OVERNIGHT MONEY: Extenders pop into the spotlight in the House

But, perhaps foreshadowing the tenor of Thursday’s hearing, top Democrats on Ways and Means are calling out Republican methods on the so-called tax extenders.

Reps. Sandy Levin (D-Mich.) and Richard Neal (D-Mass.) said in a Tuesday letter that the GOP was confusing the provisions that were clearly supposed to be temporary and those that gave a long-term boost to the economy.

{mosads}The two Democrats also criticized Republicans for not allowing discussions over provisions that lapsed before 2011, such as the Build America Bonds. 

The GOP approach, Levin and Neal said, “has only increased the uncertainty businesses face.”

WHAT ELSE TO WATCH FOR

Let’s go budgeting: Housing and Urban Development Secretary Shaun Donovan will be on Capitol Hill tomorrow, as he testifies before the Senate Banking Committee on his department’s fiscal 2013 budget request. Amid the talk of dollars and cents, expect plenty of questions about the big questions facing housing these days, including how to encourage more refinancings or the merits of allowing principal write-downs.

Donovan won’t be the only Cabinet secretary talking money tomorrow. Health and Human Services Secretary Kathleen Sebelius will testify before the House Education and the Workforce Committee on her department’s budget. 

A little reconciling: The House Committee on Oversight and Government Reform will meet Thursday on legislation to reduce the deficit by $82 billion over 10 years. Once approved, the legislation will be included as part of a broader House reconciliation package.

The committee’s plan directs federal employees to contribute an additional 5 percent of pay toward their defined benefit pension plan phased in over five years. Lawmakers and their staffs enrolled in the Civil Service Retirement System (CSRS) will pay an additional 8.5 percent of salary over five years. Lawmakers enrolled in the Federal Employee Retirement System (FERS) will pay an additional 8.5 percent of salary over five years, and congressional employees enrolled in FERS will kick in an additional 7.5 percent of salary over five years. The legislation also eliminates the FERS special supplement for new hires who voluntarily retire before age 62.

Under current law, the FERS system pays workers more if they retire before reaching Social Security retirement age. 

Focus on spending bills: The Senate Appropriations Committee will mark up the Agriculture, Rural Development, Food and Drug Administration and Related Agencies bill along with the Energy and Water Development measure on Thursday. The House panel will tackle fiscal 2013 spending for the Commerce, Justice and Science Appropriations bill.

Taxes are fun: The Senate Finance Committee will chat with government officials, accountants and taxpayers advocates about how to make filing that annual tax return a little more enjoyable. Witnesses included James White, director of tax issues at the Government Accountability Office, and Beth Tucker, deputy commissioner for operations support at the IRS.

City by the Bay: Treasury Secretary Timothy Geithner heads out west to talk about the strained U.S. economic relationship with China and the state of the global economy with the Commonwealth Club of San Francisco. 

Hurry up and wait: Senators were making a push to try to hold the farm bill markup on Thursday after postponing the scheduled Wednesday meeting at the last minute. Democratic aides said that once hurdles involving subsidies for rice and peanuts are resolved, the meeting should go forward. Several aides said Senate Majority Leader Harry Reid (D-Nev.) has made assurances that the bill will come to the floor.

BREAKING NEWS

Postal movement: The Senate passed its postal reform bill on Wednesday, 62-37, an action that Majority Leader Harry Reid (D-Nev.) and one of the bill’s key sponsors, Sen. Joe Lieberman (I-Conn.), said showed the chamber can still accomplish broad tasks.

The Senate dealt with dozens of amendments, which Lieberman noted came from both the left and the right, before passing the measure. The Connecticut independent also urged the House to move quickly on postal legislation so the two chambers could go to conference.

“The center held,” he said.

Still, the aftermath of the Senate vote showed there’s still a long way to go on postal reform.

The House has yet to move its Republican bill to the floor, and a Postal Service moratorium on closing facilities ends the middle of next month. 

