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[image: In this newsletter: This Week in Washington:
“We can’t wait”Financial Shorts: Hedge Fund Reporting; Internet Stimulus
FailPolitical Shorts UPDATES: Supercommittee; Spending Bills]


*Washington Update– November 1, 2011*
[image: In this newsletter: This Week in Washington: “We can’t
wait”Financial Shorts: Hedge Fund Reporting; Internet Stimulus
FailPolitical Shorts UPDATES: Supercommittee; Spending Bills] [image:
In this newsletter: This Week in Washington: “We can’t wait”Financial
Shorts: Hedge Fund Reporting; Internet Stimulus FailPolitical Shorts
UPDATES: Supercommittee; Spending Bills] [image: 1. This Week in
Washington: “We can’t wait”The series of economic initiatives announced by
President Obama in the past week reflects a strategic and tactical shift
that White House officials hope will guide the president’s governing and
political agenda in the months ahead.With his jobs plan stymied in Congress
by Republican opposition, President Obama has begun a series of
executive-branch actions to confront housing, education and other economic
problems over the coming months. President Obama kicked off his new
offensive in Las Vegas by promoting new rules for federally guaranteed
mortgages so that more homeowners can refinance or avert foreclosure. He
continued to Denver to announce policy changes to ease college graduates’
repayment of federal loans.The new effort, carried out through unilateral
executive actions, was agreed upon weeks ago and is strongly reminiscent of
a successful campaign deployed by Bill Clinton in the run-up to his 1996
reelection. The strategy is an approach designed to portray Obama as
decisive as the White House complains about Congress’s failure to pass his
jobs bill. Aides say President Obama, or cabinet secretaries, will announce
at least one initiative each week through the rest of the year, including
steps to help returning veterans and small businesses. Yet the officials
acknowledge that the coming policy changes, executive orders and agency
actions are generally less far-reaching than the legislative proposals now
before Congress.Polls show overwhelming support for pieces of the $447
billion package, but Republicans oppose provisions in the President’s plan
that would offset the costs with higher taxes on the wealthy. Earlier this
month Republicans blocked debate on a $35 billion bill for state aid to pay
teachers, police officers and firefighters- Democrats’ first effort to
break the jobs package into individual pieces. The next piece to be brought
up will be a $60 billion package to help rebuild aging infrastructure. The
measure would provide $50 billion for roads, bridges, rail and airport
projects, putting hundreds of thousands of construction workers, engineers
and contractors back to work at a time the country is struggling with
unemployment. An additional $10 billion would be used as seed money for an
infrastructure bank to leverage private and public capital for additional
construction projects. Similar to Obama’s jobs package and the smaller $35
billion hiring bill, the infrastructure bill would be fully paid for by
charging a 0.7 percent surtax on any income over $1 million a year for
individuals and couples – an idea that has never sat well with Republicans
who are staunchly opposed to anything resembling a tax hike. At the same
time, Democrats who are normally loyal to Obama could also present an
obstacle. Sen. Barbara Boxer (D-CA), who serves as chairwoman of the Senate
Environment and Public Works Committee, warns that an infrastructure bank
should not be used to replace federal dollars, and that it should not be a
core program. So for now, the President will exercise his constitutional
muscle outside of Congress and continue to announce jobs-related
initiatives through the fall that require executive action rather than
legislation regardless of resistance from Congress to his broader
legislative proposals. Given the modest scale of the measures, they are as
much about symbolism as substance.2. Financial ShortsHedge Fund
