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Document 15 of 96.

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September 9, 2000

SECTION: CONGRESS; Pg. 2774; Vol. 32, No. 37

LENGTH: 3944 words

HEADLINE: Exit Strategies

BYLINE: Richard E. Cohen and David Baumann

HIGHLIGHT:

In the final days of the 106th Congress, each party is plotting
how to gain maximum political advantage from a minimal
legislative effort.

BODY:

Shortly before Memorial Day, Rep. Bill Thomas, R-Calif., and Sen.
Ron Wyden, D-Ore., held a press conference in the Capitol to
announce their bipartisan resolve to enact prescription drug
benefits for Medicare recipients this year. The event's location-
on the dividing line between the House and the Senate-was
"symbolic of the fact that we believe there needs to be a
bipartisan, bicameral effort," Thomas declared at the time. While
the collaboration prompted eye-rolling among some hard-liners,
health policy veterans hailed it as significant.

But by Labor Day, the optimism expressed by Thomas and
Wyden had melted away. Asked at their respective national
political conventions about the prospects for prescription drug
legislation, each responded with a shrug of the shoulders and a
partisan jab.

"Some in my party will say that this is the best issue
for the campaign and we should wait until January," Wyden said
while in Los Angeles. Told that Thomas wants Congress to restore
Medicare money that hospitals and other providers lost under the
1997 budget deal, Wyden caustically replied: "It will be odd to a
lot of Americans why you address providers' needs-many of them
legitimate-but you don't help Mrs. Barnes who spends $ 3,000 a
year" on medication.

In Philadelphia, Thomas appeared content that the House
has approved the Republicans' prescription drug plan, regardless
of President Clinton's veto threats. "We are real comfortable
that we have passed education and health care, plus reasonable
tax cuts," said Thomas, the Ways and Means Health Subcommittee
chairman. "At the end of the day, Clinton will try to buy
(voters) off, but that won't work."

Thomas and Wyden seemed to be following the partisan
scripts that will become all too familiar during the closing days
of the 106th Congress. Congressional Republicans will inflate
their underwhelming accomplishments, complain about Democratic
obstructionism, and-most of all-try to get out of town as quickly
and painlessly as possible so they can campaign back home to keep
their majorities. Congressional Democrats, backed by Clinton's
bully pulpit and veto pen, will stir GOP divisions and exploit
hot-button issues as long as they can.

Neither party will bother much with pretenses of
bipartisanship and cooperation in coming weeks. Following their
base-energizing political conventions, this is hardly the time
for either side to seek new liaisons across the aisle or to
significantly change its rhetoric or political game plan.

Republican leaders have set Oct. 6 as their adjournment
target-meaning only four workweeks remain-although a senior House
GOP leadership aide said recently that Oct. 13 is a more likely
completion date. Most lawmakers are resigned to the notion that
Congress probably won't measurably boost its modest output of the
past 20 months during the session's final days. The ticking clock
leaves members barely enough time to complete must-pass items
such as the appropriations bills, retrieve perhaps a couple of
popular items from the legislative back burner to provide
political inoculation, and talk up their competing campaign
agendas.

"September will determine whether we take back the House
and Senate," said Sen. Charles E. Schumer, D-N.Y. "If Clinton and
(Al) Gore play it right, it will become clear that these guys
(the Republicans) could blow the economic prosperity."

"We will make efforts on several fronts," said House
Rules Committee Chairman David Dreier, R-Calif., citing
immigration, trade, and health care as a few examples. "But it
will be tough because of the short time frame and the focus on
the fact that there will be a new Administration."

Like Dreier, many lawmakers are looking ahead to the new
Administration. In fact, the sole redeeming factor of the
upcoming legislative stretch is that they won't have to endure it
again. The November election will probably bring major change-one
way or another.

