Capital Thinking Update - February 13, 2012

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In This Issue:

General Legislative

On Monday, February 13, 2012, the House will meet at 1:00 p.m. in pro forma session. On Tuesday, the House will meet at 12:00 p.m. for morning hour and at 2:00 p.m. to consider three bills naming U.S. Postal Service facilities under suspension of the rules. Thereafter, the House will turn to H.R. 7, the American Energy and Infrastructure Jobs Act of 2012. The Senate will convene at 2:00 p.m. on Monday for a period of morning business. Thereafter, at 4:30 p.m., the Senate will proceed to executive session to consider the nomination of Adalberto Jose Jordan of Florida to be United States Circuit Judge for the Eleventh Circuit.

Budget, Appropriations

LEGISLATIVE ACTIVITY

- Earmark Ban Efforts Continue. Despite failed Senate efforts to enact a permanent earmark ban through an amendment to the “Stock Trading on Congressional Knowledge (STOCK) Act” (S. 2038) (as detailed in the February 6, 2012 edition of the Capital Thinking Report), Senators Pat Toomey (R-PA) and Claire McCaskill (D-MO) plan to again offer the “Earmark Elimination Act” (S. 1930) as an amendment to the highway bill that will be on the Senate floor this week. Representative Jeff Flake (R-AZ) attempted to add the earmark ban to the STOCK Act when it was up for consideration in the House last week, but House leaders brought the bill up under suspension of the rules, a procedural tactic to prohibit amendments. Earmark opponents will continue these efforts to force votes on an earmark ban in the coming months. While an earmark ban could easily pass in the House, Senate votes will continue to be symbolic in nature...

Education

LEGISLATIVE ACTIVITY

- House Reauthorization of the Elementary and Secondary Education Act (ESEA). On Thursday, February 9, Representative John Kline (R-MN), Chairman of the House Education and Workforce Committee introduced the “Student Success Act” (H.R. 3989) and the “Encouraging Innovation and Effective Teachers Act” (H.R. 3990). If enacted, the bills would replace the current law on school accountability systems and establish teacher effectiveness measures, respectively....

REGULATORY ACTIVITY

- No Child Left Behind (NCLB) Waiver Requests. On Thursday, February 9, the White House announced the Department of Education approved the waiver request of 10 states: Colorado, Florida, Georgia, Indiana, Kentucky, Massachusetts, Minnesota, New Jersey, Oklahoma, and Tennessee. These states are now required to set new performance targets for student achievement and establish accountability systems to reward high-performing schools and address the needs of the lowest-performing schools....

Energy

LEGISLATIVE ACTIVITY

FY2013 Budget Proposal. The Administration’s FY 2013 budget proposal — to be transmitted to Congress on Monday, one week after the statutory deadline for submission — is expected to include temporary proposals to extend $5 billion worth of clean energy tax credits, including the Advanced Energy Manufacturing Tax Credit and the Production Tax Credit. Consistent with a point made in his State of the Union Address, the President also is likely to call for the repeal of all tax preferences that benefit the oil and gas industry, including the section 199 deduction and the write off for intangible drilling expenses. While Members of Congress will be under significant pressure to extend expired or expiring green energy tax credits, it will be difficult in the near-term to secure the funding to “pay for” their extension given budgetary constraints and disparate regional interests in an election year....

Environment

LEGISLATIVE ACTIVITY

- Department of Interior Budget. On Wednesday, February 15, the House Committee on Natural Resources will hold a full committee oversight hearing on the U.S. Department of Interior’s budget request for Fiscal Year 2013. Secretary Ken Salazar will testify...

Financial Services

LEGISLATIVE ACTIVITY

-  House Passes Insider Trading Bill. On Thursday, February 9, the House passed a bill that would prevent Members of Congress from financial market trading based on nonpublic information they have obtained in the course of their Congressional work. The Stop Trading on Congressional Knowledge Act or STOCK Act (H.R. 1148) passed by a vote of 417-2. The bill creates a specific fiduciary duty for Members and staff with respect to knowledge obtained as a result of their position and prohibits certain federal employees from buying or selling securities, swaps, or commodity futures based on non-public, material information gained during the course of their employment...

Health Care

LEGISLATIVE ACTIVITY

-  Doc Fix/Health Extenders. Conference Committee members met again this week to negotiate the extensions bill including the Medicare physician fee fix. For the first time, the Committee turned its attention to several House-proposed offsets, including a federal pay freeze, limitation on Medicare subsidies for upperincome earners, and a health insurance exchange subsidy recapture...

International, Defense, Homeland Security

- Syria Developments. Syrian government forces continue to shell and aim sniper fire at rebels and civilians alike, particularly in the opposition stronghold of Homs but also in other centers of resistance across the country. In response, the Obama Administration is steadily increasing diplomatic and economic pressure on President Bashar al-Assad, but the White House, Foggy Bottom, and the Pentagon remain keenly aware they are somewhat constrained from helping to bring about regime change, orderly or otherwise...

Tax

LEGISLATIVE ACTIVITY

- House and Senate Continue Conferencing Payroll Tax/Unemployment Insurance/Doc Fix Legislation. On Tuesday, February 7, the Conference Committee held its fourth meeting on the payroll tax, unemployment insurance (UI) and Medicare physicians payment fix – or the so-called “doc fix” – legislation. In December, Congress passed a two-month extension of the bill, which was fully offset by an increase in fees charged by Fannie Mae and Freddie Mac to lenders. As part of the two-month deal, the House and Senate agreed to conference on House-passed legislation that would extend all three provisions through the end of 2012 at an approximate cost of $150 billion (for a 10-month extension). The House bill also included a provision forcing the Administration to make a decision on the Keystone XL Pipeline within 60 days; for the time being, the President has rejected the pipeline proposal, stating that the 60-day deadline leaves too little time for State Department review of the project...

Transportation

LEGISLATIVE ACTIVITY

- SAFETEA-LU Reauthorization. This week, the House Rules Committee released the full version of the American Energy and Infrastructure Act (H.R. 7), which merges the five-year, $260 billion reauthorization of federal highway, transit and highway safety programs with the Ways and Means financing bill and several Natural Resources Committee-approved oil and gas measures...

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