–Senate To Vote Tuesday Evening On China Currency Bill, Obama Jobs Plan
–Hill To Vote This Week On Panama, Colombia, South Korea Trade Deals
–Senate Finance Committee To Hold Another Tax Reform Hearing

By John Shaw

WASHINGTON, Oct. 11 (MNI) – Congress faces another busy week of
economic activity with critical votes scheduled for China currency
legislation, President Obama’s jobs package and three pending U.S.
bilateral trade agreements.

The Senate will vote Tuesday evening at 5:30 p.m. ET on passage of
a currency bill that is directed at China.

Based on two procedural votes held last week, the bill seems poised
to pass the Senate easily.

However, House Speaker John Boehner has called the legislation
“dangerous” and is very unlikely to schedule a House vote on the bill.

The Senate legislation requires Treasury to develop a biannual
report to Congress that identifies two categories of currencies: a
general category of “fundamentally misaligned currencies” based on
objective criteria and a smaller group of “fundamentally misaligned
currencies for priority action” that reflect misaligned currencies
caused by clear policy actions by the relevant government.

The bill would automatically threaten economic sanctions if the
Treasury Department finds that a trading partner’s currency is
“misaligned” due to intentional policy actions of a government. In the
past, Treasury has steadfastly declined to label China a currency
manipulator.

Under the Senate legislation, countervailing duties would be
available to any U.S. industry that could demonstrate it has been
“materially injured” by imports from the country with the undervalued
currency.

The Senate will also hold a procedural vote Tuesday evening to
formally begin debate on President Obama’s $447 billion jobs package as
modified by Senate Democratic leaders.

The main change that Senate Democrats have made to Obama’s plan is
to offer a new package of offsets including a proposed surtax on the
wealthy.

Democrats have said their proposal to levy a 5.6% surtax on
household income about $1 million will pay for the full cost of Obama’s
jobs plan.

Senate Republicans are expected to vote Tuesday against the motion
to formally begin the Senate debate. Since 60 votes are needed to begin
the debate, the GOP could derail Obama’s plan — and likely will.

Both the House and Senate are expected to vote on, and pass,
pending bilateral trade agreements between the U.S. and Panama,
Colombia, and South Korea.

The congressional votes on the three trade bills are expected
Wednesday.

The Senate Finance Committee will mark-up a bill Tuesday afternoon
at 4 p.m. ET that implements the three trade agreements, sending them to
the full Senate for its debate.

In other action this week, the Senate Budget Committee will hold a
hearing Wednesday at 9:30 a.m. ET on improving the congressional budget
process. Think tank analysts will testify.

The Senate Finance Committee will hold a hearing Wednesday at 10
a.m. ET on tax reform options, with a host of think tank experts slated
to testify.

A subcommittee of the House Financial Services Committee will hold
a hearing Wednesday at 1 p.m. ET on federal home loan banks. Financial
services representatives will testify.

Another subcommittee of the House Financial Services panel will
hold a hearing Thursday at 10 a.m. ET on the relationship between the
U.S. housing system and global financial stability. Experts from the
financial industry will testify.

Yet another subcommittee of the Financial Services Committee will
hold a hearing Friday at 9 a.m. ET on proposals to amend some
derivatives provisions in Title VII of the Dodd-Frank law. This title
deals with regulation of over-the-counter swaps markets such as credit
default swaps and credit derivatives.

Congress’s deficit reduction committee has no scheduled hearings
this week, but is likely to hold private discussions. The panel is
charged to submit a $1.5 trillion deficit reduction package by Nov. 23.

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

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