OVERNIGHT MONEY: Agriculture panel plows ahead with markup

The Congressional Budget Office confirmed Monday that the draft five-year farm bill falls short of the cost-cutting sought by critics of crop subsidies. However, more than half of the $50 billion in savings from cutting subsidies is used to create new crop insurance programs. 

The bill creates a new shallow-loss crop insurance program for all commodities and a special additional revenue-based insurance scheme for cotton.

{mosads}The new programs mean the bill has less deficit reduction than the White House and House conservatives have been demanding.

President Obama had sought $33 billion in savings, while the House Republican budget calls for $30 billion.

On the other side, rice, peanut and cotton producers have said the crop insurance program does not make up for the loss of current programs. In a letter this week, groups representing them demanded a delay until May. 

Given the opposition of Southern farmers, observers expect Sen. John Boozman (R-Ark.), Saxby Chambliss (R-Ga.) and Thad Cochran (R-Miss.) to vote against the chairman’s bill.

Sen. Dick Lugar (R-Ind.) said he expects committee members to offer more cuts to programs in the form of amendments during the markup, and Sen. Sherrod Brown (D-Ohio) plans to offer amendments to the food stamp and environmental conservation portions of the bill. 

At this point, there is no clear path for the farm bill to become law before the current 2008 bill expires in September.  

Sen. Chuck Grassley (R-Iowa) said Congress will need to pass a farm bill by August, or a new bill will probably be delayed until next year.

House Speaker John Boehner (R-Ohio) has not committed to giving the bill, which is controversial with fiscally conservative freshmen, floor time. 

One source said Senate Majority Leader Harry Reid (D-Nev.) is reluctant to spend Senate floor time on a bill that would stall out in the House.

“As we know there are different political realities in the House,” Stabenow told The Hill.

WHAT ELSE TO WATCH FOR 

Drum-roll, please: It’s that time again — time for the Federal Reserve to come down from the mountain and announce its latest plan for the nation’s monetary policy. While the markets always hold their breath on Fed day, the conclusion of April’s two-day meeting of the Federal Open Market Committee (FOMC) will be watched with particular interest. That’s because it marks the first meeting of Fed officials to set policy since the nation’s economic data has taken a turn for the worse, starting with a disappointing March jobs report and followed by a series of worse-than-expected reports on the number of people seeking jobless benefits. Those disappointing reports are driving many to wonder what the Fed’s next move might be. 

Right now, the agency has said it expects it will keep interest rates near zero until the end of 2014, but that it is keeping the toolbox open if needed.

Now, some are wondering if the Fed might take further steps to give the economy a kick in the pants. But at the same time, others — including former top banking watchdog Sheila Bair — are saying it’s high time for the Fed to start bringing an end to the easy-money days.

All this adds up to plenty of attention on the Fed when it releases its latest statement Wednesday afternoon, followed by a press conference from Fed Chairman Ben Bernanke, who will further shine a light on the Fed’s thinking.

Watchdog watching: A House Financial Services subcommittee will call Securities and Exchange Commission Chairwoman Mary Schapiro to carpet tomorrow, for a hearing devoted to overseeing her agency. As the SEC works to get the Dodd-Frank Act off the ground, it is grappling with GOP lawmakers who are skeptical about its past work before the crisis and the notion of doling out more funds to help it meet its expanded responsibilities.

Housing help: The Senate Banking subcommittee devoted to housing will be once again return to that troublesome issue of what can be done to help struggling homeowners while lifting the ailing housing market. This time, lawmakers will be probing a slew of housing experts on how refinancing could be used strategically to help responsible homeowners end up with a more affordable mortgage so they have more money in their pockets to pump into the economy elsewhere.

Suddenly no sequester: The House Budget Committee will take a closer look at how to find a way to replace the planned sequester, about $500 billion in automatic cuts to defense and non-defense discretionary spending next year, which is part of the debt-limit last summer. Expect bickering between Democrats, Republicans and Daniel Werfel, controller of the Office of Management and Budget’s Office, as each party attempts to lay out the best way to proceed. As it, turns out the Veterans Administration is exempt from the automatic cuts that could hit the discretionary budget in January 2013, OMB said Monday.

Members of Congress on the Veterans’ Affairs committees and veterans advocacy groups had lobbied for exempting the VA from the automatic cuts through sequestration, expressing concern that veterans’ care would be harmed.

