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Legislative Updates: January 2013


Capitol Call

After working through the holidays and even on New Year's Day, the 112th Session of Congress limped to an end just minutes before the 113th Session began on January 3, 2013. Congress was here in Washington working to avoid the so–called "fiscal cliff," and a temporary deal was passed by the House on January 1, just 22 hours after it passed the Senate.

In addition to permanently extending the Bush–era tax cuts for all individuals earning less than $400,000 per year, the legislation puts off the "sequester" that was to occur on January 1. This leaves Congress two months to come up with a solution that is palatable to both parties, or the roughly $110 billion in automatic spending cuts to both domestic and defense programs that were included in the original sequester legislation will be enacted. It remains to be seen whether Congress will deal with the sequester issue before March 1. As if that wasn't enough, the debt ceiling issue also must be dealt with. The current government spending appropriation was scheduled to run out on March 27, but on January 26 the House hurriedly passed a plan (by a vote of 285-144) that will allow borrowing to pay the bills until May 18.

Fewer than half of the House Republicans (85 out of 233) voted for the fiscal cliff bill, joining with 172 of their Democratic colleagues to pass it by a vote of 257–167. The House had far less support for the bill than their Senate counterparts, who passed the same legislation by a vote of 89–8. Defying Speaker John Boehner, House Majority Leader Eric Cantor (R-Virginia) voted against the bill, as did House Majority Whip Kevin McCarthy (R-California) and Deputy House Whip Peter Roskam (R-Illinois).

Many Democrats were also unhappy with the bill, saying that President Obama caved on the tax issue by raising the tax increase threshold from $250,000 to $400,000. Liberals de-emphasized entitlement or spending reform, instead wishing to raise more revenue by increasing taxes on higher income taxpayers to pay for existing government programs while also making an effort to reduce the deficit. This is, of course, in direct conflict with Republicans' desires to both reduce taxes and spending on government programs and entitlements.

These contrary policy priorities, combined with a Democratic-led Senate and a Republican-led House will surely create some fireworks during the two years of the 113th Congress. Nevertheless, hope springs eternal among the newly–elected Senators and Representatives, who are all eager to get to work on the problems facing our country.

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