With George W. Bush and Gore battling for the presidency,
the public may have even less than its usual interest in-and
patience for-the legislative endgame in Washington. Moreover,
some congressional candidates, particularly those trying to
position themselves as outsiders, are distancing themselves from
the pre-election session. "We need new leadership and new
thinking," said former Rep. John Ensign, R-Nev., who is favored
to win an open Senate seat and has been pressing his own Social
Security and prescription drug proposals.

Nevertheless, the stakes in this fall's legislative
endgame are substantial. A big tactical misstep-or savvy
political victory-by either congressional Republicans or
Democrats could influence their party's electoral results all the
way up to the top of the ballot. And artfully directed goodies
from the federal Treasury could prove crucial in some key
congressional races on Nov. 7. Only a handful of House and Senate
seats are truly up for grabs, and edgy leaders in both parties
are mindful of how their actions play in those states and
districts.

"It's a blessing that the (presidential) race is this
close," said Senate Appropriations Committee Chairman Ted
Stevens, R-Alaska, as lawmakers returned to town on Sept. 5.
"Everyone is going to be walking on eggshells."

In the coming weeks, numerous measures, particularly the
11 remaining appropriations bills, will require extensive
negotiations and deal-making. For both parties, the desire to
play good politics while writing good policies will be more
dominant than ever. The two sides will, of course, join together
in the end on the spending bills and some other legislation.
Republicans, and most Democrats, want to avoid a stalemate that
might result in a politically perilous shutdown of the federal
government-although each wants to make the other party squirm.

Senate Majority Leader Trent Lott, R-Miss., complained to
reporters on Sept. 5 that the White House is "trying to
complicate things to keep us from doing our work.... I'm worried
that (Clinton) wants to create a mess at the end of the session."

Lott's fears are not unfounded. White House press
secretary Joe Lockhart indicated on Sept. 5 that the White House
will have no qualms about keeping Congress in town until
Republicans consent to Clinton's demands. "The President is
committed to staying here through Nov. 7, if need be, to get
things like a patients' bill of rights, prescription drugs, (and
an increase) in the minimum wage," Lockhart said. "If Congress
can't get their work done by Oct. 1, we're not going any place
until Election Day, if need be."

For months, Democrats have prepared to use the fall
stretch to remind voters of their legislative priorities, with
the hope that nervous Republicans would agree to cooperate and
forge deals on a few of them. "It's up to the Republicans how
much gets done, based on how scared they are," Schumer said.

Republicans apparently aren't scared enough to change
their minimalist legislative game plan. Asked whether tax
legislation will pass this fall, Sen. Charles Grassley of Iowa-
the No. 2 Republican on the Finance Committee-replied: "If we can
pass what we want, the answer is yes. If we have to compromise,
we'll wait until January."
The Long Road of the 106th
Perhaps the most significant events of this Congress took place
before it even convened in January 1999. The Republicans had an
unexpectedly poor showing at the ballot box in November 1998, and
then-House Speaker Newt Gingrich, R-Ga., was exiled less than 72
hours later. In the subsequent six weeks, reeling House
Republicans saw Speaker-to-be Bob Livingston, R-La., announce his
resignation and decided, in a bitterly divisive pre-Christmas
vote, to impeach Clinton. When it became clear in January and
February 1999 that the Senate lacked the two-thirds majority to
remove Clinton, the die was cast for the remainder of the 106th
Congress.

It took several months after that for the new House
leadership team under Speaker J. Dennis Hastert, R-Ill., to gain
its footing, but Republicans eventually rallied around the idea
of exploiting the federal budget surplus to demonstrate their
economic stewardship. They touted their plans to "safeguard
Social Security" against raids by the Democrats and to approve a
series of tax cuts targeted to particular constituencies.

Democrats, for their part, identified roughly a half-
dozen issues-health care reform, a minimum-wage increase,
increased education funding, gun control, and campaign finance
reform-that would draw lines between the parties and occasionally
pick up some GOP votes. The divisions and deadlock that sprang
from these early party positions have largely defined the Capitol
Hill battle lines for more than a year.