And while Lieberman was extolling the power of the center, the bill he sponsored with Sens. Susan Collins (R-Maine), Tom Carper (D-Del.) and Scott Brown (R-Mass.) was getting dinged from the right and the left.

“Relentless downsizing is not a strategy for success, yet the legislation adopted by the Senate targets more than 100,000 jobs and will force the Postal Service to slash services,” Fredric Rolando, the president of the National Association of Letter Carriers, said in a statement.

For his part, Rep. Darrell Issa (R-Calif.), a key sponsor of the House postal bill, called the Senate proposal “wholly unacceptable.”

“Instead of finding savings to help the Postal Service survive, the Senate postal bill has devolved into a special interest spending binge that would actually make things worse,” Issa said.

Sparring over student loans: President Obama swiped at House Speaker John Boehner on Wednesday for saying that he was spending time touting an extension of lower student loan interest rates to “distract people from the economy.”

“Now think about that for a second because these guys don’t get it,” Obama said at the University of Iowa, responding directly to a statement from “the spokesman for the Speaker of the House.”

Boehner responded this afternoon, saying the House will vote Friday to prevent a jump in interest rates for student loans, offsetting the cost with money from a “slush fund” in the president’s healthcare law.

The Speaker ripped the president for campaigning on the issue, saying he was trying to create a fight out of thin air.

“This week the president is campaigning and trying to invent a fight where there is none and never has been on this issue of student loans,” Boehner said. “We can, and will fix the problem, without a bunch of campaign-style theatrics.”

Senate Majority Leader Harry Reid (D-Nev.) has introduced a bill that would keep the interest rate at 3.4 percent for another year by closing what he argues is a tax loophole on income earned through so-called S-corporations.

On Wednesday, Senate Minority Leader Mitch McConnell (R-Ky.) accused Obama and Democrats of pushing legislation to stop student interest loan rates from rising only for political gain. 

Republicans and Democrats have shown interest in passing legislation to keep the rates low, but Republicans appear wary about possible pay-fors that Democrats would use to retain the current rate.

Knowing when to hold ’em: The Federal Reserve said Wednesday that it’s sticking with rock-bottom interest rates, citing a moderately growing economy and improving unemployment.

The Federal Open Market Committee (FOMC) described the economy as expanding moderately, with the chance it could pick up speed in the future. It also noted that the labor market has improved in recent months, but unemployment remains too high.

In a speech this afternoon, Federal Reserve Chairman Ben Bernanke had a message for Congress: the ball is in your court, and the fiscal cliff is coming.

The head of the nation’s central bank launched a staunch defense of the Fed’s actions Wednesday while leaving the door open for future action if needed. 

Fielding questions from reporters following the latest policy meeting by the central bank, Bernanke’s message to lawmakers was hard to miss: figure out a way to avoid the extreme policy swings set for Jan. 1, or risk throwing the economic recovery down the tubes.

LOOSE CHANGE

Locked and loaded: As expected, the House Appropriations Committee on Wednesday approved spending levels for all 12 annual appropriations bills at an overall level $19 billion lower than the Senate’s target. The biggest cuts are to foreign aid, labor and health programs. The committee also approved an Energy and Water bill that contains new policy riders, including one that stops the government from phasing out fossil fuel use by federal buildings and one that allows firearm use on Army Corps of Engineers controlled land.

ECONOMIC INDICATORS

Initial Claims: The Department of Labor releases its weekly filings for jobless benefits. Claims have been on the rise lately even as there has been gradual improvement in the labor market. 

Pending Home Sales: The National Association of Realtors will release its index that is a forward-looking indicator based on contract signings. 

WHAT YOU MIGHT HAVE MISSED

— Obama: GOP makes ‘no sense’ on Wall Street reform
— Two Democratic senators push to streamline, speed refinancing process
— Senate panel delays farm bill markup
— FEMA warns Congress clock is ticking on flood insurance program

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