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Boehner buys himself another week, but at what cost?

Max Ehrenfreud

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March 2, 2015

Here's a quick look at the week ahead:

-- Israeli Prime Minister Benjamin Netanyahu is in Washington. He will address Congress Tuesday.

-- On Friday, funding for the Department of Homeland Security expires after Congress agreed to a one-week extension (more below).

-- There are also reports that Attorney General Eric Holder is preparing to announce the results of the federal investigation of the police department in Ferguson, Mo.

-- And the Bureau of Labor Statistics releases its monthly employment figures on Friday.

What's in Wonkbook: 1) Homeland Security extension 2) Opinions, including Krugman on Wal-Mart 3) Regulating Colorado's yoga industry, and more

Chart of the day: This is the simplest way to explain gerrymandering. Christopher Ingraham in The Washington Post.

1. Top story: DHS shutdown delayed 1 week

Democrats and Republicans agreed late Friday to extend funding for the department for one week. "The 11th-hour move came after dozens of House Republicans dealt a humiliating defeat to Speaker John Boehner (R-Ohio) and other GOP leaders. Conservatives teamed up with Democrats to shoot down a Boehner-backed measure that would have funded DHS for three weeks. ... With just hours to spare until the department’s funding expired, House and Senate Democratic aides said they reached a “deal” with Republicans: House Democrats would provide the votes to pass a one-week funding extension. In return, Democrats said they secured an agreement that a vote would be allowed next week to fund DHS through September." Seung Min Kim, John Bresnahan and Anna Palmer at Politico.

It was a dramatic night that laid bare Republicans' disagreements among themselves. "They know their party is too divided to resolve the crisis on its own but fear the political fallout if they rely on Democrats to get them out of the jam. ... This latest setback prompted a flurry of speculation that the most conservative wing of Republicans would try to oust Boehner as speaker. Regardless of how difficult such a move is, Boehner’s closest supporters have taken the threat seriously. ... Possibly 30 or more Republicans might vote to oust the speaker, in which case Democrats would have enough votes to throw him out of his position if they wanted. Senior Democratic aides said that’s not likely to happen, mostly because of the precedent it would set." Mike DeBonis and Paul Kane in The Washington Post.

And if Boehner can't even get the votes to fund the Department of Homeland Security for three weeks, what about the debt ceiling? "The forces behind the chaotic episode remain - fractious Republicans and House Speaker John Boehner's lack of control over them. That may portend more serious trouble ahead as Washington confronts fiscal challenges on a grander scale. In five to seven months, the federal debt ceiling will again be reached, and by October Congress must pass spending bills to keep the government running in the new fiscal year. Failing to deal effectively with these issues could have much more damaging repercussions - such as a broad government shutdown or a debt default." Richard Cowan and David Lawder for Reuters.

VINIK: Republicans are endangering their chances for the presidency in 2016. "Unless Republicans find a way to avoid these fights over the next 20 months, their electoral ramifications are going to become more and more costly. The Republican primary will only exacerbate the differences between the establishment and conservative base. If Senator Ted Cruz spends the summer denouncing the debt ceiling, he will put the rest of the Republican field in a tight spot. Either disagree with Cruz and face the wrath of the GOP primary voter, or agree with him and alienate moderates who are repulsed by those legislative tactics. Neither option is good." The New Republic.

They've been outmaneuvered by President Obama. "Their latest mental breakdown is over their attempt to overturn President Obama ’s order ending deportations for some five million illegal immigrants. Once again the fight comes down to recognizing political reality, or marching off a cliff to almost certain failure. ... The sad if predictable irony is that this is exactly what Mr. Obama hoped to incite with his November immigration order. He wanted to goad an overreaction that made the GOP look both anti-immigrant and intemperate enough to shut down the government." The editorial board of The Wall Street Journal.

When will Republicans show they're capable of governing the country? "Short-term funding is still better than no funding at all. But 2015 is the year Republicans said they would prove they can govern. Two months have passed -- dominated by a pointless and still unresolved fight over vital funding for homeland security." The editors of Bloomberg View.

2. Top opinions

Thomas Piketty is huge in Japan, writes former minister of defense Yuriko Koike. "Japan finally has a government, led by Prime Minister Shinzo Abe, that is committed to ending deflation and reinvigorating economic growth, using a combination of expansionary monetary policy, active fiscal policy, and deregulation. Now in its third year, so-called 'Abenomics' is showing some positive results. Share prices have risen by 220% since Abe came to power in December 2012. And corporate performance has improved – primarily in the export industries, which have benefited from a depreciated yen – with many companies posting their highest profits on record. But Abenomics has yet to benefit everyone. In fact, there is a sense that Abe's policies are contributing to rising inequality. That is why Piketty's book appeals to so many Japanese." Project Syndicate.