ReportingThe SEC unanimously adopted a new rule last week that requires
large hedge funds to report detailed information on their holdings to
federal regulators. Managers of funds with more than $1.5 billion in assets
will be required to disclose aggregated information on how much the fund
has invested in various asset classes, where investments are concentrated
geographically, and how active the fund is in trading its portfolio. In
addition, large funds must disclose how leveraged their investments are and
how liquid they are. Large funds will be required to report the information
quarterly, within 60 days of the end of the quarter. However, they are not
required to report “position information,” or details on individual
investment holdings. Hedge funds with $150 million to $1.5 billion in
assets will be subject to less extensive disclosures, as will private
equity funds.The new rule has “substantial modifications” from the proposal
that the SEC released in February that drew broad complaints from hedge
fund managers and at least one member of Congress, who said in comments
filed with the Commission that the requirements posed an unnecessary
regulatory burden on investment managers. They also expressed concern about
whether the regulators will be able to keep the proprietary information
confidential. Because the new rules are a joint release with the Commodity
Futures Trading Commission (CFTC), the SEC won’t make public the actual
rule until after the CFTC approves it, which is expected to be later this
week. If approved as expected by the CFTC, the new rules will go into
effect in mid- to late-2012, depending on a fund’s size.Internet Stimulus
FailThe Commerce Department revoked a $80.6 million grant to bring
broadband Internet connections to Louisiana, saying that the state fell
behind schedule and changed its original plan for the stimulus funds.The
vast majority of funds will be returned to the US Treasury, except for
$594,000 that has been delivered to the state already. The grant to
Louisiana Broadband Alliance was intended to create a fiber optic network
stretching 900 miles to the most economically distressed areas of the
state. Six state agencies said they would coordinate on the project, which
was to provide access to schools, libraries and health care facilities. But
the project didn’t meet deadlines, and the state changed plans and didn’t
give enough technical and financial details to ensure the project would be
completed.The Commerce Department’s National Telecommunications and
Information Administration (NTIA) and Department of Agriculture’s Rural
Utilities Service have awarded $7.2 billion in stimulus funds during the
Obama administration aimed at bringing high-speed Internet connections to
rural areas. The Louisiana project is the fourth one to fail among the
NTIA’s 233 awards. The agency and the Agriculture Department have hailed
the success of other projects, saying that generally the stimulus programs
have been an overall success. But the failure of projects supported by
grants and loans from the federal government has also come under greater
scrutiny by some Republican lawmakers. Several have questioned the
distribution of taxpayer dollars into ill-conceived projects such as
the bankrupt solar panel firm Solyndra.3. Political Shorts–
UPDATESSupercommitteeIn 22 days, the Supercommittee is set to report its
findings, and this week marks an unofficial deadline for the panel: The
Congressional Budget Office has said it needs to see the committee’s report
for budgetary scoring in the early part of this month.Now it appears that
Social Security is on the negotiating table. This is on top of proposals
already put forth inside the panel. Last week saw a slew of plans
introduced by Democrats and Republicans on the committee. Democrats
unveiled a plan that would cut the deficit by roughly $3 trillion, which
was declared not “serious” by Republicans because of $1.3 trillion in new
tax-based revenue, but their plan did include changes to Social Security.
