“Experience is merely the name men gave to their mistakes”

The Picture of Dorian Gray by Oscar Wilde

The House and Senate are back next Monday and this month are in session 13 and 15 days, respectively. The fall agenda is packed — gun violence, trade, fiscal year (FY) 2020 spending, taxes, expiring authorizations, health care, privacy, and infrastructure. Added to that is uncertainty about the impact of Hurricane Dorian in the Carolinas and a growing call on the left for impeachment proceedings. Here is what lies ahead.

Gun Violence by Eric Rosen

Following tragic shootings this summer, focus again turned to Washington amid calls from many constituents to “do something” about gun violence. History indicates those calls will be heard but not answered. Republican control of the White House and Senate strongly suggests the status quo will continue until more Members of Congress willing to oppose the NRA are elected. Look for continued talk, and potentially some limited legislative action, on the issue in the fall. The House passed legislation earlier this year to expand background checks to cover all firearms purchases and to lengthen some wait times under that background check system. But President Donald Trump isn’t calling for the Senate to vote on those measures, and Senate Majority Leader Mitch McConnell (R-KY) has no plans to consider them in the Senate.

Prior to Hurricane Dorian, Chairman Jerry Nadler (D-NY) intended to call the House Judiciary Committee back to work early for a rare, in-recess markup to consider three additional gun control measures:

• Banning large capacity ammunition magazines;
• Preventing people convicted of a misdemeanor hate crime from owning a weapon; and
• Encouraging states to adopt laws that allow state and federal courts to take firearms away from people suspected of being a danger to the public.

Senate Judiciary Committee Chairman Lindsey Graham (R-SC) indicated support for that third measure — the so-called “red flag” legislation — and pledged to work with Senator Dick Blumenthal (D-CT) to move a version of it through his committee. Nadler also plans to hold a hearing on military-style assault weapons. But barring a new push from the Trump Administration, congressional action on guns is likely to stop there, as consensus on a policy solution that satisfies both ends of the political spectrum remains elusive.

Budget Caps/Debt Ceiling/Appropriations by Landon Stropko

The House and Senate approved a budget deal in July suspending the debt limit past the 2020 presidential election and through July 2021. The deal also increased the last remaining discretionary spending limits under the Budget Control Act for FY 2020 and 2021, sparing federal agency budgets the 10 percent cut they would have faced at the end of this year. Instead, congressional appropriators now have the ability to increase FY 2020 spending by approximately $22 billion for defense and $27 billion for non-defense, relative to FY 2019 levels. Finally, the deal is accompanied by a bipartisan handshake agreement to avoid so-called “poison pill” policy riders in the negotiations to finalize FY 2020 spending bills.

Both the House and Senate have significant work ahead to complete appropriations bills before the end of the fiscal year on September 30. The House passed 10 of the 12 annual appropriations bills — all except the Homeland Security and Legislative Branch. But the specific program levels in those bills will have to be adjusted as the House bills assumed $15 billion more in total non-defense spending and $5 billion less in total defense spending than is provided in the budget deal.

The Senate has yet to approve a single appropriations bill. The Senate Appropriations subcommittees will begin marking up Defense and Labor-Health and Human Services-Education on September 10. Senate Appropriations Committee Chairman Richard Shelby (R-AL) indicated a preference of moving the DOD, Labor-HHS, and potentially Energy and Water appropriations bills as the first minibus. Such a package would include deliverables for Republicans and Democrats alike and, if enacted, would wall off a majority of federal spending from the threat of a government shutdown before congressional leaders and President Trump turn to thornier issues like the President’s demands for border wall funding in the Homeland Security appropriations bill. House Democrats have not determined the order in which they would process minibuses, but they are already considering a continuing resolution through late-November/early-December to prevent a government shutdown in the meantime.

National Defense Authorization Act by Annie Palisi

In late June, Senators voted 86–8 to pass the FY 2020 National Defense Authorization Act (NDAA), which authorizes spending for the Pentagon. In mid-July, the House voted 220–197 to pass its version, authorizing $733 billion for defense spending compared with the Senate’s $750 billion. The House faced 439 amendments on the floor, along with a narrowly defeated vote on Armed Services Ranking Member Mac Thornberry’s (R-TX) motion to recommit the bill and block passage on the floor.

As part of the bipartisan budget deal, topline defense spending was set at $738 billion, removing one of the largest differences between the two versions of the bill but potentially creating tensions as Senators must accept potential cuts to pet programs. Staff-level negotiations continued over the August recess, and Congress is expected to officially convene the conference committee upon its return. Both chambers hope to move the final version of the bill later this month, but there are several sticking points included in the House bill that could stymie negotiations. Chairman Adam Smith (D-WA) will need to sway House Democrats to support the final compromise that could remove some of the key provisions included in the House version, including measures closing Guantanamo Bay, blocking border wall funding and military action against Iran, allowing transgender troops to serve in the military, and blocking the deployment of low-yield nuclear warheads on submarines.

