Second Session of Congress Starts Where 1st Session Ended

The 115th Congress began its second session when the Senate returned last Wednesday. The four key leaders had an initial meeting on that day to decide how they can address an expiring CR that runs out January 19, 2018.

The House delayed its return to January 8, after they passed the tax package, the CR and a waiver of automatic mandatory spending cuts. Republican leadership did have their first informal full meeting this past weekend when they met the President at the presidential Camp David retreat.

The CR adopted just before Christmas waived the across-the-board cuts to a number of mandatory and entitlement programs. If that waiver had not been included, the White House was going to delay signing the tax cut package until January 2018 because it would have allowed the across-the board cuts to be delayed until 2019. The CR waiver became critical to allowing the tax package to be signed before the holidays.

Now that that is done, January 19 is the next drop-dead date for the Congress and President. Funding runs out for FY 2018 and despite the waiver of mandatory cuts resulting from the tax cut package, Congress now faces another set of across the board cuts resulting from the 2011 the Budget Control Act (BCA). The ten-year deal enacted caps for each year. In the past several years Congress has managed to suspend those caps, two years at a time through joint negotiation. If a new deal is not reached by January 19, the ten-year BCA caps would impose cuts on both the defense and non-defense side. Defense Department supporters are seeking billions more above the current cap which is set at approximately $549 billion. As it stands, defense spending could be cut by 9 percent below what Congress is currently spending and 6.7 percent on non-defense (since defense is somewhat higher despite “parity”). Cuts of potentially $54 billion and $37 billion respectively.

In addition to the cap discussion, it’s unclear what Congress will be doing with a series of other issues including DACA, CHIP, home visiting and numerous other expired programs and laws and how much those programs will be linked to an overall deal. There is talk of yet another CR on January 19, with the next one running into February or even March.

After a Wednesday meeting between the four congressional leaders (Ryan, McConnell, Schumer and Pelosi) and White House representatives, Democrats were generally positive about slow progress while Republicans issued a joint statement that said,

“’It is important that we achieve a two-year agreement that funds our troops and provides for our national security and other critical functions of the Federal government. It also remains important that members of Congress do not hold funding for our troops hostage for immigration policy.”

That last line is significant with Republican leaders pushing against the idea of linking a budget deal and a DACA fix. Democrats, led by Senate Minority Leader Charles Schumer (D-NY) have indicated that their priorities for a deal are topped by a legislative fix for DACA youth, additional funding to address the opioid epidemic, a boost for veterans’ care, disaster relief to address the hurricane-stricken areas of Texas, Florida and Puerto Rico and the fire-ravaged areas of California, and financing for the Children’s Health Insurance Program.

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