June 03, 2005
Friday

Washington - Congress returns from the Memorial Day recess to face President Bush's call to do "four good things" that are easier said than done:

- A bipartisan Senate energy bill lacks controversial House-passed provisions approving the Arctic National Wildlife Refuge drilling, $8 billion in tax breaks plus billions more in direct federal aid, setting the stage for knockdown negotiations.

- A Central America trade pact is stalled on Capitol Hill, with critics pressing a quick vote to send it down to defeat.

- Spending restraint remains elusive when Uncle Sam has stayed in business the last three years only upon passage of budget-busting omnibus money bills plus supplemental funding for the Iraq war.

- Social Security revamp is AWOL on the House GOP leadership "priority" list.

Although Bush amends his to-do list to add that "Congress needs to make the (2001 and 2003) tax cuts permanent," don't look for fast action. Lawmakers are likely to hold off until after the president's tax-reform commission makes its recommendations in late July.

Top Bush economic adviser Allan Hubbard expects the blue-ribbon panel to offer at least three options to simplify the tax code, "some incredibly radical."

With the Pension Benefit Guaranty Corp. warning that its losses "dwarf anything in its history," Rep. John Boehner, R-Ohio, chairman of the House Education and the Workforce Committee, looks to speed through pension-reform legislation that raises employer insurance premiums more than business wants.

Meanwhile, the Senate prepares to quiz airline execs for the first time about whether other carriers plan to follow United Airlines' lead in shedding pension liabilities onto the guaranty corporation, which insures pensions of 44 million Americans across a range of industries.

June is busting out all over with new federal rules governing your personal finances. Starting this month:

- Businesses that deal with sensitive financial and personal information can no longer just dump the information once they're done with it. Instead they must destroy it by shredding paper records or erasing computer data under new rules required by the Fair and Accurate Credit Transactions Act enacted in 2003.

- Workers who rely on high-interest, high-fee payday loans to tide them over to the next paycheck will find them harder to come by in states that require these lenders to partner with banks under new Federal Deposit Insurance Corp. guidelines.

Start lobbying your employer now to take advantage of federal tax-law changes:

- Make it known if you want your boss to offer Roth 401(k) accounts, starting Jan. 1. Like Roth IRAs, the change will let you deposit after-tax dollars to your workplace retirement savings plan for the promise of tax-free withdrawals in retirement.

- Ask to extend the deadline for spending money in your Flexible Spending Account at work. The IRS has offered employers the option of adding 2-1/2 more months to the 12-month use-it-or-lose-it accounts for medical and dependent care.

New York Sen. Charles Schumer, chairman of the Democratic Senatorial Campaign Committee, says his alma mater, James Madison High School, stands to make history in the 2006 elections. For the first time ever, there may be three incumbent senators with different political affiliations who are alums of the same high school if Independent Rep. Bernard Sanders is elected to fill Vermont's open Senate seat and joins Schumer and Sen. Norm Coleman, R-Minn.

QUOTABLE

"Note to Bob Woodward and the Felt family: 'Follow the money' is still a pretty good rule of thumb." - from "The Note," put online daily by ABC News, responding to reports that the memoirs of the unmasked Deep Throat could command a $1 million advance.

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