Ezra is on vacation until November 7th.

Top Stories

1) Congressional leaders are taking over the "supercommittee" process, reports David Rogers: "With time running out, House and Senate leaders are inserting themselves more into behind-the-scenes deficit talks, exchanging proposals and trying to help the so-called supercommittee avert the threat of a $1.2 trillion across-the board spending cut if no agreement is reached. The politics for both parties -- and the leaders themselves -- are very delicate. But the level of activity goes well beyond what has been reported to date with Senate Majority Leader Harry Reid taking the lead in reaching out to Speaker John Boehner and Senate Minority Leader Mitch McConnell in a series of recent meetings. Rep. Jeb Hensarling (R-Tex.) and Sen. Patty Murray (D-Wash), the two co-chairs of the panel, participated in the closely-guarded discussions last week, and Boehner Tuesday hosted a meeting in his office with both House and Senate Republicans on the 12-member panel."

2) The Fed's weighing intervening in mortgage markets, reports Neil Irwin: "Federal Reserve officials are considering new strategies to try to lower mortgage rates and help Americans reduce the burden of debt that hangs over the economy...In the past few months, leaders at the central bank have become increasingly convinced that problems in the system of housing finance are preventing the interest rate policies the Fed controls from having their usual economic impact. For example, even after Fed action that helped lower mortgage rates, surprisingly few people were able to take advantage by refinancing because they owed more than their homes are worth. But with new efforts by federal housing regulators underway to make it easier for homeowners and the Fed running out of other tools, the idea of further intervention in the mortgage markets is gaining new attention at the central bank."

3) The administration is taking action to reduce student loan burdens, reports David Nakamura: "The Obama administration announced plans Tuesday to allow college graduates to cap their federal student loan repayments at 10 percent of their discretionary income starting in January, two years before the cap was due to take effect under federal law. The accelerated 'pay as you earn' program, which Obama will authorize through executive order, could benefit up to 1.6 million borrowers and reduce their payments by as much as a couple hundred dollars a month, administration officials said. All remaining debt on the federal loans would be forgiven after 20 years -- five years earlier than under current law. In addition, some borrowers who have more than one federal student loan will be allowed to consolidate their debt, in some cases reducing their interest rates by up to half a percentage point, officials said."

4) Europe's efforts to draft a recovery plan are stalled, reports Howard Schneider: "European leaders were frustrated Tuesday in their efforts to craft a response to the continent’s debt crisis one day before a self-imposed deadline...As top European officials prepared to return to Brussels on Wednesday for their second summit this week on the crisis, they sent conflicting signals about how much progress they had made on key elements of a rescue plan. Still unsettled were how best to use the limited resources of a European bailout fund to help cash-strapped governments such as Greece and Italy, and how much of a loss private investors such as banks should take on their holdings of Greek bonds, which have lost much of their market value. Adding to the uncertainty, finance ministers from euro-zone countries canceled a meeting without public explanation, deferring critical decisions to the summit of government chiefs."

Top Op-eds

1) Consumer and government spending drive growth, writes James Livingston: "Between 1900 and 2000, real gross domestic product per capita (the output of goods and services per person) grew more than 600 percent. Meanwhile, net business investment declined 70 percent as a share of G.D.P. What’s more, in 1900 almost all investment came from the private sector -- from companies, not from government -- whereas in 2000, most investment was either from government spending (out of tax revenues) or 'residential investment,' which means consumer spending on housing, rather than business expenditure on plants, equipment and labor. In other words, over the course of the last century, net business investment atrophied while G.D.P. per capita increased spectacularly. And the source of that growth? Increased consumer spending, coupled with and amplified by government outlays."

2) Occupy Wall Street could quickly turn extremist, writes James Miller: "Back in the general assemblies that are one hallmark of a radical democratic movement like Occupy Wall Street, the demand for consensus willy-nilly puts the most uncompromising militants in a position where they can veto the tactics and strategy proposed by the vast majority of their comrades. The moderates are inclined to compromise. So they silence their reservations about the tactics of the revolutionaries for the sake of preserving consensus and unity. Disagreements disappear, at least for public consumption. And although everyone on the inside knows who the most articulate leaders of different groups are, none of these de facto leaders can be held accountable, since, according to the group’s utopian vision, there are no leaders. By 1969, a version of this sort of perverse logic had led the New Left to a frank embrace of violence."

Late night interlude: Beirut plays "Santa Fe" on Late Night with Jimmy Fallon.

Got tips, additions, or comments? E-mail me.

Still to come: The richest Americans' incomes are soaring; federal officials are targeting poor-performing Medicare drug plans; repealing an unpopular tax provision is harder than it would seem; anti-pipeline activists aren't getting much Democratic support; and a cat hangs out in a traffic light.

Economy

The richest Americans' incomes are soaring, reports James Politi: "The after-tax income of the wealthiest 1 per cent of US households increased by 275 per cent over the past three decades, much faster than the average growth of 62 per cent for all Americans, according to a new study by congressional analysts. For the poorest 20 per cent, the growth was only 18 per cent. The report by the non-partisan Congressional Budget Office, which analyses the impact of tax and spending policies for US lawmakers, could set off a new round of discussion over rising income inequality in the US. Democrats in Congress have already called for higher taxes on the richest citizens: a new economic stimulus plan proposed by the White House would be paid for with a surtax on income above $1m under their plan. Republicans have objected to such policies as “'class warfare.'"

