Predictions for September in Washington, D.C.
September is going to be an action packed month in Washington. There is a long list of must-pass measures and a long list of priorities on which the president and members of Congress are anxious to make progress. As is typically the case in Washington, there are many complexities to each issue, not to mention the calendar itself gets a little complicated with Rosh Hashanah and Yom Kippur both falling during the month of September.
1. Debt Ceiling: The debt ceiling is currently set at $19.81 trillion. The country hit that ceiling in March; however, the Treasury Department has many tools available to manage our country’s finances in order to avoid defaulting on our obligations.
Those extraordinary measures taken by Treasury, combined with the wave of revenue that arrives at the Treasury on and around Tax Day (April 15) have allowed the United States to meet all its obligations.
That dynamic will change in October when obligations will significantly outpace revenues. A substantial obligation is owed to the Military Retirement Fund in early October, for example.
Voting to increase the debt limit is a difficult vote for members of Congress because it is a reminder to voters of past budgetary decisions that resulted in deficits and debt. Therefore, many of them look to include other measures to the legislation authorizing a higher debt ceiling. Conservatives like to see spending cuts or other fiscal restraints included with the debt ceiling legislation. The Treasury Secretary continues to ask Congress just to pass a so-called “clean” bill so the White House does not have to get pulled into contentious negotiations over the unrelated matters.
2. CHIP Funding: The Children's Health Insurance Program (CHIP) funding expires on September 30. This is a program that began as a bipartisan initiative (the so-called Kennedy (D-MA)-Kassebaum (R-KS) bill) and has enjoyed bipartisan support to reauthorize and continue the program.
Ordinarily, reauthorization would not be a controversial issue; however, this year the politics around health care legislation have made things a little less certain in the health policy arena.
On a positive note, we did see the FDA user fees extended in a solid bipartisan fashion (only one dissenting vote in the Senate). We expect CHIP funding to be extended along with several other smaller health programs that also expire on September 30, such as the Family-to-Family Health Information Centers, the Abstinence Education Grants, the low-volume adjustment in Medicare and a few others. It is possible that the continuing of these programs could be done temporarily via a continuing resolution.
3. Continuing Resolution: The fiscal year ends on September 30 when the appropriations authorized by the Omnibus Appropriation Bill, passed by Congress in May, expires.
The House passed a package of four appropriations bill in July, which includes the Defense, Military Construction and Veterans Affairs, Energy and Water, and Legislative Branch appropriations bills. It is possible that the Senate will pass this so-called "minibus" appropriations bill in September to partially fund the government.
There is, however, one significant complication: the allocation in these appropriations bills is not consistent with the discretionary spending caps contained in the Budget Control Act (BCA). The Senate has a 60 vote point of order against any bill, resolution, or amendment that violates the caps in the BCA
While it is possible this minibus appropriations bill could receive 60 votes in the Senate, we expect there to be an effort to revisit the discretionary spending caps of the BCA as a separate measure. It is likely the BCA will be revisited as a precursor to the consideration of the National Defense Authorization Act which also violates the caps in the BCA.
Given the limited floor time available in the Senate during the month of September, we expect Congress will likely pass a continuing resolution funding federal government operations for a period of two to three months beyond the September 30 deadline.
Budget Resolution: Even though the Congressional Budget Act calls upon Congress to adopt a budget resolution by April 15, there is no real consequences for delayed or no action on this task. This year Congress has an important motivation for passing a fiscal year 2018 budget resolution: to include budget reconciliation instructions that can be used to pass a major tax bill on a simple majority vote in the Senate.
The House Budget Committee reported an FY 2018 budget resolution with reconciliation instructions that can be used for a tax bill and many other reconciliation instructions calling for significant reductions in mandatory spending programs such as Medicaid and the Supplemental Nutrition Assistance Program (SNAP).
The Republican Conference appears to be divided about the committee reported budget resolution. Moderate members of Congress think the calls for spending cuts are too high while many conservatives do not think the spending cuts go far enough.
Motivation to get reconciliation instructions for a tax bill should be sufficient for the House to pass the budget resolution in September. The Senate will likely alter the resolution to get the necessary votes for it.
