Friday, August 05, 2011

CQ Roll Call Daily Briefing: The Jobs They're Doing

CQ Roll Call Daily Briefing

Friday, August 5, 2011

Today In Washington

THE WHITE HOUSE: “When Congress returns in September, I want to move quickly on things that can create more jobs, right now,” Obama said in reacting to this morning’s better-than-expected jobs report: 117,000 new positions created in July and the unemployment rate slipping by a tenth of a point, to 9.1 percent.

The president is at the Washington Navy Yard to outline his ideas for getting businesses to hire or train 100,000 veterans or their spouses by the end of 2013. At a cost of $120 million, he’s proposing a $2,400 tax credit for companies that sign on unemployed veterans during the next two years (twice as much if the person has been jobless longer than six months) as well as an extension of the existing tax credit for hiring disabled veterans. He’s also ordering the Pentagon to do more to help servicemembers get the skills and training they need before they enter the job market. (The current jobless rate for post-Sept. 11 veterans is 13.3 percent.)

Marine One will leave the South Lawn and ferry the first family to Camp David at 2:15.

THE SENATE: Convened at 10 and recessed 39 seconds later — after clearing (on a unanimous consent voice vote) legislation re-opening all the offices of the FAA for six weeks and allowing 70,000 construction workers to return to 200 airport improvement projects. (Maryland’s Ben Cardin presided, Virginia’s Jim Webb made the motion and California’s Barbara Boxer was the only other senator in the chamber — meaning the Republicans had no parliamentary defense against a much more aggressive Democratic legislative effort.) The next pro forma meeting will be at 11 on Tuesday.

THE HOUSE: Convened at 10 and recessed seven minutes later, after disposing of some routine paperwork. Its next pro forma session will be at 10 on Tuesday.

GOOD NEWS, BAD NEWS: Today’s employment report was initially greeted as unabashedly good news in financial markets, mostly because both the drop in the jobless rate and the rise in payrolls beat most analyst expectations. (The initial surges in all three major stock indexes dissipated after only an hour or so; each was down by about 1 percent at 11:30.) But that’s just the way investors behave. As a signal about the economy, the numbers can be seen as a glass that’s half full — or, just as plausibly, half empty.

The optimistic view is that the almost non-existent payroll growth and the rise in joblessness of the past few months has seemingly been reversed. After GDP grew at a 0.4 percent annual rate in the first quarter and a 1.3 percent rate in the second, a jump in payrolls and a drop in unemployment for the first month of the third quarter may be a harbinger of strong growth in the latter half of the year. That’s what Bernanke has been promising. And when the Fed chairman and his monetary-policy-setting colleagues sit down next week to deliberate about what to do, the July jobs numbers may provide some reassurance.

The pessimistic view centers on the 154,000 positions created by private employers in July — because that’s about half as many as the economy will need month after month to pull the unemployment rate back into a politically acceptable place by next year. And the 37,000 government jobs that were lost (the ninth consecutive monthly decline) will be repeated as federal, state and local budget cuts continue for years to come. Moreover, there are some anomalies in the July private payroll figures, particularly seasonal adjustments for expected automaker layoffs that may have overstated the job growth figure for the month. Finally, the figures from the household survey showed a drop in the labor force and the number of people who were working, a troubling sign. Those statistics are notoriously volatile, however, and generally not as believable as company-reported payroll counts. So maybe they don’t mean much. Again, wait for the August jobs report that will be out a month from now.

Both parties, at least for a little while, appeared to agree that the best course was to see the report as a classic “on the one hand, on the other hand” event that shouldn’t be interpreted in any way as a panacea. “We’ve got a long way to go” was in the sound bite offered by both Cantor and Austan Goolsbee — who’s in his last day as chairman of the president’s Council of Economic Advisers.

MAE DAY: Fannie Mae said today that it lost $5.2 billion in the second quarter while it continues to seek loan modifications to help reduce mortgage defaults. As a result it will ask for about the same amount in additional cash from the Treasury. It has already received almost $100 billion since a partial federal takeover during the housing meltdown of three years ago.

IN FOR A LANDING: The FAA impasse ended because Reid concluded that — with the debt crisis averted and the aviation story suddenly the only thing drawing attention to Congress — Senate Democrats would not be able to reverse the intensifying and outraged national perception that their petulance and petty parochialism had put 74,000 workers out on the street.

And so he totally capitulated to the House Republicans that his side had characterized as bullies and hostage-takers only the day before. His only sliver of victory was getting LaHood to promise to at least consider using his powers to retain some of the $17 million in annual subsidies that would otherwise be ended on commercial service to 13 small or remote locales.

