There is nothing in politics as clarifying as an election.  And as the biggest, baddest, budget watchdog podcast on the block, it’s our job to help you see the clearest picture possible of what’s about to go down on Capitol Hill.  What’s still on the legislative table? What deals might be made?  What hijinx can we expect?  And of course, what might it mean for taxpayers? Joining Steve Ellis to answer every question and shine the light in all the right corners are TCS Vice President Autumn Hanna and TCS Senior Policy Analyst Josh Sewell.

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Episode 33: Transcript

Steve Ellis:

Welcome to All American Taxpayers Seeking Common Sense. You’ve made it to the right place for over 25 years TCS, that’s Taxpayers for Common Sense, has served as an independent nonpartisan budget watchdog group based in Washington DC. We believe in fiscal policy for America that is based on facts. We believe in transparency and accountability because no matter where you are in the political spectrum, no one wants to see their tax dollars wasted.

There’s nothing in politics as clarifying as an election and as the biggest, baddest budget watchdog on the block, it’s our job to help you, our podcast listeners, see the clearest picture possible of what’s going on on Capitol Hill. This is not a process story. No. What you’re about to hear is the budget watchdogs guide to the election, lame duck and kickoff of the new congressional session. What’s still on the legislative table? What deals might be made? What hijinks can we expect? And of course, what it might mean for taxpayers here to answer every question and shine the flashlight into all the right corners are TCS, Vice President, Autumn Hanna, and TCS Senior Policy Analyst Josh Sewell. Welcome back to the podcast.

Autumn Hanna:

Thanks, Steve. It’s good to be here.

Josh Sewell:

Glad to. We’re here too.

Steve Ellis:

So Autumn and Josh, we are just days away from the 2022 midterm elections and the balance of power in both chambers of Congress is very much in question. Josh, before we read the electoral tea leaves and game out the post-election lame duck session, what’s the state of play right now before November 8th?

Josh Sewell:

Well, it’s churning. Historically, the party out of the White House wins. They make significant gains. Every election after the presidential election, the party that’s outside of power has gained seats except in 2002. And that was a little bit different, because that was post 9/11. It was a different world. So right now, house Democrats, they only have a five seat majority. That’s extremely small under even the best of circumstances. And the Senate, let’s remember, 50/50. 48 Dems and two independents sit cocks with them. So these are razor thin majorities in both. And so the fundamentals say Democrats are probably going to lose some seats, maybe a lot of seats, but things are just a little murkier in the Senate. So I think minority leader McConnell has indicated it’s going to be a very small majority, even if they somehow squeak out a few of their seats that they want. So it’s busy, it’s churning, and it’s going to be pretty tough.

Steve Ellis:

Got it. Got it. Either way, the next Congress will be messy, but before we even get there, there is the matter of the lame duck. Autumn, why is the period after the election called the lame duck anyway?

Autumn Hanna:

Well, Steve, the time after the elections, but before the new Congress is seated is called the lame duck session. And the members, the lame ducks, I even looked up the term and it apparently came from 18th century at the London Stock Exchange. It was referring to stock workers who defaulted on their debts. And this November, I think as we’ve talked about a little bit already, members are going to lose. There’s going to be some changes and some shifting around, but they are still going to be in office through the end of their term, which is January 3rd at noon, and that’s when the new Congress is sworn in. So until then we have these folks sitting there who are lame ducks waiting out their term.

Interestingly, another point that I found though I forgot to mention, was that the lame duck used to be lamer. And that’s because before the 20th amendment to the constitution was passed, folks stayed in office until March. So that was an even longer lame duck we had back then. Now we just have to stick it out till early January.

Steve Ellis:

Okay. Good history lesson. So what items are on this lame duck to-do list?

Autumn Hanna:

So the current continued resolution is something we’ve talked about here on the podcast at length over the years. So that gets us until December 16th. So there definitely has to be some action there. And as you said, Steve, no matter what happens in the election, as Josh mentioned too, the Democrats still control the legislative branch until January. So while a pending house Republican majority may push to get fiscal year 2023 spending bills delayed into next year, it’s likely the Democrats will stick together at least to get the omnibus spending bill through the house.

