This is a big week for Speaker McCarthy.  House Republican leadership hopes to pass the Limit, Save, Grow Act as early as Wednesday.   The bill would raise the Federal debt ceiling through March 31, 2024 or by $1.5 trillion–whichever occurs sooner. 

The Debt ceiling debate entered a new phase yesterday.  Speaker McCarthy sent the President a letter laying out what House Republicans were seeking as part of a deal to raise the debt limit. 

The House will spend the week on the Lower Energy Costs Act (H.R.1), introduced by Majority Steve Leader Steve Scalise.  This is a package of 21 bills from several committees.  Speaker McCarthy desiginated the bill H.R. 1 – signifying the importance of the legislation to House Republicans. 

A lot happening in and around Congress for the remainder of the week.  Take your pick as to what is most significant. Today, the Federal Reserve Open Market Committee (FOMC) meets to decide whether to raise interest rates again.

When the Senate returns today and the House tomorrow, Congress will begin a new, more complicated phase of the 118^th Congress.   They must pass annual spending bills in some form or fashion to keep the government open.  It also must raise the debt ceiling to keep the U.S. from defaulting on its debt.

When the 118^th Congress began none of the congressional leaders had resolving a banking crisis on their agenda.  But here it is – and it will take up significant time and focus over the next several weeks. 

President Biden travels to Philadelphia today to release his FY ’24 budget proposal.  For budget nerds, it is one of the biggest days of the year.  Thousands of pages of tables, charts, and numbers.  

House Republicans head to their annual retreat next week to plan out the remainder of the first session of the 118^th Congress.  They face plenty of challenges. 

The House Ways and Means Committee will hold its second field hearing today, in Yukon, Oklahoma.  The hearing entitled “The State of the American Economy: The Heartland” is part of an emerging new trend for the new Republican majority – the field hearing.  The Judiciary Committee has held a field hearing on the Southern border – and plans more.  

The House will vote on a senate-passed bill directing the administration to declassify all information related to the origins of COVID, a resolution removing U.S. troops from Syria and a bill overturning the Biden Administration’s Waters of the United States (WOTUS) rule. 

Capitol Hill was in full swing yesterday with staffers repeating “this is the most crowded it's been since the pandemic” over and over.  There were long lines to enter the buildings, numerous groups and trade associations holding “fly-ins” and receptions, and committee rooms crowded for hearings and markups. 

The 118th Congress has thus far been dominated by two big issues:  China and the debt ceiling.  Later this week President Biden will speak House Democrats at their issues retreat in Baltimore Maryland.  He will use the bully pulpit to advance the Democrats message that the debt ceiling should be raised without any conditions or negotiations over spending cuts. 

Congress returns this week, but the House is only in session Monday-Wednesday.  House Democrats have their annual issues retreat in Baltimore Maryland.  President Biden will attend the retreat on Wednesday. The House will consider two rule bills. 

The House will vote today on a resolution “Condemning the Chinese Communist Party’s use of a high-altitude surveillance balloon over United States territory as a brazen violation of United States sovereignty.” A resolution is not legislation – it is a statement by one House of Congress.  But this resolution is significant for several reasons.  First and foremost, the resolution is bipartisan.  The House will largely speak with one voice today. 

President Biden delivered a forceful and lively State of the Union Address last night.  His speech has been portrayed as an unofficial kick-off to his 2024 reelection campaign and he previewed the theme of “Let’s finish the job.” 

President Biden delivers the State of the Union tonight.  Speaker McCarthy gave his “prebuttal” early Monday evening.  The issue the Speaker chose to address is the significant part of the speech.  He wanted to talk about the debt ceiling.  It is the most challenging legislative battle for both parties this year in Congress, but it is not currently the top issue on voters’ minds. 

President Biden will deliver the State of the Union tomorrow night at 9:00 pm.  The speech presents the president with the opportunity to lay out his vision and make the case for what his administration has accomplished.  The Administration had major legislative victories in the first two years, including the Inflation Reduction Act, the infrastructure bill, gun control and the CHIPS bill intended to provide grants and incentive for domestic semiconductor manufacturing. 

Two big meetings today in Washington. Which one is more important depends on whether you think monetary policy or executive/congressional branch cooperation is more important at this moment. The Federal Reserve Open Market Committee meets today and is expected to approve a 25-basis point increase in interest rates. The other big meeting today is at the White House. President Biden will host a one-on-one meeting with the new Speaker of the House Kevin McCarthy. 

