Bipartisan opposition to 3% tax withholding
Senate Minority Leader Mitch McConnell (Brian Yaklyvich/ CNN)
October 25th, 2011
06:07 PM ET

Bipartisan opposition to 3% tax withholding

Unless Congress takes action, all bills paid by the federal government for goods, services or property after January 1, 2012 will be subject to a 3% tax withholding. The original provision was a revenue-raiser inserted into the Tax Increase Prevention and Reconciliation Act signed by President George W. Bush back in 2006. The idea was that the 3% withholding would count toward the vendor’s tax liability, meaning that at the end of the year whatever money was withheld by the government from a vendor would count as part of the total amount owed by a company back to the government in taxes.

It was seen as one way to ensure that contractors hired by the government are paying what they owe in taxes.

But because the withholding doesn't take into account the actual size of a company’s tax liability, only the revenue it is due to receive from the government, opponents like the Government Withholding Relief Coalition view the provision as "forcing companies to provide the federal government with an interest-free loan."

Well, now both the Obama Administration and Republican leadership in the Senate are on the same page when it comes to repealing this withholding. Today the Office of Management and Budget released a Statement of Administration Policy supporting the passage of H.R. 674 – a bill “to amend the Internal Revenue Code of 1986 to repeal the imposition of 3 percent withholding on certain payments made to vendors by government entities.” FULL POST


Topics: Mitch McConnell • OMB
Obama chides Republicans during Leno appearance
October 25th, 2011
05:06 PM ET

Obama chides Republicans during Leno appearance

Denver (CNN) - Seesawing between comedic and somber tones during a stop on The Tonight Show with Jay Leno on Tuesday, President Obama took swipes at Republicans in Congress and claimed he has yet to focus on the GOP presidential contest.

“Look, I think the things that folks across the country are most fed up with, whether you are a Democrat, Republican, Independent, is putting party ahead of country or putting the next election ahead of the next generation,” Obama told the late-night comedian when asked about increasingly rancorous tone in Washington.

‘It's shocking that they opposed something I proposed,” Obama later joked when asked about GOP opposition to his announcement last week that he planned to withdrawal all troops from Iraq by the end of the year.

And when it comes to the heated contest among Republicans to vie for their party’s presidential nomination, Obama maintained he’s just not that interested in it yet.

“I'm going to wait until everybody is voted off the island,” Obama joked. “Once they narrow it down to one or two, I'll start paying attention.”

Obama’s Leno appearance – his fourth on the program and second as president - came during the president’s three-day swing through Nevada, California, and Colorado, during which continues to push his jobs proposals while unveiling a series of jobs-related initiatives that the administrations says do not require congressional action.


Topics: President Obama
Analysts disagree over benefits of new mortgage rules
President Obama speaks in front of the Bonilla family's house on October 24 in Las Vegas, Nevada to announce a housing initiative to help homeowners with federally guaranteed mortgages refinance their homes. (Ethan Miller/Getty Images)
October 25th, 2011
03:21 PM ET

Analysts disagree over benefits of new mortgage rules

A day after President Obama announced adjustments to the rules governing his 2009 Home Affordable Refinance Program the independent analyses are now trickling in. CNN Money has a good write-up here, and this seems to be the crux of how they see the prevailing opinion:

The program is being touted as a way to help stabilize the housing market and stimulate the economy. But without addressing distressed homeowners and helping to clear the foreclosure glut, the effects will likely be limited, experts said.

"I would call it much to do about nothing," said John Burns, head of John Burns Real Estate Consulting. "It will help in such a small way, it's almost meaningless."

Mark Zandi, chief economist at Moody’s Analytics, disagrees. He predicted that under the old rules a total of 1.25 million homeowners would refinance their mortgages under HARP before the original end date in June 2012. The new rules will spur an additional 1.6 million homeowners to refinance before the end of 2013 when the program is now set to wind down, Zandi predicts.

That means that by his calculations, 2.85 million homeowners will participate in the HARP program, far short of the 4 to 5 million originally predicted by the administration. But Zandi doesn’t believe that this means HARP should be viewed as a failure.