Steve Ellis:

That’s right. And a noteworthy point in the Senate, Appropriations Committee Chair, Leahy, and ranking member Shelby are both retiring. So they’re going to want to go out on a high note, and they’re going to want to push through these appropriations. And I think that that’s going to have a powerful effect, especially in the clubby Senate. And we’re going to do this all for Pat Leahy and Richard Shelby to get it through.

Josh, what do you have to add to the to-do list for the lame duck?

Josh Sewell:

Well, I’m not the one adding it, but I think there’s certainly right now there’s a 33 billion disaster supplemental that’s being kicked around, and that’s mostly for Hurricane Ian. And that was proposed by Senator Rubio of Florida. But 33 billion is just the starting point. And I think we talked about this before because that bill does not appear to include any relief for Puerto Rico or any relief from any of the other disasters throughout the country. And so you can bet there will be some kind of disaster supplemental, and anytime there’s a disaster supplemental, there’s unrelated spending included in that package. That’s just a fact now.

There’s also the National Defense Authorization Act. And so this is a bill that has passed every single year for now 62 years. So I’m going to assume it’s going to go through at some point in this lame duck. It’s basically a must pass bill.

And so there’s also, I see what else is there? There’s a variety of extensions and other bills I think around of tax extenders. We have a number of temporary tax cuts that are passed every one to two years. And there’s even a few that are coming from the tax cut bill of 2017 that are about to come due. So they may want to extend those a little early, some of those that are about to expire in 2025. And I think there’s also, we receded to the back for a lot of people, but Covid-19 funding. The administration has still requested billions more for COVID 19 and other pandemics preparation. So there’s going to be a push to try to do that. And there’s other things like the Electoral Reform Act and supplemental spending for Ukraine’s defense. So there’s a lot of things that are out there, and a couple of those are considered must pass and the ones that are must pass are going to attract a lot of other things that want to pass.

Autumn Hanna:

And speaking of all of the must pass vehicle. Well there’s a handful of must pass and there’s a lot of other things that get tacked on as Josh mentioned. And one of those things that we talked about on the podcast just about a month ago or so when they were doing the CR, was the permitting reform that Senator Manchin and Senator Schumer were working towards to get on the CR. And that effort failed in pretty dramatic fashion, because we saw Republicans and Democrats coming out against that. But that was sort that 11th hour politicking to try to get that deal done on the CR and the NDA, the which is the National Defense Authorization Act I should say, the Omnibus, and these other moving vehicles that could come up in the lame duck could all offer an opportunity to get that tacked on again.

Steve Ellis:

I remember the permitting reform and that both Republicans and Democrats were raising a fuss about that. On the Republican side, they didn’t want to give Senator Manchin another win after he helped push through the Inflation Reduction Act, the IRA. And then some on the Democratic side of the aisle really didn’t like the underlying permitting reforms and potential changes to environmental reviews. And then it just ran out time to broker any deal, because they were right up against the fiscal year deadline of September 30th. And so Senator Manchin pulled the plug on that, agreed to pull the plug on that, but I definitely think they’re going to try to make another run at it.

Autumn Hanna:

And I think that’s one of several things. And I think that like a lot of these issues, it’s not always on the merits that we are raising our concerns. Permanent reform is something that we’ve said could be good for taxpayers have done in the right way, and it’s something that’s needed. But the way that process-wise sort of tacking us on at the 11th hour and we see the pitfalls in this, the fact that they can’t get it done, the fact that it’s just things get loaded onto it to get votes at the last minute, that may really not get taxpayers a good deal. That’s our concern. This isn’t the way to legislate, and these last minute add-on pieces are never really efficient or smart for taxpayers. I shouldn’t say never, but rarely will we see something good come out of that process. So, that’s our concern.

Steve Ellis:

Yeah, it’s an accident rather than intentional if it ends up being that way. But you’re saying that these could be revived again and tacked on to another last minute deal. So what are the prospects?

Autumn Hanna:

I think it’s hard to say. The outcome of the elections will certainly play a part on all these things that Josh mentioned and permitting reform anything else that gets done. I wouldn’t rule out though a deal on permitting. We’ve heard bipartisan support for the issue, and those bills are must pass. So if a provision can get added on, members aren’t likely to raise a fuss about these smaller pieces. They’re not going to want to take votes on a big piece like the NDA over permitting reform. So if they can get the details of the language and get past the politics, I think it could work. But politics have sunk it before and can sink it again. And again, like I said, the issue, there’s just no time to really work out the deals when you end up with your back against the wall having to get these bills done.

