To Be or Not to Be: Can Washington Work Together? That Is the Question

What’s on the agenda?

As the second term of Barack Obama’s Presidency begins and the 113th Congress convenes, most Americans wonder whether the two parties and the two branches of government can work together to find common ground and address the numerous critical, salient and important issues facing the nation.

The list of issues to be addressed is quite long. Most obvious and urgent is legislation related to the budget and the economy. These include sequestration, the continuing resolution for FY 2013 budget, a FY 2014 budget (overdue to be presented by the President) and the debt ceiling. Topping the list important issues are Immigration reform, gun control and tax reform (includes construction bonds). Also, there are the farm and transportation bills that need to be passed by Congress. The House Republicans have stated that they want to let all of the controversial bills originate in the Senate and let them take action first, except for those concerning taxes and revenue.

Then there is legislation that is long overdue to be reauthorized including the Elementary and Secondary Education Act (No Child Left Behind) and the Workforce Investment Act. Other education bills that need to be addressed during the 113th Congress are the Higher Education Act, career and technical education (Perkins Act) and Individuals with Disabilities Education Act. One cannot ignore revising the e-rate given the push for digital and blended learning along with the excitement over MOOCs. This is only the tip of the legislative agenda iceberg.

 

Fiscal cliff, appropriations, the budget and debt ceiling

Each of the above has a scheduled drop-dead date that can be moved, but still carry serious economic and political implications. They are:

Feb. 1: The President is supposed to submit to Congress the administration’s next fiscal year budget, which is usually dead on arrival. He has already missed this deadline but intends to present his FY 2014 budget in mid-March after the February 12, State of the Union address.

March 1: Government spending cuts — automatic across-the-board spending cuts totaling $110 billion for the current fiscal year are set to take effect (unless another delaying action). This is sequestration. On February 5, President Obama made a proposal to delay the cuts (see below), as did Congressional Republicans and Democrats later in the week. Without any action cuts will be enacted as will furloughs and layoffs of federal employees.

March 27: Expiration of government funding — a measure that authorizes spending by government agencies expires. This is for fiscal year 2013. Without Congressional action on the existing continuing resolution, the government will shut down.

April 15: Budget deadline — the House and the Senate must pass budget blueprints that include tax and spending priorities. The Senate has not adopted such a budget resolution in nearly four years. It does plan to submit its own budget by this date.

May 19: Debt ceiling — the legal debt ceiling is to be suspended until this date. The government can borrow money to meet spending obligations as needed until then. This is another extension of the debt ceiling that passed Congress and signed by the President.

 

The strategy and the politics (or visa versa)

Sequestration: When this session of Congress began there was a deep divide and a difference in strategy between the two houses and parties. The prospects are not looking good that a solution will be reached. Sequestration may be inevitable. However, one floated proposal that is a combination of closing tax loopholes for mega corporations (increase in revenue) and selective budget cuts may drive an agreement if it seems reasonable. The President spoke to this in his State of the Union Address but he got a lukewarm if any response from Republicans. Other proposals will appear in the next few weeks but it may be futile. Mitch McConnell’s response was, “Read my lips: I’m not interested in 11th hour negotiation,” in reference to the sequester, predicting that it will happen.

The fear of severe cuts to the military and selected domestic programs has woken up Congress to the reality. The issue dividing the houses and the parties revolves around the components of a compromise — program cuts and revenue generation. Democrats want more revenue generated from changes in the tax code. Republicans want more cuts to domestic programs and minimal, if any, to defense. The question is can they come together by March 1 to find common ground. This is a tough call.

One alternative is to agree to delay implementation of sequestration for three months or more to enable Congress to come to a long term deficit reduction strategy that combines program budget cuts and some revenue generated from closing tax loopholes over an above what the President successfully got in the debt ceiling agreement to raise income taxes on the most wealthy individuals. In the President’s State of the Union address, he calls for compromise and working together to address the differences.

As of February 11th, the House Republican leadership has stated that it will not introduce any tax related bills that produce revenue. This could change. Remember, that all revenue bills must originate in the House. So if none are developed, the Senate cannot act on its own, thus halting Senate Democrats from their strategy. This is the latest weapon in the sequester wars. Unless there can be some agreement, sequestration seems to be inevitable. This begs other questions as to what deficit hawks may require which would include deeper budget cuts than the sequester.

House Republicans have also stated they have already passed legislation to stop the cuts and do not want to draft any new legislation until the Senate passes a budget.

On Feb. 5, President Obama called on Congress to pass a small package of spending cuts and tax changes to delay the start in March of deep cuts in domestic and defense spending (sequestration) that could deliver a blow to a fragile economic recovery. With time running out, Obama says, Congress should adopt measures to postpone the automatic spending reductions for a few months. Without any action, the cuts, worth $1.2 trillion over a decade, are scheduled to take effect March 1. This is causing deep anxiety among government workers and contractors. In his statement, the President gives no specifics.

Several Republicans seem to favor allowing the sequester to go forward because it guarantees sharp cuts in spending. House Speaker John Boehner (R-Ohio) has said Republicans would oppose any tax increases and noted that Obama was the one who first proposed sequestration.

Pending sequestration cuts include: $6.6 billion at Health and Human Services; $3.7 billion each at Homeland Security, Education and Housing and Urban Development; $2.5 billion at State and Energy; and $43 billion at Defense.