The bill neither gives back pay to the 4,000 agency workers furloughed 14 days ago nor guarantees the government will recoup about $420 million in ticket taxes it couldn’t collect during the standoff. And it lasts only until Sept. 16, or 10 days after Congress returns, meaning negotiators will be under enormous pressure next month to reach agreement on the airline union organizing dispute that’s prevented a long-term reauthorization from being enacted for almost four years.

THROW THE BUMS OUT? An 82 percent disapproval rating for Congress was recorded by New York Times and CBS News pollsters on Tuesday and Wednesday, just as lawmakers were leaving town after avoiding default and as their initial decision to leave the FAA in limbo was becoming a headline. It was the highest level recorded by the Times/CBS poll since the question was first asked 34 years ago. And fully 75 percent of those polled said most members of Congress do not deserve to be re-elected while just 15 percent say they do — a finding that suggests an anti-incumbent wave could sweep across all four caucuses in 2012.

The poll offered other foreboding numbers for lawmakers — especially the Republicans — on virtually every front. While the survey showed a statistical tie on approval vs. disapproval for the debt deal enacted this week, 82 percent said the preceding standoff was “mostly about gaining political advantage” and just 14 percent said it was “mostly about doing what was best for the country.” And the survey signaled that the public saw the congressional GOP as politically motivated most of all: 72 percent said they disapprove of how Republicans handled the negotiations, while 66 percent disapproved of how Hill Democrats handled them.

But the poll showed a statistical tie between those who disapproved and approved of how Obama handed the standoff. And going forward, 47 percent said they trust him to make decisions about the economy — far better than the 33 percent trusting congressional Republicans. (Boehner’s own disapproval rating surged to 57 percent, up 16 points since April. His approval rating now is 30 percent.) One finding that suggests trouble ahead for the Republicans selling the argument that cutting federal spending is the best prescription for the economy: 62 percent think creating jobs should be Washington’s focus, 29 percent think it should be cutting spending — and only 8 percent say it should be both.

HOW GREEN WAS MY CAPITOL: When House members return in a month, they will see that the “Green the Capitol” initiative — which Pelosi launched with so much fanfare when she was Speaker — is officially no more. In light of the 7 percent spending cut Congress is imposing on itself and in the face of comprehensive ridicule from the new Republican majority, the House’s chief administrative officer has decided to fold the initiative into an existing energy reduction program handled by the Architect of the Capitol. The idea is to save money, eliminate redundancy and allow the administrative office to get back to its core duties, which GOP members lamented had been ignored too often in favor of the green work.

HAPPY BIRTHDAY: Mike Doyle of Pennsylvania (58) today, and fellow House Democrat Mike McIntyre of North Carolina (55) tomorrow.

PUBLISHING SCHEDULE: With Washington moving toward a state of suspended animation for the rest of August, the Daily Briefing will not be delivered during the next four weeks — unless the news demands it. Regular publication will resume on Tuesday, Sept. 6.

— David Hawkings, editor

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Copyright 2011 CQ Roll Call Inc. All rights reserved | Privacy Policy

Thursday, August 04, 2011

CQ Roll Call Daily Briefing: This is Your Captain Speaking

CQ Roll Call Daily Briefing

Thursday, August 4, 2011

Today In Washington

THE WHITE HOUSE: Obama is celebrating his 50th birthday by starting a four-day weekend. He’s got nothing on his official public schedule beyond the daily morning briefing on the state of the world. His senior staff will toast him at a Blue Room reception this afternoon, there’s a privately financed dinner party for relatives and friends (including elder daughter Malia, who gets home from camp today), and tomorrow the first family is off to Camp David.

“By the time I wake up, I’ll have an email from AARP asking me to call President Obama and tell him to protect Medicare,” the nation’s third baby boomer chief executive predicted last night during his Chicago fundraiser.

THE HOUSE: Not in session. (The next pro forma meeting is at 10 tomorrow.)

THE SENATE: Not in session. (The next pro forma meeting is at 10 tomorrow.)

FIGHT, NOT FLIGHT: Obama’s declared “expectation” that Congress will end the partial shutdown of the FAA by tomorrow shows no signs of being met.

LaHood said this morning that he’s been on the phone several times with both Reid and John Mica, the chairman of the House Transportation Committee, but that neither the Senate Democratic majority nor the House Republican majority has suggested a willingness to blink first. Until one side gives in, 4,000 federal workers will remain furloughed (including 40 airport safety inspectors), as will 70,000 construction workers who had been laboring on 200 control tower, runway and lighting projects across the country. About $30 million daily in ticket taxes will go uncollected for a 13th day.