Steve Ellis:

You’re listening to Budget Watchdog AF. The podcast dedicated to making sense of the budget spending and tax issues facing the nation. I am your host TCS president Steve Ellis, and we continue now with Autumn Hanna and Josh Sewell.

Here’s a trick question, what’s not on the to-do list that we’ve mentioned but might get done?

Josh Sewell:

Well, Budget Watchdog AF listeners know all about budget reconciliation and that was from, we talked about this on episode 11, I think it was fiscal illusions, fuzzy math, and all aboard. Well the thing is reconciliation is not just for passing spending bills and revenue provisions with the simple Senate majority. You can also pass increases in the debt ceiling. So right now the treasury is predicting that the debt ceiling, our national debt ceiling, we will run up against that at some point next year, could be pretty early in the year as well. And so there is some discussion here about maybe we could do the debt ceiling increase.

Steve Ellis:

So Congress is more like the college student that waits till the last minute to do their essay and turns it in right before midnight. They’re not very good at doing things early. Why are they adding this to this already pretty full plate, Josh? What’s the rationale?

Josh Sewell:

Clearly not good at doing things early since we haven’t passed our spending bills yet for this year. Well they want to avoid a messy fight. So if you’ve been paying attention, you may have seen that elements in the GOP are calling for conditioning any sort of debt limit increase on mandatory spending cuts. So basically seeing themselves in the majority next year, some Republicans are saying this will be our chance to force spending cuts on a Democratic administration. So Republicans think they have this opportunity to take this advantage. And so some of the Democrats are saying, well maybe this is a tool we should take out of the toolbox for the Republicans if we are not in control next year. So this is giving us deja vu to the 2010 election. As folks may remember when that was, I think it was 63 or so, Democrats lost their seat and the Republicans swung over and the beginning of the Tea Party movement.

Steve Ellis:

And then we got the budget control act out of that. And the super committee, if people go back to that. Much like AF listeners, I mean that we’re concerned about the debt ceiling. Bottom line is that this is all spending that Congress has already agreed to that it’s either through the major entitlement programs like Social Security or Medicare or it’s the appropriations bills that have passed. And so we can’t play chicken with the full faith and credit of the US Treasury. And that’s a really risky game, particularly in an inflationary environment where now you’re going to have to pay people more interest to buy our debt. And so anything that kind of roils those markets is ridiculous and it needs to be taken off the table.

Josh Sewell:

But one thing that we have talked about in the past is that we were all around for the Budget Control Act and we were there for that debate. And I think the spirit of it, the idea of reigning in uncontrolled spending is something that we are in support of. But the challenge with the, like you just said, is that with the debt ceiling, this is about decisions that have already been made. This money is out the door. We’ve committed this. Congress has made these choices. If you really want to reign in debts, if you want to reign in spending, reign in the spending. Choose to not make those spending decisions and also raise revenue to cover it. It brings back some nightmares from 12 years ago for us, but also brings back some opportunities to say whoever is in charge, make the tough decisions. Follow your values and actually raise enough revenue to cover the kind of government you want. But when we’re talking about decisions that many of you have already made as members of Congress, pay your debts, pay our debts. I mean we’ve raised the debt ceiling nearly a hundred times since 1940. 60 of those since Reagan was president, four of those under Trump. So this isn’t something that’s rare. If you’re making the decisions to take on the debt, we need to service that debt.

Steve Ellis:

Absolutely, Josh, it’s a blunt tool, it’s a scary tool. So I can certainly see the Democrats going ahead and doing that while they can get reconciliation through to kind of avoid that major, major headache. And I also could see that privately some Republicans would be happy to have the Democrats own that and do that rather than having, because the debt ceiling is going to get raised. I mean now there could be a small default before it, but mark my words, the debt ceiling will get raised.

Let’s talk about a 118th session of Congress. So what are some of the things that Budget Watchdog AF listeners should be thinking about going into this next Congress and that they’re going to be seeing and we’re going to be talking about in the future,

Autumn Hanna:

There are some things that need to get done next year, but in general with the sort of tight margins, it’s going to be hard to get a lot done. There’s going to be a lot more time trying to figure out where there is agreement. We’ll of course have annual approach so who knows what we’ll be having to talk about next September. But I don’t expect it to be dramatically different than what we’ve had to talk about here. I think we’ll get to the 11th hour probably likely again on appropriations and be dealing with the end of the fiscal year and those pieces. We will have some other bills that are just coming up like the FAA and we have the Farm Bill, which of course I’m sure is on Josh’s mind.