With the vote-a-rama likely to happen during consideration of the budget on the Senate floor, it will likely set up a conference committee with the House to resolve the differences rather than simply passing back the Senate passed resolution to the House for their approval (vote-a-ramas can result in some odd amendments being included).
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Seven Ways Trump’s Arizona Speech Complicates Congress’ Fall Agenda
President Donald Trump went out of his way to complicate Congress’ fall legislative agenda during a campaign-style rally in Phoenix, Ariz., last Tuesday. Here are seven things the president said that bode well for his ability to work with Congress.
1. Shutdown Threat: Little more than a month before the Sept. 30 deadline for funding the government into the next fiscal year, Trump threatened to shut down the government if Congress doesn’t agree to fund the border wall he repeatedly promised to build – and have Mexico pay for – during the campaign.
“The obstructionist Democrats would like us not to do it, but believe me, if we have to close down our government, we’re building that wall,” Trump said.
This didn’t seem to intimidate Democrats, several of whom took to Twitter to emphasize that they will continue to fight against the wall. Democrats have said border wall funds are a nonstarter for appropriations negotiations. They would likely welcome Trump to force a shutdown over the issue, as the GOP would undoubtedly be blamed for it.
Republican congressional leaders have promised there will not be a shutdown, putting them in a position to have to stand against Trump unless they find some extreme leverage that would get Democrats agree to fund the wall. Trump acknowledging he’s willing to force a shutdown actually increases Democrats’ strength heading into the negotiations.
2. Filibuster Fluster: While Trump has made clear for months that he’d like to see an end to the legislative filibuster, he suggested that his agenda will be stalled without it.
“If they don’t do that, then they’re just wasting time,” he said of GOP leaders.
Senate Majority Leader Mitch McConnell, whom Trump referenced briefly Tuesday as he began a tangent about the Senate’s failure to repeal the 2010 health care law, is against moving to a 51-vote threshold for legislation.
Trump brought up his desire to end the filibuster right after he threatened to let the government shut down without his border wall funding, indicating he still maintains his belief he tweeted in May that the country “needs a good ‘shutdown’ in September to fix this mess,” a reference to Senate Democrats’ ability to filibuster legislation. Trying to link his interest in removing the filibuster to government funding is dangerous politics and not likely to win him any allies in the Senate.
3. Reconciliation Regret: In lamenting the health care bill’s failure in the Senate, Trump took a shot at the budget reconciliation process, saying it “doesn’t matter; it’s a trick.” He said this before going on to explain that reconciliation rules prevented Republicans from including some policy ideas the GOP universally agrees on in the health care bill.
His choice of words was not helpful as the GOP, which looking to use the reconciliation process again to advance a tax overhaul bill and other GOP fiscal policy priorities, so long as Republicans maintain control of the government but fall short of a filibuster-proof majority in the Senate.
To many tax policy experts, reconciliation is “a trick” in the sense that it’s very difficult to craft tax legislation that can be enacted into law permanently. The budget rules would require tax cuts to sunset if the tax bill loses revenue outside of the 10-year budget window, meaning Republicans will need to fully offset their tax plan within a decade if they want the tax cuts to last.
Trump’s administration has made clear this principle of revenue neutrality this is not a priority for them, and Trump’s comment about reconciliation only reinforces that perception.
4. ‘One Vote’ Understatement: Speaking of health care, Trump repeated during his speech that it was just “one vote” that prevented Congress from repealing the 2010 health care law. Had Senate Republicans secured that additional vote for the so-called “skinny repeal” measure, there actually would have been several more steps in the process.
Senators still would have needed to vote on a final version of their bill had they passed the skinny repeal amendment to get the health care overhaul measure to a conference committee with the House. And if the conference committee was able to reach an agreement, both the House and Senate would have to pass it before Trump could sign it into law.
Trump’s simplification of the process underscores a frustration that McConnell shared at a Rotary Club event in Kentucky earlier this month: “Our new president, of course, has not been in this line of work before. And I think he had excessive expectations about how quickly things happen in the democratic process.”