And an electorate already bewildered, if not outraged, at the dysfunctional tendencies of Washington has a new (and more consumer-friendly than the debt ceiling debate) Exhibit A for explaining their disdain — which will only deepen when the July unemployment report is released in the morning. It will be extraordinarily difficult for either party to escape blame for a situation that, once all the hidden agendas are pared away, can be fairly summarized this way: Both sides in Congress agree that job creation is Job One now that the debt morass has been skirted. Then they jeopardize the livelihoods of 74,000 people and kiss off as much as $1.2 billion in tax revenue by starting their summer break ahead of schedule and during a negotiating impasse. Then Republicans and Democrats holler once again that the problem is entirely because of the other side’s ridiculous political posturing. And all because of a dispute over an amount of money that’s less than one-thousandth of 1 percent of what they just agreed to in deficit reduction.

AIRPORT TRAFFIC: The administration has not proposed a way of ending the standoff. But, by urging both the House and Senate to take a brief break from their just-getting-started August recess in order to address the matter, it’s sending a clear signal that it supports a “clean” extension of all aviation programs into the fall — which means a new bill that would have to go through both chambers (almost certainly on voice votes that would be orchestrated by the leadership and not require any rank-and-file members to return).

House Republicans have refused to do that. They want the Senate to accept the bill the House sent over two weeks ago, which would reopen the FAA while eliminating $16 million a year in subsidies for commercial service into 13 remote or small towns. Senate Democrats have refused to do that, in part because they’re miffed at the roster of communities drawn up by the House. It includes Ely, Nev. (represented by Reid), Morgantown, W.Va. (Commerce Chairman Jay Rockefeller), and Glendive, Mont. (Finance Chairman Max Baucus). The other places have less powerful senatorial protectors: Athens, Ga.; Alamogordo, N.M.; Jamestown, N.Y.; Jackson, Tenn.; Hagerstown, Md.; Jonesboro, Ark.; and Johnstown, Oil City , Bradford and Lancaster, Pa.

Mica has essentially conceded the list was in part designed to pressure Democrats to concede on a bigger dispute that’s holding up the full-fledged rewrite of aviation programs (including the launching of a modernized air traffic control system). It boils down to the GOP wanting to help Delta ward off unionizing efforts by its baggage handlers and ticket agents. Republicans have made clear they would leave the flight subsidies alone if the Democrats will drop their opposition to the anti-labor language. Democrats have made clear that’s not going to happen.

NUMBERS GAME: The first poll since the completion of the debt deal, conducted by Gallup for USA Today, shows 46 percent disapproval for the package and 39 percent approval. Among the all-important independents, 50 percent disapproved and 33 percent backed the compromise. The opinions on the left and right were predictable, but signaled that Obama and Biden had succeeded — at least initially — at framing the deal more to their base’s liking than Boehner and McConnell. While 58 percent of Democrats and 51 percent of liberals express support for the legislation, fully 64 percent of Republicans and 64 percent of conservatives say they opposed it. (The poll of 1,012 adults was taken Tuesday and has a 4 point margin of error.)

TRADEWINDS: The aviation standoff and the limp debt deal poll numbers are getting more attention than word that Reid and McConnell have hatched a deal on top-tier legislation that may well lead to measurable improvement in the economy.

The Senate leaders said last night that they’ve agreed to a “path forward” for passing an extension of an expanded Trade Adjustment Assistance program in September and then voting to endorse trade liberalization deals with South Korea, Colombia and Panama. The three together hold the prospect for as much as $13 billion annually in additional exports, but they have languished because Obama insisted that congressional action be paired with legislation on TAA, which gives retraining and other aid to people who lose their jobs to foreign competition. McConnell had resisted that because he opposes the TAA program but has essentially been forced to relent because a dozen members of his own caucus have broken with him and announced they would vote with the Democrats in favor of its revival. Boehner is in the same boat.

PREVENTING ATROCITIES: Obama made a pair of moves this morning that should buttress his not altogether rosy relationship with the human rights community. Conceding that “the United States still lacks a comprehensive policy framework” for responding to mass killings overseas — even though it’s been seven decades since the Holocaust and two decades since the genocide in Rwanda — the president announced the creation of an Atrocities Prevention Board to develop ways to ensure that the government responds to such events in time to prevent carnage. And he issued an executive order expanding the grounds for denying human rights violators entry to the United States.

OREGON TRAIL: The field for this year’s fifth special congressional election will firm up pretty quickly now that David Wu has officially quit after almost 13 years in the House. His resignation, which became inevitable after he was accused of unwanted sexual aggression by the 18-year-old daughter of a big donor, took effect at midnight. “However great the honor and engaging the work, there comes a time to hand on the privilege of elected office — and that time has come,” he said in a statement.

