January is going to get wild for Trump and Congress as a government shutdown looms

Alex Wong/Getty ImagesDonald Trump and Paul Ryan.

  • 2018 kicks off with a busy month for Congress, which has until January 19 to pass a bill to fund the government.
  • Democrats and Republicans want the bill to address issues like healthcare, immigration, and government surveillance.
  • Republicans and President Donald Trump are also eyeing other legislative plans for the year.

President Donald Trump and congressional leaders are about to face a slew of deadlines that could result in a shutdown early in the new year.

Congress must pass legislation to fund the government by January 19 to avoid a partial government shutdown. Negotiations look set to be fraught, as Republicans and Democrats alike will attempt to resolve a series of legislative issues by attaching other agenda items to the must-pass bill.

Not only does Congress have to deal with the mandatory deadlines, but GOP leadership is also likely to set its sights on the next big legislative push after completing its massive tax-code overhaul. What that will be remains up in the air.

The ‘need to pass’ legislation

After lawmakers repeatedly punted on substantial fiscal deadlines in 2017, the route to avoiding a shutdown appears much more complicated this time around.

Here’s a rundown of just some of the issues that members of Congress want to include as part of the funding negotiations:

  • Deferred Actions for Childhood Arrivals program: The Obama-era immigration program, which protects more than 700,000 unauthorised immigrants who arrived in the US as minors, is set to expire in March after Trump gave Congress a six-month deadline to codify the program. Democrats have made the program a top priority in the funding negotiations.
  • Obamacare stabilisation: Republican leaders assured GOP Sen. Susan Collins amid tax-bill negotiations that they would hold a vote on the bipartisan Alexander-Murray bill, which was designed to stabilise the Affordable Care Act’s individual insurance markets. The vote was delayed until 2018, however.
  • Children’s Health Insurance Program: Congress authorised $US3 billion more for CHIP before the holiday to prevent children from losing health coverage. But it still has not come to a long-term solution to maintain the program. Democrats want a simple extension of funding for it, while the GOP wants to pair the extension with cuts to healthcare spending elsewhere.
  • Government surveillance powers: Section 702 of the Foreign Intelligence Surveillance Act, which authorised the National Security Agency and others to collect large amounts of data and communications, is set to expire January 19. Many Democrats and Republicans alike want to curtail the surveillance powers, and adjustments to the program could be included in the funding bill.
  • Disaster relief: The White House and lawmakers from areas affected by hurricanes and other natural disasters in 2017 have asked for billions more in aid to rebuild those areas.

Congress punted twice on dealing with government funding before the holiday break, extending it only for weeks at a time as Republicans rushed to pass their tax bill. With the tax bill passed, the probability of a shutdown this time around is higher, said Isaac Boltansky and Lukas Davaz, analysts at the research firm Compass Point.

“Our sense is that the successful enactment of tax reform has left neither party eager to compromise on other issues,” Boltansky and Davaz wrote in a note to clients. “We peg the odds of a government shutdown in mid-January at 60% given the current state of play in DC.”

The next GOP push

The new year also provides Republicans the chance to lay out their next big legislative item.

Republican leaders have floated several options. For instance, House Speaker Paul Ryan immediately began to set his sights on cuts to entitlement programs like Medicaid and Medicare. Senate Majority Leader Mitch McConnell has said Republicans’ slim 51-49 majority in the Senate most likely means that won’t be an option.

Trump has told Republican lawmakers that he plans to deal with the issue of entitlements in his second term, should he get one.

“We are bearish on efforts to curtail entitlement spending in this Congress given the lack of Democratic support for the effort in the Senate, tentativeness among certain Republicans, and a basic lack of procedural bandwidth before the midterms,” the Compass Point analysts said.

Another option on the table, and perhaps a more palatable one, is an infrastructure package. Trump promised during the campaign to spend $US1 trillion on new infrastructure projects with a combination of private and public money.

After the tax bill passed, many Trump officials began to talk up the possibility of moving forward on the package. Among them were Marc Short, the White House director of legislative affairs, and Gary Cohn, the National Economic Council director.

McConnell has said an infrastructure push is on the table but will most likely need Democratic support.

Chris Krueger, an analyst at Cowen Washington Research Group, said a large package could be difficult since the parties have a slew of policy differences on infrastructure – such as how to pay for it.

“Infrastructure is very hard to shoe-horn into a reconciliation bill, so Democratic Senate votes will be needed (at least nine),” Kreuger said in a note. “The House Freedom Caucus is lukewarm on public works spending, so there is a real arithmetic problem.”

Trump, McConnell, and Ryan are set to meet at Camp David over the weekend to hash out the strategy for year two of the Trump presidency – both in the immediate fights over funding and in the longer-term push.

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