Friday, December 10, 2010

CQ Roll Call Daily Briefing: Flexible Framework

CQ Roll Call Daily Briefing

Friday, Dec. 10, 2010

 Today In Washington

THE WHITE HOUSE: Clinton is returning to the Oval Office at 3 to offer the current occupant lessons on “triangulation” — his approach to working with newly empowered Republicans, to the consternation of the liberal base, after the first midterm of his presidency in 1994. A Clinton endorsement of the tax package is therefore almost foreordained.

“Liu Xiaobo is far more deserving of this award than I was,” Obama said in a statement urging China to free the imprisoned dissident human rights advocate, who received the Nobel Peace Prize in absentia in Oslo this morning. (Pelosi was the top-ranking American at the ceremony.)

THE SENATE: Convened at 9:30 for speechmaking on the tax bill. The first test  vote on the measure will begin at 3 on Monday, but will be kept open for at least two and a half hours to accommodate senators’ travel schedules.

THE HOUSE: Not in session.

THE DOOR’S OPEN: Obama is giving himself a big opening to agree to the higher estate tax that House Democrats are insisting on as what’s rapidly becoming their only condition for not shouting “just say no” on the tax deal anymore. And he’s gambling that if the Republicans get everything else they’ve hoped for, they won’t blanche if the new estate tax rate is returned to 45 percent (not the current deal’s 35 percent) and the new floor for the heirs who will confront any taxation is $3.5 million, not $5 million.

“We put forward a framework. I’m confident that the framework is going to look like the one that we put forward,” he said in an NPR interview that was broadcast in full this morning. What that means is he’s willing to make some changes to the package, which was turned into a Senate bill that got unveiled last night at a 10-year cost of $858 billion — with about $450 billion the tax cuts for income under $250,000 and $125 billion for tax cuts above that. The jobless benefits extension will cost about $55 billion. The payroll-tax holiday would cost $112 billion.

The measure does not include an extension of the “Build America” bond program that Democrats had sought. But it has now been altered to give liberals a sweetener important to them: a collection of extended tax breaks for green energy. So changing the estate tax will be the victory that allows probably half the House Democrats to swallow hard and vote “yes.”

The working scenario: The Senate will pass the tax deal, as-is, by the middle of next week. The House will send it back after amending it to increase the estate taxes. The Senate would then clear that version — with enough new Democratic votes to offset the Republicans who could not stomach the new estate tax numbers.

STILL THE LAST TRAIN OUT: Even if the path on taxes gets really smooth, really quickly, it’s hard to see how Congress goes home before next Saturday night, when spending authority for the entire government will cease unless there’s a final appropriations deal. And it may take into Christmas week for that bill to get done, and for the Senate to finish all the “wrapup” matters that have been put on hold in the meantime.

Senate Appropriations Chairman Dan Inouye still hasn’t unveiled his omnibus spending package, which will be more ambitious than the scaled-down bill lasting until September that the House passed this week — and will include hundreds and hundreds of unambiguous earmarks. But more and more Senate Democrats have decided it’s not in their best political interest to support a bill packed with pet projects.

And so it’s increasingly likely that the best Congress will be able to muster is a sort-of stopgap that only lasts until February or March — because Republicans will decide to block anything else so that they can take a stronger hand in spending decisions come January. The delay would also give conservatives more leverage for their crusade to stop the new health care overhaul by denying the agencies money to carry it out. By the reckoning of that effort’s leader, Tom Coburn, the House bill is a “Trojan horse” larded with line items to get implementation of the law up to speed.

WHO CAN TELL? Gay-rights advocates are readying a lunchtime Capitol rally to try to jumpstart the drive for repealing “don’t ask, don’t tell,” which stalled yesterday when the Senate voted to keep alive a filibuster against a defense authorization measure including that language.

Joe Lieberman says he and Susan Collins are sure they have at least 60 votes for a stand-alone repeal measure and Reid is willing to push it, but only after the tax and appropriations bills are through the Senate — because otherwise such legislation would run into the “first things first” Republican filibuster wall. If the debates over taxes and spending drag on too long, supporters of the repeal will try to attach language to the spending bill itself. And there are more than enough votes in the House to go along with whatever strategy is pursued in the Senate.

