Overnight Finance: Dems knock trade deal as ‘too big to pass’

Another hump day, another OVERNIGHT FINANCE hitting your inbox. I’m Vicki Needham and just think, this time next week you’ll probably be jammed into a metal tube sitting on a tarmac waiting to fly off to snowy Chicago or sunny California for Thanksgiving. Seems like everyone around Capitol Hill is ready for the break.

So let’s move this along…

PROMISES, PROMISES: From The Hill’s Keith Laing: “Lawmakers promised Wednesday that a two-week temporary highway funding patch that is set to be approved this week will be the last pit stop before a long-sought multi-year transportation bill is passed.”

{mosads}”This is the last extension. Let me put an exclamation point on that,” House Transportation and Infrastructure Committee Chairman Rep. Bill Shuster (R-Pa.) said during the first public meeting for the committee that has been set up to work on a bicameral agreement on the highway bill. 

The House-Senate conferees have until Dec. 4 to make good on that vow. http://bit.ly/1OfQMYV

READY, SET, HIKE: From our own Peter Schroeder: The Federal Reserve appears to be prepping for a much-anticipated rate hike at its December meeting, in what could be a nice little present under the economic Christmas tree. 

“Most” central bank officials believe conditions for a rate hike “could well be met” by the time the Fed next meets to set policy in December, according to the Fed’s minutes from the October meeting.

“Buoyed by a strong run of economic data, Fed watchers had broadly anticipated that the Fed could finally raise rates at its final meeting of 2015, months after Fed Chairwoman Janet Yellen said she would like to raise rates before the year was out.”

So, we’ll see… http://bit.ly/1l6ZWx8

TOO BIG TO PASS: From me: A half dozen House Democrats asserted on Wednesday that opposition is growing against a sweeping Asia-Pacific trade agreement as the White House ramps up efforts to build support for the deal.

The six Democrats — Reps. Rosa DeLauro (Conn.), Louise Slaughter (N.Y.), Marcy Kaptur (Ohio), Nydia Velázquez (N.Y.), Mark Pocan (Wis.) and Tulsi Gabbard (Hawaii) — said the Trans-Pacific Partnership (TPP) deal is “too big” to pass Congress and must be scrapped.

“The Democrats, who have long opposed the expansive deal, said the more than 5,000-page agreement, which they carted out in front of the Capitol by hand truck for a press conference, is a big giveaway to multi-national corporations and will have devastating effects on the U.S. economy, jobs and wages.” http://bit.ly/1SFywZQ

DON’T TRY THIS AT HOME: Welcome to our new tax reporter, Naomi Jagoda, with the news on Treasury’s new guidance: “The Treasury Department is preparing to release guidance this week in an effort to curb inversions, a practice allowing U.S. firms to reduce their taxes by basing their operations overseas.”

“Later this week, we intend to issue additional targeted guidance to deter and reduce further the economic benefits of corporate inversions,” Treasury Secretary Jack Lew said in a letter sent Wednesday to the leaders of the congressional tax-writing committees.

“As before, we will continue to review our existing authorities to identify additional ways to address this serious problem.” http://bit.ly/1O3OUEm

WRANGLE THAT LOOPHOLE: Via Jagoda: Two congressional Democrats — Rep. Sander Levin (D-Mich.) and Sen. Tammy Baldwin (D-Wis.) — and a group of millionaires made a push on Wednesday for legislation to close the carried-interest tax “loophole.”

“We have to eliminate this loophole to make that sure everyone is paying their fair share and especially so that we can invest in an economy that creates jobs and lifts working American wages,” Baldwin said during a news conference on Capitol Hill.

Carried interest is the share of profits taken by managers of investment funds — such as private-equity funds, hedge funds and real-estate funds — for providing the service of managing the funds’ assets. http://bit.ly/1POzuUx

WHERE’S THE TAX REVENUE?: From Jagoda: “Sen. Elizabeth Warren (D-Mass.) says the big issue with the U.S. corporate tax code is not that taxes are too high — it’s that the revenue generated from the taxes is too low.

“The liberal stalwart said most U.S. corporations pay much less than the 35 percent corporate tax rate because of loopholes in the tax code, including rules that let companies shift income overseas.

“Only one problem with the over-taxation story: It’s not true,” Warren said at the National Press Club on Wednesday. “There is a problem with the corporate tax code, but that isn’t it.” http://bit.ly/1HZn4m8

WAYS AND MEANS SHUFFLE: From me: “The House Ways and Means Committee on Wednesday completed a subcommittee shuffle that was needed after Rep. Paul Ryan left the chairmanship for the speaker’s office.”

New Chairman Kevin Brady (R-Texas) announced the changes that include adding Rep. Tom Rice (R-S.C.) and adjusting the names and sizes of several subcommittees.

“These Republican subcommittee chairs and members will play a crucial role in taking real steps toward fixing our country’s broken tax code, reining in the IRS, reforming the nation’s welfare programs, expanding trade, replacing the Affordable Care Act and saving Social Security and Medicare for the long term,” Brady said in a statement. http://bit.ly/1PALt9F

HOUSE MOVES ON MORTGAGES: From The Hill’s Lydia Wheeler and Cristina Marcos: “The House passed legislation Wednesday that critics argue rolls back regulations for mortgages that were created to prevent the bad lending practices responsible for the financial crisis of 2008.”

The measure, which was introduced by Rep. Andy Barr (R-Ky.), passed 255-174. 

The bill extends a federal exemption meant for small and rural banks to all banking institutions. 

The Consumer Financial Protection Bureau (CFPB) issued regulations last year that require lenders to ensure a borrower’s ability to repay a loan in order to obtain a qualified mortgage status. That provides lenders a “safe harbor” protection from federal penalties and lawsuits brought by borrowers who have defaulted on their loans. http://bit.ly/1O3Pxhf

A LITTLE HELP: On Thursday, Reps. Sean Patrick Maloney (D-N.Y.) and Mike Coffman (R-Colo.) will unveil new legislation to help first-time home buyers.

Maloney’s legislation would allow renters to use more of their tax-free IRA savings for a down payment on a new home.

NO FREE RIDES HERE: Several House Democrats and progressive groups on Thursday will call on House leaders to reject any policy riders as part of an omnibus spending measure. More than 140 members of Congress have signed a letter calling on lawmakers to reject “poison-pill” provisions. 

Write us with tips, suggestions and news: vneedham@digital-release.thehill.com; pschroeder@digital-release.thehill.com.

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