Talking about suballocations: The House Appropriations Committee will discuss on Wednesday the breakdown of allocations to each subcommittee. On Tuesday, the panel released proposed total spending figures for all 12 annual appropriations bills that together are to reach the top-line spending figure of $1.028 trillion in the Ryan plan. The Senate is crafting bills based on the August debt-ceiling deal’s $1.047 trillion, setting up a spending showdown in the fall.

Unemployment insurance reform: A House Ways and Means Committee subpanel will examine the implementation of changes to the unemployment insurance system that were a part of payroll tax and unemployment benefits extension legislation passed earlier this year. 

Now on to tax reform: The Senate Finance Committee takes a look at the effects that federal tax changes have on state and local tax and fiscal policy with a tax experts in academia and interest groups as well as the Congressional Budget Office.

More student loan chat: President Obama puts on his black and gold on Wednesday at the University of Iowa to press his point about preventing an increase in interest rates on student loan debt. 

During his speech on Tuesday he sought to put himself in students’ shoes, telling a crowd of college students that he only paid off his student loans eight years ago.

In a fiery speech during which he urged Congress to pass legislation to prevent an increase in federally subsidized student loan rates, the president also continued a narrative in which he set himself apart from presumptive GOP presidential nominee Mitt Romney, telling the crowd that he and first lady Michelle Obama “didn’t come from wealthy families.”

“I just want everybody here to understand. I didn’t just read about this,” Obama said to roaring applause from students at the University of North Carolina. “I didn’t just get some talking points about this. I didn’t just get a policy briefing on this.”

While Obama delivers those remarks, Small Business Administrator Karen Mills and Education Secretary Arne Duncan will team up for a Twitter discussion helping college graduates start a business.

More on the economy: Treasury Secretary Timothy Geithner will take a tour of the Oregon Iron Works and United Street Car facility in Clackamas, Ore., on Wednesday before heading to the Portland City Club to discuss the state of the economy. 

BREAKING NEWS

Vote-a-rama on postal rescue: Well, maybe not a rescue, but the Senate dispensed with more than a dozen amendments to its postal reform bill on Tuesday, setting up a possible vote on final passage for Wednesday.

The series of votes puts the Senate that much closer to approving its bipartisan postal bill, after dealing with months of hurdles.

In recent weeks, Republicans decided to move ahead with a floor debate over gas prices, pushing back consideration of the postal bill. Last week, the Senate also struggled to reach an agreement over amendments. 

And before the bill even got to that point, Democrats in the chamber pushed to alter the bill to include more protections for rural post offices and more opportunities for the Postal Service to find new revenues.

In all, the Senate was supposed to consider close to 40 amendments to the postal bill, but not all are expected to receive floor votes.

On Tuesday, the Senate cleared amendments that would protect voting by mail and that would make it more difficult to close rural post offices.

The chamber rejected an amendment that would have mandated that the Postal Service switch to five-day delivery, and a separate proposal requiring it to keep six-day delivery. It also tossed aside a proposal to implement an panel to reorganize USPS.

Supporters of the postal bill hope that if the Senate does pass its bill on Wednesday, it would pressure the House into acting.

The House has yet to schedule floor time for its postal bill, even though a GOP bill passed out of committee six months ago. That Republican proposal is quite different from the Senate bill, meaning that a postal conference will likely be necessary.

Ryan challenge: More than 80 Georgetown University faculty members and administrators signed a letter to GOP Wisconsin Rep. Paul Ryan on Tuesday, challenging his use of Catholic teaching in defending his budget proposal.

Ryan is scheduled to speak at Georgetown on Thursday as part of the Catholic school’s Whittington Lecture series.

ECONOMIC INDICATORS 

MBA Mortgage Index: The Mortgage Bankers Association releases its weekly report on mortgage application volume. 

Durable Orders: The Department of Commerce releases its March report that measures the dollar volume of orders, shipments and unfilled orders of durable goods. Orders are considered a leading indicator of manufacturing activity, and the market often moves despite the volatility and large revisions that make it a less than perfect indicator.

WHAT YOU MIGHT HAVE MISSED

— U.S. trade officials call for swift completion of Asia-Pacific trade deal
— Senate supporters of Russia rights bill press on despite warning
— SEC charges credit rater with false claims
— New home sales plunge in March
— Ford gets credit rating boost from Fitch
— Consumer confidence remains depressed
— Home prices continue dropping in February
— GOP lawmaker looks to slash travel budgets in wake of GSA scandal

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