OVERNIGHT MONEY: Obama takes economic message home

The president is pressing Congress to pass a ban on military-style assault weapons and high-capacity magazines, as well as improve background checks.

The divisive issue will probably have a hard time gaining traction in Congress. 

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On Tuesday, Obama urged lawmakers to consider some changes and give those who have suffered from gun violence “a simple vote.” 

Chicago is enduring one of its worst-ever periods of gun violence, with more than 500 killed last year. 

The trip to Chicago comes after a visit to Asheville, N.C., where he focused on ramping up the nation's manufacturing sector, and a trip on Thursday to Atlanta, where he presented a plan to provide nationwide pre-K program. 

He told teachers in Decatur, Ga., that "we all pay a price" when students don't have access to quality early-childhood education.

"The size of your paycheck shouldn't determine your child's future," Obama said. "So let's fix this. Let's make sure none of our kids start out the race of life a step behind."

Obama's proposal, which he first mentioned on Tuesday, provides federal matching dollars to states with the goal of providing preschool for every 4-year-old from moderate- or low-income families. 

On Wednesday, he argued that manufacturing would keep the nation's middle class "growing" and "thriving" at an auto parts plant in Asheville, N.C.

“I believe in manufacturing,” Obama said. “I believe it makes our economy stronger.”


WHAT ELSE WE'RE WATCHING

Freeze frame: The House on Friday will vote on and probably pass legislation that would halt President Obama's executive order calling for a 0.5 percent pay hike next month.

Republicans are arguing that the government can't afford the pay hike, which will cost $11 billion over the next decade. Democrats countered that the bill is an attempt by Republicans to continue picking on federal workers who have had their pay frozen for the last two years.


Democrats complained throughout the debate that the bill should be split in two, because it would freeze the pay of federal workers and members of Congress. 

Rep. Jared Polis (D-Colo.) accused Republicans of combining the two because of the difficulty some might have voting against a bill that limits congressional pay.


BREAKING NEWS

Selling the sequester: Senate Democratic leaders unveiled a $110 billion sequester-replacement bill at a caucus meeting on Thursday that would replace $85 billion in automatic spending cuts set to hit March 1.

The Senate Democratic package is split evenly between spending cuts and provisions raising new tax revenues.

It would raise nearly $54 billion in taxes by implementing the Buffett Rule, setting a minimum effective tax rate for wealthy individuals and families, as well as raise additional revenues by changing the tax treatment of oil extraction from oil sands.

The measure also contains $3.5 billion in new farm program spending, pushed by Senate Agriculture Committee Chairwoman Debbie StabenowDebbie StabenowSenators hope for deal soon on mental health bill The Hill's 12:30 Report Dems: GOP playing from 'Trump textbook' MORE (D-Mich.).

In exchange, Stabenow has signed off on a cut of $27.5 billion in farm subsidies known as direct payments. 

White House press secretary Jay Carney said Republicans face "a simple choice" now that Senate Democrats have proposed a plan.

"Do they protect investments in education, health care and national defense or do they continue to prioritize and protect tax loopholes that benefit the very few at the expense of middle and working class Americans?" Carney asked in a statement released by the White House.

Earlier in the day, House Speaker John BoehnerJohn BoehnerIn House GOP, Ryan endorsement of Trump seen as inevitable House GOP faces dilemma on spending bills Overnight Finance: Puerto Rico bill clears panel | IRS chief vows to finish term | Bill would require nominees to release tax returns MORE (R-Ohio) said if the president was "serious about enacting his agenda," Senate Democrats needed to start proposing solutions to looming financial deadlines.

Still, the Democratic plan could face opposition from its more liberal members, who want to raise more money through taxes and cut less in spending.


CABINET WATCH

A no-go, for now: Senate Republicans voted 58-40 to block former Sen. Chuck HagelChuck HagelHagel says NATO deployment could spark a new Cold War with Russia Overnight Defense: House panel unveils 5B defense spending bill Hagel to next president: We need to sit down with Putin MORE’s (R-Neb.) nomination as Defense secretary from proceeding to a final up-or-down vote, with 60 needed to end debate. 

Four Republicans — Sens. Susan CollinsSusan CollinsGOP lawmaker: 'Republicans were wrong’ to block Garland Senate passes broad spending bill with .1B in Zika funds Senators unveil bill to overhaul apprenticeship programs MORE (Maine), Thad CochranThad CochranSenate panel passes 4.5B defense bill Senate votes to block USDA catfish inspections GOP senators: Obama bathroom guidance is 'not appropriate' MORE (Miss.), Lisa MurkowskiLisa MurkowskiSenators float bipartisan wildfire bill Overnight Energy: Lawmakers closing in on chemical safety deal GOP chair pushes Obama official on Arctic drilling plan MORE (Alaska) and Mike JohannsMike JohannsTo buy a Swiss company, ChemChina must pass through Washington Republican senator vows to block nominees over ObamaCare co-ops Revisiting insurance regulatory reform in a post-crisis world MORE (Neb.) — joined 55 Democrats and independents in supporting the nomination. 

