Congress Ready to Slow Pace, Face Long-Term Issues

Senate Finance Committee Chairman Max Baucus (D-Mont.) has been holding talks on health care with various interests, including key GOP lawmakers.
Senate Finance Committee Chairman Max Baucus (D-Mont.) has been holding talks on health care with various interests, including key GOP lawmakers. (By Melina Mara -- The Washington Post)
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By Paul Kane and Shailagh Murray
Washington Post Staff Writers
Thursday, April 9, 2009

After approving more than $1.5 trillion to bail out Wall Street and stimulate the economy and nearly passing a $3.5 billion budget blueprint in its initial legislative sprint, Congress will return from a two-week break later this month at a definitive point for President Obama's ambitious goals.

Easing off the speedy pace of the past three months, lawmakers will confront an arcane arena of long-term legislating, and the period could expose potentially deep fissures between Obama and some Democrats. Already, competing versions of climate legislation have been introduced in the House, Senate Democrats are still meeting with stakeholders in the health-care world, and the lending industry is battling a nascent effort to abolish private-sector loans for college tuition.

"We look forward to a very vigorous debate on all of the issues that follow when we come back," House Speaker Nancy Pelosi (D-Calif.) told reporters last week.

It is a process that could drag into next year for some agenda items. Democratic leaders vigorously supported the rush to pass much of Obama's economic recovery plans because of the global financial meltdown, but they welcome the return to the sometimes cumbersome congressional "sausage-making" process.

"What trumps urgency for us is getting it right. You're talking about building an entire architecture here," said Sen. Christopher J. Dodd (D-Conn.), chairman of the banking committee, which is crafting a new regulatory system to oversee financial markets.

Democratic leaders agree that they are further along on a wide-ranging overhaul of health care than they are on Obama's revolutionary climate change agenda. Senate Finance Committee Chairman Max Baucus (D-Mont.) has been holding talks on health with insurance industry representatives, labor unions, hospital executives and -- perhaps most important -- key Republican lawmakers.

Sen. Charles E. Grassley (Iowa), the ranking Republican on the Finance Committee, warned that proposals for a government-funded competitor to private insurers and a health-care board with broad powers could meet GOP resistance to such deep federal intrusion into the private markets. But, he added, "I'm not saying anything will be impossible at this point."

Democrats are sure to incite Republicans if they adopt a shortcut that would allow them to pass major health-care and education bills with just 51 votes in the Senate, where Democrats are two seats shy of the filibuster-proof margin of 60 seats. The rule, known as "reconciliation," would fuel GOP charges that Obama has ditched bipartisanship.

"If they exercise that tool, it's going to be infinitely more difficult to bridge the partisan divide," said Sen. Olympia J. Snowe (Maine), who was one of three Republicans to support the economic stimulus plan.

For Democrats, one of the dangers of drawing sharp partisan divisions is that it would move the center of gravity to the left -- a shift that could put Democratic moderate votes at risk. Many Democratic senators are beginning to privately voice concern that the House will produce a health-care bill that effectively traps people in a public federal plan, which also would risk the support of the almost 100 business-friendly House Democrats.

Rep. John B. Larson (D-Conn.), a member of the House leadership, estimated that more than 60 members of his caucus would prefer nationalized health care resembling the Canadian single-payer system.

Along with getting the health industry to accept some public option, he said, "the biggest thing is people letting go of the notion that it's going to be single-payer."

The most urgent challenge for Democrats is to identify funding sources for health-care reform, to offset the hundreds of billions of dollars in additional federal spending that will be needed to expand coverage for up to 47 million uninsured Americans. House Energy and Commerce Chairman Henry A. Waxman (Calif.), whose panel is simultaneously crafting the House's climate and health-care bills, said his committee will move first on legislation to limit carbon emissions from companies while allowing those that fall under the limits to trade their permits to heavier polluting companies.

Waxman is hoping to send legislation to the House floor no later than Memorial Day, but in the Senate, where leaders acknowledge they are far from 60 votes, the Environment and Public Works Committee just hopes to approve its version by the end of the year. The rewrite of the financial regulatory system is another example of cross-chamber tension on timing.

House Financial Services Chairman Barney Frank (D-Mass.) said his committee will begin in early May to create a systemic risk regulator to monitor markets outside the regulatory umbrella, including derivative swaps that are meant to mitigate risk but also led to the implosion of such financial stalwarts as Lehman Brothers and American International Group. The bill is one in a series of initiatives that the House aims to produce as part of a piecemeal approach to overhauling the financial industry.

Like Baucus on health care, Dodd, the Senate banking chairman, said he is making "a significant effort to stay together" with Republicans on his committee to create one comprehensive rewrite of the regulatory system. Because there are so many procedural hurdles in the Senate, Dodd said he will "get one bite" at this and wants to do it in a comprehensive bill.

Overriding all these proposals is a nearly $2 trillion budget deficit for fiscal 2009 and a growing clamor among some Democrats to rein in spending. A vast majority of conservative Democrats in Congress voted for the budget, but leading Democrats said they eventually will face a revolt if they do not find ways to pay for Obama's huge agenda.

"We have to come up with the savings in order to pay for health-care reform," Waxman said. "I don't have the answer at this moment."

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