In October 1999, Congress managed to finally pass, after
two decades of debate, a landmark overhaul of the rules governing
banking and financial services. But the only other notable laws
passed last year were the "Ed-Flex" proposal giving states more
flexibility in managing federal education aid, and the limits on
legal liability from anticipated Y2K computer problems.

So far this year, Congress hasn't been much more
productive. After Bush wrapped up the GOP presidential nomination
in early March, congressional Republicans began deferring to his
"compassionate conservatism" and generally tried to play things
low-key. Clinton this year has signed legislation aimed at
boosting trade with Africa and the Caribbean Basin, as well as
another bill requiring so-called 527 tax-exempt groups to
disclose their campaign activities. But the pace doesn't nearly
resemble that of the previous presidential election year, when a
President and Congress both eager for accomplishments really
ratcheted things up.

In 1996, Clinton and congressional Republicans each
bolstered their productivity and credibility by agreeing to a
batch of legislative deals. In July alone, they signed off on
welfare reform, the Kennedy-Kassebaum health insurance plan, and
a minimum-wage increase. GOP presidential nominee Bob Dole was
left in the cold.

This year, Clinton again has the option of signing end-
of-the-year deals, although the personal benefit this time would
be chiefly for his legacy. Despite Gore's role in the
Administration, the Vice President has not shown much interest or
involvement in resolving the key outstanding issues. Nor have
congressional Democratic leaders.

That has left congressional Republicans with the dilemma
of whether to take the initiative on deal-making. When members
left town at the end of July, the prospects did not appear good.
Various measures, such as gun control and patients' rights
provisions, were stuck in House-Senate conference committees;
others, such as the bills on marriage penalty and estate taxes,
were being prepared for Clinton vetoes. With Congress's return
this week, however, Republicans appear to have made a few
strategic shifts.

On Aug. 28, Hastert offered that House Republicans would
agree to a $ 1-per-hour increase in the minimum wage over the next
two years, as the Senate earlier had agreed to, rather than three
years, as House-passed legislation had stipulated. In return,
Hastert wants the White House to sign off on accompanying tax
breaks for small businesses. (Other congressional GOP leaders may
not be so eager to go along, however.)

In addition, Republicans have expressed a willingness to
resolve long-standing differences over patients' rights
legislation. In this case, the House had passed a more expansive
bipartisan version last year and the Senate had taken a harder
line. But with Democrats shifting the focus to prescription
drugs, the GOP sees an opportunity to reach a final settlement on
patients' rights. "Our members are close to where Clinton is,"
noted Michele Davis, spokeswoman for House Majority Leader Dick
Armey, R-Texas. "We're likely to get it done."

Moreover, Thomas' plan to push Medicare changes for
health care providers opens the door to a potentially larger
health care package. Likewise, a grab bag of tax cuts appears to
be in the offing in the Senate, which may move on several House-
passed tax cuts dealing with pensions and individual retirement
accounts, earnings for Social Security beneficiaries, the
century-old telephone excise fee, a "New Markets" initiative to
spur economic development in poor areas, and others.

Congressional Democrats might object to some of these
proposals, presenting Clinton with a tough choice: Signing the
bills would represent movement in the policy arena and provide
pre-election rewards for constituents, however modest. Vetoes
would please most Democratic lawmakers but might be difficult for
Clinton to justify to voters.

Meanwhile, Republicans have made clear their continued
resolve on two big tax initiatives-repealing the estate tax and
providing relief from the so-called marriage penalty. Clinton
vetoed both measures in August. Although Republicans plan to try
to override those vetoes-forcing Democrats to cast politically
difficult votes-they concede that they lack the votes to prevail
in both chambers. A recent Hastert statement on the estate tax
did not appear to open the door to compromise.