Prospects are much dimmer for the Pentagon policy bill, unless all the other contentious issues (the second F-35 engine and abortion in military hospitals tops among them) are also dropped and the measure focuses on straightforward procurement and personnel issues. Off-stage talks between the House and Senate on what’s dubbed “the skinny bill” have been going on for weeks. It’s been 48 years since the last time Congress adjourned for the year without enacting the annual defense authorization law.

ROLODEX ALERT: Brett Loper is coming back to the Hill to be Boehner’s policy director. The person now in that job, Mike Sommers, will be director of leadership operations. Dave Schnittger will become the Speaker’s head of communications operations. Sommers and Schnittger will be called deputy chiefs of staff, reporting to Barry Jackson. (Loper is now lobbying for the Advanced Medical Technology Association. Before he left the Hill in 2006, he was Ways and Means staff director and majority leader chief of staff for Tom DeLay.)

McConnell’s new chief of staff is 31-year-old Josh Holmes, who’s been one of the minority leader’s most trusted staffers for the past three years and is now in charge of the Senate Republican Communications Center. Holmes went back to Kentucky for a time last year to be McConnell’s peace offering to the Rand Paul campaign. He’s replacing Billy Piper, who’s left the Hill to go make money.

BERNANKE’S BÊTE NOIRE: Ron Paul has been named the next chairman of the House Financial Services Subcommittee on Domestic Monetary Policy. Put more succinctly, the libertarian Texan now will be wielding a gavel over the Federal Reserve. (His main campaign theme as the nascent tea party’s favorite 2008 presidential campaign was that the Fed should be abolished.) So unless Boehner reins him in, Paul will have all the power he needs to push legislation limiting the power of the central bank and promoting gold and silver as legal tender — and to summon Fed Chairman Ben Bernanke to a public inquisition whenever he wants. The market-moving possibilities (and the headaches for commercial bank lobbyists) seem almost limitless.

Although he’s starting his 11th full term, this will be the first time Paul has occupied the top GOP seat on any subcommittee, mainly because he’s been peripatetic about his committee assignments during his separate stints in the House. His initial legislative push will be for a full-fledged Fed audit. (He got only a very limited audit into the financial services overhaul.)

MANY SEATS TO FILL: The farmers, energy producers and rural residents of North Dakota will retain their longstanding voice on the House Ways and Means Committee, where freshman Rick Berg has been named one of the 20 new Republican members. (Berg, who’s been his state House’s majority leader, beat Democrat Earl Pomeroy, who had been on the panel for a decade; his House predecessor, Byron Dorgan, was also on the panel for a decade.)

One other GOP freshman got a Ways and Means seat: former ER nurse and state Sen. Diane Black of Tennessee. The other winners of the plum post: Vern Buchanan of Florida, Jim Gerlach of Pennsylvania, Lynn Jenkins of Kansas, Chris Lee of New York, Erik Paulsen of New Mexico, Tom Price of Georgia, Aaron Schock of Illinois and Adrian Smith of Nebraska.

There will be 22 GOP seats on the panel, but only 15 for Democrats, meaning half a dozen lawmakers now on the powerful majority side will have to get off the panel altogether. That’s just one of the myriad struggles Democrats are facing as they work to adjust their committee power structure for life in the minority.

— David Hawkings, editor

Become a Facebook fan at facebook.com/DavidHawkingsDC. Or follow me on Twitter at twitter.com/davidhawkings.

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-----

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Thursday, December 09, 2010

CQ Roll Call Daily Briefing: Here Come the Salesmen

CQ Roll Call Daily Briefing

Thursday, Dec. 9, 2010

 Today In Washington

THE SENATE: Convened at 9:30 and is on course to start debating the defense authorization measure this afternoon, a sign that Reid thinks he has the handful of GOP votes needed to overcome a filibuster and preserve language repealing the “don’t ask, don’t tell” law.

Senators were voting to set aside their version of a measure to create a path to legal status for hundreds of thousands of younger illegal immigrants; doing so will allow Reid to try to get a vote instead on the Dream Act version the House passed last night. And the Senate was on the verge of a cloture vote effectively killing legislation that would have provided medical benefits to Sept. 11 first responders.

THE HOUSE: Convened at 10 and is expected to be done for the week by early afternoon, after sending President Obama legislation that would extend through 2011 the scheduled 25 percent cut in Medicare payment rates for doctors. (The Senate passed it yesterday.) The $15 billion cost will be offset by making the first change in this year’s health care overhaul, reining in a tax credit that makes premiums more affordable.

