Federal Relations

January 3, 2013


The 113th Congress will be sworn in at noon today but will take no break from fighting over fiscal priorities with the opening weeks and months likely to be dominated by partisan fights over the size of a multibillion-dollar disaster aid package (Super Storm Sandy relief package), how to raise the nation’s debt ceiling before the end of February, and calls for additional spending cuts and an overhaul of the federal tax code.  President Obama has also called for legislative action on gun control and immigration, two issues that are sure to create more partisan division rather than unity.

Congress approved a fiscal cliff compromise on New Year’s Day, which the President signed late last night using an autopen (he is still on vacation with his family in Hawaii).  That legislation postpones the across-the-board spending cuts mandated by last year’s Budget Control Act (sequestration) for two months until March 1st, right around the time when Treasury will brush up against the debt ceiling. Additionally, the latest continuing resolution (CR) to fund the government expires on March 27th.

Republicans hope to seize on all these deadlines to win additional spending reductions and/or changes to entitlement programs, but the debt ceiling is likely to be their best leverage against Democrats who have promised to hold firm in opposition.