Republicans rolled out a $2.2 trillion plan, which would generate $640
billion in nontax revenue. House Speaker John Boehner (R-OH) and Senate
Majority Leader Harry Reid (D-NV) have discussed a $1.2 trillion plan, and
changes to Social Security alongside it could show they are reaching for a
broader scope. If the committee were to take up changes to Social Security,
it could show that Congress is looking for systemic changes to the nation’s
finances — something markets and credit rating agencies want to see. It may
not help the committee get to $1.2 trillion, but Democrats are all but
certain to insist that Boehner commit to serious changes on taxes alongside
such entitlement restructuring.Dissension remains though. It’s clear that
even if Democrats on the Supercommittee got their way, they’d have trouble
with the left flank of their party. Behind all this, both sides are staking
out ground to diffuse blame on a final compromise. Democrats and
Republicans are bracing for the Supercommittee to become a historic
failure. Both sides are already laying the groundwork for a bitter round of
finger-pointing in the event of a messy aftermath later this fall.Spending
billsThe first Minibus, which contains funding for the Agriculture,
Commerce, Justice, Transportation and Housing and Urban Development
departments, cleared the Senate Tuesday after bipartisan votes rejected
conservative demands for still deeper appropriations cuts. The bill now
heads to a House-Senate conference. It is the first in a series of
appropriations packages which the leadership hopes to finalize over the
next month while keeping faith with the spending limits set under the
August debt limit accords. Speed is important, with the government
operating under a stopgap spending bill due to expire November 18. But the
shotgun process still risks a fight in the House, where conservatives are
upset both with the level of funding allowed and their limited ability to
offer floor amendments. So far, the only 2012 appropriations bill passed by
both houses of Congress is the one funding military construction and the
Department of Veterans Affairs. The Minibus process of grouping several
appropriations bills into one package is an attempt to avoid one giant
Omnibus bill that would allow only limited debate and floor amendments.The
next Minibus would contain the bills funding the Energy Department,
financial services and possibly the State Department. These are more
controversial than the other spending measures considered by the Senate so
far. Including the Energy bill in this package would almost certainly
resurrect calls by House Republicans to defund green energy subsidies
favored by the Obama administration. The State bill contains cuts to
foreign aid that are opposed by the administration, and passage of the
financial-services bill would set off a battle with the House over
provisions defunding the Dodd-Frank financial reform law. Left outstanding
are the highly controversial Labor and Health bill and the Interior and
Environment bill. The House has proposed bills that defund President
Obama’s healthcare reform law, while its environmental bill blocks dozens
of environmental rules. The Senate Appropriations Committee has been unable
to mark up its Interior and Environment bill due to squabbling among
subcommittee members. Also on tap are the Defense, Homeland Security and
Legislative-Branch bills, though moving these could be less
difficult. Defense enjoys broad support, and might be able to “carry” the
other, more controversial bills to passage as part of a final five-bill
package.] [image: 1. This Week in Washington: “We can’t wait”The
series of economic initiatives announced by President Obama in the past
week reflects a strategic and tactical shift that White House officials
hope will guide the president’s governing and political agenda in the
months ahead.With his jobs plan stymied in Congress by Republican
opposition, President Obama has begun a series of executive-branch actions
to confront housing, education and other economic problems over the coming
months. President Obama kicked off his new offensive in Las Vegas by
promoting new rules for federally guaranteed mortgages so that more
homeowners can refinance or avert foreclosure. He continued to Denver to
announce policy changes to ease college graduates’ repayment of federal
loans.The new effort, carried out through unilateral executive actions, was
agreed upon weeks ago and is strongly reminiscent of a successful campaign
deployed by Bill Clinton in the run-up to his 1996 reelection. The strategy
is an approach designed to portray Obama as decisive as the White House
complains about Congress’s failure to pass his jobs bill. Aides say
President Obama, or cabinet secretaries, will announce at least one
initiative each week through the rest of the year, including steps to help
returning veterans and small businesses. Yet the officials acknowledge that
the coming policy changes, executive orders and agency actions are
generally less far-reaching than the legislative proposals now before
Congress.Polls show overwhelming support for pieces of the $447 billion
package, but Republicans oppose provisions in the President’s plan that
would offset the costs with higher taxes on the wealthy. Earlier this month
Republicans blocked debate on a $35 billion bill for state aid to pay
teachers, police officers and firefighters- Democrats’ first effort to
break the jobs package into individual pieces. The next piece to be brought
