OVERNIGHT FINANCE: GOP anger grows over lost IRS emails

TOMORROW STARTS TONIGHT: All eyes will be on the Federal Open Market Committee (FOMC) tomorrow, as Fed Chairwoman Janet Yellen gives her second press conference at 2 p.m.

— DON’T BET ON INTEREST RATE CLUES. “No big surprises tomorrow” PNC’s chief economist Stuart G. Hoffman predicted to OVERNIGHT FINANCE.

{mosads}“The FOMC has moved away from quantitative measures for considering an increase in the Federal funds rate, but it will remain close to zero until the final quarter of 2015. We expect the FOMC to announce another $10 billion taper tomorrow, too.”

THIS IS OVERNIGHT FINANCE. How about that game last night? Go USA! Thanks for reading. Tweet: @kevcirilli. And email: kcirilli@digital-release.thehill.com. Have me delivered daily to your inbox — click here to sign up for our newsletter.

Back to work…

BIG STORY – HOUSE SUBPOENAS HEAD OF IRS. The House Oversight Committee subpoenaed IRS commissioner John Koskinen to testify about the agency’s claims it lost former official Lois Lerner’s emails because her computer crashed in 2011.

The missing emails are at the center of an investigation into why IRS agents improperly went after Tea Party groups that applied for tax-exempt status.

— MORE MISSING EMAILS: House Ways and Means Committee Chairman Dave Camp (R-Mich.) and Oversight Subcommittee Chairman Charles Boustany (R-La.) released a statement Tuesday:

“In addition to Lois Lerner’s emails, the IRS cannot produce records from six other IRS employees involved in the targeting of conservative groups… The timeframe… covers when the Washington D.C. office wrote and directed the Cincinnati field office to send abusive questionnaires, including inappropriate demands for donor information, to conservative groups.”

— QUOTABLE: REP. TED POE (R-Texas) on the House floor earlier today: “Isn’t that an oddly convenient disappearance? Have they gone the same place the missing 18 Nixon tapes went?” Pete Schroeder has more on what Poe said: http://bit.ly/1lPEfi6.

— Philip Bump for WaPo’s The Fix: “At least one change has arrived at the IRS in the wake of the tax-exempt status controversy: The agency now stores its backup tapes for longer than six months.” http://wapo.st/1pBC2db.

…MEANWHILE, Liam Pleven and Laura Saunders for WSJ: “Expatriate Americans Break Up With Uncle Sam to Escape Tax Rules.” http://on.wsj.com/1nLLt6w.

FLASH AND – FIZZLE? Looks like the Senate is over Michael Lewis’s “Flash Boys.” Only three of 14 members of the Senate Homeland Security and Governmental Affairs’ investigative subcommittee showed up for today’s hearing: Sens. Carl Levin (D-Mich.), John McCain (R-Ariz.) and Ron Johnson (R-Wis.).

…and Johnson isn’t worried about the high-frequency trading: “This hearing should be about restoring confidence. I don’t think it’s restoring confidence if we try and create a state of fear and set up straw men, in terms of the boogey men out there, trying to game the system.”

— RT @MarkCalabria, financial regulatory director at Cato: “I suspect most members didn’t know where they wanted to be on the issue, hence avoiding making a statement either way.”

THE SCENE – SAN ANTONIO MAYOR JULIAN CASTRO, a rising Democratic star, thanked his family earlier today while testifying before the Senate Banking Committee to be Housing secretary.

Speaking to a packed committee room inside Dirksen, he thanked his twin brother Rep. Joaquín Castro (D-Texas) only to find his brother hadn’t arrived.

“You’ll have to forgive him. He’s the second-born twin and sometimes he’s late,” the mayor quipped of his brother’s tardiness.

JULIAN CASTRO MEETS CONGRESS. My report: “Senators expressed little opposition to San Antonio Mayor Julian Castro’s nomination for secretary for Housing and Urban Development (HUD), a job that would give him a major role in the push for reforms to the housing system.

Though he declined to endorse any specific legislative proposals, Castro said he supports ending the federal backstop that Fannie and Freddie now enjoy… That was enough for Sen. Bob Corker (Tenn.), who said he will support Castro’s nomination.” http://bit.ly/1kLemLE.

FIRST LOOK – HERITAGE HOUSING WHITE PAPER. The conservative Heritage Foundation will release a white paper tomorrow morning at 10:30 a.m., but we’ve got a draft version of it right here, co-authored by Heritage analysts John L. Ligon and Norbert J. Michel.

Ligon and Michel argue that getting rid of Fannie and Freddie doesn’t mean getting rid of the 30-year fixed-rate mortgage, a staple of the American housing industry.

But they’ve got tough-talk for 30-year FRMs, too:

“A 30-year FRM with a low down payment amounts to debt ownership, not home ownership. Government policies should not favor any particular loan mortgage product because no one product can best serve the needs of every borrower at any one time…

“Even though no single federal government policy created or proliferated the conventional 30-year FRM, many interest groups claim that shutting down the GSEs would imperil the existence of the 30-year FRM.

“It is misguided to justify broad government intervention and taxpayer guarantees to preserve any one type of mortgage product, and there is no inherent reason that the 30-year will not exist without the GSEs.” Read the draft version: http://bit.ly/1nNRoIi

HOUSE GOP UNVEILS TRIA PLAN, via Pete: “Rep. Randy Neugebauer (R-Texas) introduced Tuesday a five-year extension of the Terrorism Risk Insurance (TRIA) Act, which he said would ‘take off the training wheels’ on the government backstop created after the terrorist attacks of Sept. 11, 2001…

“If Neugebauer’s bill gains traction, it will eventually have to be reconciled with similar TRIA legislation making its way through the Senate. There, senators have coalesced around a seven-year extension of the program that also makes several changes to require the private sector to shoulder a larger burden of the costs.” http://bit.ly/1nirBpP.

MORE FROM THE HILL’s TEAM:

–CEOs push for tax relief as economy sputters: http://bit.ly/1pe4csT.

–Murray: ‘We just need to find the revenue’ for highway bill: http://bit.ly/1vLqV1B.

–Shops fight back on data breaches: http://bit.ly/1yfwiIu.

–House GOP targets IRS for more budget cuts: http://bit.ly/1nidLDO.

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