OVERNIGHT MONEY: Corzine, Cordray, payroll tax, oh my!

THURSDAY’S BIG STORY:

Well, if you insist: Jon Corzine will finally appear before lawmakers tomorrow — he doesn’t have any choice to continuing ducking out of the spotlight after a handful of subpoenas were issued to compel his testimony. 

The former New Jersey governor and Democratic senator has largely avoided the public eye since resigning from bankrupt firm MF Global at the beginning of November. He will appear before the House Agriculture Committee to answer questions on what exactly went wrong with the financial firm, which went bankrupt on Halloween after it lost billions of dollars in bets on European debt.

{mosads}Far more troubling to lawmakers than the bankruptcy, though, is that up to $1.2 billion in customer funds, which should have been kept segregated from the firm’s own investments, have gone missing since the collapse. Members are also looking for answers to tough questions on how regulators handled MF Global before its collapse, and whether something could have been done to avoid the eighth largest bankruptcy in the nation’s history.

Answers to those questions, however, might not be forthcoming from Corzine, who is expected by many to plead the Fifth Amendment during his appearance, given the slew of ongoing investigations swirling around him and the company. He is expected to make a statement at the hearing, but odds are against him answering any questions. 

That move is likely to give panel members a big stage to berate Corzine. 

They will also take out their ire on a top official at the Commodity Futures Trading Commission (CFTC), which regulated the company, as well as the trustee charged with handling the fallout from the bankruptcy and getting customers whatever possible money back.

Even if Corzine does not say anything, plenty of eyes will be watching as he makes the first of what will be three separate appearances before congressional committees to discuss (or not) his role in the firm’s collapse.

A third congressional panel has unanimously agreed to subpoena Corzine to testify about the bankruptcy of MF Global.

Don’t forget about Cordray: Meanwhile, House and Senate Democrats spent most of Wednesday making their case for approval of Richard Cordray to head the Consumer Financial Protection Bureau. Fight all they want, the Senate probably won’t muster the 60 votes needed to confirm him on Thursday. 

Nearlly all Republicans have dutifully banded together — everyone except Massachusetts Sen. Scott Brown — to oppose the nomination.

Democrats also seem to be on the same page, including Sen. Bill Nelson (D-Fla.), who faces a tough reelection battle but has decided to back Cordray.

The Senate GOP is asking for three major changes, including the appointment of a board to run the new agency rather than one person, who they say will have too much power.

They also want the agency to fall under the congressional appropriations process and oversight. 

The fight over the bureau, created by the Dodd-Frank financial reform law, has been drawn down partisan lines, but Democrats still think they have the upper hand in the argument going forward.

Obama administration officials on Wednesday made one last push, saying 37 state attorneys general, including a number of Republicans, have signed a letter in support.

Neal Wolin, deputy secretary of the Treasury, argued that the agency has a “very thorough arrangement” for oversight.  

He said it is required to report to Congress twice a year with respect to its financial reports and that the Government Accountability Office is tasked with performing an independent audit of its operations. There’s also an inspector general to keep an eye on operations. 

Without a director, the CFPB is handcuffed from performing all of its duties, a fact the White House argued could endanger the already fragile financial system framework.  

WHAT ELSE TO WATCH FOR

Waiting on the next bus: The omnibus, that is. The House-Senate conference on the year-end omnibus spending package will convene on Thursday. 

The meeting will focus on resolving remaining issues in a $900 billion, nine-bill spending package. The goal is to release a bill by Dec. 12 to keep the government running — if all works out — for the remainder of the fiscal year. 

Euro zoning-in: Treasury Secretary Timothy Geithner might need a good shot of Italian espresso as he winds down his whirlwind trip to Europe on Thursday with a meeting with Mario Monti, president of the Council of Ministers and minister of Economy and Finance in Milan, Italy. 

His visit wraps up on the eve of a summit of European leaders on Friday that could yield a plan for resolving the debt crisis. 

PAYROLL TAX NEGOTIATIONS 

Careening toward a compromise: House Speaker John Boehner’s (R-Ohio) leadership team is expected on Thursday to unveil a proposed payroll tax and unemployment benefits extension bill at a GOP conference meeting. The meeting will test Boehner’s leadership and ability to control a restive freshman class unhappy about the idea of granting President Obama any concessions. Rank-and-file members have been offering up ideas for how to pay for the bill since last Friday’s conference meeting, where many members objected to the payroll tax extension without spending cuts and entitlement reforms. 