Trump continuing to point blame at the Senate, yet he understated how close Republicans were to passing the health care bill, which only adds to the frustration that many Senate Republicans share and makes it harder for the already-tense health care negotiations to bear fruit
5. Unnamed Enemies: If Trump does want to complete health care or any other items on his agenda, he might want to stop attacking senators whose votes he will need.
Obviously Trump’s advisers know this, because he admitted Tuesday they asked him not to call anyone out by name in his speech. So he didn’t. He just criticized Arizona’s two Republican senators while in their home state without using their names.
The aforementioned “one vote” line (see #4 above) on the health care bill was a not-so-subtle reference to Sen. John McCain, who shocked his party by voting against the skinny repeal. Trump urged the Arizona crowd to talk to their senator about getting the health care bill done.
And after recently tweeting his support for Sen. Jeff Flake’s primary challenger, Trump took another dig at Arizona’s “other senator” without naming him: “Nobody knows who the hell he is.” Trump left no doubt who he was referring to on Wednesday morning, saying he was “not a fan of Jeff Flake.”
6. Insulting Potential Partners: As Trump suggested he can’t rely on members of his own party to help pass his agenda, he said he hopes Democrats “who will lose their election” will work with him to pass tax cuts.
Trump’s comment echo those of White House officials who have said they believe red state Senate Democrats up for re-election in 2018 will be interested in helping Republicans cut taxes. Depending on the contents of the yet-undrafted GOP plan, it’s not a completely unrealistic scenario. But Trump is not going to convince Democrats to partner with him by stating they will lose their elections, or by calling them obstructions.
7. Stirring Controversy: Another way in which Trump continues to isolate himself from Democrats, and likely many Republicans, is continuing to stir the pot on Charlottesville.
Trump spent much of the first half of his Phoenix rally attacking the media for misrepresenting his views on white supremacists protesting the removal a Confederate statute in Charlottesville that turned violent.
To emphasize his point, the president read from the three different statements he provided following the unrest that led to the death of one counter-protester.
He excluded, however, his previous remarks that blame was shared “on many sides,” and that there were “very fine people” among both sets of protesters. In continuing to avoid any acknowledgement of his controversial remarks, which drew rebukes from Republicans and Democrats, Trump is adding fuel to the fire.
His misstep on Charlottesville consumed much of the political oxygen in the wake of Charlottesville. There is not much else happening in Washington during the August recess, and if Trump keeps speaking on Charlottesville without apologizing, it will create a cloud over Congress come September.
Democrats already don’t want to work with Trump, and only dug their heels in deeper after his reaction to Charlottesville. Republicans, however, need him to sign legislation and are already struggling to walk the tightrope of condemning his inflammatory comments without attacking him personally.
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Proof That Things are Already Getting “Complicated”
House Speaker Paul Ryan: Short-term Solution Needed to Keep Government Open
Last Wednesday, House Speaker Paul Ryan (R-WI) said that a government shutdown is unnecessary but that a short-term continuing resolution will likely be needed to keep the government open beyond September 30.
“I think that will probably be necessary, yes, because I can’t imagine the Senate will be able to process the appropriations bills as quickly as the House is,” the Wisconsin Republican said during a press conference at Intel in Portland, Ore.
Ryan was at Intel to promote GOP plans to overhaul the tax code, but reporters were quick to ask him about President Donald Trump’s threat to close down the government in order to secure funding for a border wall.
“I don’t think a government shutdown is necessary, and I don’t think most people want to see a government shutdown, ourselves included,” Ryan said. “The House already has passed funding for border security, including building physical barriers like a wall in the places that are necessary … This is a need that needs to be addressed.”
Ryan suggested, however, that getting a spending measure that includes funding for the wall would be a heavier lift in the Senate. “The fact is though – given the time of year it is and the rest of the appropriations we have to do – we’re going to need more time to complete our appropriations process, particularly in the Senate,” he said.
Ryan said he has spoken with Trump about the fall agenda and the timeline. “We do agree that we need to have the physical barrier on the border … And we’ve been talking over the year and the last few weeks about how best to achieve that.”