up will be a $60 billion package to help rebuild aging infrastructure. The
measure would provide $50 billion for roads, bridges, rail and airport
projects, putting hundreds of thousands of construction workers, engineers
and contractors back to work at a time the country is struggling with
unemployment. An additional $10 billion would be used as seed money for an
infrastructure bank to leverage private and public capital for additional
construction projects. Similar to Obama’s jobs package and the smaller $35
billion hiring bill, the infrastructure bill would be fully paid for by
charging a 0.7 percent surtax on any income over $1 million a year for
individuals and couples – an idea that has never sat well with Republicans
who are staunchly opposed to anything resembling a tax hike. At the same
time, Democrats who are normally loyal to Obama could also present an
obstacle. Sen. Barbara Boxer (D-CA), who serves as chairwoman of the Senate
Environment and Public Works Committee, warns that an infrastructure bank
should not be used to replace federal dollars, and that it should not be a
core program. So for now, the President will exercise his constitutional
muscle outside of Congress and continue to announce jobs-related
initiatives through the fall that require executive action rather than
legislation regardless of resistance from Congress to his broader
legislative proposals. Given the modest scale of the measures, they are as
much about symbolism as substance.2. Financial ShortsHedge Fund
ReportingThe SEC unanimously adopted a new rule last week that requires
large hedge funds to report detailed information on their holdings to
federal regulators. Managers of funds with more than $1.5 billion in assets
will be required to disclose aggregated information on how much the fund
has invested in various asset classes, where investments are concentrated
geographically, and how active the fund is in trading its portfolio. In
addition, large funds must disclose how leveraged their investments are and
how liquid they are. Large funds will be required to report the information
quarterly, within 60 days of the end of the quarter. However, they are not
required to report “position information,” or details on individual
investment holdings. Hedge funds with $150 million to $1.5 billion in
assets will be subject to less extensive disclosures, as will private
equity funds.The new rule has “substantial modifications” from the proposal
that the SEC released in February that drew broad complaints from hedge
fund managers and at least one member of Congress, who said in comments
filed with the Commission that the requirements posed an unnecessary
regulatory burden on investment managers. They also expressed concern about
whether the regulators will be able to keep the proprietary information
confidential. Because the new rules are a joint release with the Commodity
Futures Trading Commission (CFTC), the SEC won’t make public the actual
rule until after the CFTC approves it, which is expected to be later this
week. If approved as expected by the CFTC, the new rules will go into
effect in mid- to late-2012, depending on a fund’s size.Internet Stimulus
FailThe Commerce Department revoked a $80.6 million grant to bring
broadband Internet connections to Louisiana, saying that the state fell
behind schedule and changed its original plan for the stimulus funds.The
vast majority of funds will be returned to the US Treasury, except for
$594,000 that has been delivered to the state already. The grant to
Louisiana Broadband Alliance was intended to create a fiber optic network
stretching 900 miles to the most economically distressed areas of the
state. Six state agencies said they would coordinate on the project, which
was to provide access to schools, libraries and health care facilities. But
the project didn’t meet deadlines, and the state changed plans and didn’t
give enough technical and financial details to ensure the project would be
completed.The Commerce Department’s National Telecommunications and
Information Administration (NTIA) and Department of Agriculture’s Rural
Utilities Service have awarded $7.2 billion in stimulus funds during the
Obama administration aimed at bringing high-speed Internet connections to
rural areas. The Louisiana project is the fourth one to fail among the
NTIA’s 233 awards. The agency and the Agriculture Department have hailed
the success of other projects, saying that generally the stimulus programs
have been an overall success. But the failure of projects supported by
grants and loans from the federal government has also come under greater
scrutiny by some Republican lawmakers. Several have questioned the
distribution of taxpayer dollars into ill-conceived projects such as
the bankrupt solar panel firm Solyndra.3. Political Shorts–
UPDATESSupercommitteeIn 22 days, the Supercommittee is set to report its
findings, and this week marks an unofficial deadline for the panel: The
Congressional Budget Office has said it needs to see the committee’s report
for budgetary scoring in the early part of this month.Now it appears that
Social Security is on the negotiating table. This is on top of proposals
already put forth inside the panel. Last week saw a slew of plans
introduced by Democrats and Republicans on the committee. Democrats
unveiled a plan that would cut the deficit by roughly $3 trillion, which
was declared not “serious” by Republicans because of $1.3 trillion in new
tax-based revenue, but their plan did include changes to Social Security.