I’ll meet you in Hawaii, or not: President Obama won’t vacation with his family in Hawaii while the payroll tax extension and other issues remains in limbo. He warned GOP congressional leaders to stay in town as well, and House GOP leaders let members know they might need to remain in town through next weekend. 

Two more cents: A coalition of business groups is pressing the Senate not to utilize a surtax on millionaires to pay for an extension of the payroll tax cut. The Tax Relief Coalition, echoing an argument made by many Republicans, said the surtax would disproportionately hurt small businesses.

Check out this idea: Two senators continued pushing on Wednesday for their newly introduced payroll tax cut plan as Congress remains in a partisan stalemate over how to proceed.

Republican Sen. Susan Collins (Maine) and Democratic Sen. Claire McCaskill (Mo.) are selling a proposal that would continue the current 4.2 percent payroll tax rate for workers for another year, and extend that same rate to employers on their first $10 million of payroll. 

The bill is paid for by repealing tax breaks for oil companies and by a 10-year 2 percent surtax on millionaires, which would not hit small-business owners who report their business income on their personal tax returns. The measure also includes infrastructure spending.

We’ll take door No. 1: Social Security’s chief actuary said a Democratic payroll tax extension bill would have no effect on the program’s finances.

The blessing is being used by supporters of the tax holiday to try to convince members worried it weakens Social Security. That perception is especially strong in the House GOP conference. Actuary Stephen Goss sent a Tuesday letter to Treasury Secretary Timothy Geithner and Budget Director Jack Lew giving his thumbs up.

One more try before a compromise: Senate Majority Leader Harry Reid (D-Nev.) on Wednesday filed cloture on Democrats’ latest version of President Obama’s payroll tax cut extension.

The bill, presented by Democrats on Monday, would extend the payroll tax holiday by levying a surtax on wealthy Americans, at about $85 billion less than what was included in a similar extender bill defeated in the Senate last week. That reduction in the surtax on the rich has led Democrats, including Reid, to refer to this week’s bill as “a compromise.” 

LOOSE CHANGE

Talking transit: The National Treasury Employees Union has a year-end priority of its own — ensuring that federal workers’ mass transit benefit equals their parking subsidy.

Last year’s tax cut-compromise kept the two benefits even, but the mass transit subsidy is scheduled to fall to $120 a month in 2012, down from the current $230.

“Many of these employees, already subject to a two-year pay freeze, are struggling in the current economic climate, and a reduction in these benefits would impose a severe financial burden on them,” Colleen Kelley, NTEU’s president, said in a Wednesday statement.

Show me the money: Federal agencies would be required grade their handling of taxpayer money under new legislation in the House and Senate. Under the measures, agencies would be required to, among other things, release annual reports that discuss whether there are duplicative programs elsewhere in the bureaucracy and lay out performance marks for individual programs.

The bill were introduced by Sen. Tom Coburn and Rep. James Lankford, both Oklahoma Republicans, with the Senate version already attracting roughly 30 co-sponsors.

New deadline: The U.S. Postal Service and two of its unions have set a new deadline of Dec. 16 for contract talks. Talks between USPS and the National Association of Letter Carriers and the National Postal Mail Handlers Union had been set to expire at midnight.

BREAKING WEDNESDAY

Simpler credit agreement: The Consumer Financial Protection Bureau on Wednesday released a prototype of a credit card agreement that’s written in plain English. The idea is to sweep away the legalese and make it easier for consumers to understand a card’s costs and terms.

The agency is asking for the public’s feedback on the form, which can be found here.

ECONOMIC INDICATORS

Initial Claims: The Department of Labor releases its weekly filings for jobless benefits. The economy added 120,000 jobs last month and the unemployment rate dropped to 8.6 percent. 

Wholesale Inventories: The Commerce Department will release its wholesale trade report that includes sales and inventory statistics from the second stage of the manufacturing process. The sales figures say close to nothing about personal consumption and therefore do not move the market.

WHAT YOU MIGHT HAVE MISSED

— House panel sets up hearing on Pacific Rim trade pact

— Ryan tries new budget tactic

— Groups press for reauthorization of small-business research program

— Lawmakers continue lobbying for repatriation

— Dropping loan rates boost mortgage applications

— House approves ‘mother of all anti-regulatory bills’

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