The House put off until next week a vote on whether to open an inquiry into the suspension of two ethics committee lawyers involved in the problematic probe of California Democrat Maxine Waters.

THE WHITE HOUSE: After a session with his Export Council and lunch with Biden, Obama will meet with Joint Chiefs Chairman Mike Mullen and then go to the Ellipse with his family for the National Christmas Tree lighting ceremony at sundown.

FULL STEAM AHEAD: Reid’s plan to put the tax bill before the Senate tomorrow is a sure sign he’s confident of having the (still mostly Republican) 60 votes needed to break a rare filibuster from within his own ranks and put the legislation on course to relatively smooth passage — as soon as Finance Chairman Max Baucus is through making last minute tweaks designed to shore up Democratic support.

In the House, veteran Democratic vote-counters including Barney Frank (a firm “no”) are now predicting the package will pass on that side of the Capitol. And this morning Hoyer gave his grudging endorsement to the compromise, saying his party needs to realize it can hope for nothing better given the GOP’s power in the Senate. He did so even as 54 in his caucus signed a letter pledging their opposition.

The White House has waged an aggressive campaign to push the momentum in its direction in the past two days. Yesterday, for example, OMB head Jack Lew and top Treasury adviser Gene Sperling tried to convince many wavering congressional Democrats that Biden did just fine in sticking up for their interests in the secret talks with McConnell that yielded the deal. They said the concessions the vice president won from the GOP — extension of jobless benefits, the payroll tax holiday and the targeted tax cuts from Obama's 2009 stimulus law — can be counted on to pump billions into the economy and help create 2 million or more jobs. (The tax cut extensions are seen as something of a mixed bag for state and local governments.)

IT COULD BE WORSE: In case the economic stimulus argument fails to get the job done, the White House is already rolling out its backup: the fear factor. That approach was most prominently on display when outgoing economic adviser Larry Summers warned that killing the deal would “materially increase the risk that the economy would stall out and we would have a double-dip” recession. Obama has also reportedly told lawmakers that without the deal job losses next year could top 1 million.

But the president’s goal-line stance is that congressional rejection would neuter him politically for the next two years and imperil not only his re-election prospects but also the party’s congressional fortunes in 2012. Why? Because the GOP would be able to blame the Democrats for what would effectively be a tax increase for almost everyone on New Year’s Day, when so many of the tax cuts enacted in the past decade expire without congressional action. And then the new Congress, with Republicans in charge of the House and stronger in the Senate, could push through the deal (or something Democrats hate even more) and get credit for saving the day by making the cuts retroactive to the start of the year.

That political outlook is buttressed by the latest Bloomberg poll, in which 51 percent said they are worse off now than when Obama took office and two-thirds believe the country is headed in the wrong direction. As a consequence, 46 percent said they’ve cut their holiday shopping budget this year.

BIG DEAL, BIG DEALMAKER: There’s growing reason to believe the year-ending deal-cutting will soon feature this blockbuster Senate tradeoff: Republicans agree to a quick debate next week before a vote ratifying the New Start treaty, a top Obama goal, and in return Democrats agree to lower their rhetorical volume of disdain and allow a relatively drama-free path toward enacting the tax package.

Prospects for such a swap grew yesterday after Obama declared with Polish President Bronislaw Komorowski beside him in the Oval Office: “I am confident that we are going to be able to get the Start treaty on the floor, debate it and complete it before we break for the holidays.”

One senator is bound to be at the center of such a swap: the GOP whip, Jon Kyl of Arizona. He’s the party’s de facto leader not only on arms control but also on the estate tax, which the tax deal would handle just the way he wants it. Kyl’s call to delay debate until next year has been the main stumbling block for the Russian nuclear accord. But he’s never said flat out that he’d vote “no,” only that he thinks that what’s left of the U.S. arsenal should be modernized. He seems ready to declare himself satisfied on that front. If that happens, he could quickly endorse the treaty and thereby ensure ratification — and would seem sure to do so if he was confident that would smooth the path to the new, lower 35 percent tax rate that would be assessed only on estates worth more than $5 million.

