debt ceiling

So Much Work, So Little Time

The congressional agenda is chock-full. The congressional calendar is rapidly dwindling. Tax cuts, a spending measure and a debt ceiling increase are pending priorities, with a government shutdown looming as a possibility.

The congressional agenda is chock-full. The congressional calendar is rapidly dwindling. Tax cuts, a spending measure and a debt ceiling increase are pending priorities, with a government shutdown looming as a possibility.

With only a dozen or so working days before the holiday break and the end of the year, Congress faces a daunting agenda that keeps growing longer and more challenging.

Based on published schedules, the Senate has 15 and the House 12 working days left in 2017. In that time, GOP congressional leaders want to pass tax-cut legislation and need to take action on a spending and debt ceiling bill to prevent a government shutdown.

Mixed in the politics of all that is the Dreamer’s Act and extension of funding for the Children’s Health Insurance Program (CHIP) that expired September 30, which has created a budgetary challenge for states trying to keep the popular insurance in place until Congress acts.

Then there are the series of subplots that fill headlines and color the policies and politics on Capitol Hill:

  • The intensifying investigation into Russian election meddling;
  • The Roy Moore scandal and Senate race in Alabama;
  • Unfolding disclosures about sexual behavior by Members of Congress;
  • An attempt by the Senate to repeal the Obamacare individual health care mandate as part of tax legislation; and
  • The Federal Communication Commission’s decision to end net neutrality.

Lurking in the wings are stalled talks over revisions to the North American Free Trade Agreement (NAFTA), continuing tensions over North Korea’s nuclear capabilities and the hope for an infrastructure investment package.

Dealing with all that is more like a year’s agenda, not one for a short month.

Egged on by President Trump, Republicans want to deliver tax legislation to the White House before heading home for Christmas. While GOP leaders continue to sell the tax cut as a boon for the middle class, the push to pass it quickly is aimed at satisfying the expectations of Republican donors.

When the Senate returns to work this week, it will try to pass its version of tax legislation under special rules that prevent a Democratic filibuster. It can only lose two Republican votes. It also will vote on the bill under a cloud of criticism from economists across the ideological spectrum who say it will do little for the middle class and compromise the nation’s ability to deal with an economic downturn by sharply increasing the federal budget deficit.

If the Senate passes a tax measure, it then faces a House-Senate conference committee to iron out differences, which could highlight contentious and regionally divisive issues such as home mortgage and state and local tax deductibility.

Even though Republicans are trying to pass their tax legislation without any Democratic support, they need Democratic votes to pass a spending measure and increase the debt ceiling. The tight time frames before the holiday break amplify Democratic leverage. CHIP funding, which provides coverage for 9 million children, is one enticement the GOP is trying to use. The Dreamer’s Act could be another, but it could backfire and drive away some conservative GOP votes.

The troubled Moore Senate campaign to fill the seat formerly held by Jeff Sessions comes at an especially awkward political moment on December 12. If Moore, who faces accusations of sexual misconduct with minors, loses to Democrat Doug Jones, it will make GOP control of the Senate razor thin, which could be a factor if tax legislation gets pushed into next year.

Congress is also getting some pushback on the tax plan from corporations that have become more concerned about Trump objectives in NAFTA negotiations. A fifth round of talks among Canada, Mexico and the United States failed to produce agreement, which leaves open the possibility that Trump may unilaterally pull out of the trade deal. A business coalition led by the U.S. Chamber of Commerce has lobbied Capitol Hill in opposition to radical changes to NAFTA, warning they could lead to US job losses and ironically lead to more US manufacturing moved offshore.

The special prosecutor investigation into Russian election meddling and possible collusion by the Trump campaign has taken another ominous turn. Former National Security Advisor Michael Flynn has broken off contact with the Trump defense team, signaling a possible plea deal that involves cooperating with the special prosecutor on other targets. There have been signs Special Prosecutor Robert Mueller and his team have expanded their scope to include financial dealings by the Trump Organization with Russian oligarchs associated with money laundering.

The FCC decision to end net neutrality has stirred up a wide range of opponents who fear it will hand too much power to telecommunications companies. Supporters downplay that concern, saying it will lead to more investment in digital technology. But this isn’t just a garden-variety policy issue. Net neutrality supporters have taken to social media to voice their concerns, galvanizing many people who ordinarily shun politics. Those activated voters could make a difference in the looming 2018 mid-term election.

