TOMORROW STARTS TONIGHT: FED HAS ‘PATIENT’ PLAN FOR RATE HIKES. Pete Schroeder for The Hill: “The Federal Reserve reiterated Wednesday that it is in no rush to begin hiking interest rates, as the economy continues to grow while inflation actually declines. In its latest policy statement, the central bank adhered to the message it delivered back in December, again saying it could be ‘patient’ to raising interest rates above zero.” http://bit.ly/15JyKNg
{mosads}PARSING THE FED: Jon Hilsenrath for The Wall Street Journal: The Fed ‘judges that it can be patient in beginning to normalize the stance of monetary policy,’ officials said, in the key phrase of their January policy statement following a two-day policy meeting that ended Wednesday… Whether June remains a possibility for a rate increase will depend on how the economy and financial markets behave in the weeks and months ahead. The Fed’s policy statement acknowledged the complex cross-currents it confronts as it plots a course for later in the year…
— GLOOMY OUTLOOK OVERSEAS: “In an even more subtle note of caution, the Fed said it would be watching global economic turbulence as it considers its next steps. Officials until now had avoided pointing to myriad pressures overseas — including an economic slowdown in China, financial instability in Greece and the European Central Bank’s launch of a new bond-buying stimulus program. Those pressures are putting upward pressure on the dollar, which is in turn weighing on U.S. inflation… Though the unemployment rate has fallen faster than most Fed officials expected and growth appears to have picked up, the inflation rate could fall further because of declining oil prices.” http://on.wsj.com/1yOCPuK
More Fed news in a minute…
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REPUBLICANS HEAT UP BATTLE WITH IRS, via Bernie Becker: “Congressional Republicans rolled out a new effort Wednesday to block the IRS from releasing new rules for political groups seeking nonprofit status. House Ways and Means Committee Chairman Paul Ryan (R-Wis.) is one of the top Republicans that introduced the bill barring the IRS from changing the guidelines for tax-exempt 501(c)(4) groups until the end of 2017…
“The bill, also sponsored by Rep. Peter Roskam (R-Ill.), comes as lawmakers are still investigating the IRS’s singling out of Tea Party groups, which the agency acknowledged more than 20 months ago… Sens. Jeff Flake (R-Ariz.) and Pat Roberts (R-Kan.) are introducing the bill in the Senate.” http://bit.ly/1wBStnY
REPUBLICANS MOVE TO OUST BUDGET REF, via Rebecca Shabad: “Republicans on the Budget Committee are interviewing candidates to replace Douglas Elmendorf as head of the Congressional Budget Office (CBO), according to four people with direct knowledge of the process. While GOP leaders haven’t publicly confirmed the plan to boot Elmendorf from the nonpartisan office, Republicans have approached several potential candidates about stepping in, sources say…
— THE SHORT LIST: “According to sources, those approached include Alex Brill, research fellow at the American Enterprise Institute and an economist on former President George W. Bush’s Council of Economic Advisers; Jeff Brown, a finance professor at the University of Illinois who also served on the Council under Bush; and Warren Payne, who was policy director under former House Ways and Means Committee Chairman Dave Camp (R-Mich.)… James Capretta, a senior fellow at the Ethics and Public Policy Center who worked at the Office of Management and Budget under Bush; Katherine Baicker, a Harvard professor who played a leading role in developing health policy under Bush; Donald Marron, director of the Economic Policy Initiatives at The Urban Institute and former acting director at CBO; and Charles Blahous, the director of the Spending and Budget Initiative at George Mason University and deputy director of Bush’s National Economic Council.” http://bit.ly/1EQgDkW
— RAND PAUL REVIVES ‘AUDIT THE FED.’ Schroeder: “Lawmakers are again trying to subject the Federal Reserve to a top-to-bottom review. Sen. Rand Paul (R-Ky.), who is eyeing a presidential run in 2016, introduced legislation this week that would subject the central bank to a complete audit of its activity by the Government Accountability Office.” http://bit.ly/1y6ST7x.
— WILL GOP BACK PAUL’S FED PLAN? MJ Lee for CNNMoney.com: “There’s no escaping the ‘Audit the Fed’ movement for the Federal Reserve… Now, with the new Republican majority in the upper chamber, proponents of “Audit the Fed” are hopeful that the bill will make new headway this year… Sen. Mitch McConnell’s spokesman Don Stewart said in an email Wednesday that he couldn’t comment on if and when the Senate Majority Leader plans to bring up Paul’s bill this Congress, but pointed out that McConnell is a co-sponsor of the legislation.”http://cnnmon.ie/1CA4fWD
EX-IM WATCH: FINCHER NABS 57 REPUBLICANS FOR 5-YEAR REAUTH. My take for The Hill: “Rep. Stephen Fincher (R-Tenn.) introduced legislation on Wednesday that would reauthorize the Export-Import Bank for five years. Fifty-seven other Republicans joined Fincher in co-sponsoring the legislation, obtained first by The Hill. Congress must reauthorize the bank before June 30 or it will shut down. Tea Partyers have criticized the bank as a form of ‘cronyism’ and ‘corporate welfare’ for big businesses. But centrist Republicans and Democrats argue that the bank helps sustain domestic jobs and allows for U.S. businesses to make inroads in emerging markets where the private sector won’t finance deals.”