Ryan also addressed Trump’s criticism of Arizona Republican Sens. John McCain and Jeff Flake during his Tuesday rally. “I think the president feels that that’s a strategy that works for him. I would just say that I think it’s important that we all stay unified as Republicans to complete our agenda. Those two gentleman are people I respect, know, like, and are friends with.”
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Trump Slams Ryan, McConnell Over Debt Ceiling ‘Mess’
President Donald Trump on Thursday criticized Speaker Paul Ryan and Senate Majority Leader Mitch McConnell, saying they created a debt ceiling “mess” by refusing his advice.
After the White House and McConnell’s office on Wednesday denied a recent New York Times report about tensions, including a profanity-filled phone call, between the two, the president started Thursday by attacking the Senate leader.
The Twitter strike also came a day after Ryan had pushed back on Trump’s threat to shut down the government unless he gets money for his proposed southern border wall.
Trump’s tweets also shined a fresh light on the ill will and distrust fueling much of the Republican disunity that has left it without a major legislative accomplishment during Trump’s seven-month tenure while controlling both chambers on the Hill and the White House.
The president tweeted that he suggested to Ryan and McConnell that they attach a measure addressing the country’s borrowing limit to a just-passed veterans bill, which Trump said would have ensured “easy approval.”
In a second tweet, Trump criticized the GOP leaders for not tying the debt ceiling to the veterans bill, saying their refusal means "now we have a big deal with Dems holding them up (as usual) on Debt Ceiling approval. Could have been so easy-now a mess!"
About 90 minutes after those tweets, the president fired off another saying the “only problem” he has with McConnell is the Senate majority leader’s inability to pass a health overhaul measure despite promising to do so for seven years.
The White House on Wednesday evening sought to tamp down talk that Trump and McConnell were at odds. In a statement, Press Secretary Sarah Huckabee Sanders said the two “remain united on many shared priorities, including middle class tax relief, strengthening the military, constructing a southern border wall, and other important issues. They will hold previously scheduled meetings following the August recess to discuss these critical items with members of the congressional leadership and the president’s Cabinet. White House and leadership staff are coordinating regarding the details of those meetings.”
Notably, the statement did not say a New York Times report about an expletive-laden phone call between the GOP leaders was inaccurate.
Treasury Secretary Steven Mnuchin is pushing a “clean” debt ceiling increase, though some Republican lawmakers want to attach federal spending cuts.
Democrats, who will be asked to supply the votes to push the measure across the finish line, are staunchly opposed to that idea. Several GOP House members criticized the president’s admission he wanted to attach a debt ceiling measure to the veterans bill, which likely would have made it hard to vote down given the wide support for former members of the military.
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Democrats Warn Trump Against Shutdown, Remain Opposed to Border Wall
Senate Minority Leader Charles E. Schumer, and House Minority Leader Nancy Pelosi, are warning President Donald Trump not to shut down the government.”
During a rally in Arizona last Tuesday, Trump said he is willing to risk a shutdown to secure funding for a border wall. “If we have to close down our government, we’re building that wall,” he said.
Democrats were quick to characterize the threat as reckless. “Last night, President Trump yet again threatened to cause chaos in the lives of millions of Americans if he doesn’t get his way,” Pelosi said in a statement. “Make no mistake: the President said he will purposefully hurt American communities to force American taxpayers to fund an immoral, ineffective and expensive border wall.”
The California Democrat said her party remains “strongly opposed” to the “border wall boondoggle” and that Democrats will “stand fast” against it despite Trump’s threat. Pelosi also reminded Republicans that the last government shutdown in 2013, which occurred because conservatives demanded a cut-off of funding to the 2010 health care law, cost $24 billion and 120,000 jobs.
Senate Minority Leader Charles E. Schumer warned Trump that a shutdown would cause problems for him politically. “If the President pursues this path, against the wishes of both Republicans and Democrats, as well as the majority of the American people, he will be heading towards a government shutdown which nobody will like and which won’t accomplish anything,” the New York Democrat said in a statement.