Nor does either party expect serious efforts to seek a
middle ground on prescription drug legislation. In June, the
House passed a $ 40 billion Republican bill designed to entice
private health insurers to offer drug plans to Medicare
recipients, but Democrats prefer including a drug benefit in the
Medicare program itself and Clinton has threatened a veto. At the
time, Clinton offered the Republicans a swap: He would sign their $250 billion in marriage penalty tax breaks if they agreed to his
proposed level of long-range debt reduction and his call for $ 253
billion in new Medicare prescription drug benefits over 10 years.
The offer has gone nowhere, and the Senate has not yet acted on
its own prescription drug bill.

Also looming over Congress this month is completion of
legislation granting permanent normal trade relations to China.
Following Clinton's hard-fought battle in May to get House
approval, Senate passage had been a foregone conclusion. But the
debate has left an open wound among Democrats, especially in the
House, where labor union support is crucial to their re-election.
Crunching the Numbers
When this year started, House Appropriations Committee Chairman
C.W. "Bill" Young, R-Fla., said he was determined to ensure that
his funding bills did not delay Congress's adjournment in the
fall. GOP leaders also said they wanted to complete the annual
bills early to ensure that the measures did not get caught up in
the highly politically charged atmosphere after the national
conventions.

To put it bluntly, the Republicans failed miserably. As
lawmakers returned to Washington this week, Clinton had signed
only two of the 13 funding bills-the Military Construction and
Defense measures. The remaining bills face a myriad of problems,
and Republicans have yet to develop a coherent strategy for
finishing them. "Getting out of this box is going to be a key to
retaining Congress," said Stephen Moore, the president of the
Club for Growth, a political action committee that supports
conservative candidates.

The GOP effort this year was doomed from the start. House
and Senate Republicans passed a budget resolution during the
spring that many of them acknowledged would not provide enough
discretionary spending to satisfy Clinton. Many also acknowledged
that an end-of-year budget deal would-once again-be needed, and
they expressed concern that the President would-once again-get
most, if not all, of the money he wanted for pet programs. In
1998, the last time such talks were held in an election year,
Clinton got much of the spending he wanted, and disgruntled
Republicans lost seven House seats.

The difference the two sides must bridge is not small:
The fiscal 2001 budget resolution allows appropriators to spend
about $ 601 billion in discretionary spending, while the Office of
Management and Budget has estimated that the President requested $624 billion.

Still, anyone who has seen the latest eye-popping budget
surplus numbers might wonder what Republicans are fussing about.
After all, in the first six months of this year, the
Congressional Budget Office increased its estimate of the fiscal
2001 surplus, not including Social Security, from $ 11 billion to $102 billion. Its projection of the 10-year surplus grew from $838 billion to $ 2.17 trillion.

But Republicans, especially the conservatives, are intent
on sticking as closely as possible to the tight spending levels
called for in their budget resolution. GOP leaders are also
determined not to follow the model from 1998, when a small group
of leaders-under Gingrich's control-and White House officials
resolved all of the spending issues at the 11th hour and wrote up
a massive omnibus bill.

"We're not going to do an end-of-year summit, and we're
going to try to keep spending as low as possible," said a House
Republican leadership aide. "I can't give you a price tag,
because we don't know what that price tag will be."

Instead of following the 1998 model, Republicans want to
follow Hastert's 1999 plan, in which House and Senate
Appropriations subcommittee chairmen and ranking members
negotiated their own funding bills with Administration officials.
"We went through the regular order," the GOP aide said. "We
didn't have a big buyout at the end." (Even so, Republicans ended
up spending more than they wanted to spend.)

According to Armey, "regular order" also means putting
the finishing touches on as many funding bills as possible and
sending them to the President individually before the start of
the new fiscal year on Oct. 1. "You have to send him the bills
and see what he signs and what he doesn't sign," Armey said. "Our
commitment is to negotiate (the bills) separately."