A LEVIN COMEBACK? Sandy Levin is likely to persuade the Democratic Caucus this morning to give him the party’s top seat on House Ways and Means — which would mean reversing yesterday’s surprising 23-22 decision by the Steering and Policy panel to nominate Richard Neal instead. Levin will argue that he’s done a fine job since replacing Charlie Rangel as chairman this year, that seniority should still matter (Neal is No. 6 on the panel) and that he’s more in tune with the more liberal tenor of next year’s caucus than Neal, who’s known for being the most business-friendly senior member of the tax and trade panel.

AN INVISIBLE HAND? Adam Smith is the solid favorite to be tapped as the new ranking Democrat on the House Armed Services Committee, a job that opened wide when all four of the party’s most senior panel members (Ike Skelton, John Spratt, Solomon Ortiz and Gene Taylor) were defeated last month. Smith, who just won his eighth term representing the south Seattle suburbs, started as a strong supporter of the Bush policy in Iraq but later became one of the war’s biggest critics and led the party’s unsuccessful efforts to compel the troops to come home.

As such, Smith endeared himself to the liberals on the Steering Committee even more than New Jersey’s Rob Andrews, the other viable candidate. (The candidacies of Silvestre Reyes of Texas and Loretta Sanchez of California never gained much traction.)

THE FINAL (AND MOST EXPENSIVE) FIGHT:  The razor-thin margin for the House’s wrapup spending package last night portends even more trouble in the Senate, where appropriators are still laboring to assemble an even more ambitious (and potentially more contentious) fiscal 2011 omnibus spending bill.

The House’s measure would hold discretionary spending at $1.1 trillion, the same as last year, while taking billions away from some programs and giving them to others. It includes $159 billion to prosecute the wars in Afghanistan and Iraq and deals a blow to Obama’s efforts to close the Guantánamo Bay prison. Still, no Republican voted for it — saying it still spends too much — and neither did 35 Democrats.

Senate Democrats think they have enough votes to overcome a filibuster and get their bill on the floor next week; their likeliest allies are Republican appropriators Thad Cochran, Bob Bennett, Lisa Murkowski, George Voinovich and Kit Bond, all of whom are wedded to the earmarks they want for their states. (The House bill is earmark-free)  But the Senate bill is coming in at $18 billion more than the House measure — one of the reasons why McConnell is against it. The other reason is that he thinks he can get a more prudent deal through after the GOP gains strength in the new year.

MILLER’S CROSSING: A judge in Alaska is expected tomorrow to toss out Joe Miller’s lawsuit, which asserts that vote counters used an illegally lenient standard in awarding so many Senate write-in votes to fellow Republican Lisa Murkowski. That would put the incumbent one step close to being certified as the winner in plenty of time to take office again in four weeks.

CORRECTION: Yesterday’s 2011 congressional recess roster was wrong in this way: The Senate as well as the House will be off the week of Sept. 26, which includes the start of Rosh Hashana on Sept. 29.

— David Hawkings, editor

Become a Facebook fan at facebook.com/DavidHawkingsDC. Or follow me on Twitter at twitter.com/davidhawkings.

Senators were voting to set aside their version of a measure to create a path to legal status for hundreds of thousands of younger illegal immigrants; doing so will allow Reid to try and get a vote instead on the Dream Act version the House passed last night.

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Wednesday, December 08, 2010

CQ Roll Call Daily Briefing: The New Math

CQ Roll Call Daily Briefing

Wednesday, Dec. 8, 2010

 Today In Washington

THE HOUSE: Convened at 10 and is on course to pass a bill dictating $1.25 trillion in spending through next September. The measure has no earmarks, would freeze civilian salaries and would provide $159 billion for the wars in Iraq and Afghanistan. It would hold overall spending at fiscal 2010 levels, meaning it would provide $45 billion less than Obama wants.

The measure also will carry bipartisan legislation bolstering FDA regulation of food safety. The House needs to pass that bill and send it back to the Senate because the measure that senators endorsed last week  would impose fees that are considered tax provisions, which under the Constitution must originate in the House.

THE SENATE: Convened at 9:30 and has convicted federal Judge G. Thomas Porteous Jr., who was impeached by the House earlier on four articles alleging that he took money and favors, filed for bankruptcy under a false name and lied to Congress during his judicial confirmation. The votes: first count, 96-0; second count, 69-27; third count, 88-8; and the fourth count, 90-6. Porteous now loses his seat on the federal trial court in New Orleans, his $174,000 salary and his eligibility for a government pension. (He has been suspended without pay since 2008.)