The primaries will be Nov. 8 to pick nominees in Oregon’s 1st District, centered in the northwestern Portland suburbs. The general election will be Jan. 31. Once state Sen. Suzanne Bonamici announces today, she’ll be the favorite to win the Democratic nomination — and the seat, which Obama carried by 25 points. Democrats already running are state Labor Commissioner Brad Avakian and state Rep. Brad Witt. Sports business consultant Rob Cornilles, who took just 42 percent as the Republican nominee last year despite reports that Wu’s behavior was stretching the bounds of colorfully erratic, will announce today that he wants another shot.

HAPPY BIRTHDAY: Two fellow Democrats in the House share the president’s birthday: Rob Andrews of New Jersey (54) and Keith Ellison of Minnesota (48).

— David Hawkings, editor

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

Copyright 2011 CQ Roll Call Inc. All rights reserved | Privacy Policy

Wednesday, August 03, 2011

CQ Roll Call Daily Briefing: Plane Truths

CQ Roll Call Daily Briefing

Wednesday, August 3, 2011

Today In Washington

THE WHITE HOUSE: Obama is convening a Cabinet meeting at 2, followed by one-on-ones with Clinton and Holder. He’s leaving at 5 for an evening of 50th-birthday-themed fundraising at the Aragon Ballroom in Chicago: First at a dinner for high-rollers willing to pay $35,800 a plate, then with a huge, $50-a-head crowd and hometown A-list musical acts including Jennifer Hudson and Herbie Hancock. (He’ll also “appear” by video conference at 50-person house parties across the country.) They are the first DNC fundraisers the president has been a part of since the end of June, when the debt standoff kicked into high gear. He will be back in the residence by about 1 in the morning on his big day.

THE SENATE: Not in session. The August recess began at 6:45 yesterday evening. There will be pro forma meetings every few days (so Obama won’t be able to make recess appointments) but the next real session starts at 2 on Tuesday, Sept. 6 — when Reid wants to see if there are 60 votes to pass the House’s version of the patent overhaul.

THE HOUSE: Not in session; the next substantive meeting is five weeks from today: Wednesday, Sept. 7.

WAITING FOR CLEARANCE: As part of their party’s efforts to turn the national policy debate toward jobs and away from debt, three top Senate Democrats are convening a press conference at this hour to explain why they don’t think they’re responsible for the partial shutdown of the Federal Aviation Administration that started 12 days ago and now will last at least a month more.

Their decision not to clear legislation yesterday that would have ended a standoff with House Republicans means furloughs of 4,000 federal employees will continue until Congress returns — and so will the suspension of about 200 airport improvement projects, meaning nothing to do for tens of thousands of construction workers. The impasse also means that — just a day after Obama signed a debt increase bill designed to pare deficits at least $2 trillion in the next decade — the government will lose more than $1 billion in airline ticket tax revenue.

The senators — Reid, Schumer and Commerce Chairman Jay Rockefeller — say they decided to stop even a temporary re-opening of the FAA because it would have denied them leverage in a dispute with Republicans over union-organizing rules. That’s even more important over the long term to the health of the American labor force, they say.

But the provision they’re out to stop isn’t even part of the temporary bill; it’s in a long-term FAA measure that’s hung up in final negotiations. (House Republicans — with a big push from Delta Airlines, the only big non-unionized carrier — want to block a National Mediation Board ruling last year that would allow airline and railroad employees to organize by simple majority vote.) And beyond that, the senators are facing withering criticism that what they really don’t like is that the bill they spurned would have cut subsidies to 13 rural airports, including one each in West Virginia and Nevada.

HELP WANTED: Kyl (who ought to know, since he was the only Senate Republican at the seemingly-so-long-ago Biden summit) is suggesting these qualifications for people on the “supercommittee” that will be named by the end of next week to come up with another $1.2 trillion in deficit reduction before Thanksgiving: “A. Be a glutton for punishment; B. Have a real good bladder; and C. Be able to spend some time in August at this job, which none of us want to do.”

If that sounds like the ultimate thankless job, consider how low the expectations are already sinking that the six members from each party will be able to break the Gordian knot of entitlement cuts and tax increases. And for the next three months, these six senators and six House members will be the singular focus of the entire multimillion-dollar universe of K Street lobbyists. The pressure of their entreaties — both in person and through the barrage of grass-roots campaigns, social media blitzes and old-fashioned TV and print campaigns that will soon get off the ground — should test the mettle of even the steeliest lawmakers.

It sounds like the leaders will not name themselves to the panel, after all, but instead will look for loyalists who are seen as serious players and represent segments of their caucuses. (No Gang of Six rebels need apply, in other words.) Former White House budget director Rob Portman is seen as the model for the type of person McConnell would pick. Pelosi is likely to do the typical Democratic thing and pick factional candidates from her inner circle such as Jim Clyburn and Xavier Becerra. Reid may well pick Baucus — even though he has a reputation (health care being the exception) of straying a little too far off the reservation in search of deals with the Republicans.

