Washington Extra – Two to tango
One of the more surreal experiences at the Reuters Washington Summit this week was hearing Republicans saying they are prepared to work with President Barack Obama over the next two years and then listing their priorities – which started with undoing and repealing almost everything he has done in the past two.
Today, at the Tart Lumber Company in Virginia, John Boehner unveiled the Republicans’ “Pledge to America” – a glossy 45-page booklet meant to set out their agenda for government. “Republicans have heard the American people,” said Boehner, the party’s leader in the House of Representatives.
As expected, there were howls of derision from the left. Many conservative commentators rallied behind the proposals to cut spending, lower taxes and balance the budget, but not everyone is happy. In his column, Reuters Breakingviews columnist James Pethokoukis argued that Republicans had missed the chance to make the case for the kind of serious fiscal reform the United States desperately needs.
“America’s so-called ‘party of no’ has finally revealed what it will say ‘yes’ to. Yet a new Republican manifesto offers little more than undoing President Barack Obama’s reforms to date, with vague talk of balanced budgets. Maybe that’s smart politics. But it’s a missed opportunity.”
Lest you think Washington Extra is letting Democrats off the hook for the lack of bipartisanship in Washington these days, there was another moment of surreal politics that stood out at this week’s Reuters summit. How can you blame the administration for the uncertainty plaguing business, one senior administration official asked, when the president has been “totally certain” all along about what he wanted to do with the Bush-era tax cuts?
Blame uncertainty on the Republicans for “agitating to change that basic formulation,” the official said. Perhaps this is what our Republican guests meant about the “arrogance of power” and how policies are just being sent down Pennsylvania Avenue.
It takes two to tango, and right now neither party seems inclined to dance with the other. That is not good news for the deficit or ultimately for business and financial markets, where concern is rising that failure to agree on tax policy could see everyone’s taxes rise in January. Further ahead, two years of both parties staring at each other across the dance floor is also less than voters deserve.
“The markets just want to see cooperation on tackling the big issues,” investment strategist John Canally at LPL Financial told us. “I think markets are looking for clarity on the tax cuts and … if that can get that addressed sooner rather than later, that would be great.”
“Paralysis at this time in the government is probably not what markets want to see,” Canally said. “They also don’t want what we’ve had for the last couple of years either — the sweeping legislative changes — because businesses like to have clarity on costs and benefits.”
Here are our top stories from today…
Republicans present “Pledge to America” agenda
Republicans in the House of Representatives, forecast to do well in November’s congressional election, presented a “Pledge to America” campaign agenda on to create jobs, cut taxes and shrink government.
For more of this story by Richard Cowan, read here.
Obama asks Wen for more action on yuan
President Barack Obama told Chinese Premier Wen Jiabao that China needed to do more to resolve a dispute over the value of the Chinese currency, a senior U.S. official said. In talks with Wen on the sidelines of the U.N. General Assembly, Obama said the currency was the “most important issue” of their meeting, the U.S. official told reporters.
For more of this story by Paul Eckert and Steve Holland, read here.
For a Q + A on what is causing tension between the U.S. and China, click here.
For a factbox on a proposed House bill that could clear the way for action against countries with “fundamentally undervalued” currencies, click here.
Obama pushes Israel on settlements
Israel should extend its settlement building moratorium and Arab states should move toward normal ties with the Jewish state to promote fledgling peace talks, President Barack Obama said. Speaking at the U.N. General Assembly three weeks after Israeli and Palestinian officials resumed direct peace talks, Obama urged world leaders to make sure “this time is different” from previous failed efforts to end the six-decade conflict.
For more of this story by Steve Holland and Alister Bull, read here.
No hope for tax cut vote before election: Democrat
Congress will not vote on extending Bush-era tax cuts before the November elections, a Senate leader said, reflecting fear among some Democrats that it could hurt their chances at the polls.
For more of this story by Kim Dixon and Susan Cornwell, read here.
Congress sends small business bill to Obama
A $30 billion small business lending bill cleared Congress, giving President Barack Obama’s embattled Democrats a hard-won victory just weeks before the November elections. The House of Representative gave the bill final congressional approval on a mostly party-line vote of 237 to 187. It now goes to Obama who will sign it on Monday.
For more of this story by Donna Smith, read here.
Bachus wants liquidation power repealed
Republicans would try to repeal the government’s new authority to seize and liquidate large troubled financial firms should they take control of the U.S. House of Representatives next year, a key lawmaker said. Representative Spencer Bachus, who is in line to be chairman of the House Financial Services Committee under Republican control, said that section of the new Dodd-Frank financial law institutionalizes government bailouts of “too-big-to fail” institutions and puts taxpayers at risk.
For more of this story by Dave Clark, read here.
Star billing at House bank panel could change
The powerful congressional committee that oversees the financial sector, which has had a contentious relationship with Wall Street, could change its tenor considerably if Republicans win big in the November elections.
For more of this story by Kevin Drawbaugh, read here.
Data hints economic soft patch may be easing
Sales of previously owned homes climbed in August from a 13-year low, more evidence the economy was stabilizing after a sharp summer slowdown, even though new claims for unemployment benefits rose last week.
Luminaries say recession not over
Who says the U.S. recession is over? Not Treasury Secretary Timothy Geithner. And not legendary investor Warren Buffett. The private-sector National Bureau of Economic Research, considered the arbiter of recessions, announced on Monday it had pegged June 2009 as the end of the slump. That was no surprise to Wall Street economists, most of whom had long ago concluded the recession ended in the summer of last year.
For more of this story by Emily Kaiser, read here.
Consumer czar Warren: banks receptive to change
Elizabeth Warren, the Obama administration’s new consumer financial protection czar, said on Thursday that banks are showing early receptiveness to her plans for simplifying their disclosures to consumers.
For more of this story by David Lawder, read here.
FCC paves way for new mobile devices
U.S. regulators paved the way for new, faster wireless devices by opening unused television airwaves for mobile broadband use. Device makers such as Dell Inc, Nokia and Motorola Inc stand to profit from the Federal Communications Commission’s unanimous vote to allow unlicensed wireless devices to operate on this unused spectrum.
For more of this story by Jasmin Melvin, read here.
U.S. envoy nominee aims to foster Pakistani trust
The nominee to be President Barack Obama’s new envoy to Pakistan pledged to work aggressively to boost America’s image in the country, where billions in aid spending has done little to convince people of U.S. friendship.
For more of this story by David Alexander, read here.
Madoff trustee mistreating victims, lawmakers say
Investors who fell victim to Bernard Madoff’s estimated $65 billion Ponzi scheme should not be forced to return profits they believed they had legitimately made, lawmakers said.
Analysis: Whitman outspends Brown but California race tight
Republican Meg Whitman has given a record-shattering $119 million to her campaign for California governor, allowing her to outspend Democrat Jerry Brown, but the huge bankroll has not produced a lead in polls. The two candidates are in a dead heat, each supported by 41 percent of likely voters, according to the latest Field Poll.
For more of this story by Dan Whitcomb, read here.
For more stories from our Washington correspondents visit www.reuters.com and stay informed.
Photo Credits: Reuters/Larry Downing (House Republican leaders)