Republicans rolled out a $2.2 trillion plan, which would generate $640
billion in nontax revenue. House Speaker John Boehner (R-OH) and Senate
Majority Leader Harry Reid (D-NV) have discussed a $1.2 trillion plan, and
changes to Social Security alongside it could show they are reaching for a
broader scope. If the committee were to take up changes to Social Security,
it could show that Congress is looking for systemic changes to the nation’s
finances — something markets and credit rating agencies want to see. It may
not help the committee get to $1.2 trillion, but Democrats are all but
certain to insist that Boehner commit to serious changes on taxes alongside
such entitlement restructuring.Dissension remains though. It’s clear that
even if Democrats on the Supercommittee got their way, they’d have trouble
with the left flank of their party. Behind all this, both sides are staking
out ground to diffuse blame on a final compromise. Democrats and
Republicans are bracing for the Supercommittee to become a historic
failure. Both sides are already laying the groundwork for a bitter round of
finger-pointing in the event of a messy aftermath later this fall.Spending
billsThe first Minibus, which contains funding for the Agriculture,
Commerce, Justice, Transportation and Housing and Urban Development
departments, cleared the Senate Tuesday after bipartisan votes rejected
conservative demands for still deeper appropriations cuts. The bill now
heads to a House-Senate conference. It is the first in a series of
appropriations packages which the leadership hopes to finalize over the
next month while keeping faith with the spending limits set under the
August debt limit accords. Speed is important, with the government
operating under a stopgap spending bill due to expire November 18. But the
shotgun process still risks a fight in the House, where conservatives are
upset both with the level of funding allowed and their limited ability to
offer floor amendments. So far, the only 2012 appropriations bill passed by
both houses of Congress is the one funding military construction and the
Department of Veterans Affairs. The Minibus process of grouping several
appropriations bills into one package is an attempt to avoid one giant
Omnibus bill that would allow only limited debate and floor amendments.The
next Minibus would contain the bills funding the Energy Department,
financial services and possibly the State Department. These are more
controversial than the other spending measures considered by the Senate so
far. Including the Energy bill in this package would almost certainly
resurrect calls by House Republicans to defund green energy subsidies
favored by the Obama administration. The State bill contains cuts to
foreign aid that are opposed by the administration, and passage of the
financial-services bill would set off a battle with the House over
provisions defunding the Dodd-Frank financial reform law. Left outstanding
are the highly controversial Labor and Health bill and the Interior and
Environment bill. The House has proposed bills that defund President
Obama’s healthcare reform law, while its environmental bill blocks dozens
of environmental rules. The Senate Appropriations Committee has been unable
to mark up its Interior and Environment bill due to squabbling among
subcommittee members. Also on tap are the Defense, Homeland Security and
Legislative-Branch bills, though moving these could be less
difficult. Defense enjoys broad support, and might be able to “carry” the
other, more controversial bills to passage as part of a final five-bill
package.] [image: 1. This Week in Washington: “We can’t wait”The
series of economic initiatives announced by President Obama in the past
week reflects a strategic and tactical shift that White House officials
hope will guide the president’s governing and political agenda in the
months ahead.With his jobs plan stymied in Congress by Republican
opposition, President Obama has begun a series of executive-branch actions
to confront housing, education and other economic problems over the coming
months. President Obama kicked off his new offensive in Las Vegas by
promoting new rules for federally guaranteed mortgages so that more
homeowners can refinance or avert foreclosure. He continued to Denver to
announce policy changes to ease college graduates’ repayment of federal
loans.The new effort, carried out through unilateral executive actions, was
agreed upon weeks ago and is strongly reminiscent of a successful campaign
deployed by Bill Clinton in the run-up to his 1996 reelection. The strategy
is an approach designed to portray Obama as decisive as the White House
complains about Congress’s failure to pass his jobs bill. Aides say
President Obama, or cabinet secretaries, will announce at least one
initiative each week through the rest of the year, including steps to help
returning veterans and small businesses. Yet the officials acknowledge that
the coming policy changes, executive orders and agency actions are
generally less far-reaching than the legislative proposals now before
Congress.Polls show overwhelming support for pieces of the $447 billion
package, but Republicans oppose provisions in the President’s plan that
would offset the costs with higher taxes on the wealthy. Earlier this month
Republicans blocked debate on a $35 billion bill for state aid to pay
teachers, police officers and firefighters- Democrats’ first effort to
break the jobs package into individual pieces. The next piece to be brought