Reid will try to take up the defense authorization bill tonight after he loses all this afternoon’s cloture votes. They would break GOP filibusters on legislation that would put young illegal immigrants on a path to citizenship if they serve in the military or go to college (the so-called Dream Act), a measure to compensate Sept. 11 cleanup workers, a bill creating nationwide union organizing rights for police and firefighters, and a $250 payment for senior citizens because there’s no Social Security COLA this year.

THE WHITE HOUSE: After a late morning meeting and news conference with  Polish President Bronis?aw Komorowski, this afternoon Obama has a Cabinet meeting and will sign the bill awarding lawsuit settlement money to black farmers and American Indians mistreated by the government.

BRIDGING THE DIVIDE: Democratic anger and frustration at the tax cut deal continues, but the administration and the Republicans are sounding plenty confident they can push the deal through next week.

Biden, who had little success trying to tamp down Senate dissent yesterday, isn’t likely to fare any better when he returns to the Capitol today for a similar session with the House Democrats. And Obama will soon start working the phones to woo annoyed but still winnable Democrats by stressing the package’s potential to boost the economy — albeit at a cost, now estimated to top $900 billion, that would outstrip the size of the economic stimulus package he sweated to enact at the start of his presidency. The president will also appeal to the immediate political reality: Since the GOP is taking over the House and gaining ground in the Senate next month, this is the best deal the Democrats are going to get for some time.

It remains doubtful the package’s main provisions will be altered in any meaningful way to win liberals — because any such moves would cause a Republican revolt. The focus of Democratic ire remains the proposed estate tax, which Pelosi has derided as “a bridge too far” — although she has carefully stayed well short of opposing the package. (The plan would also allow the first $5 million of an individual’s estate to be passed on to heirs tax-free. Couples would receive a $10 million allowance. Estates would be taxed at 35 percent beyond that, the lowest rate since 1931.)

Assuming all 179 Republicans vote "yes," Obama would have to come up with at least 39 Democrats (or just 15 percent of the current caucus) to get the measure through the House — a seemingly very low bar. The math is a bit more difficult in the Senate, where at least 18 Democrats (one-third of them) would need to join all the Republicans in order to break the filibuster promised by Bernie Sanders and other liberals. So far, only about a dozen Senate Democrats have signaled support for extending all the Bush a tax cuts, while at least twice as many have said they are firmly opposed to the idea. That means the lobbying effort will be focused on the 20 in the middle.

WHAT THE POLLS SAY: The pollsters are offering mixed news about the package. A Gallup survey done Friday through Sunday, before the deal was unveiled, found 66 percent support for extending the Bush tax cuts for all income levels for two years and the same level of support for a yearlong extension of jobless benefits. But a Bloomberg survey, which contacted some people after the deal was rolled out, found only 35 percent support for keeping the lower rates for the highest earners, and half of those people said those breaks should last for a shorter time than the tax cuts for the middle class.

BISHOP WINS: This morning GOP entrepreneur Randy Altschuler conceded his narrow defeat in New York’s 1st congressional district, which takes up most of Long Island, so Tim Bishop will be back for a fifth term. Theirs was the last contested House race, so the final line score can now be inked in: The Republicans have gained 63 seats and will have 242 seats in January, to 193 for the Democrats. Later today, Republican Tom Emmer is expected to concede the Minnesota governor’s race to former Sen. Mark Dayton, which would make him the nation’s 20th Democratic governor next year.

GET OUT YOUR CALENDAR: The incoming Republican majority unveiled a 2011 House calendar today that deviates considerably from next year’s Senate calendar, which came out yesterday.

The 112th Congress will convene Wednesday, Jan. 5. There’s no official date set for the State of the Union  address, but the night of Tuesday, Jan. 25, seems like a solid bet. The House GOP has set Dec. 8 as a target adjournment date; Senate Democrats long ago gave up on the notion of setting even a straw-man adjournment date. But the two chambers have very different plans for their time off beyond a shared recess week in February, two weeks off at the same time surrounding Easter in April and the same five-week August break.