Firms are eager to challenge new SEC disclosure rules in court, reports David Hilzenrath: "As regulators draft new rules for hedge funds, private-equity funds and other money managers, some of these companies and their supporters have been laying a foundation that could be used to challenge the requirements in court. The Securities and Exchange Commission is scheduled to vote Wednesday on another installment in the government’s Wall Street overhaul -- a set of rules that would require private money managers to divulge information about their business to federal overseers. The confidential disclosures are meant to help the government avert another financial crisis by identifying potential risks to the system. But money managers and others have criticized a draft of the rules, arguing they would be unduly costly and burdensome."

The US is pushing back against export subsidies in other countries, reports Bob Davis: "The Obama administration is using negotiations this week over a multilateral trade deal to try to craft limits on the ability of state-owned companies to use government preferential treatment and subsidies to outcompete privately owned firms. While the immediate target of the effort is Vietnam--one of the parties in the trade talks, whose state-owned industries such as its loss-ridden shipbuilders have sucked in state credit, but don't pose much of a competitive threat for the U.S.--people involved in the negotiations say the longer-range target is China's state-owned giants, which have become among the biggest and most profitable firms in the world, and which are looking to expand in the U.S."

Consummate professionalism interlude: A local news anchor makes the best of a camera blooper.

Health Care

Federal officials are targeting poorly performing Medicare drug plans, reports Marilyn Werber Serafini: "Nationally, federal officials have given negative assessments to more than a quarter of Medicare’s rated prescription drug plans that will be available to seniors in 2012...The Centers for Medicare and Medicaid Services is notifying the plans that, unless they improve their performance over the next few years, they face expulsion from Medicare. This month, CMS revised the way it rates Medicare drug plans to focus more on quality, and many plans’ ratings fell from 2011 to 2012. The criteria changed to stress clinical outcomes, such as whether a patient takes his medication the way he is supposed to, in addition to process measures, such as how long a patient is kept on hold when calling the plan."

Domestic Policy

Repealing an obscure tax provision is taking a lot of Congressional effort, reports Rosalind Helderman: "The House will vote Thursday on whether to adjust an obscure tax provision that is widely expected to be a huge burden on government contractors and cost jobs should it take effect as scheduled in 2013. Republicans support the change. So do Democrats...Congress is likely to approve the change eventually, but with a degree of difficulty that is now common in Washington. The reasons are familiar: It costs some money -- the Congressional Budget Office estimated $11.1 billion over the next decade. And in figuring out how to pay for it, both parties have retreated to the same battle crouches over spending and taxes that have defined Washington’s political war in recent years."

The administration is unveiling a new veteran support program, reports Susan Crabtree: "As part of its new 'We Can’t Wait' for Congress theme, the White House has announced an initiative to help veterans of the Iraq and Afghanistan wars get back to work. The latest effort, part of a comprehensive plan to transition veterans from the battlefield to the workplace, challenges community health centers around the country to hire 8,000 veterans over the next three years. Community health centers, clinics where the poor can receive medical services even if they have limited or no health insurance, are uniquely positioned to hire veterans because many of them are located within 100 miles of a military base and many military veterans have the medical and team-oriented organizational skills these clinics need, White House officials told reporters Tuesday."

Almost two thirds of states are tightening teacher accountability regimes, reports Stephanie Banchero: "Nearly two-thirds of states have overhauled policies in the last two years to tighten oversight of teachers, using techniques including tying teacher evaluations to student test scores, linking their pay to performance or making it tougher to earn tenure, according to a report issued Wednesday. At least 23 states and the District of Columbia now evaluate public-school teachers in part by student standardized tests, while 14 allow districts to use this data to dismiss ineffective teachers, according to the report from the National Council on Teacher Quality, an advocacy group. Eleven of these states use the test-score evaluations to decide if teachers get tenure, the report said."

Obama should take Occupy Wall Street's student loan demands seriously, writes Kevin Carey: "The students in Zuccotti Park are right to focus on the injustices of student debt: Many of them are indentured to the very banks that destroyed the economy and along with it the jobs students need to pay their loans back. The banks were bailed out for their trouble, while students are left with debt that, thanks to financial industry lobbying, can’t be discharged in bankruptcy. Outstanding student loans in the United States are projected to reach $1 trillion this year, a larger sum than credit card debt...Colleges like to blame feckless state legislators who won’t financially support higher learning, and in states like California they certainly have a point. But much of the guilt lies with higher education institutions themselves."

Adorable animals in intersections interlude: A cat in a traffic light.

Energy

Congressional Democrats aren't particularly keen to help Keystone activists, reports Darren Goode: "Environmental groups opposing the $7 billion, 1,700-mile pipeline sending crude from Alberta oil sands to Texas have uncovered evidence they say shows the State Department has already made up its mind, such as internal emails showing a cozy relationship between a TransCanada lobbyist and former Hillary Clinton campaign aide with a department official working on the project. But while House Republicans have fanned the flames of the Solyndra affair with an unending stream of letters, hearings and subpoena threats, Senate Democrats -- who have all the same arrows in their quivers -- have been slow to take up arms over Keystone."

Closing credits: Dylan Matthews is a student at Harvard and a researcher at The Washington Post. Wonkbook is compiled and produced with help from Michelle Williams.

newsletters@email.washingtonpost.com