As GS summarizes the week ahead in politics, it will be "a somewhat quiet week, with the House on recess and energy legislation on the Senate floor; fiscal debates will continue in the background, with possible action in the Senate on competing budget plans starting later this week…" In other words, the soap opera on the debt limit will soon start getting very interesting.
Monday, May 16
- The Treasury reaches the debt ceiling. As expected, the Treasury will reach the $14.294 trillion limit on public debt today (this counts debt held by the public as well as in government trust funds). Once reached, the Treasury can create a bit more than $200bn of room for additional net issuance by redeeming overnight Treasuries held in government retirement accounts and a few other miscellaneous funds. It expects to exhaust those measures by August 2, at which point the Treasury would no longer be able to finance budget deficits through net borrowing unless it identifies further “extraordinary measures” to create additional room. In the meantime, discussions among the “gang of six” bipartisan group in the Senate and Vice President Biden’s series of fiscal meetings with senior members of the House and Senate at the White House will continue.
- House Budget Committee Chairman Paul Ryan (R-WI) speaks on fiscal issues. At the Economic Club of Chicago. He is likely to make reference to the findings of the Medicare and Social Security Trustees, who issued their annual reports on Friday showing deterioration in the finances of both programs.
- International Trade Commission on steel wire. The ITC will rule on antidumping and countervailing duties on steel wire from China and Mexico.
Tuesday, May 17
- President Obama meets with Saudi King Abdullah….
- Offshore drilling legislation. The Senate Energy and Natural Resources Committee will hold a hearing on four measures to increase offshore drilling permitting.
- Treasury Sec. Geithner speaks in NY. The debt limit is likely to be a primary focus. At the Harvard Club.
Wednesday, May 18
- Securitization. The Senate Banking Committee will hold a hearing on the state of the securitization markets, with several industry witnesses testifying.
- SEC rating agency meeting. The SEC will hold a meeting to consider proposing new rules to implement Dodd-Frank rules related to credit rating agencies and other providers of diligence for asset-backed securities.
- Senate votes on repeal of oil production subsidies. The bill to repeal $21bn in oil and gas-related subsidies seems unlikely to pass. It faces opposition from at least two Senate Democrats and potentially several more, as well as all 47 Senate Republicans, leaving it far short of the 60 votes that would be necessary to clear the Senate. The bill would remove oil and gas production from the list of activities eligible for the 9% “domestic manufacturing deduction,” deduction of drilling and development costs, depleted wells, and materials injected into wells, and sets an excise tax on certain offshore leases issued in the 1990s without royalty payments.
Thursday, May 19
- President Obama speaks on Middle East…
- Senate budget vote in committee? Senate Budget Committee Chairman Kent Conrad (D-ND) has not yet scheduled consideration of this budget resolution in the committee, which is now roughly two months past the usual timing of the start of the process in the Senate. Conrad hasn’t yet announced when the committee vote will occur, but Wednesday or Thursday looks likely. His resolution is likely to propose allowing the 2001/2003 tax cuts to expire and will reportedly propose a new top rate for incomes over $1 million.
- Advanced vehicle technologies. The Senate Energy and Natural Resources Committee will hold a hearing on legislation to promote advanced vehicle technology and plug-in electric vehicles. These were left out of the Senate’s energy bill that will be on the floor this week, but could be included in any subsequent energy legislation the Senate considers.
- CEA Chairman Goolsbee speaks in NY. At the Council on Foreign Relations.
Friday, May 20
- President Obama meets with Israeli Prime Minister Benjamin Netanyahu….