–President Obama To Host Hill Leaders For Dinner; Budget On Menu
–Vice President Biden To Meet Hill Leaders Thursday On Budget
–Senate’s Gang of Six Continue To Seek Bipartisan Budget Accord
–Senate Finance Committee To Hold Hearing On Budget Enforcement Ideas

By John Shaw

WASHINGTON (MNI) – It’s not hyperbolic to say the grinding,
months-long battle over the fiscal year 2011 budget this winter and
spring will come to be viewed as child’s play compared to what looms
ahead on fiscal issues.

As Congress returns Monday from its two week spring recess, the
main focus will be on the need in the next 60 days or so to increase the
$14.3 trillion debt ceiling.

Congressional Republican leaders continue to say they will only
agree to raise the debt ceiling if the increase is coupled with specific
spending cuts and a budget enforcement regime to begin driving budget
deficits downward.

Senate Majority Leader Harry Reid last week said he is open to
supporting legislation that imposes a statutory cap on budget deficits,
but said the debt ceiling must be increased this summer.

“If we’re not able to do this, it’s going to affect us for
generations to come,” Reid said.

Senate Minority Leader Mitch McConnell has said that he expects
Congress to address debt ceiling legislation between the Memorial Day
and July 4th congressional recesses.

This week informal budget talks, or at least the initial staking
out of positions, will begin.

President Obama will host a Monday evening dinner with
congressional leaders and discussion of the budget is expected to be one
of the main topics of discussion.

Vice President Joe Biden will hold his first meeting with
congressional leaders on FY’12 budget and debt ceiling issues Thursday.

And crucially, the bipartisan group of six senators who are working
on a bipartisan deficit reduction plan, the so-called Gang of Six, is
expected to continue work on its plan and possibly introduce a package
as early as this week.

The members of the Gang of Six have said they are working on a
package that is roughly based on the work of the Simpson-Bowles
Commission which outlined a plan to cut $4 trillion over a decade.

The Senate Finance Committee is holding a hearing Wednesday at 10
a.m. on various mechanisms that might be developed to achieve deficit
reduction goals.

The Finance Committee is also holding a hearing Tuesday at 10 a.m.
on steps to make the U.S. tax code more fair.

The House Financial Services Committee will hold a hearing Thursday
10 a.m. to receive Treasury’s annual report on the state of the
international financial system.

A subcommittee of the Financial Services panel will hold a mark-up
session Wednesday at 10 a.m. to consider a bill to fundamentally revamp
the newly created Consumer Financial Protection bureau.

The Senate may consider legislation this week that would repeal tax
benefits for oil and gas companies as well as resume debate on a small
business research bill that has been stalled for weeks.

The House will consider legislation to increase domestic oil and
gas production and will take up bills that curb the regulatory power of
executive branch debarments under the new health care law.

** Market News International Washington Bureau: (202) 371-2121 **

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