Monday, March 16, 2020

The Congressional Process and Disaster Response

David Super

     On March 6, President Trump signed Public Law No. 116-123, the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020 (widely referred to on Capitol Hill as “C1”).  Its near-exclusive function was providing additional funds for government agencies responding to SARS-CoV-2. 

     Early last week, House Democrats introduced legislation to begin to address the pandemic’s impact on the general public (“C2”).  Speaker Pelosi threatened to pass it with Democratic votes alone and place the Senate in the position of accepting it or explaining why it was not doing so.  In the interest of speed, however, she negotiated a somewhat pared-down version with Treasury Secretary Mnuchin on behalf of the Administration.  She thought she had an agreement Friday afternoon but further back and forth was required before the President would tweet out his approval, which most House Republicans insisted was a prerequisite to their passing the legislation under emergency procedures.    

     Subsequently, it was discovered that the disjointed and last-minute negotiations had resulted in questions about whether the agreements were fully reflected in the legislative language.  Speaker Pelosi, to avoid any hint of bad faith, agreed to further negotiations with Secretary Mnuchin and directed her staff to prepare an amendment making the necessary “technical corrections.”  (That was absolutely the right thing for her to do:  although the corrections could have been made in the Senate, when the ambient level of trust is already low each side needs to be extremely clear that its word is its bond.) 

     The most expeditious means of passing the technical corrections amendment, however, requires unanimous consent in the House.  (The best alternative requires waiting until the full House returns tomorrow.)  And although the changes are being sought by Republicans, one of their number, Texas Rep. Louis Gohmert, blocked unanimous consent on Monday.  Senate Majority Leader Mitch McConnell could bring the corrected legislation to the floor of the Senate on his own – allowing it to be married expeditiously to the House bill when it arrives – but doing so would require unanimous consent in the Senate as well.  That apparently is not possible because some Republican senators want to vote against this legislation. 

     Little doubt exists that this legislation will indeed be signed into law this week on the terms that Speaker Pelosi negotiated with Secretary Mnuchin, but because the effective dates of some of its most important provisions are tied to the date of enactment, roughly a week will be lost.  Given that some of the legislation’s key provisions seek to promote social distancing, that delay seems likely to cause further spread of the virus, further illnesses, and further overloading of health care facilities and personnel.  Although both Rep. Gohmert and the likely Senate opponents are strong supporters of President Trump, they are unwilling to defer to the Administration on the merits of the legislation.  Senator McConnell, who is no stranger to hardball politics, has been unwilling to pressure members of his caucus to cease their delays. 

     One common element of bipartisan agreements on legislation is each side’s promise not to seek more.  Ordinarily, the party that had grudgingly accepted a bill in exchange for dropping its most offensive parts is unwilling to do so unless it receives assurances that it will not immediately have to defend against those same proposals.  A promise to abandon dropped provisions, however, has been conspicuously missing from this process. 

     Leaders in both parties are openly discussing a new package (“C3”) that they are already beginning to draft.  Thus, the items Speaker Pelosi agreed to drop or scale back from C2 remain very much alive and under discussion.  For example, although she agreed to reduce the amount by which the federal matching rate for Medicaid would rise in C2, Democrats can (and absolutely should) include further increases in their version of C3.  Other changes to programs for low-income people in C2, though meaningful, fall far short of what will be needed to help people weather the concurrent public health and economic disasters. 

     The question then arises how C3 will come together.  Although the details are unclear, some broad outlines of the process are fairly clear. 

     First, at some point the political process will settle on an outside budget constraint.  This will be largely separate from agreements on the components of the package, which will come later.  When putting together the 2017 tax cut, Republicans settled on $1.5 trillion before they were even close to an agreement on the provisions the legislation would contain.  When they could not get the gross cost down to anything close to the number they had announced, they began a desperate search for offsets to close the gap.  The results were some of the most unpopular provisions of that law. 

     In the same way, Democrats will seek to use the spectacular cost of President Trump’s proposed payroll tax holiday to justify a large bottom line.  As long as bad news on the virus and the economy continues, neither the Administration nor congressional Republicans will have much leverage to oppose that level outright.  On the other hand, as C2’s difficulties have shown, Republicans can do a fair amount of stalling without paying much political cost.  Democrats will want to reach a deal both to help beleaguered people and states as well as to ensure that a deal is locked in before the politics change – which they will.  After Hurricane Katrina, Republicans successfully ran out the clock on the public’s engagement and did not pass any significant anti-poverty legislation.  Burned by that experience, Democrats moved much more quickly in reaching agreement on recovery legislation during the Great Recession.  This required them to accept a package that liberal economists regarded as much too small and that omitted their key priorities – ironically including pandemic response preparedness. 

