–White House, Hill Leaders Seek To Sell Debt Hike Deal
–Senate Set To Vote First, Then House On Debt Hike Accord
–Senate Banking To Hold Confirmation Hearing For Cordray

By John Shaw

WASHINGTON, Aug. 1 (MNI) – The laboriously negotiated debt ceiling
agreement between President Obama and congressional leaders will soon
face the most skeptical of possible audiences: the House and Senate.

In announcing the agreement Sunday night, Obama noted the agreement
will be reviewed by House and Senate members Monday, adding that
Congress must hold “some very important votes” to pass the package in
the coming days.

“We’re not done yet,” he said, referring to the need for both the
House and Senate to approve the plan.

Vice President Joe Biden has come to Capitol Hill Monday to meet
with both House and Senate Democrats and lobby for the agreement.

House and Senate Republican leaders will also meet with their
colleagues to review the accord.

The debt ceiling agreement will be placed on a bill that is pending
in the Senate and is likely to be voted on by the upper chamber Monday.

Senate Majority Leader Harry Reid said Monday that he is working to
set up a Senate vote later today. No Senate vote would occur before 2
p.m.

Assuming the bill passes the Senate, it will then be sent to the
House for a final vote, either Monday night or Tuesday.

Passing this package through both chambers in a few days will be
difficult, especially since it will require a very unusual coalition of
Democratic and Republican lawmakers to support it.

The agreement seems likely to pass the Senate in a strong vote but
is almost certain to face a close vote in the House.

The central elements of the package are $1 trillion in
discretionary savings over ten years that will be secured by putting in
place caps on discretionary programs for ten years. A bipartisan
congressional committee will be created to identify an additional $1.5
trillion in deficit reduction, including from entitlement programs and
from tax reform. This panel must make its recommendations in late
November. If Congress fails to accept this plan, across-the-board
spending cuts would be triggered to secure more than $1 trillion in
savings.

Under the agreement, the debt ceiling will be increased by $2.1
trillion which should extend Treasury borrowing until early 2013.

Reid and Senate Minority Leader Mitch McConnell announced their
support of the debt hike plan Sunday on the floor of the Senate.

House Speaker John Boehner has urged his members to support the
package; House Minority Leader Nancy Pelosi has been more cautious,
saying she will review the accord with her members Monday afternoon.

The U.S. has already reached its $14.29 trillion debt ceiling.
Treasury Secretary Tim Geithner has said that Congress must pass
legislation increasing the debt ceiling by August 2, this coming
Tuesday.

In other action this week, the Senate Banking Committee will hold a
hearing Tuesday at 10 a.m. on national mortgage serving standards and a
confirmation hearing Thursday at 2 p.m. for Richard Cordray to be the
first director of the Bureau of Consumer Financial Protection.

A Senate Banking subcommittee will hold a hearing Wednesday at 2
p.m. on debt financing in the domestic financial sector. Another Senate
Banking subcommittee will hold a hearing Wednesday at 9:30 a.m. on the
housing finance system.

The House Financial Services subcommittee will hold a hearing
Wednesday at 10 a.m. on the future role of the Federal Housing
Administration in multi-family mortgage markets.

The House Financial Services Committee will hold a hearing Thursday
at 10 a.m. on proposals to overhaul the SEC. Mary Schapiro, the SEC
chair, will testify.

The House Financial Services Committee will also hold a hearing
Friday at 10 a.m. on the exposure of U.S. banks to the debt crisis in
the European Union.

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

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