Just before the President’s announcement on Feb. 5, the Congressional Budget Office released its economic projections for the year ahead. It says that by the end of 2013, the federal budget deficit will come in under $1 trillion — the first time in five years. The gap between taxes and spending is estimated to narrow to $845 billion in the fiscal year that ends in September.

The Budget: Senate Budget Committee Chairwoman Patty Murray (Wash.) has announced that her committee will draft this year a budget blueprint; a return to the senate's regular order of business that could lead to an adoption of a Senate budget for the first time in four years. This came on the heels of a similar pledge by Democratic Senator Charles Schumer (N.Y.). Her pledge is significant, since she chairs the key committee responsible for moving the spending plan to the Senate floor.

Republicans have drafted a budget blueprint for each of the last several years in the House. Though the draft bills will be different, there is some hope that common ground can be found in the conference committee.

With the President presenting his budget so late adds to a very tight schedule for an agreed upon budget blueprint from both houses of Congress.

Continuing Resolution: This may end up being the most problematic. There has been some noise that the Republicans in the House will not address or vote against extending the continuing resolution. Others think this is a very risky political move. This analysis seems to be changing the thinking by House Republicans. It is now trying to avoid a government shutdown drama by passing a funding bill in February rather than waiting until the end of March. The bill would adhere to sequester mandated levels. This would thwart Senate efforts to get their bill in the hopper first with higher levels of funding. Will there be a shut down similar to what occurred during the Clinton Administration? Who will blink first?
 

Other hot button issues

There seems to be bipartisan efforts for both gun control and immigration reform. Different proposals have been drafted by a combination of Democrats and Republicans.

On gun control, there seems to agreement that the legislation needs to address at a minimum mental health services and access to firearms, elimination of large ammunition clips and the creation of a universal background check during the purchase of all firearms. There is disagreement over the assault weapons ban and this probably won’t make it into a final bill in either the House or the Senate.

Numerous bills have been or will be introduced, but there is significant hope that this issue will have a bipartisan bill during the first session of the 113th Congress.

Immigration reform seems to be gaining common ground on key elements that need to be included in legislation. There maybe some Republican pushback on the road to citizenship. Members seem to understand the depth and importance of this issue and have begun to address it through conversations, proposals and bipartisan meetings. Common ground may be found early in the session and drafted legislation will have few differences between the House and Senate. But, the devil will be in the details and something can always go awry to derail committed efforts.

The elements are still being worked out. There will also be a proposal from the President on immigration reform. The test will be how close the two or three proposals will be.

Tax reform will take longer. It is also included in sequestration and budget negotiations since changes in the tax code can provide additional revenues. Changes in the code can be interpreted as a tax increase for an individual or an industry to which the Republicans are presently objecting given the tax increase deal they made with the President to temporarily avoid the fiscal cliff.

One other issue seems to be coming to the forefront based on the President’s State of the Union Address. It is climate change. No question, it will have a divided debate and proposed solutions will become politically volatile.

 

Education and workforce

As was stated above, there are several pieces of legislation that require reauthorization. Given the Republicans are the majority in the House and the Democrats in the Senate, they do not necessarily have the same priorities.

The chairs of the two authorizing committees seem to be interested in trying one more time to reauthorize the Elementary and Secondary Education Act (ESEA), but there are significant differences in what should be included.

The Senate Health, Education, Labor and Pensions Committee (HELP) has a new ranking member, Senator Lamar Alexander (Tenn.). He worked closely with the chair, Senator Tom Harkin (Iowa), to get a bill out of committee in the last Congress. This is Harkin’s last hurrah since he has announced that he will not run for re-election in 2014. We may see movement.

On the House side, Congressman John Kline chairs the Education and Workforce Committee and he has stated that he is interested in moving ESEA as well as addressing the Higher Education Act.

Other key bills that both committees will have to address include the Workforce Investment Act, Individuals with Disabilities Act and the Perkins Act (Career and Technical Education). But they will most likely be delayed until the second session in 2014 and be stymied by the election cycle.

 

In conclusion

There is some good news. They may find some agreement and common ground to pass immigration reform. Wiser minds may realize there is a need to extend the continuing resolution, and possibly come to a sensible compromise to begin to make programmatic budget cuts and find tax loopholes to generate revenue, all of which reduce the deficit. Gun control will take longer but something will be completed during this session.

One would hope that the members of Congress listened to voter discontent in November 2012, with how little was being accomplished and they will do something about it that is productive and constructive.

The big problem is predicting anything this Congress will do. There is a battle of personalities and political philosophies. Positions change day-to-day and new proposals seem to be popping up every day to address the most critical issues and topics. Conventional wisdom is out the window! Stay tuned!

Fritz Edelstein is a principal in Public Private Action, a consulting group. His work focuses on strategic government and constituent relations, business development strategy, advocacy research and policy analysis, strategic planning and resource development, and advocacy, outreach and public engagement. This work includes producing Fritzwire, the education Internet newsletter providing timely information on education and related issues. Read Fritzwire, Education’s Water Cooler, everyday to keep up with what is happening in education around the nation and in Washington, D.C. To subscribe write: fritz@publicprivateaction.com.

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