Steve Ellis:

You stole Josh’s thunder.

Autumn Hanna:

I’m not going to talk about it. I’m just going to say it, and then leave. I’m volleying it over right now to you, Josh.

Josh Sewell:

You’re more than welcome to work on the Farm Bill. It’s one of the best things to work on.

Autumn Hanna:

I definitely didn’t say that. I said it’s happening, not that I’m working on it.

Josh Sewell:

Yeah, it is actually. I mean we’ve all long anticipated this and we try to talk about it on every podcast, but we actually should see a farm bill reauthorization process next year. The bill does expire at the end of the fiscal year. So again, just because something expires doesn’t mean you have to work on it, but they’re going to try to work on that. And I think if we’re not, you said annual probes, I was thinking we still might be finishing this year’s probes so we could have double annual probes. And I do think there could be some sort of budget deal. Again, if the debt ceiling isn’t raised or if it’s only temporarily raised, that could come up again. Because another thing in the debt ceiling is you can suspend the debt ceiling instead of raising it under certain conditions. And they’ve done that in the past. So basically just suspend it for a certain number of months in order to force it onto the Republicans. That could be a potential opportunity there. And who knows, honestly? There could be a few things that come up that we haven’t seen, because we’ve seen a lot of disaster supplementals, and we’ve seen some things pop up that we wouldn’t anticipate.

Autumn Hanna:

I think there’s certainly going to be a lot of debate too on the spending that’s already been allocated through the Inflation Reduction Act and through the Infrastructure and Jobs Act. So that’s a lot of money that the agencies have and I think if we do see a change in the house, there could be a lot of fuss raised in hearings in other places, even though I don’t know that there’s a lot of opportunity to get anything done. You still have President Biden in the White House and really tight margins in the Senate, whichever direction it goes. But certainly will be a lot of debate and discussion around that spending.

Steve Ellis:

I think a lot depends. We’re pretty much assuming, and I think all the pundits are assuming that the Republicans are going to take back the house. It just depends on what the margin is. But it really depends on whether the Senate stays in democratic control or if it moves to the Republicans. That what is the game changer for what Republicans can do. But you still have the presidential veto. So for instance, budget reconciliation, it only works when one party has control of all three places of the House, the Senate, and the White House. And so it won’t stop if Republicans have control of both chambers. It won’t stop them from trying to pass something and making the president veto it. But yeah. And then on the debt ceiling, the one thing I think is also kind of interesting is I don’t know, and I literally don’t know, because I don’t think it’s been tested, if you could suspend the debt ceiling in reconciliation, because it’s not an actual number. That’s all up to the Senate Parliamentarian. Is it policy or is it actually the same thing? I don’t know. But we’ll have to see exactly how that plays out and the Democrats may not decide to pick it up or maybe not be able to get all 50 of their Senators on the side of that.

Autumn Hanna:

I think we are and have a really busy November, December. I think it’s likely no matter what that a lot of things will be talked about even if a lot doesn’t get done.

Steve Ellis:

Yeah, lame ducks seem to over promise and under deliver. There’s no doubt about that.

Autumn Hanna:

That is definitely historical truth, I think. So. But we’ll see what happens on Tuesday.

Steve Ellis:

Exactly.

Josh Sewell:

Well and however many weeks afterwards. Because I would not expect-

Autumn Hanna:

That’s true. We probably won’t know anything on Tuesday.

Josh Sewell:

Yeah, I mean certainly someplace won’t be done voting or won’t be done counting the votes and it’s increasing looking like there may be a runoff for the Senate in Georgia at the very least, and that could be the deciding factor.

Steve Ellis:

Certainly was last time. So there you have it. Before the 118th Congress is seated. The 117th Congress still has work to do, and we’re here with you making sure good policy isn’t left by the wayside in all the politicking. This is the frequency. Mark it on your dial, subscribe and share, and know this. Taxpayers for Common Sense has your back, America. We read the bills, monitor the earmarks, and highlight those wasteful programs that poorly spend our money and shift long-term risk to taxpayers. We’ll be back with a new episode, and I hope you’ll meet us right.