Evans-Novak Political Report

ENPR: Week of May 23, 2007

May 23, 2007
Washington, DC
Vol. 42, No. 11a

Congress

Iraq: After passing two bills that President Bush deemed unacceptable, Democrats have blinked in the fight over funds for the Iraq War.

  1. Senate and House leaders are now promising a vote Thursday on a bill that funds the Iraq War through the end of the fiscal year and does not include a withdrawal timetable. The bill would, however, include benchmarks for the Iraqi government, with consequences for economic aid in the event that they do not meet the benchmarks. The idea is to get a quick vote on the same bill in both houses, avoid a conference committee, and leave for Memorial Day.

  2. President Bush has won a rare showdown victory over Congress simply because Democrats felt they could not afford the risk of letting a war in progress run out of money. The Democrats’ problem is that this demonstrates conclusively that they are all talk on the Iraq War — a fact that their base will quickly realize. There is no way for Congress to end the war short of cutting off funds, and to cut off funds without the consent of the President is to invite a repeat of exactly the same showdown the Democrats have now already lost.

  3. The bottom line is that Democrats have passed on their best chance to end the Iraq War. If they are not willing to take a risk here in a non-election year in order to force Bush to end the war, then they certainly do not have what it takes to cut off war funds in the coming presidential election year. The best they could possibly do is to make some symbolic gesture, such as a rescission of congressional approval for the war — a recent suggestion of Sen. Hillary Clinton (D-N.Y.) — or perhaps a non-binding resolution demanding its end. There is another option, but even more undesirable than images of soldiers running out of ammunition in the desert would be a politically suicidal attempt to impeach President Bush during the last year of his term.

  4. Majority Leader Steny Hoyer (D-Md.) asserted that Democrats will force Bush out of Iraq with next year’s appropriations process. But this is an empty threat. Bush will have an even stronger hand in a 2008 game of chicken than he did this year. This is where it pays to be a lame duck President. Unlike every Democratic member of the U.S. House, President Bush will not have to face re-election. Bush, already in the bunker on several key issues and unwilling to compromise, will be even less politically vulnerable in 2008. He will have almost no political motivation to capitulate to Democratic demands on Iraq.

  5. The White House snubbed Rep. Phil English (R-Pa.) by omitting him from what became a highly publicized meeting at the White House for the moderate Republican Tuesday Group to discuss Iraq War policy with President Bush. English did not complain to the White House, but he believes he was removed from the invitation list by presidential aides. English had voted for anti-Iraq-surge legislation.

Earmark Envy: Rep. Jack Murtha (D-Pa.), a hero of the anti-war movement because of his strident anti-war rhetoric, has embarrassed his party once again with his classical modus operandi of favor-trading and pork-barrel politics.

  1. Rep. Mike Rogers (R-Mich.) accused Murtha of threatening him with the loss of all future earmarks for his district. Murtha became upset with Rogers when the latter attempted to strip out a Murtha earmark (a duplicative government program in his district) from a spending bill by using a motion to recommit.

  2. Rogers responded by bringing a privileged resolution to the House floor that would have reprimanded Murtha, and Democrats responded by tabling it in a 219-189 vote.

  1. The whole episode embarrasses a congressional majority that campaigned and won a majority partly on an anti-corruption message. That nearly all Democrats voted (some grudgingly) for what effectively amounts to a cover-up of unethical behavior is a black mark. Freshman members are already receiving a public relations beating for voting on Murtha’s side.

  2. This Murtha affair — actually the latest of several — reinforces the notion we have long propounded, that House Speaker Nancy Pelosi (D-Calif.) made a grave error in judgment when she supported Murtha against Rep. Steny Hoyer in the race for majority leader following the November elections. Pelosi has publicly stated she does not believe Rogers’ accusations, but Murtha has not denied anything.

  3. The latest Murtha incident also stands as an affirmation of the corrupt practice of distributing congressional earmarks. That an Appropriations subcommittee chairman such as Murtha would wield such threats is a clear example of government corruption that is legal because of the power of congressional earmarking.