Republicans senators argued that they needed more time to vet Hagel for the job and would take time during next week's recess to make a final decision of their support or opposition. 


LOOSE CHANGE

Failure threat: Sen. Bob CorkerBob CorkerRubio: 'Maybe' would run for Senate seat if 'good friend' wasn't McConnell-allied group: We'll back Rubio if he runs for reelection The Trail 2016: Interleague play MORE (R-Tenn.), sent a letter to federal banking regulators after a Senate Banking Committee hearing on Thursday asking if the economy would be threatened by the failure of any single financial institution. He sent the letter to Under Secretary of the Treasury Mary J. Miller and Federal Reserve Governor Daniel K. Tarullo.

“My question was: ‘Are there any individual financial institutions whose failure would pose a systemic risk to the United States?’ I was disappointed in your answer, which seemed to indicate that you do not know if there are institutions whose failure might threaten the stability of our country,” Corker wrote. 

“[W]ould you please let me know if there are currently any financial institutions so large or so complex that their failure would threaten the financial stability of the United States?  If so, how do you plan to resolve this issue?”

So sweet: A group of bipartisan lawmakers is co-sponsoring a bill to lower sugar prices and make it easier to sell and trade sugar as a way to save consumers and businesses upward of $3.5 billion a year. 

The result, they say, would be lower food prices across the board, as well as lower costs and more jobs for businesses, such as confectioners. 

Sen. Pat Toomey (R-Pa.), who introduced the measure to the farm bill last summer, was joined by Sens. Jeanne Shaheen Jeanne ShaheenSenators to Obama: Make 'timely' call on Afghan troops levels Overnight Defense: Pentagon denies troops on Syrian front lines | Senators push for more Afghan visas Senators push to authorize 4,000 more visas for Afghans MORE (D-N.H.), Mark KirkMark KirkFunding boost for TSA sails through committee GOP senators propose sending ISIS fighters to Gitmo VA chief 'deeply' regrets if Disney comment offended vets MORE (R-Ill.), Dick DurbinDick DurbinHow airport security lines got so bad Dem senators call for sanctions on Congo Dems press ITT Tech to give students right to sue MORE (D-Ill.), Rob PortmanRob PortmanJuan Williams: Electoral map looks grim for Trump McConnell touts 'Senate squad' in Wes Anderson-style video Liberal super-PAC hits Johnson for supporting Trump MORE (R-Ohio), Frank Lautenberg (D-N.J.), Dianne FeinsteinDianne FeinsteinSanders tests Wasserman Schultz Sunday shows preview: Bernie soldiers on Clinton’s email troubles deepen MORE (D-Calif.), Bob Corker (R-Tenn.), Kelly AyotteKelly AyotteSenators to Obama: Make 'timely' call on Afghan troops levels Overnight Defense: Pentagon chief fears sequestration's return Senate GOP ties Iran sanctions fight to defense bill MORE (R-N.H.) and Lamar AlexanderLamar AlexanderSenate backs equal pay for female soccer players Overnight Healthcare: Momentum on mental health? | Zika bills head to conference | Only 10 ObamaCare co-ops left Overnight Regulation: GOP slams new Obama education rules MORE (R-Tenn.), as well as Reps. Joe Pitts (R-Pa.), Danny Davis (D-Ill.), Earl BlumenauerEarl BlumenauerOvernight Finance: Path clears for Puerto Rico bill | GOP senator casts doubt on IRS impeachment | Senate approves .1B for Zika House votes to let VA doctors recommend medical marijuana Pot advocates storm Capitol Hill MORE (D-Ore.) and Bob GoodlatteBob GoodlatteIRS head vows to finish term despite impeachment push House Republicans press case for impeaching IRS commissioner Saudis scramble for Washington allies MORE (R-Va.). 

“This flawed policy hurts not only candy companies and food manufacturers, but also the families who end up paying higher costs for products made with sugar,” Toomey said.


ECONOMIC INDICATORS 

Industrial Production-Capacity Utilization: The Federal Reserve will release its January report showing the physical output of the nation's factories, mines and utilities. The monthly report also provides a measure of capacity utilization. 

Michigan Sentiment: Thomson Reuters/University of Michigan will release its measure of consumer sentiment for February. 


WHAT YOU MIGHT HAVE MISSED

— Legislation would raise business lending caps for credit unions
— Senate Dems hold the line on consumer bureau
— Sen. Warren presses regulators to take firmer line with banks
BoehnerJohn BoehnerIn House GOP, Ryan endorsement of Trump seen as inevitable House GOP faces dilemma on spending bills Overnight Finance: Puerto Rico bill clears panel | IRS chief vows to finish term | Bill would require nominees to release tax returns MORE challenges Senate Dems to take lead, pass Obama second-term agenda
— USPS poll: Public backs five-day delivery
— Gallup: Americans support ending Saturday mail delivery
— Lawmakers claim momentum in push for Internet sales tax
— Obama favors sacking the penny
— Talks continue between AFL-CIO, Chamber on immigration reform
— Senators urge regulators to scrap down payment rule
— US, Switzerland sign tax evasion agreement
Jobless claims drop by 27,000


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