President Biden will meet with Speaker McCarthy on Wednesday to discuss (not negotiate) raising the debt ceiling. Serious negotiations are months away. Wednesday’s meeting will be part of a shorter-term messaging battle between the two parties to set the terms of the negotiations and attempt from both sides to gain political leverage in the negotiations.  Both sides want to claim the mantle of “reasonableness.”

The House is in session today and will vote on several amendments and final passage of H.R. 21, the Strategic Production Response Act. The first attempt to allow an open rule for the first time in 7 years on the House floor has gone pretty smoothly and Members have given it positive reviews. 

Today, the House will begin consideration of H.R. 21 – Strategic Production Response Act.  The 3-page bill prohibits non-emergency drawdowns of the Strategic Petroleum Reserve without a plan to increase federal lands available for energy production by an equal amount.  The real significance of the bill is how it will be considered in the House – under an open rule. 

One issue will dominate the first session of the 118th Congress:  The debt ceiling.  The constitution gives Congress the power to borrow money on the credit of the United States.  Congress, by law sets the amount the federal government is allowed to borrow. 

Speaker McCarthy announced his selection of Members to serve on the Select Committee on the Strategic Competition Between the U.S. and the Chinese Communist Party … aka the Select Committee on China. 

Congress returns this week with both the House and Senate in session. The Senate will vote on nominations. The Senate Leadership hopes to announce and be able to ratify revised committee rosters and ratios this week. The House is expected to consider the Strategic Production Response Act later in the week under a "modified open rule,” 

The House of Representatives voted yesterday to create a “Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party.” The vote was 365-65 with 146 Democrats joining with all Republicans to create the new select committee.  After the rancor and partisanship of the first week, this is a strong bipartisan move on a top-tier issue facing the 118th Congress.

A busy first day of week two of the 118th Congress in the House of Representatives.  The Republican Steering Committee met all day and decided the chairmanships for the final committees.

The House of Representatives has a Speaker. On the 15th ballot, Kevin McCarthy (R-CA) finally prevailed, receiving 216 votes to Hakeem Jeffries (D-NY) 212 with 5 Republicans voting present.  The early Saturday morning vote ended a dramatic and tumultuous start to the 118th Congress. 

The Speaker election in the House of Representatives remains unresolved after an historic 11 ballots.  The House will reconvene at noon today and will try again. On the floor, the stalemate has continued, and the vote counts really haven’t changed.  

After six ballots, the House has been thus far unable to elect a Speaker.  Because the election of the Speaker is the first order of business in a new Congress, nothing else can proceed.  The Members themselves haven’t even been sworn in.  Tensions and frustration grew throughout the day. 

An historic opening day of the 118th Congress.  For the first time since 1923, the House of Representatives failed to elect a Speaker on the first ballot.  And the House adjourned until noon today after three rounds of roll call votes failed to elect a Speaker.

The 118th Congress opens today.  The Senate is in town just today – when it convenes at noon for the first session of the 118th Congress, the swearing-in of Senators, and various housekeeping measures – before recessing again until January 23rd.

The rush to complete the work of the 117th Congress will take a pause tonight for history.  Ukrainian President Volodymyr Zelensky will address a joint session of the Congress at 7:30 pm.  President Zelensky will also meet with President Biden earlier in the day. 

The 4,155 page Omnibus spending bill text was posted at 1:40 AM this morning.  A summary can be found here. At over 4,000 pages and nearly $1.7 trillion in spending, there is a lot in the bill.  National defense ($858 billion) received a 10 percent increase – a big Republican priority.  

The “plan” is to release text on the massive end-of-the-year Omnibus spending bill that will fund the government for the remainder of fiscal year 2023.  Negotiators and staff worked all weekend finalizing text and negotiating what is in and what is out.  

The House passed a one-week continuing resolution (CR) giving negotiators more time to reach a spending deal for the rest of fiscal year 2023.  The vote was 224-201 with nine House Republicans joining all voting Democrats in backing the measure: (Reps. Adam Kinzinger (Ill.), Liz Cheney (Wyo.), Chris Jacobs (N.Y.), Anthony Gonzalez (Ohio), John Katko (N.Y.), Jaime Herrera Beutler (Wash.), Fred Upton (Mich.), Steve Womack (Ark.) and Brian Fitzpatrick (Pa.)).

The House Financial Services had scheduled for today one of the most high-profile hearings of the year.  FTX founder Sam Bankman-Fried was set to testify – remotely from the Bahamas – to the House Financial Services Committee today about the collapse of the FTX.  He had told the committee he would not take the 5th amendment.  And then, last evening he was arrested in the Bahamas.

Congress returns today for a big week. Government funding runs out on Friday.  Both the House and Senate will need to act this week to keep the government open.  It seems certain at this point that the specific action will be a short-term continuing resolution (CR) – probably one week, to give negotiators time to complete a full-year Omnibus spending bill. 