Trade by Noah Kowalski

The Administration’s aggressive approach to international trade continued as the President ratcheted up pressure on China. The President recently ordered U.S. companies to “immediately start looking for an alternative to China.” New tariffs also took effect with a 15 percent tariff on some imports from China and additional increases set for October 1 and December 15. It is increasingly unclear whether any deal can be reached to resolve the escalating trade war. Meanwhile, Administration officials continued work on delivering a signature trade win with the new North American Free Trade Agreement (NAFTA) and negotiations with Japan, the United Kingdom, and the European Union.

Meanwhile, Congress is focusing on NAFTA 2.0. Speaker Nancy Pelosi’s (D-CA) nine-member working group presented its report at the end of July on negotiations with United States Trade Representative (USTR) Robert Lighthizer around the United States-Mexico-Canada Agreement (USMCA). It remains to be seen how the Administration will resolve House Democrats’ four main concerns with the deal — labor, environment, enforcement, and access to affordable medicine. The deal may face Senate headwinds with Senator Pat Toomey (R-PA) and others raising additional concerns over dispute settlement and sunset provisions.

As the President prepares to head to the United Nations General Assembly meetings at the end of the month, USTR is pushing for a bilateral trade deal with Japan, a post-Brexit trade deal with the United Kingdom, and progress on an agreement with the European Union as well as formalizing a resolution to France’s proposed digital services tax.

Taxes by Carolyn Coda

The end of the year is shaping up to be a “choose your own adventure” for the tax and retirement world. Congress inked some wins this year in the tax world, including passage of a robust IRS administration bill and the first update to a tranche of international tax treaties in almost a decade. With only 11 legislative weeks between now and Christmas, time is running short on a handful of lingering issues, and lawmakers are working to determine if a tax bill can pass by itself or if remaining priorities need to be packaged together. This includes tax extenders, technical corrections to the Tax Cuts and Jobs Act (TCJA), and a bipartisan package that incentivizes Americans to save for retirement.

On tax extenders, the major sticking point remains whether any package should be fully offset. The House Ways and Means Committee passed a package in July, fully offset by changes to the estate tax, but that bill has failed to advance. The Senate is looking to debate its own bill in the fall, and Republican leadership has been vocal in their belief that offsets are not necessary in this situation, as has historically been the case. The path to pass technical corrections to the TCJA is also complex and fraught with political frustrations. Democrats believe it should not be their responsibility to fix the Republicans’ signature tax reform package, and many would like wholesale change as opposed to minor tweaks. On the other hand, Republicans argue Congress historically passes a technical corrections package after every major tax reform bill and this effort should be no different. Both sides admit there are a set of technical corrections that should be addressed, including provisions impacting the taxation of Gold Star families, employees of charitable organizations, and investments in qualified improvement properties, but are still negotiating how to move forward.

One option is to include one or more provisions in a larger tax package, as seen in the House Setting Every Community Up for Retirement Enhancement (SECURE) Act. The bill, which overwhelmingly passed the House in the spring, aims to improve the U.S. system of retirement and savings and includes the technical correction to the TCJA that impacts Gold Star families. The SECURE Act is languishing in the Senate, where the substantially similar Retirement Enhancement and Savings Act (RESA) was introduced. Lawmakers in both chambers are targeting the passage of a retirement and savings bill as a top priority for fall and hope that the remaining hurdles can be cleared, including how to address an extraneous 529 education plan provision cut from the House package at the last stage of negotiations.

Even as the fate of the extenders package remains uncertain, there is strong interest among House Democrats to expand existing tax incentives to promote renewable and clean energy. In April, more than 100 House Democrats signed a letter to ask Ways and Means Chairman Richard Neal (D-MA) to extend and/or expand numerous clean energy tax incentives and create new incentives in the process. Neal recently signaled plans to take up a clean energy tax package later this year. Provisions likely in the mix include an extension of tax incentives for residential and commercial clean energy technologies, tax incentives for energy storage, tax credits for electric vehicle purchases, and enhanced incentives for advanced biofuels.

Export-Import Bank by Mary Beth Stanton

Both chambers introduced legislation to reauthorize the Export-Import Bank before the charter expires at the end of this month. Unfortunately, neither bill made it through committee before the August recess, making a short-term extension likely.

The House Financial Services Committee began marking up its bill in July and abruptly stopped the markup amid objections from committee Democrats. Leading up to the markup, Chairwoman Maxine Waters (D-CA) worked closely with Ranking Member Patrick McHenry (R-NC) on a bipartisan bill to renew the agency’s operations for seven years and expand its capacity to offer loan guarantees to foreign buyers of U.S. exports. To garner Republican support, the bill would also ban the bank from lending to any company more than 25 percent owned by the Chinese government. Democrats on the committee and defenders of the bank believed this provision would bar major U.S. companies from doing business with China and therefore threatened to vote against reauthorization. The bill was pulled from markup, and Waters is hoping to get a full reauthorization through the committee with bipartisan support this fall.