  4. Prior to Murtha’s bluster, Democrats had suffered a much smaller setback in keeping the lid on public exposure of earmarks. Rep. Nita Lowey (D-N.Y.) was forced to pull from her House website a press release boasting about an $8.7 million earmark attached to the supplemental appropriations bill. She had to cover it up because Appropriations Chairman David Obey (D-Wis.) said (and maintains still) that the bill containing her earmark did not contain any earmarks.

Immigration: The Senate is considering an immigration compromise that has items acceptable to nearly everyone — and is therefore, as a whole, unacceptable to nearly everyone. Still, its chances cannot be discounted.

  1. Last year’s far more lenient immigration reform measure passed the Republican-led Senate with 62 votes — and it could have received 64 votes if every senator had been present. Of the 21 Republicans who voted for that bill, only two are no longer in the Senate. Four of the bill’s GOP opponents have been replaced by Democrats. For that reason, a filibuster appears unlikely to succeed.

  2. For liberals, the bill offers legal residency and citizenship to immigrants. For conservatives, the bill abolishes "chain migration" for extended family members in favor of a system that admits immigrants based on their qualifications and skills. For business, the bill creates a guest-worker program. For labor, the bill promises to legalize many illegal immigrants who will in turn become union members.

  3. But the bill also contains problems for everyone. The problem for business is the need for more unskilled labor – greater than the need for skilled labor. The unskilled market is tight because the percentage of college graduates in America has risen dramatically. Shrinking the pool further is the fact that many Americans lacking skills and education are receiving public benefits or participating in the black-market economy.

    The problem for conservatives is that many of them have no tolerance for any kind of legal status — guest worker or otherwise — for those present in the U.S. illegally.

    The problem for liberals can be either the depressing effect that immigrants supposedly have on the wages of unskilled workers or the abandonment of family chain migration.

    The problem for labor is the failure to confer citizenship status on all guest workers so that they can join unions.

  4. The Senate compromise is somewhat similar to the one advanced last spring by conservative Rep. Mike Pence (R-Ind.). The major difference between the Pence plan and the Senate compromise is that the Pence plan required all illegal immigrants to return to their home countries in order to get a legal guest-worker status, whereas the Senate bill requires this only of those seeking citizenship. For that reason and due to other differences of degree, Pence opposes the current proposal. Still, it is a much tougher and more enforcement-focused bill than the one the Senate considered last year, which Pence had also opposed.

  5. The extension of this bill’s consideration for two weeks could mean its doom, as congressmen and senators return home to face their constituents over the Memorial Day recess. Sen. Saxby Chambliss (R-Ga.), who has endorsed the compromise along with conservative Sen. Jon Kyl (R-Ariz.), was booed during an appearance at the his state’s Republican convention in Duluth, Ga. Many House Democrats will also feel pressure to oppose the plan. Rep. Joe Donnelly (D-Ind.) already panned the Senate bill yesterday while speaking on a related bill on immigration. The pressure on members who do not speak against the immigration compromise now will be immense.

  6. The tolerance by many on the right (and in some segments of the labor left) for deviation on this issue is non-existent. In a closed-door debate at a recent retreat of the conservative House Republican Study Committee, Rep. Bob Inglis (R-S.C.) warned that the GOP ran the risk of looking like the racist National Party of South Africa on the immigration issue. Most of his conservative colleagues disagreed, holding that anti-immigration campaigning did not hurt the GOP in 2006. The bitter debate reflected the split over immigration in conservative ranks.

  7. Democrats benefit most from kicking this issue further down the road and dragging it out as long as possible. Republicans will continue to self-immolate as long as they are forced to discuss the immigration issue. It created great rancor in GOP ranks in 2006 and cost the party heavily with the Hispanic vote. A cycle full of harsh anti-immigrant rhetoric could prove devastating for the Republican nominee in 2008. The best thing that can happen for the Republican Party is for the bill to pass over their objections, freeing up the 2008 presidential candidates to move away from the immigration issue.

Budget: In routine party-line votes last week, both houses of Congress completed action on a Democratic-crafted budget containing the biggest tax increase in U.S. history.