— WHAT’S IN THE BILL: His bill includes reforms to the bank that he says will make it more transparent, such as requiring an independent audit of the bank’s financing portfolio. The bill would also reverse Ex-Im rules that restrict the Bank from financing projects with power plants that decline to adopt greener technology. That provision is championed by the coal industry but opposed by environmental groups.
— HOUSE FINSERV CO-SPONSORS: Fincher was joined by six other Republican members of the House Financial Services Committee in supporting the bill: Reps. Peter King (N.Y.), Frank Lucas (Okla.), Steve Stivers (Ohio), Randy Hultgren, (Ill.), Bob Dold (Ill.) and Ann Wagner (Mo.), who is the House GOP senior deputy whip. My story: http://bit.ly/1DbpDQ0
— TONY FRATTO, former Bush senior official and director of Hamilton Place Strategies: “Everyone knows there’s broad support for reauthorizing Ex-Im — on the committee and in both houses. Getting 58 cosponsors is strong, especially with Hensarling so opposed. This isn’t the right fight, and members know it — every one of them has constituents, small businesses, workers, who want to keep Ex-Im.”
— PAUL SULLIVAN, director of International Business Development, ACROW BRIDGE: ” The timing could not be more apropos, as later this week EXIM Bank will provide financing guarantees supporting Acrow’s bridge development program in the Republic of Cameroon.”
ARE YOU IN THE ‘ONE PERCENT?’ Chris Miles for MarketWatch has how much you need to earn to be in your state’s ‘one percent’ wealthy bracket: http://on.mktw.net/15RiitW
TALK OF THE TOWN – – LORETTA LYNCH NOMINATION HEARING. Peter Sullivan for The Hill: “Attorney General nominee Loretta Lynch defended President Obama’s executive actions on immigration Wednesday, but noted that she was not involved with the contentious decision.
“Speaking of the Office of Legal Counsel memo laying out the legal justification for the action shielding millions of people in the country illegally from deportation, Lynch said, ‘I don’t see any reason to doubt the reasonableness of those views.’
“During her confirmation hearing before the Senate Judiciary Committee, Lynch echoed the administration’s argument that the Department of Homeland Security is not able to deport all of the people in the country illegally, so it should prioritize categories like criminals and remove the threat of deportation from others.” http://bit.ly/1EqrpAY
COLLEGE TAX PLAN: The White House said Wednesday it believes that President Obama’s unpopular proposal to tax college savings accounts makes sense as part of a broader education plan. The decision to jettison the proposal, which had come under criticism from Republicans and Democrats as a middle-class tax hike, was made because the issue had become a ‘distraction’ lowering the odds that Obama’s broader education plan would gain traction, the White House said.
–WH PRESS SECRETARY ERIC SCHULTZ: “‘He didn’t want this to be a stumbling block that would jeopardize the rest of the package,’ Schultz said. Schultz stressed that the administration would have only implemented the taxes on withdrawals from college savings accounts as part of a $50 billion program that would have provided tax breaks to middle-class families and students. But the White House’s insistence that it still believed the savings plans should be taxed is likely to give Republicans — who have seized on the issue in recent days — additional ammunition.” http://bit.ly/15RjsWn
QUOTABLE, House Speaker John Boehner (R-Ohio) in an interview with Fox News’s Brett Baier when asked if he’s serving his last term: “No, no, no – – I’ll be here for a while.” David McCabe for The Hill recaps: http://bit.ly/1Di5xUH
FLASH POLL – – OBAMA, CONGRESS TRUSTED EQUALLY ON ECONOMY. Jesse Byrnes reports: “Americans are essentially evenly split on who they trust to make decisions about the economy, with about four in 10 Americans backing both President Obama and the GOP-led Congress, according to a new poll.”
— CRUNCHING THE NUMBERS: “Forty-one percent of Americans trust Obama’s handling of the economy compared to 40 percent who back the Republican-controlled Congress, a Suffolk University/USA Today poll released Wednesday found. The poll found 13 percent don’t trust either one. On handling the economy, the poll found Obama enjoying 77 percent support among those who identify as “liberal” or ‘very liberal,’ while Congress holds 62 percent support among ‘conservative’ or ‘very conservative’ respondents. A majority of Americans, 55 percent, say the economy is getting better, while 32 percent say it is getting worse. Fifty-one percent credit the improved economy to Obama, while 45 percent say he played little to no role.” http://bit.ly/15VeFE9
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