up will be a $60 billion package to help rebuild aging infrastructure. The
measure would provide $50 billion for roads, bridges, rail and airport
projects, putting hundreds of thousands of construction workers, engineers
and contractors back to work at a time the country is struggling with
unemployment. An additional $10 billion would be used as seed money for an
infrastructure bank to leverage private and public capital for additional
construction projects. Similar to Obama’s jobs package and the smaller $35
billion hiring bill, the infrastructure bill would be fully paid for by
charging a 0.7 percent surtax on any income over $1 million a year for
individuals and couples – an idea that has never sat well with Republicans
who are staunchly opposed to anything resembling a tax hike. At the same
time, Democrats who are normally loyal to Obama could also present an
obstacle. Sen. Barbara Boxer (D-CA), who serves as chairwoman of the Senate
Environment and Public Works Committee, warns that an infrastructure bank
should not be used to replace federal dollars, and that it should not be a
core program. So for now, the President will exercise his constitutional
muscle outside of Congress and continue to announce jobs-related
initiatives through the fall that require executive action rather than
legislation regardless of resistance from Congress to his broader
legislative proposals. Given the modest scale of the measures, they are as
much about symbolism as substance.2. Financial ShortsHedge Fund
ReportingThe SEC unanimously adopted a new rule last week that requires
large hedge funds to report detailed information on their holdings to
federal regulators. Managers of funds with more than $1.5 billion in assets
will be required to disclose aggregated information on how much the fund
has invested in various asset classes, where investments are concentrated
geographically, and how active the fund is in trading its portfolio. In
addition, large funds must disclose how leveraged their investments are and
how liquid they are. Large funds will be required to report the information
quarterly, within 60 days of the end of the quarter. However, they are not
required to report “position information,” or details on individual
investment holdings. Hedge funds with $150 million to $1.5 billion in
assets will be subject to less extensive disclosures, as will private
equity funds.The new rule has “substantial modifications” from the proposal
that the SEC released in February that drew broad complaints from hedge
fund managers and at least one member of Congress, who said in comments
filed with the Commission that the requirements posed an unnecessary
regulatory burden on investment managers. They also expressed concern about
whether the regulators will be able to keep the proprietary information
confidential. Because the new rules are a joint release with the Commodity
Futures Trading Commission (CFTC), the SEC won’t make public the actual
rule until after the CFTC approves it, which is expected to be later this
week. If approved as expected by the CFTC, the new rules will go into
effect in mid- to late-2012, depending on a fund’s size.Internet Stimulus
FailThe Commerce Department revoked a $80.6 million grant to bring
broadband Internet connections to Louisiana, saying that the state fell
behind schedule and changed its original plan for the stimulus funds.The
vast majority of funds will be returned to the US Treasury, except for
$594,000 that has been delivered to the state already. The grant to
Louisiana Broadband Alliance was intended to create a fiber optic network
stretching 900 miles to the most economically distressed areas of the
state. Six state agencies said they would coordinate on the project, which
was to provide access to schools, libraries and health care facilities. But
the project didn’t meet deadlines, and the state changed plans and didn’t
give enough technical and financial details to ensure the project would be
completed.The Commerce Department’s National Telecommunications and
Information Administration (NTIA) and Department of Agriculture’s Rural
Utilities Service have awarded $7.2 billion in stimulus funds during the
Obama administration aimed at bringing high-speed Internet connections to
rural areas. The Louisiana project is the fourth one to fail among the
NTIA’s 233 awards. The agency and the Agriculture Department have hailed
the success of other projects, saying that generally the stimulus programs
have been an overall success. But the failure of projects supported by
grants and loans from the federal government has also come under greater
scrutiny by some Republican lawmakers. Several have questioned the
distribution of taxpayer dollars into ill-conceived projects such as
the bankrupt solar panel firm Solyndra.3. Political Shorts–
UPDATESSupercommitteeIn 22 days, the Supercommittee is set to report its
findings, and this week marks an unofficial deadline for the panel: The
Congressional Budget Office has said it needs to see the committee’s report
for budgetary scoring in the early part of this month.Now it appears that
Social Security is on the negotiating table. This is on top of proposals
already put forth inside the panel. Last week saw a slew of plans
introduced by Democrats and Republicans on the committee. Democrats
unveiled a plan that would cut the deficit by roughly $3 trillion, which
was declared not “serious” by Republicans because of $1.3 trillion in new
tax-based revenue, but their plan did include changes to Social Security.
