"No problem of human making is too great to be overcome by human ingenuity, human energy, and the untiring hope of the human spirit." -President George H.W. Bush
GOVERNMENT FUNDING: Negotiations over funding for the border wall are ongoing but have not yet yielded an agreement. Democrats are sticking to the $1.6 billion in the Senate bill for ‘border security’ with President Trump and the Republicans not budging from the $5 billion outlined in the House measure. Given the funeral for President George H.W. Bush and an abbreviated work week, it was questionable whether Congress would be able to wrap up work on the remaining FY 2019 appropriations bills before Dec. 7. Now, though, with the president and lawmakers turning their attention to the service for former President Bush, there’s clearly not enough time to forge a spending deal by Friday – or even early next week. An Oval Office meeting between Trump, Senate Minority Leader Chuck Schumer and House Minority Leader Nancy Pelosi that was scheduled yesterday was postponed, possibly until next Tuesday.
Since the current continuing resolution (CR) expires Friday, lawmakers from both chambers are looking to pass a two-week funding extension, until December 21, for the seven appropriations bills that have not yet been enacted - Environment, Interior, and Related Agencies; Financial Services; Transportation/HUD; and Agriculture/FDA, as well as Homeland Security; State and Foreign Operations; and Commerce/Justice/Science.
FARM BILL: A deal in principle on a new five-year farm bill has been reached by the “Big Four” negotiators (Senate and House Agriculture Chairmen and Ranking Members Roberts, Conaway, Stabenow, and Peterson), but the details have not yet been released. Chairman Conaway originally expected language this week, but the expectation now is that the agreement will be released next week.
TAX BILL: House Republican leaders had planned to pass a tax bill last Friday, but were short of votes needed for passage and pulled the bill from the schedule. The bill, which Ways and Means Chairman Brady unveiled on November 26, has several parts, including an extension of various tax breaks that had expired, a handful of technical corrections to the 2017 tax bill, retirement savings provisions, and IRS reforms. While there is bipartisan support for much of the bill, House Democrats want to have hearings next year on what they view as problems created by the 2017 bill, so they and their Senate counterparts have no interest in passing a bill this year that fixes some of the most egregious problems. Because leadership needs most Republicans to be on board to pass the bill, each Republican has more leverage to argue for what they think should or should not be in the bill.
With time running out in the lame duck session, it’s unclear whether there will be an agreement to jettison the technical corrections and other controversial provisions and pass a package with tax extenders and possibly the IRS reform/tax administration package and retirement savings incentives.
USMCA/NAFTA 2.0: On Friday, November 30, Trump, Canadian Prime Minister Trudeau, and Mexican President Peña Nieto signed the U.S.-Mexico-Canada Agreement. This starts the clock for additional requirements, including the Administration’s list of required changes to U.S. law, due within 60 days, and the International Trade Commission’s report, due within 105 days.
U.S. Trade Representative Robert Lighthizer said the countries will now focus on a resolution to Section 232 tariffs on steel and aluminum. Lighthizer also emphasized his confidence that a high number of Democrats will vote for the implementing legislation. Despite Ambassador Lighthizer’s assertions about bringing most Democrats on board, the road to passage for the USMCA will be long, as Democrats and Republicans are both expected to try to insert provisions into the implementing bill. After the signing ceremony and the G-20 Summit, President Trump told reporters aboard Air Force One that he will be formally terminate the original NAFTA agreement soon, “so Congress will have a choice of the USMCA or pre-NAFTA.” The NAFTA termination clause requires that a party submit a six-month notice of withdrawal and that the agreement will remain in force for the other parties.