As the saying goes “If you don’t like the weather in Maine, wait a minute and it will change.”  That now seems to apply to the political situation in Washington.  Just three days after voters in Georgia re-elected Ralph Warnock and gave the Democrats a 51-49 margin in the Senate, Arizona Sen. Krysten Sinema announced she was becoming an independent. 

The Lame Duck session of the 117th Congress came into more focus late yesterday when an agreement was reached on the text of the National Defense Authorization Act (NDAA).  The annual bill that authorizes national defense programs is a “must pass" bill that also requires bipartisan agreement. 

Ten days until government funding runs out.  No one expects or wants a government shutdown, but the December 16th deadline is real in the sense that Congress needs to pass something by then to prevent a shutdown.  Right now, the most likely scenario is a short, one-week continuing resolution to give congressional leaders more time to reach an agreement on a full-year funding bill.

It is December 1st and Congress still has not reached an agreement on the overall level of spending for the fiscal year 2023 – which began on October 1st.  The Federal Government is currently operating under a continuing resolution (CR) that simply extends all spending at last year’s level.  That CR expires on December 16th.  

This morning Rep. Hakeem Jeffries (NY) will become the House Democrats Leader (and Speaker nominee for the Democratic caucus) for the 118th Congress.  He will be the first new leader for House Democrats since 2003 when Nancy Pelosi (CA) began her incredible 20 year run as the top Democrat in the House.  He will also be the first black leader in either party and legislative body. 

Last night, President Biden asked Congress to step in and avert a potential railroad workers strike.  Several unions have rejected a tentative deal reached before the midterm elections – raising the threat that a strike could begin in early December. That could cause immediate and significant harm to the economy.

Congress returns this week for a sprint to the end of the year to complete the Lame Duck session. Government funding runs out on December 16th. While Members and staff hope to complete the Lame Duck session by the 16th, most are beginning to expect the session to last longer. It all starts with the government funding bill. In September, Congress passed a stopgap bill to fund the government through December 16th. 

The news of the day on Capitol Hill is the decision by Speaker Nancy Pelosi to step aside from her leadership of House Democrats.  She has led the caucus for twenty years – an extraordinary run for a legislative leader in the House.  Speaker Pelosi is 82.  In 2018, when she ran for Speaker after Democrats took back control of the House, she made a pledge to step aside after the 2022 elections. 

House Republicans completed their leadership elections.  With growing confidence that they have won the majority for the 118th Congress, the House Republican conference elected:

• Speaker-Elect: Kevin McCarthy (CA) (188 votes)
• Majority Leader: Steve Scalise (LA) (Unanimous voice vote)
• Majority Whip: Tom Emmer (MN) (2nd ballot 115 votes)
• Conference Chair: Elise Stefanik (NY) (144 votes)
• NRCC Chairman: Richard Hudson (NC) (unanimous voice vote)

AP is reporting this morning that, “Republicans were on the cusp of retaking control of the House late Monday, just one victory shy of the 218 seats the party needs to secure a majority, narrowing the path for Democrats to keep the chamber and raising the prospect of a divided government in Washington.”  Senate Democrats have secured their majority regardless of the outcome of the Georgia Senate runoff on December 6th between Sen. Ralph Warnock and Hershel Walker.

The 2022 midterms went pretty much as all the analysts expected … NOT.  The final results are not in, but a few things seem clear

• Congress will remain very closely divided
• Florida moves from a purple to red state
• Democrats outperformed history in midterm elections

There is not much left to say – all the theories and predictions can be better assessed tomorrow.  There’s not much left to do.  Candidates have special routines and superstitions for election day.  Barack Obama famously liked to play basketball.  Campaign staff settle in to begin pouring over exit polls beginning midafternoon.  Golf courses in the Washington area are packed today with lobbyists, politicos and congressional staff who need to kill time before the results begin trickling in.

Almost there.  Several billion dollars spent on the midterm elections.  Candidates and surrogates’ vocal cords shot.  Campaign staff living on adrenaline and caffeine.   Voters exhausted with all the TV ads but ready to vote – voter enthusiasm in both parties is high. 

Four days to go.  As America heads into the final weekend before the midterms we can begin to speculate about what it means for the country.  Here are a few key questions that the election will (likely/hopefully) provide some answers for.

Five days to go.  The U.S. Senate is currently controlled by the Democrats, but the partisan mix is 50-50.  Democrats control the Senate because Kamala Harris as Vice President is president of the Senate and breaks the tie.  That alone makes the 2022 midterm elections important – one net seat pick up for Republicans and the majority changes hands.  Elections for senators are staggered so only roughly one-third of the Senate is up for election in any one cycle.  

