The Shutdown Threat is Over. So Now What?
With the ink on President Trump’s signature now drying on the final fiscal year (FY) spending bill, the threat of another government shutdown has passed…for now. Because the shutdown began in December, before the transition of power in Congress, it derailed the House Democratic majority’s policy agenda, as all of the attention on Capitol Hill was focused on finding a solution to end the funding lapse. With the shutdown now over, we can look ahead and ponder what will happen in an era of divided government. With Democrats in control of the U.S. House and the GOP in control of the Senate and the White House, and with the 2020 campaign now in full swing, we’re sure to see a lot of political posturing, but what legislative achievements can we expect to see enacted this year?
Rep. Alexandra Ocasio-Cortez (D-N.Y.), the youngest member of Congress and a social media star, has offered her “Green New Deal,” which aims to tackle climate change and address growing economic inequality. While Senate Majority Leader Mitch McConnell (R-Ky.) has said the upper chamber will vote on the plan in the coming weeks, it really isn’t going anywhere. The majority leader’s goal is to demonstrate that the freshman congresswoman’s ambitious proposal actually has little Democratic support, and to drive a wedge between the most liberal element of the Democratic party and its more moderate wing. (For her part, House Speaker Nancy Pelosi (D-Calif.) has dismissed Rep. Ocasio-Cortez’s outline as “the green dream or whatever ...”)
Nor will we see enactment of H.R. 1, the first bill introduced in the new Congress by House Democrats. (The designation H.R. 1 generally is reserved for the majority party’s top priority for that session of Congress.) The “For the People Act,” which would impose new campaign finance regulations and new lobbying rules, is good messaging for the 2020 presidential and congressional elections, but the Republican Senate won’t consider it. (Senate Majority Leader McConnell historically has opposed campaign finance reform – even going so far as to sue the government arguing the McCain-Feingold campaign finance reform bill of 2002 was unconstitutional – since he believes it encroaches on Americans’ free speech rights. McConnell lost most of his arguments before the Supreme Court.) Even if it did, President Donald Trump would veto the bill.
Lawmakers also aren’t likely to touch “Medicare for all” legislation, anything having to do with President Donald Trump’s space force (which, for the first time in 70 years, would establish a new branch of the military), or raise the marginal personal income tax rate to 70 percent, as some more liberal Democratic members of Congress have proposed.
No, the legislation that actually gets enacted in 2019 will be far more mundane – but still incredibly important.
For starters, lawmakers must raise the debt ceiling – the statutory limit on the amount of national debt that can be incurred by the federal government – at some point during the coming months, probably by September. In the absence of an increase or suspension to the debt ceiling, the Treasury Department is legally prohibited from issuing new debt to pay its bills, which include things like paying out Social Security benefits and federal workers’ compensation.
The Bipartisan Budget Act of 2018 suspended the debt limit through March 2019 and while the Treasury Department can use “extraordinary measures” for a few months to prioritize some payments over others and juggle the country’s finances for a bit, we know that Congress will have to act on this matter this year. The House, at least, will be able to avoid a lot of the drama usually surrounding a debt limit increase since Democrats quietly approved amendments to the House rules that would allow House leaders to suspend the debt ceiling automatically by approving the chamber’s yearly budget proposal. As The Wall Street Journal explained, this provision “would allow lawmakers to avoid taking a separate, direct vote on the borrowing limit.”
The debt limit is not the only budget matter on the House and Senate’s to do list. The Bipartisan Budget Act of 2018, which set discretionary funding levels for FY 2018 and FY 2019, expires on Oct. 1, 2019. If lawmakers don’t reach another budget deal, spending caps for FYs 2020 and 2021 automatically will take effect. Practically, that means lawmakers would have to find $125 billion in discretionary spending cuts for those two years.
We just endured the longest government shutdown in history over $5 billion for a border wall. Cutting funding for education, infrastructure, and the military by 15 times that with less than 18 months before an election will be even more contentious. In other words: the debt limit and the budget deal will take up a lot of oxygen over the next few months.
Lawmakers also will have to decide what to do with the National Flood Insurance Program, or NFIP, which does exactly what its title says: provides insurance for homeowners and businesses in flood-prone areas. Congress passed a short-term NFIP reauthorization in December 2018 and it expires May 31, 2019. Expect lawmakers to pass another short-term bill since Republicans want not only reauthorization, but to reform the program to allow for more private insurance options. With hurricane season bearing down, it’s likely lawmakers will want more time to debate a long-term NFIP plan.
Authorization for the Export-Import Bank ends on Sept. 30, 2019. The bank, which provides financing to help export U.S. products, is unpopular among members of the GOP. The last authorization, in 2015, actually resulted in the bank being shut down for a short time, and President Trump, after taking office, nominated former Rep. Scott Garrett (D-N.J.), who, as a member of Congress, argued that the Export-Import Bank should be shuttered to head the bank. (Even the Republican-led Senate wouldn’t confirm him for the post.) Small government Republicans will be emboldened to again take a whack at the organization again this year in hopes that they can permanently end its authorization.
Congress also must deal with a few tax issues.
The Tax Cuts and Jobs Act that was signed by President Trump in December 2017 included a tax credit for family leave that expires on Dec. 31, 2019. Lawmakers will have to decide whether to extend this popular provision and they also will have to decide whether to delay (again) implementation of a tax on medical devices and a Health Insurance Tax (a sales tax on health insurance) that were part of the Affordable Care Act.
These are the matters with which Congress must deal by certain deadlines. They aren’t, of course, the only issues that will take up lawmakers’ attention.
The issue of rising prescription drug prices already has been the subject of hearings on both sides of Capitol Hill. Leaders in both parties, including the president, want action and the parties could seek to find common ground.
Another issue where, on paper, lawmakers from both sides of the aisle could be motivated to work together is infrastructure. Congress will need to reauthorize highway funding programs by the end of September 2020, so we could see some progress on this issue this year. Republican and Democratic leaders in both chambers of Congress also have said they want to address data privacy and cybersecurity issues this year, and there’s been some momentum behind bipartisan efforts to create a national data breach standard.
Finally, there is the trade agreement between the United States, Canada, and Mexico.
Republican leaders, including Senate Finance Committee Chairman Chuck Grassley (R-Iowa) whose panel oversees trade policy, have said they won’t consider this pact until the president lifts tariffs on imports of Mexican and Canadian steel and aluminum products.
There is no sign the White House is ready to budge, and with Democrats wanting to make changes to labor and environmental provisions in the trade deal, this debate could be a long one, or, more likely, one that doesn’t ultimately result in a vote.
That’s a lot of heavy legislative lifting to do in a particularly divisive political era – and one that’s about to become more heated as the 2020 campaign kicks into gear.