Interestingly, Armey also left open the possibility that
if Clinton vetoes spending bills and the polls look good for
Bush, Congress could pass a continuing resolution that funds
various government agencies through February or March. Such a
plan would allow a President Bush to make his mark on the fiscal
2001 spending bills.

At this point, a federal government shutdown appears
highly unlikely. Top aides to Clinton have vowed that the
President will sign continuing resolutions to keep the government
funded until a budget deal is reached. "We will sign short-term
CRs as long as it takes to get the job done," Sylvia Mathews,
deputy director of the Office of Management and Budget, said on
Sept. 5.

Congressional Democrats, for their part, vow to fight for
Clinton's priorities during the appropriations process. Senate
Minority Whip Harry Reid, D-Nev., said the President will not be
shy about vetoing funding bills if they are unacceptable. "The
Republicans put themselves in an impossible role," Reid said.
"We're ready to do battle and the angels are on our side. Any
problems they have, they painted themselves." And the former
boxer added: "They telegraphed their punch. You could see that
six months ago."

Democrats also don't plan to make it easy for the
Republicans to meet their Oct. 6 target for adjournment. "For
them to get out of town without doing some of the things
(Clinton) wants done is going to be very difficult," said a
senior House Democratic aide. "He's in a very strong position.
They're in a very weak position. They don't even know how to
broker the deal."

The Democrats' concerns include funding levels, as well
as controversial legislative language that has been tacked onto
several of the appropriations bills. For instance, the House
Democratic aide complained that the Commerce-Justice-State
appropriations bill passed in that chamber contains "mindless
cuts" and would renew a fight over U.S. dues owed to the United
Nations.

The District of Columbia spending bill has riders that
Democrats consider "social engineering," while the Foreign
Operations appropriations measure again will bog down over aid to
international family-planning groups. The Veterans Affairs-
Housing and Urban Development funding bill lacks sufficient money
for housing and space programs, the House Democratic aide said.
And, as part of the Labor-Health and Human Services-Education
bill, Republicans once again have set themselves up for a fight
over White House demands for funding for school construction and
the hiring of new teachers.

Resolving those issues will increase spending to a level
about $ 10 billion to $ 17 billion higher than allowed under the
budget resolution, a senior Senate GOP aide predicted. But
because Republicans "will try to avoid any kind of fight with the
President over the appropriations bills," Clinton will probably
get at least some of this extra money, the aide said.

A key appropriator agreed. "We're going to have to fork
over some more money," said Rep. Sonny Callahan, R-Ala., the
House Foreign Operations Appropriations Subcommittee chairman.
"Unfortunately, the President is going to get most of what he
asks for." Providing Clinton with that money, Callahan added, is
"going to give some Republican members heartburn" and upset the
GOP base.

Conservatives say they will be watching the negotiations
carefully to make sure that GOP leaders fight the President on
certain issues and get something in return for higher spending.
"What will prevent those deals is that people like me and the
conservative flank would walk rather than leave whole new
spending," said Rep. Mark Sanford, R-S.C.

An aide to another House GOP conservative added: "A lot
of conservatives believe it is important to fight. One of the
best ways to do that is to have (Clinton) veto bills. If we're
fighting and we lose some ... that's radically different than
walking in (to budget negotiations) and saying, 'What do you
want?' "

Bush, however, might not be so happy to see congressional
Republicans in disarray and picking fights over spending bills,
because the public's distaste for such activities could hurt his
presidential campaign. "He has to encourage them not to pick
fights, be smart, and go home," said the House Democratic aide.
"But if he tries to help them, they're likely to tell him to go
to hell like they tell everyone else to go to hell."

A key House Republican advised Bush simply to stay far
away from the legislative fights and avoid blame. "Whether we get
something done depends on the President of the United States,"
said Thomas, pointedly adding that, for now, "that's Bill
Clinton, not George W. Bush."

LOAD-DATE: September 11, 2000

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