Trump threatening a shutdown if he doesn’t get his way “is the polar opposite of leadership,” House Appropriations Committee Ranking Member Nita Lowey said in a statement. Congress should not be wasting billions to “fulfill campaign applause lines” but rather invest that money in in schools, health care, infrastructure, job creation and “addressing actual homeland security vulnerabilities. If the President follows through on his threat to shut down the government, he and his enablers should be held fully accountable."
Republicans have largely been mum about the Trump threat, but some conservatives have reacted positively to the president's desire to build the wall. In advance of the Arizona speech, Rep. Jim Jordan, the Ohio Republican who previously chaired the House Freedom Caucus, said “Congress should include border wall funding in government funding legislation this fall. It’s what we ran on – we need to fulfill that promise.”
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Consumer Groups Locked In Legal Battle with FDA Over Formaldehyde
After receiving an unsatisfactory response to a citizen petition calling for the Food and Drug Administration to take action on formaldehyde in keratin hair straighteners, two environmental groups are suing the agency in an attempt to force the agency to make a decision, within a set time period, on whether to ban the ingredient.
The FDA has pushed for the case to be dismissed, arguing that a lawsuit cannot be filed to force an agency to take a particular action in response to a citizen petition, and that the groups cannot sue solely on behalf of the general public at large.
Concerns over formaldehyde in these hair straighteners prompted action from one California senator, who is pursuing any available option to pass legislation that would require FDA review cosmetic ingredients, including formaldehyde. It remains unclear, however, whether mandating an FDA review of the safety of the product would result in the type of action for which the environmental groups are advocating.
The Environmental Working Group (EWG) filed a citizen petition in 2011 which called for the agency to "investigate and respond appropriately to the deceptive practices of the companies that conceal the fact that their hair-straighteners release formaldehyde under customary conditions of use … require labels for hair straighteners that contain formaldehyde, including formaldehyde in solution and formaldehyde-releasing chemicals that warn users about the risk of exposure during the treatment process … and review whether to ban the use of formaldehyde, including formaldehyde in solution, and formaldehyde-releasing chemicals as ingredients in hair-straighteners."
"The FDA has failed to protect stylists and consumers from exposure to formaldehyde," said Melanie Benesh, legislative attorney at EWG in an August 7 press release. "Since at least 2008, the agency has known about the health hazards associated with these hair straightening products and done nothing. Despite the complaints, the FDA has yet to take action to regulate these products."
Following a December 2016 lawsuit from EWG over what it saw as an unreasonable delay in responding to the 2011 petition, FDA granted the request to review whether it should ban the use of formaldehyde, but declined to initiate rulemaking to require a warning for hair products containing the chemical.
The agency also argued it has already investigated and responded appropriately to certain companies' alleged deceptive practices, and that it would continue to take actions on a case-by-case basis. "We have not yet made a determination about whether a safe level for the use of [methylene glycol/formaldehyde] in hair smoothers can be established as opposed to a ban. Our next steps in the process would be to complete our scientific evaluation and conduct an analysis of the risks posed to users under the conditions as labeled, or as customary or usual, and then make our ultimate analysis and data available for public comment," FDA said in response to the citizen petition.
EWG argued, however, that FDA's response to the citizen petition was insufficient, and filed an amended lawsuit alongside Women's Voices for the Earth (WVE) calling on the court to mandate a deadline by which FDA would need to decide whether to ban formaldehyde. The FDA has called for the lawsuit from EWG and WVE to be dismissed because, they argue, the Administrative Procedure Act does not grant petitioners the right to compel an agency to take a certain action in response to a petition. "While the APA grants Plaintiffs the right to petition, it does not grant them the right to compel FDA to take any particular action or action that it is not legally required to take," the FDA argues.
In response, EWG argued in a July 28 motion that both groups have standing to sue, given that the alleged lack of action from FDA has adversely affected them. "In their motion to dismiss, defendants argue that plaintiffs lack standing to bring this action. But both EWG and WVE satisfy the requirements for organizational standing. FDA's refusal to act has adversely impacted the activities of both of the plaintiffs, forcing them to divert funds from other advocacy programs to continue to educate the public and advocate on behalf of salon workers and consumers who are harmed by exposure to formaldehyde in keratin hair straighteners. WVE also has members of its organization who have suffered, and continue to suffer, concrete, particularized injury as a result of FDA's inaction, and thus satisfies the elements of associational standing as well," the plaintiffs wrote.