KRUGMAN: Wal-Mart's wage increase was a response to political, not economic, conditions. "Walmart is under political pressure over wages so low that a substantial number of employees are on food stamps and Medicaid. Meanwhile, workers are gaining clout thanks to an improving labor market, reflected in increasing willingness to quit bad jobs. ... The point is that extreme inequality and the falling fortunes of America’s workers are a choice, not a destiny imposed by the gods of the market. And we can change that choice if we want to." The New York Times.

LUCE: Jesus "Chuy" García doesn't have real solutions for Chicago. "Mr Garcia promised to stand for the people against the “giant corporations, the big money special interests, and the Hollywood celebrities who have poured millions into the mayor’s campaign”. It sounded compelling, particularly against Mr Emanuel’s talking points. Yet it will bring Chicago far closer to Detroit than San Francisco. Mr Garcia offered no solution to Chicago’s fiscal crunch, which will result in a steep rise in property and business taxes that would drive jobs away. It would also eat up ever more that should be invested in raising the 99 per cent." The Financial Times.

Dodd-Frank will leave the the Federal Reserve weaker in a crisis, write Glenn Hubbard and Hal Scott. "The Dodd-Frank Act (July 2010) pulled back the Fed’s lender-of-last-resort powers for non-banks. They can now be exercised only with the approval of the Treasury secretary, and the Fed cannot lend to a single institution as it did with AIG . It must now only lend under a broad program, and must also meet heightened collateral requirements. In addition, the FDIC cannot expand guarantees to bank depositors without congressional approval, and the Treasury can’t do the same to money-market funds without new legislative authority. These changes could make it difficult for the Fed and other regulatory bodies to act effectively in the next crisis." The Wall Street Journal.

3. In case you missed it

Netanyahu will address Congress Tuesday during a controversial visit. "The controversy was sparked when House Speaker John Boehner invited Netanyahu to address Congress without first consulting the White House, which conventionally takes the lead on foreign affairs. ... The speech has stoked discord between Republicans and Democrats in Congress. It has also put considerable strain on politicians eager to work with Israel on security but skeptical of Netanyahu’s position on nuclear negotiations with Iran." Jose A. DelReal in The Washington Post.

The administration has plans to counter Netanyahu's opposition to a deal with Iran. "The president has scheduled an interview with Reuters for Monday afternoon, the same day that Susan E. Rice, his national security adviser, and Samantha Power, his ambassador to the United Nations, will address the American Israel Public Affairs Committee at its policy conference here. Mr. Netanyahu also will speak to the Aipac gathering on Monday." Julie Hirschfield Davis in The New York Times.

Old hands at the Clinton Foundation resisted efforts at reform, leading to the resignation of chief executive officer Eric Braverman. "Sources tell Politico his exit stemmed partly from a power struggle inside the foundation between and among the coterie of Clinton loyalists who have surrounded the former president for decades and who helped start and run the foundation. ... A spate of recent news stories in Politico and elsewhere have highlighted questions about the foundation’s aggressive fundraising both before and during Braverman’s tenure, including the news that the foundation had been accepting contributions from foreign governments with lax oversight from the State Department when Hillary Clinton was secretary of state; the foundation has been Clinton’s main public platform since she left State in February 2013. ... This account of Braverman’s foundation tenure is based on interviews with about a dozen current and former Clinton Foundation staffers, Braverman associates, donors and Clinton allies, most of whom cited the coming presidential race in declining to be identified." Kenneth P. Vogel at Politico.

The Federal Reserve will raise rates at some point, but what about after that? "Fed officials have made clear they expect to begin raising short-term interest rates from near-zero this year, though not before midyear. After that, there is great uncertainty at the central bank and in the markets about the future path of interest rates. The long-run outlook for rates has consequences for everyone. For households, it will determine payments on mortgages and car loans; for businesses, on corporate bonds; and for the government, on the $13 trillion in debt held by the public. A disconnect between the Fed and the market over the long-run rate outlook also could be a source of market turbulence in the months ahead." Jon Hilsenrath in The Wall Street Journal.

A report finds that older Americans are getting unnecessary and dangerous psychiatric drugs, at Medicare's expense. "Senator Thomas R. Carper of Delaware, the senior Democrat on the Homeland Security and Governmental Affairs Committee, said the report showed that 'many seniors with dementia are receiving risky mind-altering medications,' financed in many cases by taxpayers and the Medicare program." Robert Pear in The New York Times.

Colorado lawmakers debate a bill to exempt licenses for yogis from state oversight, joining a nationwide debate on yoga regulation. "The bill passed in a Senate committee hearing on Wednesday, inspiring one Republican lawmaker and yogi to leap onto a desk and strike a crow pose, balancing his knees on his elbows. The bill has not been introduced in the House." Julie Turkewitz in The New York Times.

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