WASHINGTON – Congressional Republicans are pressing for an end to the four-decade ban on exporting crude oil and further curbs on President Barack Obama’s environmental agenda as part of a sweeping $1.1 trillion spending bill.
Days from a Friday midnight deadline, progress has proven elusive for negotiators who also are trying to hammer out a separate measure to renew dozens of expired tax breaks. The two bills are the major items of unfinished business for this session of Congress.
“We’ve come to a standstill,” said Sen. Barbara Mikulski of Maryland, the top Democrat on the Appropriations Committee, who blamed the tax bill for the logjam.
While the GOP is seeking concessions from the Obama administration and Democrats on the environment, Republicans have dropped demands to cut off federal funds for Planned Parenthood and for implementing Obama’s marquee health care law.
The spending bill would fill out the details of the October budget deal and fund the day-to-day operating budgets of every Cabinet agency, averting a partial government shutdown. House Speaker Paul Ryan, R-Wis., said Monday that Congress may miss the deadline to complete the bill and renew a growing package of tax breaks for both businesses and individuals.
“It might take us more than just this week to get these issues put together correctly,” Ryan told The Big AM 1380 radio station in Janesville, Wisconsin, after negotiations over the weekend failed to close out numerous unresolved items.
Ryan’s top lieutenant, Majority Leader Kevin McCarthy, R-Calif., said lawmakers may have to work into the weekend, which would likely require a short-term funding bill to avoid a government shutdown at midnight Friday, though the White House indicated Monday that Obama won’t sign such legislation unless a long-term bill is in sight.
The spending and tax bills’ fates have become intertwined as part of a single negotiation among top leaders like Ryan, Senate Majority Leader Mitch McConnell, R-Ky., and top Democrats Harry Reid of Nevada and Nancy Pelosi of California.
“People on both sides of the aisle won’t get 100 per cent of what they want,” McCarthy said. “I think at the end of the day there’s a place where everybody can find common ground.”
The tax measure would extend dozens of tax breaks that typically are renewed only a year or two at a time. This year, both sides have tried making some of them permanent, with Democrats hoping to use repeal of the oil export ban as a bargaining chip for tax breaks for renewable energy like solar and wind power, congressional aides said.
With the two sides finding progress difficult, Republicans late Monday said they planned for House debate this week on a bill extending the expiring cuts for just two years. Lawmakers from both parties said efforts for a bipartisan deal would continue, and lawmakers could update the measure if a compromise was reached.
“If everyone is stuck where they’re at, we will end up with again, I think, another wasted exercise,” said House Ways and Means Committee Chairman Kevin Brady, R-Texas, referring to past failed attempts to permanently extend some of the tax cuts.
Most of the spending items in the so-called omnibus appropriations bills have been worked out, but numerous difficult policy provisions remain, including a GOP bid to block new emissions rules for power plants and an effort to restrict Obama’s ability to declare national monuments in his final year in office.
Pelosi warned in a letter to fellow Democrats that the tax breaks package may be getting too large and that many of the spending bill’s policy “riders” are unacceptable if GOP leaders are going to win Democratic votes.
“In order for us to support the omnibus bill, the poison pill riders must go,” she said of the spending measure.
The question of pausing the processing of Syrian and Iraqi refugees after last month attacks in Paris was part of the talks, though much of the focus was on a bipartisan effort to tighten a program allowing millions of foreigners to enter the U.S. without a visa.
The spending bill gives generous increases to the departments of Justice, Homeland Security and Veterans Affairs. A budget increase for NASA enjoys broad bipartisan support, while Republicans insisted on curbing the budgets of the Environmental Protection Agency and the IRS.
On the tax side, the cost of the package has swelled as both sides press to make pet provisions permanent law, including a research and development tax credit favoured by the high-tech industry.
There’s also bipartisan support for permanently extending a tax break allowing those in a state without an income tax to deduct their state and local sales taxes. Democrats want income eligibility categories for the child tax credit to be automatically indexed for inflation and comparable treatment for tax credits for college tuition and child care.
There’s also support among Democrats and Republicans for a two-year delay in implementation of a 40 per cent excise tax on higher-premium health insurance plans, a key pillar of Obama’s 2010 health care law that is strongly opposed by his labour union allies. Another proposal would suspend a 2.3 per cent tax on medical devices.