These are the recesses planned next year:
Week of Jan. 17 (MLK Day) for the Senate only
Week of Jan. 31 for the House only
Week of Feb. 21 (Presidents Day) for both chambers
Week of March 21 for both chambers
Weeks of April 18 and April 25 for both chambers (Passover begins the evening of Monday, April 18; Easter Sunday is April 24)
Week of May 16 for the House
Week of May 30 (Memorial Day) for the Senate
Week of June 6 for the House
Week of June 27 for the House
Week of July 4 (Independence Day) for the Senate
Week of July 18 for the House
Week of Aug. 8 through Labor Day, Sept. 5, for both chambers
Week of Sept. 26 for the House
Week of Oct. 17 for the House
Week of Oct. 24 for the Senate, which has nothing noted on its calendar after that
Week of Nov. 7 for the House
Week of Nov. 21 (Thanksgiving) for the House

ROGERS THAT: Harold Rogers is starting to send signals about his chairmanship of House Appropriations — or at least about what he promised in order to win the gavel. He says that, except for the fact that it would take so much time, he likes Boehner’s idea for splitting the 12 annual spending bills into more discrete measures. The idea is to avoid putting members in the awkward position of having to vote on things they don’t like (the Labor Department, for example) and things they like (cancer research) in the same measure.

Rogers also is promising to enforce the GOP’s promised earmark moratorium, reduce discretionary spending to its fiscal 2008 level, deny money to implement parts of the health care law and consider shrinking the panel’s size — now 60 seats, or one for about every seven lawmakers. He has not yet signaled, though, how aggressively he’ll work to position his allies as the chairmen of the dozen subcommittees.

Two domestic areas that will benefit from Rogers’ chairmanship: homeland security, his recent subcommittee focus, and the rural poor. Somerset (population 11,000) is the largest municipality in his southeastern Kentucky district, which had the second lowest median income ($22,000) and the highest share of white residents (97 percent) of any congressional district at the time of the 2000 census.

DEMOCRATIC CHOICES: Norm Dicks of Washington is destined to be tapped as the ranking Democrat on Appropriations, besting Chaka Fattah of Pennsylvania, when the House Democratic Steering and Policy Committee meets formally for the first time since the election. And it looks like Sandy Levin of Michigan will be asked to stay in the party’s top spot on Ways and Means.

— David Hawkings, editor

Become a Facebook fan at facebook.com/DavidHawkingsDC. Or follow me on Twitter at twitter.com/davidhawkings.

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dailybriefing@cqrollcall.com

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Tuesday, December 07, 2010

CQ Roll Call Daily Briefing: Selling the Tax Deal

CQ Roll Call Daily Briefing

Tuesday, Dec. 7, 2010

 Today In Washington

THE WHITE HOUSE: Biden is coming to the Capitol to take the lead in selling the tax deal to disgruntled Democrats. He’ll make the administration’s pitch to the party’s senators at 1:30, during their weekly caucus lunch. Other administration officials may appear at a 6:30 House Democratic caucus.

THE SENATE: Convened at 10 for the impeachment trial of federal Judge G. Thomas Porteous Jr. Prosecutors from the House say he’s been taking cash and other favors from people with business before U.S. District Court in New Orleans since before he arrived there in 1994 — and that he lied to the Senate and the FBI while his nomination was being vetted. Deliberations will be behind closed doors and the required two-thirds majority for guilty verdicts on all four articles of impeachment is expected tomorrow. Porteous would then be the first federal judge removed from office in 21 years.

THE HOUSE: Convenes at 12:30 to pass 16 relatively non-controversial bills. One, which would then go to the Obama for his signature, would give volunteer organizations that work with children (sports leagues and Scouting groups, for example) continued access to FBI background check files.

Pelosi will preside over her final Capitol Christmas tree lighting ceremony as Speaker. It’s a 67-foot Engelmann spruce from Wyoming.

LET THE HORSE-TRADING BEGIN: Obama and GOP congressional leaders are describing their tax deal with words like "tentative" and "framework" for good reason. There’s no legislative language yet — and there won’t be until the White House is confident it has sufficient Democratic support on the Hill to get the package enacted. And that means there will be changes to what was announced last night — probably in the form of additional provisions designed to bring handfuls of Democrats on board, not alterations to the deal’s big-ticket items.

Green lobbyists, for example, think they have a great opportunity to win an extension of several about-to-expire clean energy tax breaks, principal among them the credit for wind, solar and other renewable energy projects and an investment tax credit for domestic makers of wind turbines and solar panels.

