This week: Unemployment fight enters second week

Talks on extending unemployment benefits for the long-term jobless will continue this week when Congress returns.

After spending the last week sparring over how to pay for an extension of the emergency program, the Senate will be back at it on Monday. The talks devolved during the Senate’s first week of work in 2014 as Republicans have objected to their inability to offer amendments. But as the debate enters a second week, it appears the GOP will get their chance to offer tweaks, driving hopes for a deal. But even then, the package would still face an uncertain future in the House, as Republicans there are also looking for reforms to add to it.

At the same time, the House will take up a stopgap spending bill to buy time to finalize a $1 trillion omnibus spending bill and avoid a government shutdown. That legislation seems set for passage, with leaders of both parties backing it to give appropriators time to wrap up work on a longer spending deal. Without the stopgap, the government is scheduled to shut down on Jan. 16.

The omnibus bill is expected out sometime Sunday or Monday. The House is likely to vote on the long-term spending bill in the middle of the week, with the Senate set to send it to the president by the end of the week.

The long-stalled farm bill is once again at a crossroads. Negotiators are hoping this weekend to clear a standoff on dairy subsidies that pits Speaker John Boehner (R-Ohio) against the leading Democrat on the House Agriculture Committee, Rep. Collin Peterson (D-Minn.).  At issue is whether dairy farmers would see subsidies curtailed if the production causes drops in prices — a feature of the Senate bill known as supply management. If one side backs down, or a compromise allowing farmers the choice of the old and new systems is agreed to, then a deal could be announced next week.

It has not yet been decided whether a conference committee would convene, allowing votes on controversial items like catfish inspection and meat labeling. In any case, no final farm bill passage is likely until the end of January at the earliest, given the need for the Senate to finish work on the omnibus spending package.

The Senate Finance Committee will begin work Thursday on a bill that provides guidance from Congress to the White House in negotiating trade agreements.

The measure, introduced on Thursday, is facing a swarm of Democratic opposition, especially from the top Democrat on the House Ways and Means Committee, Rep. Sandy Levin (D-Mich.).

Levin wants the legislation to provide a specific framework for congressional involvement in the negotiating process. He is arguing the measure doesn't go far enough to ensure Congress wouldn't get left behind in the process and would be left only with a say of what is included in any global agreements toward the end of trade talks.

The Volcker Rule will be back next week, as that contentious centerpiece to the Dodd-Frank financial reform law gets reworked. Financial regulators have until Wednesday to announce whether they will rework a portion of that risky trading ban that inadvertently cracks down on smaller banks. Lawmakers in both parties have urged regulators to adopt such a fix and will get another chance to weigh in that same day when the House Financial Services Committee holds a hearing exploring how the rule could impact jobs and the economy.

The Joint Economic Committee will dive into what looks to be a hot midterm election issue, when the bicameral panel explores the nation’s growing income inequality on Thursday. Democrats have indicated they plan to hammer on that issue ahead of the polls as a core piece of their economic message.

On Wednesday, the Federal Reserve will offer a sneak peek into the economy with the release of its latest Beige Book. Those anecdotal takes from business contacts nationwide could be telling on the heels of a disappointing jobs report that upended hopes the economy was set for liftoff.

And a Senate Banking subcommittee will hit another hot-button issue Wednesday, as lawmakers explore the potential issues surrounding banks cutting out the middleman, and buying and holding physical commodities themselves.