Six days to go. Elections for the House of Representatives are unique. All 435 seats are up for election. In the Senate, only about one-third of the body is up for election at any one time. The House is a national election, like the presidential election. At the same time, there are 435 separate elections – with candidate quality, experience, and fitting a particular constituency all acting as important factors.

One week to go. The midterm elections are Tuesday, November 8th, although early voting has already begun. With so little time left and the stakes so high it is difficult to provide analysis without contradicting one or both parties' closing argument/strategy. But it seems clear two dynamics are at work.

The Senate continues to inch towards final passage of a continuing resolution (CR) to keep the government open past midnight Friday.  It now looks increasingly likely that the House of Representatives will vote on Friday on final passage of the legislation.  (That is welcome news to “downtown” as there are scores of fundraisers scheduled for this evening).  Congress is poised to leave town for the midterm election push. 

The Senate cleared the first procedural step towards passing a continuing resolution (CR) last night after Sen. Joe Manchin dropped his controversial permitting reform language.  The CR could pass the Senate as early as today, or more likely tomorrow, leaving the House with plenty of time to pass the bill before Friday’s midnight deadline.  The CR extends government funding at current levels through December 16.  

The Senate returns today, and the House returns tomorrow.  Funding for the government runs out on Friday at midnight and there are less than six weeks to go before the midterm elections. Congress has one main task this week – keep the government funded.  The process will start this evening in the Senate with a cloture vote on the continuing resolution (CR) that includes Sen. Joe Manchin’s permitting reform language

Tomorrow, outside of Pittsburgh, House Republicans will unveil their “Commitment to America”.  Ever since House Republicans unexpectedly picked up 14 seats in the 2020 elections, they have confidently been planning to win back the majority in 2022, where they need a net gain of five seats to win the majority. 

The economy takes center stage today in Washington.  At 2:00 the Federal Reserve Open Market Committee will announce its decision on interest rates.  A third straight 75 basis point increase is expected.  Federal Reserve Chairman Jerome Powell will hold a press conference and provide “forward guidance” about the Fed’s inflation outlook and potential policy responses – like additional rate increases. 

“The Pandemic is over.”  A simple, straightforward statement.  Some would say obvious, some would say overdue.  Others would say premature, and others would label it as inaccurate.  President Biden’s statement on 60 Minutes Sunday night touched off a controversy with both policy and political ramifications.  

The House and Senate are in session this week.  Discussions/negotiations over a continuing resolution (CR) to keep the government open past September 30th continued over the weekend, but progress remains slow.  The momentum appears to be to drop items rather than add items to ride along with the CR.  Senate Majority Leader Schumer said he supports adding $12 billion for Ukraine to the CR. 

The White House announced a tentative agreement between the railroad workers unions and the rail carriers that will avert a strike that could have occurred as early as tomorrow.  Nearly 40 percent on inland goods – including energy and food are moved by rail and it was estimated that a strike could cost the economy $2 billion a day.  

It was a calculated risk.  The White House wanted a big celebration to highlight the passage of the Inflation Reduction Act.  They chose to hold the event on the White House lawn the day the Labor Department would release the August CPI report -- inflation numbers.  They had reason for optimism.  Gas prices have dropped for 13 consecutive weeks.  Analysts expected the inflation rate to drop below 8 percent.

The BLS CPI showed inflation at 8.3 percent year over year and excluding food and energy, the core rate is 6.3 percent.  Both numbers exceed analysts’ expectations. The House returns today to a fair amount of uncertainty over what Congress can produce over the final three weeks of session before the midterm elections.  Job one is to keep the government open past the September 30th deadline, when government funding runs out. 

The White House and congressional Democrats hope to keep their summer momentum going this week.  The White House will hold a celebration for the passage of the Inflation Reduction Act on Tuesday – right after the August report on the Consumer Price Index for August is released.  With gas and energy prices falling, economists expect to see inflation dip below 8 percent. 

The final phase of the pre midterm election session of the 117th Congress is rapidly drawing to a close.  There will be a lame duck session post-election, but the agenda for the lame duck will not become clear until after the November elections.  In the meantime, Congress has a few weeks to finish some must do work and potentially pass a few additional “want-to-do” items.

The Senate returned yesterday.  The House returns next week.  This begins the final congressional session before the increasingly competitive mid-term elections.  Congress has one “must do” item this month – pass a continuing resolution (CR) spending bill to keep the government open.  The current funding expires on September 30th.