Hurricane Harvey Blows DC Political Winds in New Direction

Devastation caused by Hurricane Harvey has shifted the political winds in Washington, DC to focus on funding relief efforts, which may provide the political cover for Congress to raise the debt ceiling and allow more time to come up with a spending bill before the new fiscal year begins October 1.

Devastation caused by Hurricane Harvey has shifted the political winds in Washington, DC to focus on funding relief efforts, which may provide the political cover for Congress to raise the debt ceiling and allow more time to come up with a spending bill before the new fiscal year begins October 1.

Hurricane Harvey tore into Texas and its winds continued to blow all the way to Washington, DC.

Congress returns to town Tuesday and now topping its list of to-dos is passage of legislation to add billions more in funding to the Federal Emergency Management Agency to cover soaring costs to build after the ravages of one of history’s worst hurricanes in Texas.

President Trump has called for $7.9 billion in increased funding, even though Texas Governor Greg Abbott predicts it will require as much as $180 billion to recover what was lost or damaged in Houston, Corpus Christie, Beaumont and other Southeast Texas communities.

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The increased funding comes as Congress must find a way to approve legislation raising the US debt ceiling and a funding measure to keep the federal government’s doors open when the new fiscal year begins October 1. Those already prickly political issues were complicated when Trump said he was willing to accept a government shutdown to get a down payment on funding of his border wall.

Congress is already under a tight deadline to raise the debt ceiling and approve a FY 2018 spending measure and now also must deal with funding Hurricane Harvey relief, legislation to maintain the so-called Dreamers program and possibly increased expenditures to fight a war with North Korea.

Congress is already under a tight deadline to raise the debt ceiling and approve a FY 2018 spending measure and now also must deal with funding Hurricane Harvey relief, legislation to maintain the so-called Dreamers program and possibly increased expenditures to fight a war with North Korea.

Trump seems to have backed off the border wall threat under the cover of pressing for immediate relief funding to hard-hit Texas and parts of Louisiana, which he visited twice since the hurricane made landfall August 25.

Even though there is no direct connection between increased FEMA funding and raising the debt ceiling, which reflects past federal spending, hurricane victim relief may give GOP congressional leaders the leverage they need to push through both measures without a lot of political infighting, especially from the conservative wing of the Republican Party. Both Texas senators, who have bona fide conservative credentials, have expressed support for more FEMA funding. Relief aid would be touted by Trump and other politicians as a significant legislative achievement.

If that happened, there would be would more space – and perhaps legislative days – for what are expected to be intense political negotiations over spending for the next fiscal year. The Trump administration has called for massive budget cuts in many federal agencies – including FEMA, but those cuts may not have much political traction, even among many Republicans.

Instead, GOP leaders may try to raise the stakes for congressional Democrats by threatening to cut back on spending for health care for children to gain political concessions on revisions to the Affordable Care Act and possibly other political objectives. There are bipartisan Capitol Hill discussions occurring on ways to repair, as opposed to repeal, Obamacare, which could become part of the budget conversation.

Congressional spending decisions rarely follow a straight line and the hard negotiating never occurs in public view. While budget negotiators may ignore Trump’s budget outline, there are less likely to dismiss the President’s push for major tax cuts. While there also is willingness and even preliminary discussion of a bipartisan tax reform measure, agreement is virtually impossible before the end of September when some kind of a spending bill must pass. That suggests Congress will resort once again to some kind of continuing resolution, perhaps to the end of the year, to allow more time for the tax issue to ferment – and the hurricane relief bill to grow.

All that is murky enough political water, but it will get murkier. Trump will announce his decision to roll back the Obama-era decision to grant work permits to the children of undocumented immigrants, possibly with a 6-month delay to give Congress a chance to act. While a number of states have threatened to sue if the so-called Dreamers program isn’t scrapped, many GOP congressional leaders, including Speaker Paul Ryan, have expressed support for legislation that would maintain the program.

