Tales from the Trail

Washington Extra – Proposals to nowhere

February 2, 2012

A line kept cropping up in our stories from Washington today, something along the lines of “unlikely to be passed in Congress.”

President Obama went out to Falls Church, Virginia to tout his $5 billion to $10 billion plan to help homeowners refinance. The proposal, sketched out in last week’s State of the Union address, could provide relief to many locked into high rates by their homes’ sagging value. But it doesn’t look like it will overcome Republican opposition.

Democrats also introduced today the “Paying a Fair Share Act of 2012,” longhand for the “Buffett Rule” that Obama also raised in his address last week. The idea is that millionaires would pay a minimum 30 percent effective tax rate. It has almost no chance of passage in a Republican-controlled House that has sworn off tax increases.

Sure, this kind of political theater is part of the Washington spectacle. But we thought it was best to tell readers to sit back and enjoy the show – rather than start making plans for the future.

Here are our top stories from Washington…

Obama presses Congress to step up aid for homeowners
President Barack Obama pressed lawmakers to back a $5 billion to $10 billion plan to help U.S. homeowners refinance, part of an election-year package that is unlikely to overcome Republican opposition in Congress. Obama moved to counter Republican criticisms that the proposal would use taxpayer money to bail out irresponsible borrowers by stressing that only homeowners current on their payments could benefit. The president had sketched out the plan in his State of the Union address last week.

For more of this story by Margaret Chadbourn, read here.

Exclusive: Mortgage deal would give US states enforcing clout
A proposed settlement to resolve mortgage abuses by top U.S. banks will give states broad authority to punish firms that mistreat borrowers in the future, according to documents seen by Reuters. Under the settlement, which states are currently reviewing to decide whether they will join, the states and a separate “monitoring committee” will have the authority to go to court to enforce the terms and seek penalties of up to $5 million per violation.

For more of this story by Rick Rothacker and Aruna Viswanatha, read here.

After Florida win, Romney stumbles in comments
Republican presidential candidate Mitt Romney ran into a wall of criticism for remarks suggesting he was indifferent to America’s poor, after scoring a resounding victory in the Florida primary. The wealthy ex-governor of Massachusetts and former private equity executive gave a clumsy reminder while speaking to CNN of the challenges he faces winning over voters struggling with the economic downturn and high unemployment.

For more of this story by Sam Youngman, read here.

Exclusive: MF Global triggers regulatory rethink at CFTC
The head of the Commodity Futures Trading Commission has ordered an extensive review of how futures brokerages are regulated, following the collapse of MF Global three months ago, a CFTC official told Reuters. CFTC Chairman Gary Gensler ordered the review after questions emerged about whether the CFTC or exchange-operator CME Group, whose self-regulatory arm served as MF Global’s front-line regulator, could have done more to prevent the firm’s collapse and safeguard customer money.

For more of this story by Christopher Doering, read here.

U.S. weighs 30 percent “Buffett Rule” tax on millionaires
Millionaires would pay a minimum 30 percent effective tax rate under a law introduced on Wednesday in the Senate with the backing of President Barack Obama and named after billionaire investor Warren Buffett. Nicknamed the “Buffett Rule,” the tax bill reflects Democrat Obama’s bid ahead of November elections to highlight the sort of unfairness he says is represented by Buffett’s tax anomaly – that he pays a lower effective rate than his secretary does.

For more of this story by Patrick Temple-West, read here.

U.S. aims to halt combat role in Afghanistan in 2013
The United States plans to shift out of a combat role next year in Afghanistan, focusing instead on training and advising local forces, the U.S. defense secretary said on Wednesday. “Our goal is to complete all of that transition in 2013 and then hopefully by mid- to the latter part of 2013 we’ll be able to make a transition from a combat role to a training, advise-and-assist role,” Leon Panetta told reporters en route to a NATO defense ministers’ meeting in Brussels.

For more of this story, read here.

From elsewhere…
Taliban “poised to retake Afghanistan” after NATO pullout
The U.S. military said in a secret report that the Taliban, backed by Pakistan, are set to retake control of Afghanistan after NATO-led forces withdraw, raising the prospect of a major failure of Western policy after a costly war. Lieutenant Colonel Jimmie Cummings, a spokesman for the NATO-led International Security Assistance Force, confirmed the existence of the document, reported on Wednesday by Britain’s Times newspaper and the BBC.
For more of this story, read here.

Republican enthusiasm gap is worry in battleground state
Republican voters gave presidential hopeful Mitt Romney a resounding victory in Florida but they turned out in lower numbers than in the previous primary in 2008 and were only lukewarm about their party’s candidates. The number of Republicans who voted on Tuesday – 1.7 million – was down 14 percent from 2008, in a worry for the party in a swing state that will be crucial for the November election battle with President Barack Obama.

For more of this story by read here.

For more stories from our Washington correspondents visit www.reuters.com and stay informed.

Photo Credit: REUTERS/Larry Downing (Obama); REUTERS/Craig Lassig (Romney); REUTERS/Alex Wong/Pool (Panetta  drives  the aircraft carrier USS Enterprise)

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