The scandal-ridden Internal Revenue Service is doling out $70 million in employee bonuses, despite the White House’s directive to cancel bonuses due to sequestration, according to information obtained by the office of Sen. Chuck Grassley (R-IA).
Grassley told the Associated Press that the IRS, which has spent the last month embroiled in controversy over its targeted scrutiny of conservative nonprofits and its $49 million in conference spending, would pay the bonuses because of an agreement with the employees' union.
"The IRS always claims to be short on resources," Grassley said. "And it appears to be making an extra effort to give the bonuses despite opportunities to renegotiate with the union and federal instruction to cease discretionary bonuses during sequestration."
The IRS confirmed that it is negotiating with the union over the matter and did not dispute Grassley's claim that the bonuses are imminent. - Read more at CNBC
RISING MORTGAGE RATES COULD SLOW RECOVERY Mortgage rates have spiked over the last few weeks in anticipation that the Federal Reserve will scale back its $85 billion monthly bond-buying program. Experts fear that the rising rates could weaken the housing market and undermine the recovery. In fact, there are already signs that the higher rates have become a drag on the market. Refinancing application fell 11 percent over the past two weeks and 36 percent down from the beginning of May, according to the Mortgage Bankers Association. - Read more at The Washington Post
ALL EYES ON BERNANKE Fed Chairman Ben Bernanke will hold a highly anticipated press conference at 2:30 p.m. today following the Fed’s latest monetary policy meeting. - Here is what Wall Street experts expect him to say
CBO: IMMIGRATION REFORM REDUCES DEFICIT BY $197B In addition to that reduction over 10 years, the Congressional Budget Office also said Tuesday that the deficit would be reduced by an additional $700 billion from 2024 to 2033. CBO said the measure would spur economic growth because of the large number of new workers and consumers added to the economy. The report is good news for the bipartisan “Gang of Eight” senators who have attempted to sell the bill as a boost to the economy. Read more at The Fiscal Times
HOUSE SPLIT BY ONLINE SALES TAX GOP lawmakers are split over the online sales tax bill that easily cleared the Senate last month. The measure allows states to force online U.S. retailers to collect sales taxes on purchases from their residents — even if the business has no offices, stores or warehouses inside that state.
Republican governors are pushing hard for the bill’s passage. A group of staunch conservatives are refusing to cave to any new taxes. Even Speaker John Boehner has expressed concern over the bill, saying that it could hurt Internet start-ups. - Read more at The Hill
SEC TO FORCE ADMISSIONS OF WRONG-DOING The new Securities and Exchange Commission chairwoman, Mary Jo White, announced Tuesday a new policy that requires companies and individuals to admit wrongdoing as a condition to settling civil charges in certain cases brought by the financial markets regulator. For decades, plaintiffs have been allowed to settle charges without admitting or denying liability. - Read more at The Wall Street Journal