Republicans rolled out a $2.2 trillion plan, which would generate $640
billion in nontax revenue. House Speaker John Boehner (R-OH) and Senate
Majority Leader Harry Reid (D-NV) have discussed a $1.2 trillion plan, and
changes to Social Security alongside it could show they are reaching for a
broader scope. If the committee were to take up changes to Social Security,
it could show that Congress is looking for systemic changes to the nation’s
finances — something markets and credit rating agencies want to see. It may
not help the committee get to $1.2 trillion, but Democrats are all but
certain to insist that Boehner commit to serious changes on taxes alongside
such entitlement restructuring.Dissension remains though. It’s clear that
even if Democrats on the Supercommittee got their way, they’d have trouble
with the left flank of their party. Behind all this, both sides are staking
out ground to diffuse blame on a final compromise. Democrats and
Republicans are bracing for the Supercommittee to become a historic
failure. Both sides are already laying the groundwork for a bitter round of
finger-pointing in the event of a messy aftermath later this fall.Spending
billsThe first Minibus, which contains funding for the Agriculture,
Commerce, Justice, Transportation and Housing and Urban Development
departments, cleared the Senate Tuesday after bipartisan votes rejected
conservative demands for still deeper appropriations cuts. The bill now
heads to a House-Senate conference. It is the first in a series of
appropriations packages which the leadership hopes to finalize over the
next month while keeping faith with the spending limits set under the
August debt limit accords. Speed is important, with the government
operating under a stopgap spending bill due to expire November 18. But the
shotgun process still risks a fight in the House, where conservatives are
upset both with the level of funding allowed and their limited ability to
offer floor amendments. So far, the only 2012 appropriations bill passed by
both houses of Congress is the one funding military construction and the
Department of Veterans Affairs. The Minibus process of grouping several
appropriations bills into one package is an attempt to avoid one giant
Omnibus bill that would allow only limited debate and floor amendments.The
next Minibus would contain the bills funding the Energy Department,
financial services and possibly the State Department. These are more
controversial than the other spending measures considered by the Senate so
far. Including the Energy bill in this package would almost certainly
resurrect calls by House Republicans to defund green energy subsidies
favored by the Obama administration. The State bill contains cuts to
foreign aid that are opposed by the administration, and passage of the
financial-services bill would set off a battle with the House over
provisions defunding the Dodd-Frank financial reform law. Left outstanding
are the highly controversial Labor and Health bill and the Interior and
Environment bill. The House has proposed bills that defund President
Obama’s healthcare reform law, while its environmental bill blocks dozens
of environmental rules. The Senate Appropriations Committee has been unable
to mark up its Interior and Environment bill due to squabbling among
subcommittee members. Also on tap are the Defense, Homeland Security and
Legislative-Branch bills, though moving these could be less
difficult. Defense enjoys broad support, and might be able to “carry” the
other, more controversial bills to passage as part of a final five-bill
package.