–House Returns For Brief Week of Work; Senate Returns Next Week
–House To Vote Wednesday To Disapprove of Final Debt Hike Tranche
–House-Senate Panel On Payroll Tax Cut Bill To Gear Up Next Week

By John Shaw

WASHINGTON, Jan 17 (MNI) – Congress limps back into Washington this
week, with the House holding an abbreviated session and the Senate
returning next week.

The House will convene Tuesday afternoon and be in session only
Tuesday and Wednesday of this week. House Republicans will hold an
issues conference Thursday and Friday in Baltimore.

The House Rules Committee will meet Tuesday evening for a meeting
that will pave the way for a House vote Wednesday to disapprove the
final installment of last year’s debt hike agreement.

The vote was triggered by President Obama’s recent letter seeking
the final $1.2 trillion tranche of the debt ceiling increase that was
negotiated last August.

Under the debt hike agreement, now that Obama has formally made
this request Congress has 15 days — January 27 — to vote on a motion
to disapprove the debt ceiling increase.

The House is almost certain to vote to disapprove the debt ceiling
increase Wednesday. The House passed a disapproval motion last fall.

The Senate returns to action Jan. 24 and is also certain to vote on
the disapproval resolution. However, it is very unlikely that the
Democratic-controlled Senate will pass the disapproval motion.

Even if it did, Obama could veto the resolution. Overriding a
presidential veto would require two-thirds majorities in both the House
and Senate — a virtually inconceivable scenario.

Obama’s formal request and the congressional votes will have the
effect of increasing the current $15.2 trillion debt ceiling to $16.4
trillion, an adjustment that would probably delay any future debt
ceiling hikes until after the November election.

The August, 2011 debt ceiling agreement triggered a $400 billion
increase in the debt ceiling which had been $14.3 trillion. Treasury
sought an additional $500 billion increase in September. The House voted
to disapprove the request, but the Senate rejected the disapproval
motion so it went forward.

In addition to the debt ceiling disapproval vote, Congress will
return to tackle another leftover issue: talks on a payroll tax cut
extension package.

Both Obama and congressional leaders have said they want to pass a
one year extension of the payroll tax cut, but they differ on how to pay
for the nearly $200 billion package. There are also disputes over GOP
efforts to overhaul the unemployment insurance program.

A two-month payroll tax cut extension package was approved by
Congress in December and expires at the end of February.

A House-Senate conference committee will formally negotiate the
package, but the talks are likely to be guided by congressional leaders
with input from the White House.

The Congressional Budget Office will release its updated budget and
economic report for the 2013 through 2022 fiscal years on January 31.
The report will also give an updated estimate of the FY’12 budget
deficit.

Obama will give his State of the Union Address on January 24 and
then is scheduled to release his budget in early February, probably
February 6. The president is also expected to nominate a candidate to
succeed the current White House budget director Jack Lew who Obama has
just named his new chief of staff.

Both the House and Senate will hold several months of hearings on
Obama’s budget and the overall economic outlook as reflected by the CBO
report.

The House and Senate Budget Committees are charged to craft
congressional budget resolutions this spring to outline spending and
revenue goals and to make deficit projections.

** Market News International Washington Bureau: (202) 371-2121 **

[TOPICS: M$U$$$,MFU$$$,MCU$$$]