Director of Government Relations :: Larry Hart

Like those monsters in horror films that are never quite dead the first time you think they are, Congress came back today for a one day encore. The Democrats got an unneeded boost during what was to be the August recess after Republican Senators Susan Collins and Olympia Snowe cut a deal with Senate Majority leader Harry Reid to pass a state bailout bill to pay for Medicaid and education costs.  That allowed House Speaker Nancy Pelosi to call the House back into special session with much fanfare to pass the bill today on a party line vote.  The media has played into the Obama Administration’s claims that this will “save” hundreds of thousands of teaching jobs, it is really a sop to 1/states like New York and California that have spent themselves into bankruptcy and 2/ teachers unions who have deliberately accepted layoffs as the alternative to benefit cuts.  The unions know two things:  their dues depend on the number of members and they need the dues this election year to defeat conservatives.  In an excellent American Spectator piece today (also on our website), Vincent Vernuccio uses the Milwaukee school system as an example.  Right now, Milwaukee teachers get $40,000 in benefits, including a Cadillac health care plan costing $26,000 per year. When asked to accept a plan with co-pays to avoid layoffs, the union refused.  On top of that, the bill doesn’t actually require the funds be used for teachers, and the bloated education bureaucracies will surely find other uses that have nothing to do with the classroom.

This bill also has the same flaw as the stimulus.  It’s a one time shot of money.  Those who accept it will be in the same fix next year, thus in the position of asking for another bailout.  As for the allocation of funds, a large percentage will go to states that have been the most irresponsible, such as New York, New Jersey and California. One state won’t get anything:  Texas, because they refused to use the stimulus money to increase spending, instead shored up their rainy day fund and don’t need a bailout.

Interestingly, besides giving more money to the Bath Iron Works in Maine, the Democrats were forced to make actual cuts in a number of popular welfare programs, such as food stamps and renewable energy grants to fully pay for the $26 billion cost of the bill.  However, both Reid and Pelosi assured the liberals in the caucus that they would figure out a way to restore the funds later, admitting these were phony cuts.

With any luck, the monster is really dead this time until September 13, when showdowns loom over energy, taxes and possibly the START Treaty with Russia, although many believe that will be held until the inevitable lame duck session after the election.

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Director of Government Relations :: Larry Hart

The deal cooked up by Senate Majority Leader Harry Reid and the two Republican Senators from Maine, Olympia Snowe and Susan Collins, to get a badly need win for the Democrats, not surprisingly turned out to involve money for Maine.  Each time this $36 billion bill has been brought up there have been different funds to partially offset the cost.  One part of it would have meant less money for Bath Iron Works, a sacred cow of funding in Maine since the days of Senator Bill Cohen, a Republican who became bill Clinton’s Defense Secretary.  So that was scrapped and Reid was able to convince House Speaker Nancy Pelosi to call the House into special session next week to pass the new version of the bill, another demand by Snowe.

Now Reid is taking grief from the powerful renewable energy lobby for stealing $1.5 billion from the bloated renewable energy loan program set up in the stimulus to help offset the state bailout.  The solar energy industry has packed a powerful political punch with Republicans and Democrats in western states, including Reid’s Nevada, and they are furious with Reid for not including a mandate to purchase renewable energy in his energy bill. So Reid now says he will find a way to “restore” the funds to the program, which is also missing $2 billion used for the absurd “Cash for Clunkers” program.  Reid has a point on this one, since most of the $20 billion in the program has never been given out, due to bureaucratic ineptness and the odd requirement of the program that the Treasury Department share responsibility.  Treasury, of course, had no one in the Department with knowledge on these issues.

Nevertheless, the state bailout bill is a big win for the Democrats who had failed for weeks to get a vote on their “jobs” agenda.  Most of the money will go to big urban states such as New York, New Jersey and California where the state employee unions are strong.

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Director of Government Relations :: Larry Hart

Just when it looked like the Democrats in Congress had completely failed to pass any of their much heralded “jobs” agenda before the August recess, the Republicans came to their rescue.  Maine Senators Olympia Snowe and Susan Collins provided the votes to pass a state bailout bill. This bill gives $16 billion to the states to help pay their Medicaid bills and $10 billion demanded by the teachers unions who claim it will save teachers jobs in some states.  Up until now, Senate Majority Leader Harry Reid had been frustrated at every turn in attempts to pass a small bank bailout bill and any type of energy legislation.  To get the Republican votes, Senate Democrats had to actually cut some spending on food stamps and some feel-good programs to “foster industrial and scientific innovation.  They are also raising taxes on multinational companies by restricting the use of a foreign tax credit.

The irony is that the House originally scheduled its recess to begin August 6 along with the Senate, but with no action by the Senate decided to leave a week early for an unprecedented six week summer break.  But have no fear. House Speaker Nancy Pelosi will call the House back into special session next week to pass the bill and give her Democrats something to talk about other than the miserable failure of the Stimulus and the rest of the Obama/Pelosi/Reid agenda. The bill is small potatoes as far as government spending goes these days but it gives the Democrats a much needed morale boost at a time when all major legislation has come to a halt and the polls are looking grim for them.

