FY 2014 Appropriations

On Friday, September 20, the House approved an amended short-term FY 2014 Continuing Resolution (CR) (H.J. Res. 59) that would fund the federal government at current levels through December 15, while eliminating all funding for the Affordable Care Act  (ACA) (P.L. 111-148, P.L. 111-152). The 230-189 House vote fell along party lines, with the exceptions of Republican Scott Rigell (R-VA) who voted against the CR, and Democrats Mike McIntyre (NC) and Jim Matheson (UT) who voted in favor of the bill. Prior to the House vote, President Barack Obama issued a veto threat against any measure that defunds the health care reform law.

As a government shutdown looms on October 1, the Senate is scheduled to begin work on the CR early this week. Senate Majority Leader Harry Reid (D-NV) is expected to restore funding for the ACA and send a clean CR back to the House through a procedural strategy in which he will first bring the full bill up for a cloture vote (which requires the support of 60 senators) before proceeding to an amendment process through which he will allow an amendment to reinstate funding for the ACA (amendments require only a simple majority to succeed; Democrats hold a 54 vote majority). By forcing the cloture vote on the full bill, he puts Republicans in the position of either voting against the full bill or moving forward in a manner in which they will likely lose the health care vote.

Once the Senate passes the bill, it will go back to the House, where it may be further amended and volleyed back to the Senate. However, it is possible that Senate debate may take the entire week, forcing House Speaker John Boehner (R-OH) to either hold an up-or-down vote on September 30—which could succeed with Democratic support—or to allow a government shutdown.

Debt ceiling

Fiscal political brinkmanship will not end with enactment of a short-term CR. In fact, that may just be the beginning of the real showdown. This week Republican House leaders will bring up a bill to increase the government’s borrowing authority under conditions still in discussion by the caucus. Among the provisions discussed are: delaying or defunding the ACA; approval of the Keystone XL pipeline; guidelines for tax code overhaul; and discretionary and mandatory spending cuts. The President has long insisted that he wants a clean debt ceiling increase and will not negotiate on the matter.

Stakeholders, including the U.S. Chamber of Commerce, last week urged Congress to pass a clean CR and debt ceiling increase in order to prevent the volatile market reaction to the fiscal uncertainty that surrounded the debt ceiling debate in 2011.

The President intends to meet with Congressional leaders late this week to discuss the pressing fiscal issues.