Even before learning whether he will get the call, the Finance chairman is weighing whether his committee should write a tax code overhaul plan this fall and send it over to the supercommittee.

AUTOMATIC WEAPON: The reason for pessimism was underscored by Reid yesterday when he declared, without any wiggle room at all, that the panel will come up double zeros for sure unless at least one of the Republicans votes for higher taxes. “They will have no legislation coming out of that committee unless revenues are a part of the mix,” he said on NPR. “It’s a fact of life. And if they don’t like that, then they can look forward to the huge cuts that will take place in sequestration.”

The only thing in the panel’s favor, in other words, is that the prospect of the new law’s "trigger" was even less palatable than whatever the committee cooks up. The prospect of across-the-board cuts to defense spending that Obama and Biden got McConnell and Boehner to sign off on as their “consequence” for no November deal would so rock the Defense Department that it’s tough to imagine them actually being carried out.

VOTES OF NOTE: This week’s debt deal votes will frame some sharp contrasts in some of the hottest Senate races of 2102 — and will muddy the waters in some others. Dick Lugar was one of the 28 Senate Republicans who voted “yes” yesterday; his tea party primary opponent, Indiana Treasurer Dick Mourdock, says he would have voted against the bill because it “merely sets the stage for an even bigger crisis.” But Utah’s Orrin Hatch was among the 19 Republican “no” votes one day after his highly likely primary challenger, Jason Chaffetz, cast the same vote in the House. Republican Sen. Dean Heller of Nevada voted “no” while his principal Democratic challenger, Rep. Shelley Berkley, voted “yes.” And Claire McCaskill and Jon Tester were among the 45 Senate Democrats who voted “yes” a day after two of the Republicans who want their seats, Rep. Todd Akin of Missouri and Rep. Denny Rehberg of Montana, each voted “no.”

NOT WITH A BANG: Sometimes, little nuggets of legislative gold get through the Senate in the hours after the last big vote but before the start of a recess. Last night, not so much. Other than declaring Campus Fire Safety Month and National Chess Day, senators confined themselves to confirming a relatively short list of mostly small-bore nominees. The big three were Army Gen. Martin Dempsey to become chairman of the Joint Chiefs in September, when Adm. Mike Mullen steps down; Matt Olsen to head the National Counterterrorism Center; and Deborah Hersman to chair the National Transportation Safety Board. Six federal trial court vacancies were also filled, and new ambassadors were dispatched to a geography bee’s worth of countries: Vietnam, the Fiji Islands, Nauru, Tonga, Tuvalu, Kiribati, Macedonia, Moldova, Guatemala and Mexico.

BEEHIVE BUZZ: Maybe the most unusual thing Obama has done this week was to nominate a Republican to be the top federal prosecutor in Utah — and not only that, a top lieutenant to one of his most ardent tea party critics on Capitol Hill. The president’s choice is David Barlow, who for the past seven months has been the top Judiciary Committee counsel for freshman Sen. Mike Lee. (The two have been friends since they were undergraduates at BYU.) Democratic lawyers and politicos in Utah says they’re frustrated and miffed that the president passed them by for one of the plum patronage jobs in the government, but Republicans were putting intense pressure on the White House to fill a post that had been vacant for 18 months.

QUOTE OF NOTE: “I don’t see any momentum for more compromise after this deal than there was before. Maybe less,” Mark Halperin said on MSNBC’s “Morning Joe” this morning — reinstated a month after being dropped indefinitely for calling the president “kind of a dick” on the air.

HAPPY BIRTHDAY: Democratic House member (and Senate candidate) Chris Murphy of Connecticut (38).

— David Hawkings, editor

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

Copyright 2011 CQ Roll Call Inc. All rights reserved | Privacy Policy

Tuesday, August 02, 2011

CQ Roll Call Daily Briefing: Time for Recess

CQ Roll Call Daily Briefing

Tuesday, August 2, 2011

Today In Washington

THE WHITE HOUSE:  Obama will end the most potentially cataclysmic policy standoff of his presidency this afternoon when he signs the debt increase and deficit reduction deal. The legislation will arrive in the Oval Office about 10 hours before the Treasury says it would otherwise reach its borrowing limit.

This morning the president started pivoting out of the debt crisis and toward a renewed focus on job creation at a closed-door East Room meeting with leaders of the AFL-CIO Executive Committee. At 3:15 he’s got a photo op with the crew of the Space Shuttle Endeavour — led by commander Mark Kelly. Expectations are growing that Kelly's wife, Gabby Giffords, will be on hand for her second surprise public appearance in as many days.