“The program will ultimately provide a meaningful boost to the broader economy as financially stressed households will benefit from much lower mortgage payments,” Zandi wrote in an email to CNN. “It will also provide a bit of help to the housing market by forestalling some mortgage defaults.”

But there seems to be some disagreement among experts over exactly how “meaningful” that economic boost will be, and precisely how much help the new program will provide to the housing market.

CNN Money does well at summarizing the two sides of the argument:

The effort really is an economic stimulus program, experts said. By reducing homeowners' monthly payments, it will allow them to spend money on other things and spur demand. FULL POST


Topics: Housing • President Obama
Obama's plan to help college students
October 25th, 2011
02:19 PM ET

Obama's plan to help college students

WASHINGTON (CNNMoney) - President Obama is expected to announce measures aimed at helping college graduates climb out of their student loan debt hole.

One of the proposals would push up the start date for more favorable terms on a special loan repayment program based on income, sources tell CNNMoney. Another measure would encourage graduates with two or more different kinds of federal loans to consolidate them.

The initiatives were originally unveiled by Obama in his budget proposals. But the president is expected to trumpet them when he appears Wednesday at the University of Colorado's Denver campus.

The president is under pressure to address the financial concerns that students and recent graduates face with dour job prospects in this economy. Student loan debt, which is now outpacing credit card debt, is one of the things being protested at Occupy Wall Street marches in New York.

For the complete story, click here.

Did you know...presidential fundraising
President Barack Obama speaks during a Democratic campaign fundraiser in Orlando, Florida, October 11, 2011. (SAUL LOEB/AFP/Getty Images)
October 25th, 2011
01:11 PM ET

Did you know...presidential fundraising

This week President Obama will hold six fundraisers in three states during a three-day visit to the Western United States. According to Democratic officials, his campaign hopes to raise more than $4 million. A busy fundraising schedule this week brings the total number of fundraisers on the president's schedule this month to 12. That mirrors the number of fundraisers he attended in September, the last month of the Federal Election Commission's 3rd fundraising quarter. In August, the president held only 7 fundraisers, and in July he held no fundraisers due to tense negotiations over a compromise to raise the federal debt ceiling.

On top of the president's efforts, First Lady Michelle Obama has hosted at least four fundraisers this month, and she hosted three fundraisers in the last week of September to bring in some last-minute cash before the close of the quarter. Vice President Joe Biden has been less active on the fundraising trail this month with only one fundraiser on his public schedule in October, but during September the vice president attended eight events raising money for the Democratic National Committee.

Almost none of the fundraising events attended by residents or employees of the White House collect money directly for President Obama's 2012 reelection fund. Due to campaign fundraising limits, the president, vice president and first lady raise almost all of their money for a joint account of the Democratic National Committee and Obama  for American – Obama's reelection campaign – called the Obama Victory Fund. Generally, the campaign gets the first $5,000 of an individual's contribution. By law, an individual donor is allowed to contribute $2,500 per candidate or candidate committee per election. So $5,000 would constitute a maximum donation of $2,500 for both the primary and the general elections. The maximum amount any individual can donate to a national party committee is $30,800 per calendar year, so the remaining portion of any donation up to that maximum amount goes to the DNC.

In the most recent FEC fundraising quarter, the joint Obama Victory Fund raised more than $70 million, and OFA received nearly two thirds of that, taking in $42.8 million.

POTUS's schedule for Tuesday, October 25, 2011
October 25th, 2011
09:05 AM ET

POTUS's schedule for Tuesday, October 25, 2011

It's Day Two of this week's trip out West to court voters not only for his re-election campaign but also to build support for his American Jobs Act. Last night, he stopped by Roscoe's Chicken and Waffles and greeted patrons. But today the president is devoting his time to fundraisers. Plus, he's taping an appearance for the Tonight Show with Jay Leno. After the taping this morning in Los Angeles, he'll head to San Francisco for a fundraiser and then fly to Denver tonight where he'll have two more campaign events.

For the full schedule, click below. FULL POST


Topics: 2012 Election • Daily Schedule • The Vault