     One implication of the early selection of a budget constraint is that proposals will crowd one another out.  Including part of the President’s payroll tax holiday – which will give the most to higher earners and nothing to the unemployed – would mean less money for checks to families; issuing checks without any means-testing will mean that the checks must be considerably smaller than if they were limited to low-income people; one form of state fiscal relief will likely crowd out another that might prove better-targeted.  Once the key actors have settled on a bottom line, continued advocacy for less efficient measures will crowd out more efficient ones rather than growing the pie. 

     Second, whatever budgetary constraint is accepted will be gross, not net.  Deficit-increasing legislation will face few obstacles under either budget process rules (because Congress will designate it as “emergency” spending) or politics (because President Trump clearly believes running huge deficits will help him win re-election).  Much hardship will surely go unaddressed in any event so the constraint on the package’s size will be whatever negotiators think will sound “too big” to the electorate.  Although the net cost will determine the effect on the economy and the national debt, critics will cite the gross amount when attacking the package.  It therefore will be the gross amount that proponents will need to be willing to defend.  This emphasis on gross cost suggests that offsets largely will be unavailing as means of expanding what is done for struggling people.  A package without offsets may be a sensible response to a huge drop in economic output, but in any event it is a reality.  Thus, proposals for grants and loans will have similar impacts on the gross cost; proposals shifting into the present large amounts of money that individuals or states expect in the future will be problematic. 

     And third, regrettably, permanent reform is likely off the table.  This episode – like the Great Reces­sion – demonstrates that states’ pro-cyclical fiscal constitutions tend to deepen recessions.  (They also waste resources during booms.)  Increasing the overall share of national Medicaid costs borne by the federal government during downturns or other forms of automatic state fiscal relief should not have to wait for Congress each time the economy sours.  Restoring broad coverage in our dilapidated unemployment insurance system is needed throughout the business cycle and certainly should not have to await congressional action in a downturn.  Correcting rules that deny food assistance to low-income workers who have more than three months when they cannot find work over a three-year period would respond both to the realities of the low-skill labor market and improve our automatic fiscal stabilizers.   

     In ordinary times, however, these kinds of reforms are nobody’s priorities.  Today, the need for them is clear, but Democrats will not want to delay responding to the emergency to negotiate such reforms.  Even during the Great Recession – when Democrats held the White House and large majorities in both chambers of Congress – they sought to avoid criticism for overreaching by excluding any provisions (even concerning responses to recessions) without explicit expiration dates from their stimulus legislation.  By contrast, when Republicans advocate tax cuts in response to downturns, they often insist that the reductions be permanent or vehemently oppose allowing them to expire.  With most of the federal government in Republican hands, Democrats probably could not enact permanent reforms now even if they made that a priority. 

     One final note about the operation of Congress itself.  To avoid exposing the Members, as well as the thousands of others whose work enables Congress to meet, Congress itself should practice social dis­tancing.  This also might set a more positive example than the President has been doing with his packed-stage news conferences.  At times, Congress largely has gone home while leaving a handful of Members (perhaps from the Capitol region) to conduct any necessary business.  Typically that consists only of calling the chambers to order and adjourning. 

     Congress could, however, conduct most regular business with two Republican senators and one Democrat as well as three Democratic representatives and two Republicans.  (That ratio in the House would prevent the Democrats from suspending the rules.)  Most legislation cannot pass the Senate without bipartisan support to break a filibuster; the threat of the lone Democrat to note the absence of a quorum would serve similar purposes.  Republicans have had little success in peeling off enough Democrats to defeat legislation in the House this Congress so having bills pass 3-2 would be little different from what happens in the full chamber.  With the election approaching, overriding presidential vetoes is wildly improbable so little is lost by giving up the chance to try.  Having exempted itself from open-meeting laws, Congress could hold committee hearings and mark-ups on-line.  Members’ signatures are required to file bills, but most of those signatures probably come from autopens anyway.  Members already submit statements for the Congressional Record about what they would have done on votes they miss; this could now become routine. 

     With Washington apparently one of the most-impacted areas of the country, their frequent shuttling back to their districts is not what we need now.   


Older Posts
Newer Posts