THE SENATE: Convened at 9:30 and will vote at noon to clear the debt bill. The leaders have agreed to require 60 votes because they’re confident of cresting that threshold with ballots to spare. At least 35 and as many as 40 Democrats will vote for the measure, as will 30 to 35 Republicans, so the final “yes” tally will be between 65 and 75. (The bill passed the House yesterday with 63 percent of the vote — including exactly half the Democrats who voted, three out of four Republicans and two out of three members of the GOP freshman class.)

That will be the final roll call before the summer break begins, but the chamber will stay open for several hours while Reid and McConnell prepare for the traditional pre-recess “wrapup” — by securing unanimous consent to advance a thick pile of routine bills and confirm a long roster of non-controversial nominees.

Chances have all but evaporated that senators will clear a bill ending the partial shutdown of the Federal Aviation Administration, meaning about 1,000 furloughs and the suspension of dozens of airport construction projects will continue until September.

THE HOUSE: Convened at 10 for a brief pro forma session — one of about eight that will be held in the next month to keep Congress technically in session and prevent Obama from using his recess appointment powers. But the August recess has started three days early: Lawmakers have been told their next roll call vote will not be before 6:30 p.m. Sept. 7, the Wednesday after Labor Day.

FOCUS ON JOBS, AGAIN: A paralyzing default may have been avoided, but the post-debt-crisis period for shaping American economic policy is already being filled with more uncomfortable news. Consumer spending dropped 0.2 percent in June, the first such decline in almost two years, the Commerce Department reported this morning — while personal incomes rose just 0.1 percent, the smallest gain in nine months.

After the unemployment rate, consumer  spending is the most closely watched of the economic indicators because it accounts for 70 percent of the GDP. And the July  jobs report comes out on Friday, with a high degree of apprehension about how many new positions were created last month.

Expecting that the news won’t be encouraging, stung by the outcome of the debt impasse and keenly aware that the polls show a public much more interested in jobs than deficits, congressional Democrats are eager to change the subject to their economic prescriptions. Their talking points for town meetings during the next five weeks will start with the assertion that the debt deal’s singular victory for the president (as measured by all the lines in the sand he drew and then erased) was really the most important bottom line of all: Raising the debt limit by at least $2.1 trillion means the Treasury won’t have to ask for permission to borrow more money until about the time the next Congress convenes and the next presidential inauguration takes place. And that means official Washington has 18 months when it should focus almost exclusively on jobs. (This was the main rationale for a “yes” vote that Biden offered Democrats in his back-to-back caucus appearances yesterday.)

The drive to make that happen will begin in the Senate, where Reid’s team is preparing an agenda of relatively low-cost or paid-for measures — some with support from the Chamber and other business groups — that could draw some Republican votes. A renewed push for updating the long-lapsed highway bill — perhaps including the creation of an infrastructure bank for big public works projects that would draw both government and industry contributions — is the most ambitious item on the roster. There’s also talk of extending the current “holiday” for workers from the 2 percent payroll tax that helps stock the flush-for-the-time-being Social Security Trust Fund. (Talk of extending the holiday, and maybe even expanding it to cover the share businesses pay on their payrolls, was dropped early in the debt deal negotiations.) There will also be a revival of debates about indefinitely extending the research and development tax credit and reviving the tax credit for the makers of renewable energy hardware.

‘SUPER’ SKEPTICISM: The recess will also afford some quiet time for the four leaders to each pick their three delegates to the “super committee” that has until Thanksgiving to propose $1.5 trillion in deficit reduction beyond the savings from projected appropriations levels that are “round one” of the cuts for in the budget bill. (Those, by the way, amount to only $756 billion if measured starting after the enactment of the shutdown-avoiding spending package in the spring, the CBO said, well short of the $935 billion Republicans are looking for.)

Who gets put on the committee (the choices are due in two weeks) will be the most important factor in deciding whether there will even be a “round two” deficit reduction package, or whether Congress will be forced to acquiesce in deep across-the-board cuts in both defense and domestic spending. It will only take one of the Republicans, presumably, to form a majority with the six Democratic lawmakers on a plan to make revenue-raising changes in the tax code part of that package — and one Democrat to bond with all six Republicans in favor of making some fundamental changes that slow the growth of Medicare and Medicaid, and maybe even Social Security.

Since the members of this panel would inevitably become agents of the leadership, the odds are strong that the top leaders will name themselves and their deputies — along with perhaps top members of House Ways and Means and Senate Finance. The Democrats haven’t publicly ruled out anyone on ideological terms. But this morning John Cornyn, a top McConnell lieutenant, declared of the Senate minority leader on MSNBC: “I can guarantee you one thing: He’s not going to appoint anyone who would support any tax increases.”

