OVERNIGHT FINANCE: Trade policy in the spotlight

THURSDAY'S BIG STORY:

Focus on trade: U.S. Trade Representative Michael Froman will finally make his oft delayed appearance before the Senate Finance Committee on Thursday to discuss President Obama’s trade agenda.

Negotiations between the U.S. and Japan as part of the Trans-Pacific Partnership (TPP) are likely to remain the hot topic among lawmakers wondering whether a deal can be reached between two of the world's largest economies.

Froman's appearance follows a trip to Asia with the president where U.S. and Japanese leaders said they would continue working toward a deal but failed to reach a breakthrough that would have led to the completion of the massive 12-nation trade deal. 

Even ahead of the trip, U.S. trade officials said it was unlikely that they would reach a deal with Japan but they were hoping to make siginificant progress in that direction. 

A White House official said that "together the United States and Japan have identified a path forward to deal with our bilateral issues... that will also give momentum for the regional negotiations."

During the trip, one Japanese official said he didn't have any expectations for an agreement until after the U.S. midterm elections. He added that the talks were complicated by the unwillingness of lawmakers, many in Obama's own party, to grant the president trade promotion authority (TPA).

Panel Republicans eager to see the trade deals move along could probe Froman about the Obama administration's interest in TPA and whether he will urge the president to become more engaged to ensure that Democrats get on board and help push legislation through Congress. 

Senate Finance Chairman Ron Wyden (D-Ore.) has said that he prefers a "smart-track" policy over the so-called fast-track and he is continuing to talk to members about their priorities for a bill. 

There are plenty of opponents of the trade deal and fast-track authority who argue there is now little chance to ink an agreement. For them that's a positive since they argue that the TPP too closely mirrors deals of the past that they say have hurt U.S. workers.

Still, U.S. and Japanese trade officials have intensified talks in recent weeks over complex tariff and non-tariff issues concentrated in the agricultural and auto sectors.

Meanwhile, the U.S. and European Union will meet for their fifth round of talks next month and that is likely to be a topic of conversation about where things stand on that front. 

 

WHAT ELSE WE'RE WATCHING

Growing business: A House Financial Services subcommittee will hold a Thursday hearing on several legislative proposals to enhance capital formation for small and emerging-growth companies with business experts. 

Budget request: A Senate Appropriations subcommittee will chat with NASA Administrator Charles Bolden Jr. about the specifics of his agency's fiscal 2015 budget. 

 

LOOSE CHANGE

Out of Dodge: All sorts of people in Washington aren't that happy about the pharmaceutical giant Pfizer's efforts to take over the British drug company AstraZeneca, in a move that would substantially lower Pfizer's tax bill.

But as Bloomberg reports, Washington doesn't seem likely to do anything about it anytime soon.

John Koskinen, the IRS commissioner, says there's not much more his agency can do about so-called inversions. The Treasury Department says targeting those sorts of deals are an administration priority.

But top tax writers on Capitol Hill say that the best way to deal with the issue is in a broad rewrite of the the tax code that isn't likely to happen anytime soon.

 

ECONOMIC INDICATORS

Initial claims: The Labor Department will release its weekly claims for first-time jobless benefits.

Challenger job cuts: The Chicago-based firm will release its report on the number of job cuts that are planned by U.S. employers in April.

Personal income, personal spending: The Commerce Department releases March figures that are forecast to show an increase in income and spending over February's levels. 

ISM index: The Institute for Supply Management will release its April index that measures the manufacturing sector's pace of growth with expectations that the manufacturing sector expanded at a faster rate. 

Construction spending: The Commerce Department releases its March report on spending that could show that construction spending increased. The report is broken down between residential, non-residential and public expenditures on new construction and is volatile and subject to huge revisions. 

 

WHAT YOU MIGHT HAVE MISSED

— Report: US puts India, China on watch list for intellectual property violations

— Report: Private-sector employers added 220,000 jobs in April

— CFPB tweaks rules to offer more mortgage credit

— Fed pulls back stimulus despite feeble GDP

— Senate targets May 22 to advance spending bills

— Advocates applaud Obama transportation proposal

— Economic growth falls to anemic 0.1 percent

— Pawlenty: GOP should back wage increase

Subcommittee approves Commerce, Justice, Science spending bill

— House spending bill would prevent change to ObamaCare questions

 

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