The other wild card that could blow up budget talks is the heightening war of words between the United States and North Korea over its nuclear weapon capability. Diplomatic options seem to be dwindling and some kind of military action is becoming more probable, despite predictions of enormous collateral damage. At a minimum, the United States would need to reinforce its manpower levels in Asia. There are reports military units already have been put on notice. As we learned in Iraq and Afghanistan – and earlier in Vietnam, fighting on the ground and dropping bombs from the sky is budget-busting expensive.

It is hard to imagine how the political situation in Washington, DC could get much worse. Well, its name is Irma and it may be heading to Florida coast later this week.

GOP Gets Breathing Room to Pursue Priorities

The appointment of special counsel Robert Mueller to lead the Russian meddling  investigation has given GOP congressional leaders breathing room to work on their stalled legislative priorities that reflect campaign promises.

The appointment of special counsel Robert Mueller to lead the Russian meddling  investigation has given GOP congressional leaders breathing room to work on their stalled legislative priorities that reflect campaign promises.

The appointment of former FBI Director Robert Mueller as special counsel in the ongoing Russian meddling probe may be bad news for President Trump and his associates, but good news for congressional Republicans. It could give them the political space to tackle their major legislative priorities before congressmen head home for an August recess.

And the agenda is daunting – replacing Obamacare, a major tax cut, progress on the Fiscal Year 2018 federal budget, an infrastructure package and passage of a debt ceiling increase.

The drip, drip of news revelations about the Trump’s team entanglements with Russians has distracted the White House and seemingly delayed any substantive tax proposal. The House narrowly passed an Obamacare replacement bill, with Trump’s support, but that legislation has bogged down in the Senate. The Trump FY 2018 budget proposal was pronounced dead on arrival on Capitol Hill, at least in part for what critics call a $2 trillion math error on how to pay for a major tax cut.

GOP congressional leaders felt under the gun to intensify committee probes into Trump’s Russian connections, until the Department of Justice appointed Mueller to lead the criminal investigation. Many Hill Republicans are hopeful that, with the investigative burden shifting from Congress to Mueller, they can focus less on the scandal and more on addressing their list of looming deadlines and campaign promises – a long list that Congress has made little headway on achieving.

However, the breathing space they now have still may not be enough time to pass their legislative agenda.

Senate leadership staff huddles this week to begin drafting from scratch a new alternative to the House-passed American Health Care Act (AHCA). The Senate has the benefit of the Congressional Budget Office score, which estimates 23 million people would lose health insurance over the next decade. New public opinion polls indicate Obamacare is more popular than the AHCA. Even if they are successful, it make take time to ensure all the details fit together.
 
On the other side of Capitol Hill, House appropriators are trying to figure out how to keep the government’s doors open when the new fiscal year begins October 1. Delayed action on fiscal 2017 spending, combined with the GOP’s decision to start with a health care overhaul, has put Congress months behind schedule on appropriations for FY 2018.

House appropriators are weighing an ambitious plan to pass a 12-bill omnibus appropriations package ahead of the August recess.  Given the very late start, appropriators would need to mark up their respective bills at a record pace to bring a full package to the floor before July 31. Even if they can pull off this monumental task, they will face an even bigger political hurdle garnering the necessary Democratic votes in the Senate.

Democrats retain some leverage in both the House and Senate in regard to passing a debt ceiling increase, which GOP conservatives won’t support, even though failure to raise the debt ceiling could result in US default on loans. How much leverage Democrats have and what they will use it for remains unknown.

Hope of passing tax and infrastructure legislation before August is dim, but getting a health care bill and an FY 2018 budget approved but the August recess would improve odds for addressing those issues by the end of the year.

While Mueller’s appointment gives breathing room to GOP lawmakers to work on their priorities, success is still tied to Trump and his ability to focus on advancing legislation without more self-inflicted controversy, such as his unsolicited comment about spending more on health care even though the AHCA, which he supported, would spend less.

Michael Skipper is CFM’s Federal Affairs Associate. Before joining the team in Washington, D.C., Michael worked on state affairs in Oregon, where he also studied political science and environmental policy at OSU. In his free time, Michael enjoys traveling, reading and spending time with friends and family. You can reach him at michaels@cfmpdx.com

 

 

Garrett, who will be CFM’s Manager, Federal Affairs, can be reached at his CFM email address: kirbyg@cfmdc.com.