With two weeks before the Memorial Day break, Congress will focus on a few key outstanding fiscal policy issues, foremost among them:

• Budget Resolution -- Mind the Cap Gap: Senior congressional budget committee staffers say that if compromise is not reached and a budget resolution passed before the break, Congress will not have an FY09 budget. A small House-Senate discretionary spending cap gap -- about $1.5 billion -- remains to be resolved. OMBW Statement.
• War Supplemental -- Domestic Content Dispute: President Bush has threatened to veto a war supplemental bill with any domestic spending content. Both the House and Senate supplemental bills have such content -- including a GI-style bill for Iraq war veterans and an unemployment benefits extension provision -- amid disagreement over what needs to comply with PAYGO, and how. WSJ Story.

Major fiscal policy items unlikely to see floor action until after the Memorial Day break:

• Housing -- Will Lawmakers Hear about it Back Home?: The $2.7 billion mortgage refinance bill providing $300 billion in loan FHA guarantees, passed by the House last week, faces significant obstacles in the Senate and the administration. Its fate may be cast by what lawmakers hear from constituents about the issue during "district work" week at the end of the month. NYT Editorial.
• Taxes -- AMT Patch and Popular Extenders: The House plans to address these two issues in two bills and, probably, to see that both are paid for -- and may act before Memorial Day. The Senate will act on a bill combining the issues, with 41 GOP Senators refusing to pay for them; Senate floor action isn't expected 'til June. Senate Bill Summary.