"The APA requires the FDA to 'conclude' a matter presented to it 'within a reasonable time.'...Plaintiffs have sufficiently alleged that FDA's failure to complete its review and reach a substantive decision is unreasonable in light of the substantial time that has passed since the Petition was filed and the overwhelming evidence that FDA's inaction threatens serious consequences to human health. While defendants argue that FDA is not required to undertake a review of any kind, its decision to do so – and thereby avoid a challengeable decision to the contrary--subjects the pace of its progress to review under the APA," the EWG and WVE say.
In the July motion, EWG argued that the agency has failed to uphold its responsibility, and slams FDA for not explaining why it has taken six years to act on EWG's original petition: "Defendants offer no explanation why six years has been an insufficient period of time for FDA to collect and analyze the information it deems necessary to act on the Petition. Indeed, defendants do not so much as even hint at when FDA will complete its analysis and reach a final decision about what, if any, action to take. FDA's dilatory pace infects both plaintiffs' request that FDA review whether to ban the use of formaldehyde or formaldehyde-releasing chemicals in the manufacture of keratin hair straighteners - a review that has not occurred, despite FDA's claim that it has 'granted' plaintiffs' request - and plaintiffs' request that FDA require such products to contain labels disclosing their formaldehyde-containing content. While FDA denied the latter request 'at this time,' its basis for doing so was its own failure to act on plaintiffs' request that it review whether to ban the products altogether.”
In Congress, legislation instructing FDA to initiate a safety review of formaldehyde as a cosmetic ingredient may be on the horizon.
Sen. Dianne Feinstein's (D-CA) Personal Care Products Safety Act, reportedly is being floated as a rider to over-the-counter monograph reform legislation. Feinstein's bill would require FDA evaluate the safety of a minimum of five cosmetic ingredients per year, and mandate that the agency review the safety of formaldehyde in the first year. The bill would also require FDA to consider whether consumer warnings are needed to help ensure safe use of cosmetic products and close an alleged loophole that allows products sold for "professional use" to not disclose an ingredient list on the label.
EWG plugged the Feinstein legislation as one remedy to force FDA to review formaldehyde in a timely manner.
"If the legislation is passed, the Environmental Working Group would still want the Food and Drug Administration to complete the review of formaldehyde as soon as possible. The legislation requires the review to be completed roughly one and a half years from the time the legislation is enacted," Melanie Benesh, EWG's legislative attorney.
When asked if the agency could indefinitely delay its review of evidence to determine if it could make an initial finding on an ingredient's safety, Benesh appeared to suggest public pressure would push FDA toward making a timely decision. Benesh said that given the volume of information available, EWG hopes the agency would act as quickly as possible given the new resources and authorities in the bill.
Benesh also pointed to a section of the bill outlining that in the event FDA "determines that the available data and information are not adequate to make a proposed or final determination regarding safety," it can determine a period of up to 18 months "during which time the determination made by a responsible person under subsection (a) or (b) of section 609 with respect to the safety of such cosmetic ingredient or non-functional constituent shall be deemed to be in compliance with the requirements of this Act." However, that section says such a decision from FDA, "shall not affect final determinations of safety."
When asked the same question, Feinstein's office stated the congressional intent of the legislation is to have FDA review ingredients, especially the five explicitly named, within one year.
For the five initial chemicals listed in the bill, the office noted that the industry, health advocates and consumers all want a decision and that it expects the agency to have the resources, ability and authority to do such a review in a timely manner if the bill was made law.
"Despite the fact we use these products daily in our homes, the potential health effects of many of their ingredients haven't been independently tested. Creating a timetable for the FDA to identify and remove harmful chemicals will make these products safer. Formaldehyde is at the top of that list. Our bill identifies five chemicals, including formaldehyde, that are particularly dangerous to expedite the process of removing them from personal care products. It also requires the FDA to identify and begin a review of five more ingredients each year," Feinstein said in a statement.
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