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Obama pivots to jobs

After months of hot button issues like immigration reform, global climate change and gay marriage dominating the White House’s agenda, this week President Obama pivoted and turned his attention to jobs and the economy.

In a series of speeches delivered this week, President Obama attempted to paint Republicans as obstructionists and made the case that while the economy was improving – more needs to be done.

President Obama, in an almost campaign like swing, made the case for increased spending on infrastructure projects like roads, ports, rail, and the electric grid. While making the case for new projects to spur economic growth, the president also threw down the gauntlet on the question of the upcoming fight over raising the debt ceiling. Speaking in Jacksonville on Thursday, President Obama said:

"Shutting down the government just because I'm for keeping it open – that's not an economic plan…Threatening that you won't pay the bills in this country, when we've already racked up those bills, that's not an economic plan – that's just being a deadbeat."

Budget battle: Congress headed towards continuing resolution

Congress appears to be heading towards a continuing resolution to keep the government funded beyond the current fiscal year. The current continuing resolution, a measure which is supposed to be a temporary legislative fallback, is set to expire on September 30th of this year.

That September 30th deadline leaves Congress only nine scheduled legislative days in September once they return from their August recess.

The House and Senate have moved forward on very different budget paths. The Democratic-led Senate is operating under a $1.058 trillion figure for discretionary spending and House Republicans are operating under a $967 billion topline figure, a figure President Obama has said he would veto in appropriations bills.

While a continuing resolution seems to be a fait accompli, at this point many questions still remain about what such a continuing resolution would look like: What level of spending will be included, how many different appropriations bills will be rolled into it, how will it deal with the sequester cuts, and how long will a new continuing resolution last?

Senate to markup comprehensive tax reform in the fall

This week, Senate Finance Committee Chair Max Baucus (D-MT) announced his committee will markup comprehensive tax reform legislation this fall. Baucus, who is retiring at the end of his term, is working closely with Senator Orrin Hatch (R-UT), the ranking Republican on the Finance Committee, to lay the groundwork for this almost Herculean legislative effort.

Baucus and Hatch have taken a “blank slate” approach to comprehensive tax reform, putting the onus on supporters of current provisions of the tax code to make the case on why their provision should be contained in the code moving forward.

Baucus and House Ways and Means Committee Chairman Dave Camp (R-MI) have made passage of comprehensive tax reform the number one item on both of their committees' agenda and the two have travelled the country seeking input on potential changes.

While the bipartisan push for tax reform intensifies, many still remain skeptical that a deal can be struck. The looming debate over the debt ceiling and the need for a continuing resolution to fund the government beyond September 30th are both pressure points that could have created an opening for a “grand deal” necessary to get the kind of meaningful comprehensive tax reform that both sides are pushing for. However, leaders on both sides of the aisle have signaled an unwillingness to deal on either of these issues – with Republicans holding the line on spending and refusing to give in on revenue, and Democrats pushing for higher spending levels and increased revenue.

Thursday afternoon, Senate Majority Leader Harry Reid (D-NV) and the Democrat’s number three ranking member, Senator Chuck Schumer (D-NY), appeared to dismiss Baucus’ effort, instead focusing on supporting the budget blueprint drafted by Senator Patty Murray (D-WA).

House Republicans delay markup of labor, health and education

This week, House Republicans delayed indefinitely markup of the appropriations bill covering labor, health and human services and education.

Democrats claim the delay shows the Republicans are worried how their push for deep spending cuts will look. Republicans claim the delay was only caused by a flurry of other appropriations activity.

If Republicans stick to their topline numbers, which they are expected to do, that approach would translate into a 22 percent cut in funding in the labor, health and education spending bill from its fiscal 2013 enacted level. Since details of the measure have not yet been made public, exact amounts for proposed cuts to certain programs are unavailable.

However, if the 22 percent cut is applied evenly across all accounts, Democrats say that would mean such reductions as a $6.7 billion cut from the National Institutes of Health; $2.8 billion from special-education programs; $1.2 billion from the Centers for Disease Control and Prevention; $3.5 billion from aid for disadvantaged students; $1.1 billion from job training efforts; $1.8 billion from Head Start; and $764 million from substance abuse and mental health services. 

Political Bits:

House

Minnesota 3rd District: Ex-TV news anchor Don Shelby (D) is reportedly mulling a run against Rep. Erik Paulsen (R-MN) potentially putting in play a suburban Minneapolis Congressional District that has been in Republican hands for decades.

New York 13th District: Former New York Gov. David Paterson (D) is considering a bid for Rep. Charles Rangel's House seat if the New York Democrat decides to retire. Rangel has said his current plan is to run for re-election.

Senate

Georgia: The crowded Georgia Senate field got even more crowded this week. Businessman David Perdue (R) and former Sen. Sam Nunn’s daughter, Michelle Nunn (D), both announced they are running to replace retiring Sen. Saxby Chambliss (R-GA). Perdue joins a GOP field that already includes Reps. Paul Broun, Jack Kingston and Phil Gingrey, and former Georgia Secretary of State Karen Handel.

Kentucky: Businessman Matt Bevin (R) announced this week that he would challenge Senate Minority Leader Mitch McConnell in the Republican primary next year. Several Tea Party groups have been looking for a challenger to McConnell for the last few months.

2016: Because it's never too soon

Invoking the families of 9/11 victims, New Jersey Gov. Chris Christie (R) on Thursday heatedly denounced the growing libertarian drift on national security in the GOP that is favored by another potential 2016 presidential candidate Sen. Rand Paul (R-KY).

A look ahead:

House

The full Energy and Commerce Committee is expected to hold a markup on “doc fix” legislation before the August recess.

Senate

Tuesday, July 30 – The Senate Banking, Housing and Urban Affairs Committee will hold a full committee hearing on Mitigating Systemic Risk in Financial Markets Through Wall Street Reforms at 10:00 a.m. in 538 Dirksen. Securities and Exchange Commission Chairman Mary Jo White and Commodity Futures Trading Commission Chairman Gary Gensler are scheduled to testify.

A bipartisan energy-efficiency bill may hit the Senate floor next week.

Washington by the numbers

25 percent – The share of North America’s internet traffic accounted for by Google, according to Wired.

Washington humor

“The TSA just announced that passengers can pass through security without taking their shoes off if they’re willing to pay an extra $85. That explains the TSA’s new motto: ‘We catch terrorists who don’t have an extra $85 on them.” – TBS’s Conan O’Brien

 

 Steven C. LaTourette, President | 202.559.2600

McDonald Hopkins Government Strategies LLC
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www.mcdonaldhopkinsgs.com

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