Washington Update 12.07.2021

If you’re hanging around with nothing to do and the zoo is closed, come over to the Senate.  You’ll get the same kind of feeling and you won’t have to pay.” – Sen. Bob Dole

Such was the wit and wisdom of Sen. Bob Dole (R-KS), a war hero and statesman who passed away Sunday at the age of 98.  There aren’t many like him left, but his legacy, as with his sense of Congress as a menagerie, will live on.

A quiet chaos has gripped the Capitol.  A government shutdown was averted, but the hard part—a budget deal—was punted until next February.  Now we’re left with what was once considered easy: the National Defense Authorization Act (NDAA); and the part that seems like it will last forever: the Build Back Better Act; and the part that few seem to notice: an across-the-board sequester, starting in January, unless Congress intervenes.

So, what happens next?  We’ll take a stab.  The first question on everyone’s mind is timing.  Can reconciliation pass both chambers before Christmas?  It’s possible, but for that to happen, the Senate must run nearly non-stop, with near-perfect efficiency.  What was that Bob Dole quote again?

The “Byrd bath,” a much-abused term, won’t run its course until later next week (at the earliest). Getting final determinations from the Senate Parliamentarian requires Republicans and Democrats in the room, with final text and CBO/JCT scores.  That will take time.

Also note that CBO committed to the Senate Budget Committee (Republicans) to run a full, ten-year score (no budget gimmicks, no “sunsets”) of the Senate substitute (which hasn’t been released yet).  While the full score is not required for floor purposes, Sen. Manchin (D-WVA) may want to see it before casting his final vote.  That, too, will take time.

CBO’s full score, plus the next round of inflation numbers on Dec. 10 from the Department of Labor (bound to get Manchin’s attention), along with a host of issues now being, and yet to be, negotiated (methane tax, oil and gas leasing restrictions, paid family leave, SALT, international tax provisions, among others), will also take time.

This is a long list to check off in the next 3 weeks.  Again, possible, but Herculean to pull off.  Then there’s the fight over how to avert financial default.  There will be no default; the question is how that happens.  Including a debt-limit suspension in NDAA was floated this weekend, yet that seems far-fetched.

As of now, reconciliation is still possible.  Some Republicans are brokering a deal that entails a relatively painless Senate Budget Committee markup (few or no amendments) and floor debate (i.e., a very short vote-a-rama). Senate Republican Leader Mitch McConnell (R-KY) has a plan that he will share with Republican Senators at their weekly Tuesday lunch.  We will likely know more about next steps after that meeting.

And don’t forget the sequester, triggered earlier this year by President Biden’s $1.9 trillion American Rescue Plan Act.  We’ll spare you the details, but Congress has simply waived the sequester under the Budget Control Act over the last decade. It expires on Dec. 31st.  The rescue plan also triggered the statutory PAYGO sequester, requiring hundreds of billions in mandatory spending cuts (Medicare and much else) starting in mid-January.

Normally this kind of thing gets buried in an omnibus spending bill, but that won’t happen, if at all, until early next year.  The sequester can’t be tucked into reconciliation.  In the strange world of DC budgeting, the sequester is an accounting mechanism, meaning it doesn’t score.  Which means it violates the Byrd rule.  How does it get done?  Congress will likely find a way but getting there could be painful.

In the meantime, the Department of Justice just announced it will sue Texas over its redistricting map.  Last week the Supreme Court heard oral arguments in a case that could result in the demise of Roe and Casey.  Inflation is expected to worsen, with energy prices projected to skyrocket come winter.  Will any of this matter come November 2022?  Some of it will.  Hard to say what.  In any case, welcome to the zoo.


Debt Limit / NDAA – With the government funded until February, the next major deadline for Congress is the debt limit.  The discussions about using NDAA to carry it run right into House Republicans, who, fresh from their fight on the bipartisan infrastructure bill, won’t provide an easy out for House Democrats.

This is particularly true after former President Trump has issued multiple threatening statements, warning Republicans not to negotiate away the debt limit while reconciliation lumbers along.

House Democratic leaders face similar difficulties, as 38 Democrats voted against the House version of NDAA several months ago.

Meanwhile, with the Senate defense bill in doubt, staff for the so-called “Big 4”—House Armed Services Chairman Adam Smith (D-WA) and Ranking Member Rep. Mike Rogers (R-AL); Senate Armed Services Chairman Jack Reed (D-RI) and Ranking Member Sen. Jim Inhofe (R-OK)—are ironing out a compromise bill that can pass both chambers, possibly later this week.


Nominations – The Senate’s Executive Calendar is exceedingly crowded.  Democratic leaders are racing to confirm President Biden’s nominations before the end of the year—and before Republicans can force any unconfirmed nominations back to their respective committees.  If successful, Republicans would cause only minor delays.  In January, most committees will hold markups to report the nominees to the floor for consideration.

Also look for nominations to fill the Senate schedule.  There are even talks among Democrats of a nominations “vote-a-rama” to confirm as many nominees as possible this year.  Jerome Powell’s re-nomination to chair the Federal Reserve Board likely won’t happen until January.  Even with Democratic objections, there is little doubt that Chairman Powell will be confirmed, in good part by support from Republicans (42 supported him last time).


House/Senate Floor – The House and Senate’s schedule could be adjusted this week as the country mourns the loss of former Senate Majority Leader Bob Dole (R-KS).  For now, in addition to NDAA, the House will likely consider H.R. 5314, the “Protecting Our Democracy Act.”  Among other things, the bill addresses presidential abuses and foreign interference in federal elections.

Sen. Mike Braun (R-IN) will also try to use the Congressional Review Act (CRA) to overturn the Biden Administration’s vaccine mandate on private employers. Sen. Manchin has indicated he will vote for the CRA “resolution of disapproval.” Braun et al. can send a powerful, bipartisan message, but that’s it: the CRA contemplates no expedited procedures in the House, where leadership determines the floor schedule.  Even if it did pass the House, Biden would veto it.  And there is no veto-proof majority in either chamber.