OVERNIGHT MONEY: Debt-ceiling debate returns with a vengeance

House Minority Whip Steny Hoyer (D-Md.) called the GOP proposal to deny Obama’s requested debt-ceiling hike a meaningless “charade” that will only delay action on more substantial issues. 

Hoyer said the measure has no chance of passing and is designed only to score political points by highlighting large deficits during the president’s three years in office. 

{mosads}Even if it garners enough support to pass the House, it would still need backing from the Senate and Obama — highly unlikely scenarios. 

Last week, the Congressional Budget Office estimated that deficit spending for fiscal year 2012 will be $973 billion — down from its projected figure of $1.2 trillion in January 2009, just before Obama took over the White House, but still much higher than historic levels. 

Republicans concede that Obama inherited a fiscal mess, but insist he hasn’t done nearly enough to reduce spending over the last three years.

House Speaker John Boehner’s (R-Ohio) office on Tuesday called the vote “an indictment of the administration’s reckless spending binge that has driven America’s economy down a disastrous fiscal path.”

Hoyer is hardly the only critic of the GOP’s strategy: some rank-and-file Republicans have also hammered their leadership for essentially approving the debt-ceiling hike by supporting last August’s deal. 

“The deal we cut in August: that’s a joke,” Rep. Mick Mulvaney (R-S.C.) recently told The Hill.

“I do have some anger with my own leadership,” he added. “The Republican establishment was just as misleading about a default as the Democrats.”

Alice Rivlin, an economist and senior fellow at the Brookings Institution, expressed concern on Tuesday that the issue will unnecessarily linger in Congress. 

“I’m actually worried that the Congress will come back to the debt-ceiling problem, and they shouldn’t,” she said. “The debt ceiling has got to be raised, they decided to raise it and I hope that doesn’t become an issue again.” 

WHAT ELSE TO WATCH FOR 

Take one Volcker and call me in the morning: Top regulators of all financial stripes will testify before the House Financial Services Committee on Wednesday, where they’ll defend their efforts to spin the “Volcker Rule” from an abstract idea into reality. This key piece of the Dodd-Frank Wall Street reform law, aimed at curbing risky investments by banks, has proven to be a big headache for regulators, and a source of heartburn for the financial sector. Regulators have put together a lengthy proposal as a first crack at the rule but still have plenty of questions for the public on how they should handle enforcement. 

Meanwhile, the financial sector is warning that a rule shouldn’t pinch the industry’s ability to keep markets liquid and accessible.

On Capitol Hill, Republicans have criticized regulators’ work, and the rule itself, as problematic. Democrats argue regulators aren’t going far enough, and are leaving loopholes open for use by Wall Street.

With all that in mind, top regulators from the Commodity Futures Trading Commission, Federal Reserve, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency will have to answer plenty of questions. And they’ll be followed up by a slew of various industry stakeholders who will continue the tug-of-war over the rule.

A CLASS Act: The Ways and Means Committee convenes Wednesday morning to mark up a repeal of the law’s long-term-care CLASS Act, an effort that was cut short last year after the House ran out of time to deal with it. The Energy and Commerce Committee voted 33-17 in November to repeal the voluntary payroll deduction program. 

Republicans believe the program is mortally wounded after the Obama administration put it on hold in October, saying it can’t find a way to make it solvent “at this time.” House leaders think they have the political advantage over Democrats, who are left with the unpalatable choice of repealing a program they voted for or risking criticism for supporting an unsustainable entitlement.

The repeal bill “puts the Democrats in a very difficult position,” Rep. Charles Boustany Jr. (R-La.), the bill’s sponsor, told The Hill last year. “They have to decide whether they’re going to do the fiscally responsible thing and repeal the program or support something that is fiscally irresponsible.”

Recess is over, now get back to work: The debate over Obama’s recess appointments continues. The Constitution Project will host legal experts from Harvard and Stanford to debate whether the president’s move to ignore pro forma sessions and advance controversial nominations is a kosher move, or a wrenching of the nation’s founding document.

Mayors hit the high points: As the U.S. Conference of Mayors continues its big meeting here in Washington, D.C., they’ll hear from some Obama administration bigwigs tomorrow. Housing and Urban Development Secretary Shaun Donovan and the recently appointed director of the Consumer Financial Protection Bureau, Richard Cordray, will give their two, and probably more, cents to the local leaders. Rep. Barney Frank (D-Mass.) and House Minority Leader Nancy Pelosi (R-Calif.) will also be among the power players making appearances.

So, where’s the budget?: House GOP freshmen are set to start a new session of Congress with a long-held criticism. Members of the freshman class have scheduled a briefing on Wednesday to bash Senate Democrats for going 1,000 days without passing a budget.

The Senate will mark that milestone next Tuesday — which, the GOP freshmen and other Republicans have pointed out, just happens to be the day President Obama heads up Pennsylvania Avenue to deliver his State of the Union address.

Time to break camp: The Occupy movement set its sights on Congress on Tuesday — and now House Republicans are returning the favor.

The House Oversight Committee announced today that it will hold a hearing next week on the public health and safety impacts of the Occupy DC encampment at McPherson Square.

The hearing comes after Vincent Gray, Washington, D.C.’s mayor, expressed a slew of concerns about the site where, the National Park Service says, protesters have a First Amendment right to camp out. Those concerns include financial worries, and problems with rats.

D.C. and National Park Service officials are set to testify next week, with an Interior official also invited.

BREAKING TUESDAY

New budget guru: President Obama on Tuesday appointed Jeffrey Zients as acting director of the Office of Management and Budget (OMB). Zients replaces Jack Lew, who is leaving his post as budget director to become White House chief of staff. “I’m pleased to designate Jeff Zients to lead the Office of Management and Budget. Since day one, Jeff has demonstrated superb judgment and has provided sound advice on a whole host of issues,” Obama said in a statement. By naming an acting director, Obama avoids a confirmation battle with the Senate this year. 

ECONOMIC INDICATORS 

MBA Mortgage Index: The Mortgage Bankers Association releases its weekly report on mortgage application volume. 

NAHB Housing Market Index: Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months.

Producer Price Index (PPI): The Labor Department will release its report that tracks the prices of goods at the wholesale level. The market tracks PPI closely because it represents prices for goods that are ready for sale to consumers. 

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

WHAT YOU MIGHT HAVE MISSED

— Lawmakers support move to cut pay of Fannie, Freddie executives

— SEC inspector general departs

— Top House Democrat presses Republicans for plans to investigate VIP loans

— Banks ordered to provide ‘living wills’ to regulators

— Club for Growth: GOP ‘hypocrisy’ upcoming on debt-limit vote

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