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August 4, 2010

Honorable Senator Daniel Inouye, Chairman
Honorable Senator Thad Cochran, Ranking Member
Committee on Appropriations
Room S 128
U.S. Capitol, Washington, DC 20510

Honorable David Obey, Chairman
Honorable Jerry Lewis, Ranking Member
House Appropriations Committee
H-218
U.S. Capitol, Washington D.C. 20515

Dear Chairman Inouye, Chairman Obey, Senator Cochran and Representative Lewis:

Today the American Conservative Union, the nation’s oldest and largest grassroots conservative organization, launched a new effort entitled ACU ACORN ACTION.

Despite the fact that Congress voted to cut funding for ACORN, multiple stories have surfaced that groups housing former ACORN leadership and staff are being established throughout the country to simply avoid scrutiny.   It is our belief that these entities may seek to obtain taxpayer funding despite the desire of Congress to eliminate funding for programs directed by these very same leaders.

ACU is tracking these entities.

To date, as you can see on our website www.ACUAcornAction.com we have identified several organizations whose close ties to ACORN raise suspicion.

We look forward to working with your staff to help you identify these groups.

Millions of Americans were shocked by the actions of ACORN office staff members shown on videos last year.  In addition, ACU and others have raised concerns over ACORN’s potential role in the subprime mortgage crisis and voter fraud.

We urge you to remain vigilant in ensuring that taxpayer funds are not misspent on illegal, unethical or political activities.

On behalf of our ACU members throughout the nation, I appreciate your attention to this matter.

Sincerely,

Larry Hart,
Director of Government Relations
The American Conservative Union

Director of Government Relations :: Larry Hart

Adding to a growing list of failures, Senate Majority Leader Harry Reid threw in the towel today on yet another bill he had promised to pass before the August recess.  After capitulating on cap and trade, Reid has drawn up an “energy” bill dealing with oil spill liability, more energy tax increases (oil tax) and further restricting domestic energy production.  In addition, although the bill claims to be a “response” to the BP oil spill, it would pave the way for BP and a few other large oil companies to dominate offshore oil drilling by eliminating any cap on the amount of liability a company would have for a spill.  No small or medium size company could afford that type of risk. Senate Republicans led by Lisa Murkowski have drawn up an alternative bill that would be more favorable to domestic energy production but would give the Obama Administration the power to decide liability caps which is not what some conservatives would think is a good solution to the problem.   In any case, by refusing to allow Republican amendments to bills some Republicans would have helped pass, Reid has failed on every issue since the financial overhaul bill with the exception of an extension of unemployment insurance.

As expected, Republicans are going through the motions on the Kagan nomination to the Supreme Court. They have agreed not to object to dealing with other business during the Kagan debate.  This helps lessen the intensity of media coverage on issues the Democrats would just as soon avoid, such as Kagan’s unlawful actions in throwing military recruiters off the Harvard Law School campus.

Congress is due to go into recess Friday, not with a bang, but with a whimper.

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Director of Government Relations :: Larry Hart

While the House left town a week early for an unprecedented 6 week vacation, the Senate is once again tied up in knots over Senate Majority Leader Harry Reid’s refusal to allow Republican amendments that would make some Democrats look bad and the ability of the 41 Republicans to stick together on this one issue.  On the bill to “aid” small business, appointed Senator George Lemieux of Florida provided the 60^th vote needed to add a “small bank bailout” provision to the bill.  This would give the treasury a $30 billion fund to “encourage” small banks to lend more to small business in much the same way the TARP injected funds into large financial institutions.  But Lemieux then backed off further support of the bill until Reid agreed to allow further amendments. One of the amendments at issue would repeal a “tax compliance” law passed to help pay for the health care bill, which requires every small business to file a tax form every time they pay out or receive a payment of $600 or more.  There is so much concern over this issue by small business, many Democrats have jumped on the bandwagon.  This is somewhat embarrassing to supporters of Obamacare as it could be considered the first very small step toward repealing its provisions.  So the small business bill is in limbo for now.

Next, the energy bill.  Having abandoned cap and trade, Reid now has a bill to change the laws on offshore drilling that would also eliminate any cap on liability for an offshore spill.  Although this measure is a response to the BP spill, it’s clear that unlimited liability would favor large companies like BP and prevent smaller companies from competing, often the end result of government regulation.  So it looks like this bill will also fall short of 60 votes to proceed this week.  Unless Reid relents on the amendment issue, that leaves the nomination of Elena Kagan as the final vote before the Senate takes a break.  Reid would have liked to push that debate as late in the week as possible to make it difficult for Kagan’s opponents to have the usual three or more days of floor time.  To do that, he needed something to fill up the time.  He didn’t have it and thus has been forced to start the debate Tuesday.  Stay tuned.

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