Monday, May 4, 2009

The Weekly Strike-5/4-5/10

Good Monday morning and welcome to the Weekly Strike, where we preview the upcoming week in politics. Another busy one, so let's get to it.

THE WHITE HOUSE: President Obama undoubtedly will try to settle things down a little bit after a hectic week. In the span of 7 days, the President had to deal with the outbreak of the H1N1 virus, he helped orchestrate a key party switch in the Senate, he gave a prime time press conference on his first 100 days, and addressed a pending Supreme Court vacancy. His schedule this week, so far, seems a little more laid back.

Today the President delivers remarks on tax reform at the White House. He will outline a plan to close offshore tax loopholes that he expects will save the taxpayers $240 billion over ten years. He will reportedly propose that this money be used to cut taxes for businesses. Again, the President here is trying to seem fiscally responsible. I have to admit I'm a bit skeptical. Every President EVER has talked about saving money by cutting down on "waste, fraud and abuse." I would rather see Obama put his political capital on the line to make harder choices, like cutting payments to private student loan companies and Medicare advantage. Oh yeah, $240 billion over ten years is really not a lot of money. That's a third of the size of the stimulus package, which will only be spent over two years. The President concludes his day holding a celebration for Cinco de Mayo at the White House.

Tomorrow, the President will meet with Israeli President (more like a figurehead) Shimon Peres. Tomorrow, he holds a key meeting with the Presidents of Afghanistan and Pakistan. With the Taliban on the march into Pakistan, there is ample reason for the President to be concerned that the situation could spiral out of control, especially considering that Pakistan has nuclear weapons.

Perhaps the biggest event on this week's schedule is Thursday's expected release of those "stress tests," which should tell us which banks have enough stability to enjoy continued government support. If those stress tests come back negative, expect a stock market blood bath. As Chuck Todd pointed out, any bad result on these tests will embolden left-wing critics of the President, who say that he hasn't gone far enough.

THE SENATE: Congress this weeks continues a parade of financial regulation legislation. The Senate today will resume consideration of the "Helping Families Save Their Homes Act." Originally intended to be the Senate version of a House-passed housing, it is now significantly watered-down after the removal of the controversial "cramdown" provision. The Senate will vote on two amendments tonight, both from Senator Clown of Louisiana. I expect them to complete the bill by mid-week, which would trigger a contentious House-Senate conference. The Senate will then presumably move to consideration of the House-passed Credit Card Bill of Rights. The bill adds new regulations to protect the consumer against additional interest rates, and will require credit card companies to notify customers 45 days in advance of any rate increases. Learn more on this comprehensive bill here. The bill passed overwhelmingly in the House, and I expect it to do equally as well in the Senate. If it passes later in the week without changes, President Obama can sign it as soon as early next week. If the Senate amends the bill, the House will either have to accept the changes or demand a conference.

THE HOUSE: The House also focuses on regulatory reform this week. After dealing with suspension bills today and tomorrow, the House moves to consideration of a separate housing bill cracking down on predatory mortgage lending. Among other provisions, the bill will prohibit steering incentives in connection with origination of mortgage loans and will direct federal banking agencies to to prohibit condition terms or practices that are "abusive, unfair, deceptive, predatory, inconsistent with reasonable underwriting standards, or not in the interest of the borrower."

The House will also voted on a bill the Senate passed overwhelmingly last week that protects against mortgage fraud. They will use expedited suspension procedures for this bill, assuming that it can muster the necessary 2/3rds support. If they do approve this measure, it will go straight to the President's desk. For those of you keeping score at home, that's three separate housing bills being considered this week.

That's it for now, thanks to those who have left comments recently! Keep them coming!

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