Update 651 — Trifecta’s Final Frame:
What Can Still Make it in Lame Duck?
Congress returns from Thanksgiving break next Monday for a month-long lame duck session — all that remains of the 117th Congress until Christmas Eve, when you can expect adjournment — and the last shot for Democrats to make use of their fleeting trifecta to tie up loose ends and secure goals before the final whistle and the divided 118th Congress takes the field.
Time remains for some legislative items. Congress must pass defense spending and government funding for FY23, which expires on December 16. Progressive priorities like banning congressional stock trading and a clean debt limit extension face barriers, but would be big gains before Republicans take control of the House.
In today’s update, we detail what to expect from the lame duck session on these bills and issues in the lame duck.
Have a great Thanksgiving break…
This Too Must Pass
The continuing resolution currently funding the government expires on December 16. By then, Congress will need to extend the existing continuing resolution or adopt a new omnibus for Fiscal Year 2023. Given that we will have a divided government come January, the best case scenario is for Congress to reach a bipartisan agreement on an omnibus this year. A short-term CR in December is likely to result in two more years of additional CRs, meaning flat funding for government agencies that desperately need budget increases to keep pace with inflation and to combat years’ worth of chronic underfunding.
Members also need to finish up the National Defense Authorization Act (NDAA) by the end of the year, or it will be the first time that Congress has failed to pass an annual defense spending bill since 1961. While House Minority Leader Kevin McCarthy, who is angling to become Speaker come January, has called for delaying the key bill until next year, there have not yet been strong signals from the rest of the Republican caucus that it will hold up the NDAA. The House has already passed its version of the bill in July with 329 members in support, including McCarthy.
What We Would Like to See
While this has been a very productive Congress with legislative achievements like the American Rescue Plan, the CHIPs and Science Act, the Infrastructure Investment and Jobs Act, and the Inflation Reduction Act, there are several legislative priorities that remain.
- Debt Limit — The House changing hands in February moves up Democrats’ timeline to handle the debt limit. While Congress won’t have to raise or suspend the debt limit until later next year to avoid default, Republicans have already called for cuts to Social Security and Medicare in exchange for allowing the government to meet its existing financial obligations and avoid default. Given this, Democrats ought to find a long term solution to the policy hostage-taking the GOP ritually demands that risk the full faith and credit of the United States.
The ideal way to do this would be through a bipartisan measure to suspend the debt ceiling in the omnibus. But if Republicans insist on pushing the issue off until they control the House, the next best option is to circumvent Republicans entirely. Raising the debt limit through reconciliation as a last-minute standoff over the debt ceiling would have serious consequences for the economy. Some Democrats, including Senator Elizabeth Warren, have called to eliminate the debt ceiling entirely, although permanent debt ceiling reform does not yet have the support it would need to pass.
- Tax Extenders — Congress will also take up a tax extenders package this December to address tax changes from the 2017 Tax Cuts and Jobs Act and expired provisions of the American Rescue Plan related to:
- The Child Tax Credit expansion
- Research and experimentation amortization
- Limit on business interest expenses
- 100 percent bonus depreciation for machinery
Progressive advocates and lawmakers are calling on Congress to withhold any corporate tax breaks until a monthly fully refundable Child Tax Credit is instituted. Democrats must hold the line and refuse to vote for corporate tax breaks until they have secured critical support for children and families.
- Electoral Reform Act — After a bipartisan working group came together to reform the ambiguous 1887 law the Electoral Count Act, the effort is almost across the finish line. The House passed their version of reform — the Presidential Election Reform Act — in September. The Senate Rules Committee passed the bill out of committee on a vote of 14-1. There is enough support for a floor vote, but there has also been discussion of attaching the bill as an amendment to the omnibus government funding bill in order to streamline the process. Passing the Electoral Count Act will be a great achievement in clearing up ambiguities in how electoral college votes are processed, which led to turmoil in the 2020 election and January 6th attack.
- STOCK Act 2.0 — This Congress seemed like the moment, finally, to ban congressional stock trading. With numerous reports detailing members’ conflicts of interests and several bills attempting to address the issue, it has been difficult to find a solution that appeases all members of Congress. Despite the difficulties in getting this done, there is still hope the lame duck session will provide an opportunity to address congressional stock trading, even if there is not yet enough support – or time in the congressional calendar – to ban it completely.
There are still several agenda items that Committees will need to address by December 31st:
- Crypto — Congress has failed to achieve any kind consensus on the extremely volatile crypto market. The recent crash of FTX, a crypto trading platform worth over $32 billion at its peak, has proven the fall of the crypto industry comes with consequences to its investors – in this case, one million investors. Now known as one of the highest-profile crypto collapses to date, FTX and sister firm Alameda Research Company filed for bankruptcy protections on November 11 and exposed the shocking and deeply concerning practices that went on behind closed doors. Samuel Bankman-Fried, the founder and former CEO of FTX, has found himself owing nearly $3.1 billion to his 50 biggest creditors. In addition to money owed, the 30-year old could face a number of civil, or criminal, charges once investigations are all said and done.
With growing pressure to pass legislation and crackdown on the industry, Chairwoman Maxine Waters of House Financial Services and Chairman Sherrod Brown of Senate Banking each announced their intent to thoroughly investigate the fatal collapse before the year’s end and plan to hear from Bankman-Fried. Details are still forthcoming, but we can expect the hearings to occur sometime in the first half of December with legislation likely to follow.
- Antitrust — After record-breaking demand and treacherous experiences for customers, Ticketmaster suspended the general public ticket sale for Taylor Swift’s latest tour. The subsequent public outrage and bad blood has drawn the attention of regulators and legislators: Multiple Attorneys General and the Department of Justice have opened investigations into the company for antitrust violations rooted in the merger between Ticketmaster and Livenation in 2010 – which regulators should’ve said no to as the ticketing industry massively consolidated. Senate Antitrust Subcommittee Chair Amy Klobuchar followed suit by announcing a lame duck hearing on the matter. It remains to be seen if these investigations or hearings will result in any enforcement action against Ticketmaster; however, the incident has reminded us all too well that we need significant antitrust reform. Long story short, the alliance between Democratic lawmakers and Swifties could be enough to bring rigorous antitrust policy out of exile.
- January 6th Select Committee — After several blockbuster hearings ending with a subpoena of former President Trump, the committee is set to release their final report including findings, policy recommendations, and possibly criminal referrals. After Trump failed to comply with the subpoena, the committee is considering next steps, which will likely be detailed in the report. The report is expected to be released in December and will consist of eight chapters. Chairman Bennie Thompson also appointed a subcommittee to clear up any loose ends such as potential civil and criminal referrals who have failed to comply with subpoenas. The subcommittee is led by Rep. Jamie Raskin with members Rep. Liz Cheney, Rep. Zoe Lofgren and Rep. Adam Schiff.
When Congress returns on Monday, Democrats will have a long list of items to finish up and far too little time to get to them all. The clock is ticking on the trifecta, and the next few weeks will mark the party’s final chance to address key components of its platform, like marriage equality and the Child Tax Credit, as well as to secure a more favorable omnibus than we are likely to see in the coming years. Democrats must work quickly to capitalize on their remaining opportunities before a new Congressional cycle where Republicans control the House.