‘Tis the Season

by John Lawrence


Well, it’s mid-December, and you know what that means: a whole lot of money is being spent. But I’m not talking about holiday presents: I am referring to two massive bills very quietly grinding their way through the Congress, out of view of the public which is going to both give and receive when the final legislation is signed.

Yes, squirreled away in the back offices of the Capitol, and over the 456-, 225 – and 224- prefix phone lines, complex negotiations are taking place on the end-of-the-year appropriations and tax bills that will help shape the politics and the pocketbooks of a few hundred million Americans in coming years. Not that many Americans would know: search the front pages of today’s major newspapers including the New York Times, Washington Post, Los Angeles Times, Boston Globe and Chicago Tribune and you will find nary a mention of the offers, counteroffers and dealings.

As always, there will be winners and losers; meritorious policy changes, and real stinkers thrown in to satisfy and powerful legislator or cobble together a few needed votes. Some will be relatively minor (remember: Congress rounds off to the nearest $100 million!); some will have lasting impacts (yes, appropriations are annual but tax changes can, and will, be permanent, or at least until the next “tax reform” bill occurs).

Without putting readers to sleep, let me run through the process here; true, people tell you “process is boring” and “no one cares.” Well, actually, the people who control the process – who happen to be the same people who write the laws – most certainly do care, and they are delighted that so few other people are willing to invest in following the intricate maneuverings. Sometimes legislating, like card tricks, is all in the wrist. Remember the warning of former Rep. John D. Dingell (who knew something about card tricks): “If I let you write the substance and you let me write the procedure, I’ll screw you every time.”

There are two deadlines fast approaching (actually we already went past a few, but who’s counting?). Last fall’s budget agreement only established the parameters for the bill that really counts: appropriations (a/k/a, the money). Since we have long since passed the beginning of the fiscal year (October 1) without new appropriations bills in place, we are operating on Continuing Resolutions (CRs) that extend last year’s spending levels. But the budget agreement allows much more spending – tens of billions more – above the so-called “sequestration caps,” and legislators are anxious to spend it, Republicans and Democrats alike. Although for different priorities. Hence the dealing. Congress will keep extending the deadline for the final CR (or Omnibus) until all the final appropriations deals are cut, thereby avoiding the dreaded government shutdown that occurs when the spending deadline passes.

The second deadline applies to provisions of the tax code that expire on January 1, provisions that result in every bit as much “spending” as appropriations, although Republicans don’t do their budget that way, which allows them to rack up cascades of unpaid-for tax spending without having to provide the “offsets” that new appropriations require. (They rationalize this exception by assuring naïfs that revitalized economic growth resulting from the tax cuts will more than compensate for the up front losses; how quaint a theory.)

The looming expiration of many tax provisions presents opportunities to leverage new policies as trade-offs; refuse me what I want, and your tax provision dies. This tax cliff is why, back in 2012, Democrats were able to kill the extension of the Bush upper income tax cut by carving it out of the permanent extension of the middle class cut; had Republicans balked, the tax cuts would have expired for everyone, which would not have been received well back home.

The procedural thicket is where things get problematic, especially for the new Speaker. Ryan has the fancy office because John Boehner infuriated the far-Right Freedom Caucus, which refused to sign off on Continuing Resolutions that could pass the Senate and be signed into law, preferring government shutdowns. They demanded either lower spending (a no go with the Dems) or policy changes (also known as “riders,” supposedly not allowed on appropriations bills by widely permitted by mutual agreement; incidentally, they are the first cousin to the banned “earmarks’), similarly unacceptable to Democrats.

As a result of Freedom Caucus intransigence, Boehner was compelled to cut deals with Democrats to avoid the disaster of government shutdowns, and Democrats naturally demanded — and got — spending and no policy riders (like killing the health care law, for example, or ending funding for Planned Parenthood). That combination of Democratic victories, over and over again, infuriated the Freedom Caucus, which branded Boehner an Obama-Pelosi-Reid collaborator, and you know the rest of that story.

Well, here’s the thing: Ryan is basically facing the same choice. The Freedom Caucus isn’t happy about the higher spending allowed in the budget agreement (which many of them opposed) and reflected in the CR under discussion, and even if Ryan were able to sneak in a few conservative riders, most of them probably won’t vote for the CR because they want to be able to preserve their anti-spending purity. So Ryan has no choice but to get to know Mrs. Pelosi real well and real quickly, which will genuinely exasperate his Conference.

Simultaneously, however, the former Ways and Means chairman is dragging along a big tax bill (which is anything but “tax reform”) that Republicans (and many Democrats) want despite its being unpaid for, and despite its projected impact on the deficit. How big, you wonder: at last count, $700 billion … and climbing. That is nearly as big as (a) the upper income tax cut – and guess who gets most of the benefits of this tax bill; (b) the much reviled Obama stimulus bill that no Republicans voted for because it wasn’t paid for; and (c) the TARP bailout, which Republicans also opposed because it wasn’t paid for (although it did make a tidy profit for taxpayers once the money got paid back, thanks to Democratic insistence).

So, here’s the problem: Ryan probably can’t get enough Republicans to vote for the CR, so he needs Democrats. Ryan probably can get Republicans to swallow their anti-deficit pride and vote for the tax bill, but many Democrats don’t like it. Separately, each could pass; together, as Ryan would like to pass them, not so sure. And Sen. McConnell is saying the will only consider the bills as a unified package.

Procedurally, this is not a good scenario: the bills must pass identically, of course; Members cannot pass bills sequentially and have them magically reunite before travelling down to the White House. Well, actually, they can, and have, and maybe that’s how all this happens. This is where mastery of the Rules becomes essential. Ryan also could decide to pass his two bills, with different “yea” votes for each, and get out of Dodge, leaving McConnell to figure out to pass them and avoid a shutdown and expiration of the tax cuts.

Now it is worth remembering the caterwauling of John Boehner and his Republican Conference when similarly complex bills appeared on the schedule and were passed hours after being finalized. Remember him dropping the health care bill on the House floor with an enormous thud; recall the merciless excoriating of Pelosi for saying no one would know for certain what was in the health bill until it was passed (a perfectly reasonable statement, given the back and forth negotiations, skillfully twisted into an allegation that Members did not know what they were voting on). Recall the promise of the new Republican majority in 2011 to follow “regular order” and not allow bills to be brought to the floor without a 72 hour layover so every Member could read every fascinating line?

Well, forget all that. The 72 hour rule has gone the way of the disappearing quorum (RIP 1889) and regular order is essentially irregular order. The combination of complexity, deadlines and deal-cutting ensures that when ever the package is sewn up, it will move like lightening so legislators can vote, rush out of town, and get on with spending their own money for Christmas presents. Only then will reporters, bloggers and budget geeks “know what is in the bill” and who – oil companies, casinos, tech industries, etc. etc. – filled their silk stockings.