The return to the normal partisan corners — and so soon after one of the few genuinely bipartisan, if limited, legislative bargains of the past few years — suggests neither side is holding out much initial hope for the committee. That skepticism is further underscored by the understanding of how the final debt deal stalled almost completely, and nearly came apart, in the final 36 hours  because of disagreement about the “trigger” that will be pulled if the committee produces no legislation. The workings of the trigger became super-important, obviously, because Biden, Reid, McConnell and Boehner are all expecting a high likelihood that the trigger will get used.

CAMPAIGN IN WAITING: The feel-good story of the summer — Gabby Giffords' genuinely surprising return to the House last night to vote for the debt bill — had the political class buzzing soon enough. While she stood on the floor to 10 minutes of cheering (and a standing ovation that stretched into the galleries, where expressing such sentiment is officially forbidden) she was surrounded by all five of Arizona’s Republican congressmen as well as the state’s two other Democratic House members. But after she used her left hand to operate the voting machine (which she hadn’t used since the day before she was shot in January) and walked haltingly off the floor clutching the hand of top aide Pia Carusone, GOP aides and lawmakers could not help allowing that her triumphant return almost surely meant she’s decided she’s well enough to seek a fourth term in 2012.

Her office then quickly knocked down that expectation. “The congresswoman is working on her recovery, and no decision has been made to seek re-election at this time,” her communications director said. That said, one of Giffords’ best friends in the House, Democratic National Chairwoman Debbie Wasserman Schultz, continues to spearhead fundraising for a campaign in waiting — and said last night that lawmakers should expect to see Giffords on the floor of the House “casting many, many more votes, for years to come.”

WU’S LAST VOTE: David Wu issued a video statement last night explaining why he cast the last vote of his congressional career in favor of the debt deal, and thanking his suburban Portland constituents for making him the first Taiwanese-born person ever in Congress. The statement did not, however, say precisely when his resignation would take effect, and no letter had been received by the clerk of the House or the Oregon governor’s office this morning.

HAPPY BIRTHDAY: Two of the four Democrats who have announced decisions to retire from the House  next year: Mike Ross of Arkansas (50) and Dan Boren of Oklahoma (38).

— David Hawkings, editor

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

Copyright 2011 CQ Roll Call Inc. All rights reserved | Privacy Policy

Monday, August 01, 2011

CQ Roll Call Daily Briefing: Let's Make a Deal

CQ Roll Call Daily Briefing

Monday, August 1, 2011

Today In Washington

THE SENATE: Convened at 10:30 and looks to vote first (perhaps as soon as late in the afternoon) on the deal announced last night to raise the debt limit beyond the 2012 election while mandating at least $2 trillion in spending cuts.

THE HOUSE: Convened at 10 and at noon will begin a debating a series of non-controversial bills (one making it bureaucratically easier for soldiers abroad to become citizens) until the whip teams in both parties are confident they have the votes between them to pass the debt and deficit legislation.  

THE WHITE HOUSE: Obama is spending the day working the phone to round up as many Democratic congressional votes as possible for the deal. His only announced meetings were a 10:30 senior staff session and, just before that, a farewell visit with Gary Locke before Locke steps down as Commerce secretary and heads off to become envoy to Beijing.

Biden is at the Capitol to sell the deal to fellow Democrats. He’s spending an hour with senators now and at noon will  head into a House caucus.

HEATING UP: The hottest month ever recorded in Washington is over — but only meteorological speaking: July’s average daily high was 94 degrees. But one of the hottest months in the history of Washington politics and fiscal policy won’t be over for several more hours and (dangerously) maybe not until tomorrow. And there’s still more than a little suspense about how the record books will end up recording the moment.

Passage by the Senate is locked down: McConnell and Reid each have every reason to be confident of “yes” votes from solid majorities of their caucuses — probably at least 35 (and possibly as many as 45) of the 53 Democrats and at least 30 (and as many as 35) of the 47 Republicans. That’s a floor of 65 votes (and a ceiling of 80), suggesting any last-minute parliamentary protestations being contemplated by the tea party right (Mike Lee of Utah is the potential ringleader) won’t get very far. Procedurally, Reid has engineered an elegant parliamentary solution — it involves formally “reconsidering” one of the votes from the weekend — that allows him to get a straightforward vote on the deal without any cloture votes or other procedural delays — assuming he gets just one unanimous request granted by the conservatives (on what’s normally a routine ask).

The formula for making a majority in the House is not as clear, and it gets more complicated every hour the bill lies out in the sunshine — where it will be poked at and spurned by more and more advocacy groups and their congressional allies at both ends of the ideological spectrum. (Congressional Black Caucus chairman Emanuel Cleaver urged fellow lawmakers on the left to reject it as a “sugar-coated Satan sandwich.” Senate Armed Services Republican Lindsey Graham said the deal "will destroy our nation’s defense infrastructure at a time when we need them the most.")

