By Bernie Becker, Peter Schroeder, Erik Wasson and Vicki Needham - 07/13/11 11:36 PM EDT
“The fact that Moody’s put the United States on its watch list and may downgrade our AAA bond rating underscores the danger for those who would hold our economy and jobs hostage to a rigid ideological agenda — instead of acting in the best interests of our country,” Rep. Chris Van Hollen (D-Md.), the ranking member on House Budget, said in a statement.
“The President is gambling with our credit rating by refusing to put a plan on the table to reduce our debts and deficits,” Rep. Dave Camp (R-Mich.), the chairman of the House Ways and Means Committee, said in a statement of his own. “There is a clear path forward — cut Washington’s out-of-control spending to preserve a strong U.S. credit rating and, more importantly, get this economy back on track.”
Looking forward to Thursday, Treasury Secretary Timothy Geithner is scheduled to meet with Democratic senators at the Capitol, an administration official said. And Sen. Charles Schumer (D-N.Y.) is having a morning news conference on the consequences if the U.S. defaults.
Elsewhere on Wednesday, some Democrats expressed praise for a fallback plan offered by Senate Minority Leader Mitch McConnell on Tuesday, which would allow Obama to raise the debt level three times in exchange for proposing spending cuts. But GOP lawmakers, especially those with Tea Party backing, lined up against the plan.
Finally, the Gang of Six may yet emerge to save the day. Sen. Tom Coburn (R-Okla.) told reporters that he was still considering rejoining the effort to seek a deficit grand bargain. With White House talks showing little sign of movement, the Gang’s moment might be here.
WHAT ELSE TO WATCH FOR:
Warren, the CFPB architect, is set to testify before the full House Oversight Committee, in a follow-up to what was a contentious subcommittee hearing back in May. (A quick refresher: Warren and Rep. Patrick McHenry (R-N.C.), the subcommittee chairman, got into it over for how long Warren had agreed to testify.)
Luckily, this time around, Warren has agreed to free up the entire day, meaning Rep. Darrell Issa (R-Calif.), the Oversight chairman, and fellow panel members will be able to ask any and everything they want.
And there should be little trouble filling up the time. "The Oversight Committee has a lot of questions," Issa told Fox Business Network today. "We've very concerned that this is an entity that's essentially funded around Congress, and yet has the ability to bully banks."
In her prepared testimony, Warren touts the work the CFPB has been doing leading up to its debut, and details exactly what is happening to get the brand new agency up and running. The testimony also devotes a significant chunk to detailing the CFPB's accountability and oversight — something that Republicans complain is lacking.
Bernanke’s back: Who says sequels never live up to the original?
Ben Bernanke, the Federal Reserve chairman, is slated to jump right back into the saddle tomorrow, when he makes an encore appearance at the Senate Banking Committee to discuss the state of the economy.
On Wednesday, the Fed head told lawmakers that the debt limit must be raised to avert "tremendous problems" for the economy, and that they better do something to bring down the deficit as well.
But he refused to wade into the specifics that lawmakers are wrestling over as part of a debt deal, saying that was up to Congress to decide. He also said the Fed was looking into more stimulus to boost the economy if needed (much to the delight of the stock market and disappointment of the dollar).
Bernanke will likely hit the same notes tomorrow, but will face fresh questions from the Senate this time.
Briefing room: A pair of Texas Republicans — Sen. Kay Bailey Hutchison and Rep. Louie Gohmert — are expected to discuss efforts to use a discharge petition to bring legislation to the House floor ensuring service members get paid, even if the debt ceiling isn’t raised by Aug. 2.
Gohmert also discussed military pay at a Wednesday news conference, with Reps. Michele Bachmann (R-Minn.) and Steve King (R-Iowa). And if that appearance was any indication, the Texas Republican won’t by shy on Thursday: Gohmert suggested today that the president wasn’t doing his homework in the debt-limit discussion.
Financial fortification: A Treasury official will brief a House Financial Services subcommittee over how the new Office of Financial Research plans to keep mounds of financial data safe from hackers. Created by Dodd-Frank, the OFR is charged with gathering information to assist the new Financial Stability Oversight Council (that's FSOC, for those studying for the acronym test). But with hackers always looming over the horizon, Republicans want to know what the office — which they charge lacks proper congressional oversight — is doing to keep that information in the right hands.
-- The Labor Department will release first-time unemployment claims, less than a week after June's bleak report showed only 18,000 created jobs. Claims have remained stubbornly above 400,000, rising in recent months as the economic recovery has stagnated.
-- The Census Bureau, in another big report due out, will measure the total receipts of retail stores, providing insight into consumer spending trends. As it stands, consumers have been slow to return to their pre-recession spending habits.
-- The Labor Department is set to circulate the producer price index as well.
-- And the Commerce Department also will release its business inventories report, which includes sales and inventory statistics from all three stages of the manufacturing process: manufacturing, wholesale, and retail.
Appropriatin’: House Appropriators spent their Wednesday holding a heated debate over the Commerce, Justice and Science bill, which has sparked some controversy for eliminating the local law enforcement COPS program and for cutting the National Science Foundation budgets.
But in a perhaps mild upset, the biggest battles in the full committee came over gun rights, as Democrats and Republicans sparred over the Justice Department’s ability to keep guns away from terrorists and ATF requirements for gun dealers.
The panel also reported out a legislative branch bill cuts House office budgets by 6.4 percent, a topic of some consternation among lawmakers.
On Thursday, the House will continue to debate the 2012 Energy spending bill, which slashes funding for clean energy spending dear to Obama.
Play fair!: Rep. Barney Frank (D-Mass.) and two other House Democrats are pressing House Republicans over what they deem “improper funding restrictions” on CFPB, The Wall Street Journal reports.
Don’t hold back: Never one to bite his tongue, former Sen. Alan Simpson (R-Wyo.) has told the Journal he no longer believes a deal will get done by Aug. 2.
WHAT YOU MIGHT HAVE MISSED:
On the Money’s Wednesday:
-- Financial group says debt limit uncertainty potentially "devastating."
-- The White House threatens to veto approps bill over Dodd-Frank.
-- The budget deficit chugs toward $1 trillion.
-- Congressional tax-writers discuss debt and equity…
-- But Democrats would have rather talked up the debt limit.
-- The 112th Congress: Former lobbyists times two.
-- Treasury: A weaker Dodd-Frank may mean a weaker economy.
-- Bill Nelson: Keep Social Security away from the debt limit.
-- Democrats blast GOP members of the FCIC.
-- GAO: Financial regulators are going to have a rough go with proprietary trading.
-- Chief executives keep hitting the door.
-- And mortgage applications drop.
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