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Budget Committee update

Senator Patty Murray (D-WA) and Rep. Paul Ryan (R-WI), who chair the budget super committee set up as a result of the deal to end the government shutdown, are optimistic a deal can be reached on spending levels through 2015.

While the long sought "grand bargain" appears to once again be out of reach, Murray and Ryan are close on a smaller deal, and even a smaller deal would be a positive step considering the gridlock in Washington these days.

Murray and Ryan are trying to wrap up a budget agreement that would set 2014 discretionary spending levels near $1 trillion, while replacing the sequester with alternative, targeted spending cuts. No cuts will be made to entitlement programs like Medicare, Medicaid and Social Security.

The potential deal also includes increasing revenue by way of increasing fees on airline ticket purchases. It doesn’t include revenue from tax increases. 

One sticking point is a GOP proposal to raise retirement benefit payments by federal workers, an idea that President Obama also suggested in his own budget plan. Democratic leaders overall have been lukewarm on that proposal, with some - including House Minority Whip Steny Hoyer, strongly opposing such a move.

Click here to view the Washington Business Brief -- Budget Update, Immigration Reform and Charitable Tax Changes.

House Republicans poised to pass CR

If Rep. Paul Ryan and Sen. Patty Murray fail to produce the framework for a budget agreement early next week, Republicans in the House are prepared to pass a short-term Continuing Resolution as a preemptive measure - to avoid another government shut down - before heading home for the holiday break next Friday.

Republican leadership in the House doesn't want to step on the work of Ryan and Murray, especially at a critical point in the negotiations, but they can't afford to wait much longer to act. The House has a three-day rule for moving bills from the Rules Committee to the House floor. That means, barring extraordinary maneuvering, GOP leadership must file its CR no later than Wednesday to pass the measure by Friday.

The House adjourns Dec. 13 for a three-and-a-half-week holiday recess, the same day budget negotiators must report to Congress whether they have reached a long-term agreement to set spending levels and soften sequestration cuts. Congress does not reconvene until the week of Jan. 6.

The expected Republican House CR would set spending levels at $967 billion - a level of spending that Democrats, both liberals and centrists, say is too low. If Democrats remain united in their opposition to this CR, Speaker of the House John Boehner would need the votes of all but 15 of his caucus to pass the measure - something that could be a challenge. 

Volcker rule expected next week

The final version of the much-anticipated Volcker rule intended to serve as a central pillar of the Dodd-Frank overhaul is expected to be unveiled next week. But lingering disputes among regulators and anticipated lawsuits could further delay implementation of the law more than three years after it was enacted.

The Commodity Futures Trading Commission and Federal Deposit Insurance Corp. will hold public meetings on Dec. 10 to consider the rule, designed to curb banks from making speculative trades that don’t benefit customers. Three other agencies that also have a hand in implementing the rule — Federal Reserve, the Office of the Comptroller of the Currency and the Securities and Exchange Commission — have not yet announced their plans.

Financial interests expect the final rule may be stronger than a version proposed two years ago. 

Farm Bill update

There are positive signs coming from lead negotiators on the farm bill conference committee that a deal could be reached early next year.

The top four farm bill conferees — House Agriculture Chairman Frank D. Lucas (R-OK), House Agriculture ranking member Collin C. Peterson (D-MN), Senate Agriculture Chairwoman Debbie Stabenow (D-MI), and Thad Cochran (R-MS) — met Wednesday for just over an hour and both sides said that differences were "narrowed."

The principal disagreements between Republicans and Democrats with the farm bill are over the nutrition and commodity titles.
The Republican House bill would cut an estimated $40 billion from the Supplemental Nutrition Assistance Program — more commonly known as food stamps — while the Democratic Senate bill would cut just $4 billion over 10 years. In the commodity title, the major disagreement is whether to pay farmers based on base acreage or planted acreage.

The Doc Fix

This week, Senate Finance Committee Chair Max Baucus (D-MT) said his committee will consider so-called "doc fix" legislation to repeal the rate formula used for physician reimbursement under Medicare. Baucus sent out a notice to fellow committee members announcing they will meet in "open executive session" on Dec. 12 "to consider an original bill to repeal what is officially known as the Medicare Sustainable Growth Rate (SGR) formula."

The legislation that Baucus will offer will be distributed 48 hours before the start of that meeting.

However, there remains significant stumbling blocks to any major overhaul of the doc fix—including how to pay for it—even as bipartisan support for repeal has gained momentum.

Unless Congress acts by Jan. 1 in some manner, Medicare physician payments will be cut by about 24.4 percent.

On Oct. 31, Baucus and Finance Committee ranking member Orrin Hatch (R-UT)—joined by House Ways and Means Chairman Dave Camp (R-MI) and that panel's top Democrat, Rep. Sander Levin (D-MI)—released a "discussion draft outline" on permanently fixing the SGR. That draft called for a SGR repeal that would include a 10-year freeze and a performance-based incentive program starting in 2017.

It remains uncertain how any permanent SGR fix, or another temporary one, might ultimately be approved this year, either as a stand-alone item or part of a larger budget bill possibly being worked out by a bipartisan budget conference committee.

It also is not clear where budget offsets might be found to pay for a permanent repeal. The Congressional Budget Office estimated earlier this year that it would cost about $139 billion over 10 years, which was lower than previous CBO estimates.

