SCOTUS RULES AGAINST PUERTO RICO DEBT RESTRUCTURING: The Supreme Court ruled Monday that Puerto Rico can’t restructure the debts of its public utilities to avoid a financial crisis, closing off one of the island’s last remaining options for avoiding default without help from Congress.
In a 5-2 ruling, the justices said that although the government and people of Puerto Rico should not have to wait for possible congressional action to avert a financial crisis, the Constitution does not allow them to rewrite a statute that Congress enacted in 1984.
{mosads}While states can allow municipalities to seek such debt relief, the lower court said, Congress had not given Puerto Rico that right.
“The plain text of the Bankruptcy Code begins and ends our analysis,” Justice Clarence Thomas wrote in the majority opinion. “Resolving whether Puerto Rico is a ‘state’ for purposes of the pre-emption provisions begins ‘with the language of the statute itself,’ and that ‘is also where the inquiry should end’ for ‘the statute’s language is plain.'” The Hill’s Lydia Wheeler explains: http://bit.ly/1PYCGzH.
OVERSIGHT PANEL TO VOTE ON CENSURE RESOLUTION: The House Oversight and Government Reform Committee is set to vote Wednesday on a resolution to censure Koskinen.
The vote is part of a larger effort by House Republicans against Koskinen. Many GOP lawmakers have accused him of engaging in misconduct while Congress was investigating findings that the IRS subjected conservative groups’ applications for tax-exempt status to extra scrutiny.
The censure resolution, which was introduced last month by Oversight Committee Chairman Jason Chaffetz (R-Utah), calls for Koskinen to resign or for President Obama to remove him from office. It also calls for the forfeiture of Koskinen’s federal pension and other benefits: http://bit.ly/1WLXVa4.
SECOND IRS IMPEACHMENT HEARING SCHEDULED: The second House Judiciary Committee hearing to consider whether IRS Commissioner John Koskinen should be impeached will take place on June 22.
A committee spokeswoman informed The Hill of the misconduct hearing date on Monday without explicitly using the word “impeachment.”
Reps. Jason Chaffetz (R-Utah) and Ron DeSantis (R-Fla.) argued at a hearing last month that Koskinen should be impeached because he failed to comply with a subpoena and made false statements under oath during Congress’s investigation into 2013 revelations that the agency was subjecting conservative groups applying for tax-exempt status to additional scrutiny.
Outside experts are expected to comment at next week’s hearing on the findings from the first round and recommend if they think Congress should take additional action. The Hill’s Naomi Jagoda gives us a preview: http://bit.ly/1tn2zyJ.
HAPPY MONDAY and welcome to Overnight Finance. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
Tonight’s highlights include an alternative Puerto Rico debt bill from Bernie Sanders, everyone running against Wall Street and a Democratic push to expand Social Security.
See something I missed? Let me know at slane@digital-staging.thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N.
SANDERS QUIETLY INTRODUCES ALTERNATIVE PUERTO RICO DEBT BILL: Sen. Bernie Sanders (I-Vt.) is rolling out a wide-ranging bill to tackle Puerto Rico’s debt crisis ahead of a critical July 1 deadline.
{mosads}Sanders’s legislation would give the island territory the ability to file for bankruptcy and support an emergency infusion of Federal Reserve funding to help it restructure its debt.
The Vermont senator is a vocal opponent of a measure approved by the House last week. He says that bill, backed by leaders of both parties in the House, would only create “huge profits” for Wall Street by forcing Puerto Rico to cut pensions and public services to cover its debts. The Hill’s Jordain Carney tells us why: http://bit.ly/1XkMbvf.
WALL STREET IN 2016 CROSSHAIRS: The right and left increasingly have one thing in common: neither wants to be seen as friendly to Wall Street.
Eight years since the financial crisis, big bank bashing remains very much en vogue in Washington.
On both the legislative and political front this week, the two parties battled over who is tougher on the financial sector.
House Financial Services Committee Chairman Jeb Hensarling (R-Texas) reignited the debate over regulating Wall Street Tuesday when he unveiled his vision for how Republicans should replace the 2010 Dodd-Frank financial reform law.
Hensarling argued that the law has been a disaster for the economy, restricting access to credit for business while burying banks under an avalanche of new rules.
“Simply put, Dodd-Frank has failed. It’s time for a new legislative paradigm in banking and capital markets,” he said in New York. The Hill’s Peter Schroeder breaks it down: http://bit.ly/1ZM3C6a.
DEMOCRATS HOPE SOCIAL SECURITY PLAN WINS VOTERS OVER: Democrats are likely to step up their calls for expanding Social Security as the general election heats up.
President Obama recently garnered attention for calling for increased benefits. And advocates for expanding Social Security think the topic could be a good issue for Democrats as they try to unify the party behind presumptive presidential nominee Hillary Clinton and win over seniors, who are more likely to vote than other groups.
Polls over the past few years have shown that most Americans don’t support cuts to the program.
“In a lot of ways, there isn’t a more winning issue for Democrats than Social Security expansion,” said Rebecca Vallas, managing director of the Poverty to Prosperity program at the Center for American Progress: http://bit.ly/25Yw6gx.
DEMS PUSH MCCONNELL TO TAKE UP ‘PAYCHECK FAIRNESS’: A trio of Democratic senators are pushing Majority Leader Mitch McConnell (R-Ky.) to bring up legislation aimed at closing the gender pay gap.
Sens. Patty Murray (Wash.), Barbara Mikulski (Md.) and Dianne Feinstein (Calif.) sent a letter Friday to McConnell urging him to schedule a “long overdue” vote on the Paycheck Fairness Act “as soon as possible.”
“The wage gap is not just a women’s issue–it also impacts families who depend on working women to make ends meet,” the senators wrote. “Unequal pay hampers a woman’s ability to buy groceries, to pay the rent, to find affordable quality child care, and to save for her kids’ education.”
The letter comes after senators unanimously passed a resolution last month demanding the United States Soccer Federation eliminate disparate pay for the men’s and women’s teams: http://bit.ly/1U4D78b.
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