Congress Sets Modest To-Do List Amid Polarized Election Campaign

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(Bloomberg) -- Republicans are showing little appetite for big action in what may be their last months in full control of Congress.

The House took much of last week off and doesn’t get back to Washington until Tuesday. The Senate is bogged down in confirmation hearings. And many lawmakers are already focused on their first election campaigns since President Donald Trump took office.

Democrats are making a bid to take the House or Senate majority in November -- or both. Yet as in most election years, Congress’s legislative schedule is light on high-profile initiatives, especially compared to last year’s agenda featuring massive tax cuts and the unsuccessful attempt to repeal and replace the Affordable Care Act.

Lame-duck House Speaker Paul Ryan insists he’ll finish this term with a focus on bills to encourage employment and job training. But Senate Majority Leader Mitch McConnell is limited by Senate rules that require help from Democrats to advance legislation. The Senate has even struggled to confirm Trump administration nominees, such as Thursday’s 50-49 vote on Jim Bridenstine to lead NASA.

So Congress will concentrate mainly on the meat and potatoes of government. Here are some of the bills that will keep lawmakers coming back to Washington, even as they campaign for re-election at home:

Renewing Farm Programs

The farm bill is usually a bipartisan measure that unites lawmakers from rural states with supporters of food stamps, known as the Supplemental Nutrition Assistance Program. The bill’s provisions include subsidies for growers of staple crops such as corn and cotton, research dollars for land-grant universities and funding for national forests.

The House Agriculture Committee last week passed a GOP-only version, H.R. 2, with Democrats withholding their votes mostly in opposition to a provision expanding work requirements for some SNAP recipients. The Senate Agriculture Committee’s Republican and Democratic leaders say they’re working on a bipartisan bill that will largely ignore the House changes to food stamps. The current farm legislation expires at the end of September, and a simple extension may be necessary.

Extending Individual Tax Cuts

Some Republicans want to vote to make tax cuts for individuals permanent. December’s tax overhaul permanently reduced the corporate rate, while the lower rates for individuals are set to expire after 2025.

“We fully intend to make these things permanent,” Ryan said last week, "and that’s something we’ll be acting on this year.”

But Republicans disagree on whether this idea is a political winner, in part because the effort would remind people that their tax cut is only temporary. McConnell said he would consider it, but he’s skeptical there’s a desire in the Senate to vote this year. Republicans won’t use a fast-track budget process that would allow them to act without Democratic support.

Separately, tax professionals have urged lawmakers to make technical corrections to the tax legislation, including provisions affecting net operating losses, charitable deductions, and full and immediate expensing. But so far, Republican leaders have signaled they won’t vote on a stand-alone bill before November.

A bipartisan plan to restructure the Internal Revenue Service may have a better chance after passing the House last week. It would create an independent office for appeals, require an IRS reorganization plan by 2020, and modernize information technology systems -- an initiative that may gain steam after the IRS online filing system shut down for most of Tax Day last week as millions of Americans raced to file their returns.

Easing Banking Regulations

The House and Senate have taken different approaches to rolling back banking regulations. The House last year passed its plan, H.R. 10, which would rip up major parts of the Dodd-Frank law passed after the 2008 financial crisis. It would repeal the Volcker Rule, which restricts banks from making speculative market bets with their own capital, and scrap the fiduciary rule, which requires brokers to put customers’ interests ahead of their own when handling retirement accounts.

The Senate last month passed S. 2155, a bipartisan plan that raises the asset threshold for banks to be designated as systemically important financial institutions, subject to stricter Federal Reserve supervision. While intended to ease regulations for smaller banks, it doesn’t go as far as some Republicans and Wall Street bankers wanted.

House Finance Chairman Jeb Hensarling of Texas wants to add elements of his House bill to the Senate version. If he insists on taking the bill to a conference committee, senators may balk. The White House has said Trump is eager to sign a bill as soon as possible and supports the Senate version.

Reauthorizing the FAA

The House plans to vote this week on H.R. 2997, which would reauthorize the Federal Aviation Administration through 2023 and provide additional oversight and funding for a system to modernize air traffic control. The FAA’s legal authority has been extended on a short-term basis through September.

The measure stalled last year in part over a proposal by House Transportation Chairman Bill Shuster of Pennsylvania to create an independent non-profit body to manage the air traffic control system. That was dropped from the current House bill.

The Senate version, S. 1405, introduced by Senate Transportation Committee Chairman John Thune of South Dakota, would also set new drone safety regulations and create a public-private partnership pilot program for construction or improvements at general aviation airports.

Confirming Trump Nominees

The Senate’s hands will be full with confirmation hearings and votes for dozens of judicial and executive branch nominees, including Trump’s choices to replace leadership at the State Department and Central Intelligence Agency.

The Senate Foreign Relations Committee plans to vote Monday on Mike Pompeo’s nomination to be Trump’s second secretary of state. Pompeo is opposed by Senator Rand Paul, a Kentucky Republican, though Democratic Senator Heidi Heitkamp of North Dakota said Thursday she’ll cross party lines to back him. Even if his nomination fails to get majority support in the committee, it can go to the Senate floor without a recommendation.

Gina Haspel, Trump’s choice to replace Pompeo as CIA director, faces a challenging confirmation hearing May 9 in the Senate Intelligence Committee.

Spending Bills

The House and Senate Appropriations Committees are taking Trump at his word when he said he won’t sign any more spending bills like the $1.3 trillion omnibus that became law in March.

The House plans to consider 12 appropriations bills in May, and the Senate will try to pass a handful of them before the August recess. Still, the Senate is unlikely to pass them all before the 2019 fiscal year begins Oct. 1, which means Congress will need a short-term extension to avoid a government shutdown. Congress passed five extensions before finally completing the fiscal 2018 appropriation in last month’s bill.

Trump administration officials say they wanted to retroactively cut as much as $60 billion from the 2018 funds, but McConnell said he’s not interested in canceling any money after months of delicate bipartisan negotiations. Because a formal request from Trump would automatically freeze spending in the affected agencies for up to 45 days, Congress may act quickly to reject it.

Coasting to November

Even as Congress plans to coast into the election, other developments could force action. A Senate bill to protect Special Counsel Robert Mueller could gain urgency if Trump threatens his investigation. Trump’s trade negotiators could also send a retooled North American Free Trade Agreement for approval.

And Ryan could face calls for a pre-election succession battle for House speaker, even though he promised members he plans to “run through the tape” with a strong finish to his term.

©2018 Bloomberg L.P.

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