The situation makes Pelosi, who has spent so much of the year in a remarkably diminished posture, the indispensable woman for the next day. With the help of her rival and deputy, Hoyer, she will need to swallow her own liberalism long enough to find probably as many as 64 Democrats — one-third of her caucus — willing to vote for a deal that does almost nothing for the party’s priorities and tarnishes its president’s reputation for parceling out his political capital at just the right time.  

The number could need to be that big because Boehner is going to lose at least triple and maybe even four times the Republicans he lost (22) when his plan passed on Friday. The Speaker’s own endorsement of the package last night — “Now listen, this isn’t the greatest deal in the world, but it shows how much we’ve changed the terms of the debate in this town,” he said in a conference call with his caucus — is not going to be enough to bring along even a majority of the tea party freshmen on the second round. And if as many as 88 Republicans vote “no” in the end, that means only 152 will vote “yes.”  That is 64 votes short of 216, the magic majority-guaranteeing number for the moment (because  two House seats are vacant and two members aren’t well enough to be in town for the votes.)

NO HOME FOR THE HOLIDAYS:  If the debt crisis-averting deal becomes law by the Tuesday night deadline, then Congress could be sent home for the summer recess as soon as the next day, or two days ahead of schedule. (The assumption is that the get-out-of-town votes will end up being on a much smaller deal, which remains elusive today, that puts aside the current disputes over rural flight subsidies and Delta’s labor relations and reopens all of the Federal Aviation Administration.)

But whatever days the lawmakers get with their families this summer are more than likely to be taken away at the end of the year — at both Thanksgiving and Christmas. That’s because the new Joint Select Committee on Deficit Reduction, the panel of three lawmakers from each of the four corners of the Capitol being created by the bill, is being given a deadline of Wednesday, Nov. 23 (the day before the turkey gets carved) for proposing at least $1.2 trillion and as as much as $1.5 trillion in deficit reduction.

Assuming the panel does not announce a deadlock on that day — which is a big assumption, unless a Gang of Six GOP senator who has shown a willingness to raise some new revenue gets one of the seats — then the deadline for the House and Senate to cast their up-or-down votes on the committee’s package is Friday, Dec. 23. As in two days before Christmas.

If the committee reaches an impasse at Thanksgiving, then in theory Congress would not have not much to do in December — assuming it finished making an initial down payment on the $917 billion in spending cuts during the next decade promised under the deal, which would happen through completing the regular appropriations process.  But at the same time, it would be difficult to imagine lawmakers going home for the holidays while the bill’s tough trigger is kicking in —  the automatic cuts to both domestic and defense programs as well as to  Medicare payments to doctors and hospitals. If Congress does not enact at least $1.2 trillion in deficit reduction, a “sequestration” budget process would be triggered to find the difference. In other words, if the panel  came up with an $800 million plan, $400 billion would be sequestered — and equally from defense and non-defense accounts. It’s similar to the system enacted as part of the 1985 Gramm-Rudman-Hollings anti-deficit law and the 1997 law that produced the last run of balanced budgets.

BETTER BEFORE IT GETS WORSE: But the deal actually makes finishing this year’s spending bills a little easier. While it  sets  discretionary caps of $1.05 trillion for fiscal 2013 (starting more than a a year from now), the cap is $1.04 trillion for fiscal 2012, the budget year that starts in October — a grand total that’s about $24 billion more than the House has been working  toward. (There’s  also a “firewall” between defense and non-defense spending, meaning that domestic accounts can’t be raised to bump up spending on the Pentagon, the VA or homeland security.)

TAXING MYSTERY: The deal makes no mention of tax increases, but neither does it prevent them. And in some ways it could make them more likely than not. The Republicans are arguing strenuously that the bill’s ground rules for the committee’s work — which as to do with what the budgetary baseline is for calculating deficit reduction — makes it effectively impossible for the panel to propose tax changes of almost any kind. But if there’s no bill from the special committee, there’s also nothing to prevent all of the Bush tax cuts from expiring at the end of 2013, which would generate some $3.6 trillion in revenue during the next decade. And that’s the way the White House is spinning it — that the panel can make just the sort of changes the president wants — not only the politically potent loophole closing for corporate jets and oil subsidies, but also for ending the tax cuts for the highest earners — so long as one Republican can be found to take that tough vote.


HAPPY BIRTHDAY:  Republican Sue Myrick of North Carolina (70) today; two of her House colleagues, Republican Joe Wilson of South Carolina (64) and Democrat Betty Sutton of Ohio (48), yesterday.

— David Hawkings, editor

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