  1. Democrats’ success in shaping the coverage of this tax-hike as a non-tax-hike can be attributed to Senate Budget Chairman Kent Conrad (D-N.D.), who has repeatedly insisted his budget contains no higher taxes. But Conrad’s budget increases discretionary spending $200 billion over five years, while promising immense budget surpluses in the future. It only does so because it raises taxes on upper-bracket income earners and investors who receive dividends and take long-term capital gains.

  2. Conrad’s denial about the tax-hike in his budget resulted in a Senate debate not on the merits of higher taxes, but on the existence of the tax increase. The bottom line is that if Congress does nothing, several tax rates will increase when President Bush’s tax cuts expire in 2011. Moreover, the Senate’s adoption of the Baucus amendment, to extend some of the tax cuts, was adopted and changed the revenue bottom line, despite Conrad’s earlier insistence that there were no tax hikes in his budget.

  3. Conrad has defended his no-tax-increase claim with an exercise in statistical sleight of hand. He has been comparing his own budget to the President’s budget using data from two completely different sources, which employ different techniques and operate under different economic assumptions. The result of this trickery is the appearance that the two budgets raise the same amount of revenue.

  4. Democrats in the Senate buy into his euphemisms. Not a single Democratic senator voted against the tax-increasing budget — not even Ben Nelson (D-Neb.), who broke a no-tax-hike pledge in casting the vote. Nelson supported the Bush tax cuts, but now he has voted to let them expire. But the budget resolution only narrowly passed the House, with 13 Democrats opposing it, nearly all of them moderates. Freshman Rep. Harry Mitchell (D-Ariz.) was among those not fooled by Conrad’s rhetoric that there was no tax increase in the budget, as he said, "I simply cannot support a budget that allows key tax cuts to expire."

  5. The Democratic budget does contain a one-year patch for the Alternative Minimum Tax, extension of the increased child tax credit, and the bottom 10 percent income tax bracket. But the continuation of reduced tax rates on capital gains and capital gains tax treatment for dividends are not included in the budget, nor are the lower marginal rates passed in 2001 (these expire in 2011).

  6. Some market-watchers assert that the effect of the expiring tax cuts — especially capital gains — still has not been priced into the stock and real estate markets. This could mean a major market boom or bust late next year, depending entirely on the results of the 2008 election, on the perception that that election decides whether taxes on gains will increase in 2011. Gridlock or Democratic control — the two most likely outcomes — is likely to result in a correction driven by tax policy.

Governor 2007

Kentucky: As we expected, Gov. Ernie Fletcher (R) survived a divisive primary that pitted him against former Rep. Anne Northup (R). Fletcher easily avoided a runoff with a surprisingly strong 50-plus percent performance — he only needed 40 percent to get the nomination. On the Democratic side, as we also anticipated, former Lt. Gov. Steve Beshear came out on top. He too finished surprisingly strong, narrowly clearing the 40 percent bar and avoiding a runoff of his own. Fletcher’s unexpectedly strong finish gives him new hope in the November contest, but his approval remains below 50 percent — well below 50, according to some polls.

Senate 2008

Virginia: With 80-year-old Republican Sen. John Warner not disclosing until late this year whether he will definitely seek a fifth term in 2008, Rep. Tom Davis (R) is building strong statewide support for the GOP nomination in case Warner does not run.

Conservative activists are not happy with the prospective nomination of Davis, who has a lifetime 70 percent American Conservative Union voting record compared to Warner’s 81 percent. Republicans would also stand a chance of losing Davis’s suburban Washington district

In his favor, Davis would be a strong candidate in populous Northern Virginia (carried by Democrats in their recent statewide victories). Former Gov. Jim Gilmore (R) is a more conservative possibility, but only if he gives up his current campaign for the Republican presidential nomination.

Former Gov. Mark Warner (D) would be the strongest Democratic candidate for the Senate, but insiders believe he may forgo that race to keep himself available as Sen. Clinton’s vice presidential running mate.


Sincerely,
Robert D. Novak

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