Political bits:

House

California 25th Congressional District: Former State Senator Tony Strickland (R-CA) announced he was switching from a run in the 26th C.D. to a run in the 25th C.D., which is currently represented by Rep. Buck McKeon (R-CA) - leading to speculation that McKeon will retire.

Maine 2nd Congressional District: Former State Senator Richard Rosen (R-ME) announced he will not seek the GOP nomination for this potentially competitive open seat.

New Hampshire 1st Congressional District: NH State Rep. John Cebrowski (R-NH) is seriously considering a run in 2014. Former U.S. Rep. Frank Guinta (R-NH) is already a candidate.

New York 13th Congressional District: Rep. Charlie Rangel (D-NY) will seek a 23rd term in 2014.

Senate

Arkansas: Senator Mark Pryor (D-AR) is up with a new TV ad where he talks about his faith in the Bible.

Kentucky: The Chamber of Commerce is running ads in support of Senate Minority Leader Mitch McConnell (R-KY) touting his support for coal.

New Hampshire: Former U.S. Senator Bob Smith (R-NH) announced that he will run for the GOP nomination for Senate.

New Hampshire: Former U.S. Senator Scott Brown (R-MA) will keynote the NH GOP's Holiday reception on Dec. 19, but is unlikely to make a decision on whether he runs for Senate in New Hampshire until January.

Wyoming: The newly-formed Cowboy PAC, which is supporting Liz Cheney's (R-WY) challenge to Republican Senator Mike Enzi, is holding a $10,000 per-couple fundraiser in DC featuring former Vice President Dick Cheney.

A look ahead:

House

Tuesday, Dec. 10 – The House Foreign Affairs Committee's Africa, Global Health, Global Human Rights and International Organizations Subcommittee and Middle East and North Africa Subcommittee will hold a joint hearing on Human Rights Abuses in Egypt at 9:00 a.m. in 2172 Rayburn.

Tuesday, Dec. 10 – The House Foreign Affairs Committee will hold a hearing on The Iran Nuclear Deal: Does It Further U.S. National Security? at 1:00 p.m. in 2172 Rayburn. Secretary of State John Kerry is scheduled to testify.

Wednesday, Dec. 11 – The House Administration Committee will hold a hearing on Establishing a Commission to Study the Potential Creation of a National Women's History Museum at 10:30 a.m. in 1310 Longworth. Witnesses include Reps. Marsha Blackburn (R-TN) and Carolyn Maloney (D-NY).

Wednesday, Dec. 11 – The House Foreign Affairs Committee will hold a hearing on Afghanistan 2014: Year of Transition at 10:00 a.m. in 2172 Rayburn.

Wednesday, Dec. 11 – The House Energy and Commerce Committee's Health Subcommittee will hold a hearing on Patient Protection and Affordable Care Act Implementation Failures: What's Next? at 10:00 a.m. in 2123 Rayburn. HHS Secretary Kathleen Sebelius is scheduled to testify.

Wednesday, Dec. 11 – The House Small Business Committee will hold a hearing on The Small Business Health Options Program: Is It Working for Small Businesses? at 1:00 p.m. in 2360 Rayburn. Gary Cohen, deputy administrator and director of the Centers for Medicare and Medicaid Services' Center for Consumer Information and Insurance Oversight, is scheduled to testify.

Senate

Monday, Dec. 9 – The Senate will resume consideration of S.1197, the National Defense Authorization Act, at 4:00 p.m.

Monday, Dec. 9 – The Senate will proceed to executive session to resume consideration of the nomination of Patricia Millett to be U.S. circuit judge for the District of Columbia Circuit at 5:00 p.m. At 5:30 p.m., the Senate will proceed to a vote on confirmation of the Millett nomination.

Tuesday, Dec. 10 – The Senate Banking, Housing and Urban Affairs Committee will hold a hearing on Housing Finance Reform: Fundamentals of Transferring Credit Risk in a Future Housing Finance System at 10:00 a.m. in 528 Dirksen.

Tuesday, Dec. 10 – The Senate Finance Committee will hold a hearing on the nomination of John Koskinen to be commissioner of Internal Revenue at 10:00 a.m. in 215 Dirksen.

Tuesday, Dec. 10 – The Senate Foreign Relations Committee will hold a hearing on The Transition in Afghanistan at 2:30 p.m. in 419 Dirksen.

Wednesday, Dec. 11 – The Senate Judiciary Committee will hold a hearing on Continued Oversight of U.S. Government Surveillance Authorities at 2:30 p.m. in 226 Dirksen. Gen. Keith Alexander, director of the National Security Agency, is scheduled to testify. 
           

Washington by the numbers

29,000 - The number of HealthCare.gov insurance enrollees Sunday and Monday, more than the entire month of October.

28 - The percentage of Americans who will pay a fine rather than purchase health insurance. 

They said what?

“[I]f the Democrats think that Yoko Ono and Lady Gaga should be setting American energy policy, I am happy to go on record denying that it's a good idea.” -- Louisiana Gov. Bobby Jindal, accusing Democrats of taking their cues from Hollywood. (National Journal)

Washington humor

"The president said despite the initial problems, it's working better now and going to continue to improve. A million people visited on Monday, mostly to see if they were covered from injuries suffered at Wal-Mart on Black Friday." –Jimmy Kimmel

 

 

 Steven C. LaTourette, President | 202.559.2600

McDonald Hopkins Government Strategies LLC
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www.mcdonaldhopkinsgs.com

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