At a Senate Banking hearing on Ex-Im reauthorization, Senator Kevin Cramer (R-ND) and Senator Kyrsten Sinema (D-AZ) introduced a bill to renew the bank’s charter for 10 years to give U.S. businesses more predictability when using the bank. It will serve as a marker for reauthorization. Chairman Mike Crapo (R-ID) and Ranking Member Sherrod Brown (D-OH) do not have a similar proposal nor have they set out a timeline for reauthorization.

Flood Insurance Reauthorization by Carolyn Coda

Absent congressional action, the National Flood Insurance Program (NFIP) will expire on September 30. The House passed a slimmed-down, multi-year reform package in the spring, but Senate lawmakers are unhappy with the bill and want to move their own legislation. As we continue through the height of hurricane season and feel the potential impacts of Hurricane Dorian, it is likely Congress will need to pass another short-term extension to avoid disruptions in the NFIP.

Health Care by Katie Wise and Ben Klein

The debate over Medicare for All (or some or many) will likely dominate the Democratic presidential primary debate on September 12. The issue is creating a clear divide between progressive candidates who favor universal health care and moderate candidates who prefer to build on the Affordable Care Act with more modest, incremental reforms. Not to be outdone, there are rumors President Trump may unveil his own health care reform plan in September at campaign-style events.

While the presidential primary debate and the White House proposal will generate headlines, the real action on health policy, particularly surprise billing and prescription drug prices, will likely be on Capitol Hill. The Senate Health, Education, Labor and Pensions (HELP) Committee this summer advanced bipartisan legislation on a 20–3 vote to end surprise billing, address prescription drug costs, and increase health care price transparency. A provision was also added during the committee markup to raise the minimum age for buying tobacco products from 18 to 21. Senate Finance Committee Chairman Chuck Grassley (R-IA) and Ranking Member Ron Wyden (D-OR) released their own legislation to address prescription drug prices. The Finance Committee approved the bill on a 19–9 vote in late July. On the House side, the Energy and Commerce and Ways and Means committees continue to advance standalone legislation to address surprise billing and prescription drug prices. Pelosi is hoping to announce a path forward this month.

Privacy by Eric Rosen

Efforts to enact a federal consumer privacy law continue this fall. While public progress is scant, legislators serving on the House Energy and Commerce Committee and the Senate Commerce Committee continue to wrestle with highly technical questions concerning the extent to which American consumers should be given control over their personal data online. The issues we described last spring persist, but Members of Congress now have far fewer legislative days remaining before California’s Consumer Privacy Act goes into effect on January 1, 2020.

In the House, Chairman Frank Pallone (D-NJ) and Consumer Protection Subcommittee Chairman Jan Schakowsky (D-IL) say that a federal privacy bill is a committee priority, but the Energy and Commerce Committee’s broad jurisdiction — overall health, environment, commerce, and related issues — continues to make finding time and capacity for such complex negotiations challenging. In the Senate Commerce Committee, an initial six-senator working group focusing on privacy — made up of Chairman Roger Wicker (R-MS) and Ranking Member Maria Cantwell (D-WA) as well as Senators John Thune (R-SD), Jerry Moran (R-KS), Brian Schatz (D-HI), and Dick Blumenthal (D-CT) — continues to work on the issue, with Wicker and Cantwell managing the negotiations this summer. Offices involved in negotiations pledged not to share details of their internal discussions until participants agree they are ripe for public review. The Senate works best when bipartisan groups collectively agree to limit leaked reports on their progress — that edict has largely held to date, suggesting Senators continue to make progress on the issue. The question remains whether that progress is enough to enact legislation this session of Congress. This fall will be make-it or break-it time for the effort.

Impeachment by Eric Rosen

Will they or won’t they? Whether the Democratic majority impeaches President Trump is a question likely to be settled over the next several months. House Judiciary Committee Chairman Nadler is not waiting and has already begun an impeachment inquiry: on July 26, the House’s general counsel filed a petition in the D.C. District Court saying as much. Nadler’s panel is seeking grand jury testimony regarding the President’s potential knowledge of Russian interference in, and connections with, the 2016 campaign. Courts have held that House committees can obtain such materials as part of impeachment investigations. Observers can ignore whether formal articles of impeachment have been introduced or voted on or whether the Judiciary Committee has held formal impeachment hearings. Those steps are not necessary to initiate an impeachment investigation, and indeed as the House told the court in July, one is already underway.

So, what happens next? With over 130 Members of the House on record as supporting the President’s impeachment, Nadler has the support of a majority of his caucus to continue the investigation. What it uncovers, and the extent to which the committee can break the Administration’s chokehold on potential witness testimony during any public impeachment hearings, will likely determine whether political support for removing the President from office will grow. Each time a significant public step in the investigation occurs (after the special counsel’s report was released in April, after Mueller’s first public remarks in May, and after his testimony before the Judiciary Committee in July), the number of impeachment supporters in the House jumps.