 to 3 percent range and the economy will not enjoy the type of rebound experienced after 1982 when GDP grew eight percent for over a year."

Rep. Maxine Waters (D-Calif.) and three other House Democrats are asking the Federal Housing Finance Agency (FHFA) how it determined what two banks should pay in recent settlements over problems with residential mortgages sold to the government-sponsored enterprises (GSEs).

Over at our Floor Action blog, Pete Kasperowicz has the news that the Senate Judiciary Committee’s first hearing this year is scheduled to be on the government’s efforts to recoup billions in taxpayer money lost to fraud. 

Sen. Patrick Leahy (D-Vt.), the judiciary panel’s chairman, announced a hearing for Jan. 26 during a Tuesday speech, noting that fighting fraud was also an issue that interested the committee’s incoming ranking member, Sen. Charles Grassley (R-Iowa).

National Taxpayers Union Vice President Pete Sepp said in a press call Tuesday that he sees momentum for passage of a balanced-budget amendment this year.

He said that the approaching vote in Congress on the debt limit provides a “tremendous opportunity for budget process reforms.”

“There is a developing movement for a constitutional amendment,” he noted.

Rep. Jesse Jackson, Jr. (D-Ill.) proposed undoing House Republicans' first cut to help fund lawmakers' security.

Jackson, in a release, said his staff is working on a proposal to reverse the 5 percent cut in the office budgets for members of Congress, which the House approved last week.

In addition to restoring the cut, Jackson said he would propose a 10 percent increase in office budgets for security, in the wake the shooting of Rep. Gabrielle Giffords (D-Ariz.) Saturday at a meeting with constituents in her home district.

"I do not feel that fear should grip us, but since 9/11 we've secured every federal facility with the exception of our district offices," Jackson said. "After the events of last weekend it is clear that our district staffs are vulnerable. Members should have the resources and the latitude to take the appropriate security measures in order to protect themselves and their staffs."

The cut in office budgets was one of the first measures on which the new Republican House had taken action last week. It had first been proposed by Speaker John Boehner (R-Ohio) to reflect the atmosphere of austerity that the GOP has sought to project with its new majority.

Jackson, like many other Democrats, opposed the Republican-led cuts.

Cross-posted from Blog Briefing Room. 

The National Retail Federation (NRF) announced Tuesday that it has hired David French to be its new chief lobbyist.

French will be senior vice president for government relations for the retail trade group and will direct its advocacy efforts in Washington. He comes from the International Franchise Association.

"There are a lot of tools that the NRF brings to the table and I'm looking forward to being part of it," French told The Hill.  

Policies dealing with taxes, the workplace and healthcare reform will be on the agenda for the retail trade group during the upcoming year, French said. 

The "regulatory tsunami" stemming in large part from financial and healthcare reform laws is one of the biggest threats to the American economy, according to the president of the U.S. Chamber of Commerce.

Chamber President Tom Donohue said in a Tuesday address that the dramatic increase in federal regulations poses "the single biggest challenge to jobs, our global competitiveness, and the future of American enterprise."

Two former senators are taking their nearly 50 years of congressional experience to K Street.
Sens. Bob Bennett, a Republican from Utah whose reelection bid faltered in his party’s primary, and Byron Dorgan, a North Dakota Democrat who retired after the 111th Congress, have landed at Arent Fox as senior policy advisers in the firm’s government-relations practice, the firm announced Tuesday.

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Sen. Susan Collins (R-Maine) has asked the Government Accountability Office (GAO) to audit a program that helps federal employees who suffer on-the-job injuries.

The ranking member of the Senate Homeland Security panel, Collins wrote in a letter to the GAO that she is concerned that the Federal Employees’ Compensation Act program has “potential for waste, fraud, and abuse.”

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