Congressional Democrats are almost as miffed about being ignored in the negotiations — and about what Obama’s "punting on third down" approach portends for the next two years — as they are about the basic framework of the deal, which has been in the cards for weeks. And so, to justify their "yes" votes, they’ll insist on winning some modest "improvements" to give them cover, if not any measure of satisfaction.

Investors seem ambivalent today as they weigh the deal’s virtues (essentially continuing current tax policy for two years while signaling that Washington remembers how to compromise) against the idea of adding perhaps $750 billion or more in red ink — and just when it seemed there might be momentum for making some tough fiscal policy choices. By 11:30 the main stock indexes were all up, but by less than 1 percent each.

A NO TO PAYGO: To turn the deal into law, Congress will have to make a formal, symbolic acknowledgement of its deficit-deepening decision — by declaring that a budgetary "emergency" exists that warrants a skirting of the pay-as-you-go law, which normally requires that tax cuts be offset by spending cuts or other revenue increases.

And there would be a lot of tax cuts. To review: All the breaks and lower rates (on income, dividends and capital gains) scheduled to expire on New Year’s Eve — including those from the 2009 stimulus law as well as the 2001 and 2003 tax laws — would be extended through 2012. The Alternative Minimum Tax would be "patched" for both this year and 2011 so that it does not hit more taxpayers. The estate tax would be 35 percent, but only on estates worth more than $5 million — more generous figures (except for the one-year repeal of 2010) than even under the Bush tax law. Long-term unemployment benefits would be extended through next December. The Social Security and Medicare payroll tax would be cut by 2 percentage points for 2011, a year when businesses would be permitted to write off the full cost of capital investments.

A ‘CR’ IN NAME ONLY: The Democrats are calling the appropriations bill they’re readying for a House debate this week a "continuing resolution," a term normally reserved for measures that maintain almost all agency and program spending levels at the rates of the past fiscal year. But this CR is totally different from that "autopilot" approach. The 183-page draft looks more like a complete, detailed omnibus because it would alter funding levels for hundreds of programs for the remaining 10 months of fiscal 2011.

Passage would put enormous pressure on the Senate to go along with that approach — especially because the House measure contains no earmarks and would carry out Obama’s two-year’s federal pay freeze. And it would make good on many of his spending requests without breaching the $1.1 trillion discretionary spending cap that Congress has informally pledged itself to.

House Democrats have also figured out a means for preventing at least two days of GOP filibusters in the Senate.

CHAIRMAN’S MARK: The spending package will be the swan song for Dave Obey as chairman of House Appropriations — any very possibly, too, for Jerry Lewis as the panel’s top Republican.

The House GOP Steering Committee is meeting at 3 to debate its slate of proposed committee chairmen, and the expectation is they will begin by deciding NOT to grant the term-limit waivers that would give Lewis a chance to reclaim the Appropriations gavel and Joe Barton an opportunity to take back the Energy and Commerce chairmanship. Their only hope, then, would be to appeal the matter to the entire GOP caucus. But their chances of getting satisfaction there are pretty slim — especially at a time when the tea party insurgents in the freshman class are reviving interest in all manner of term limits, not only in the Hill power structure but maybe even a constitutional change to limit congressional service.

If California’s Lewis is boxed out, then the steering committee will be choosing among two lawmakers who are decorated veterans of the Washington spending culture — but who have worked hard to portray themselves as all about knife-wielding in the years ahead. Harold Rogers of Kentucky is a 27-year appropriator who’s run an adept insider’s campaign, while Jack Kingston of Georgia has positioned himself as the candidate of insurgency (even though he’s been on the panel 16 years.) The edge goes to Rogers, although Boehner’s decision to give anti-earmark crusader Jeff Flake a seat on the panel could give a late boost to Kingston.

Without Barton in the hunt, it appears as though Michigan’s Fred Upton has sufficiently reinvented himself ideologically (moving from a Ripon Society moderate to an abortion-rights oppositing conservative) to secure the Energy and Commerce job instead of John Shimkus of Illinois or Cliff Stearns of Florida. The two other contested chairmanships aren’t really close. Spencer Bachus of Alabama will hang on at Financial Services instead of Ed Royce of California, and Stearns will get Veterans’ Affairs as a consolation prize at the expense of fellow Floridian Jeff Miller.

— David Hawkings, editor

Become a Facebook fan at facebook.com/DavidHawkingsDC. Or follow me on Twitter at twitter.com/davidhawkings.

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