Congressional Outlook

The House and Senate are in recess this week.

Last week, the Senate voted on voting rights legislation and attempted to change the filibuster rules, both of which failed. Congress is now moving on to act on old items that have loomed large on the legislative calendar. While both chambers of Congress are in recess until next week, Members and their staff remain working on a FY 2022 omnibus appropriations package, a smaller version of the Build Back Better (BBB) Act, and a U.S. “competitiveness” bill, among other items.

In a January 21 Dear Colleague letter, House Speaker Nancy Pelosi (D-CA) outlined the upcoming agenda for the House. She said passing a “strong omnibus” is the House’s top priority. “We remain laser-focused on meeting the needs of the American people with regard to the pandemic, and at the same time, on addressing the many critical priorities facing our nation,” she said. The four appropriations leaders have been negotiating a FY22 package and there is belief that a deal by the end of the month is within reach. On the Senate side, Appropriations Committee Chair Patrick Leahy (D-VT) hopes to work out a deal on government funding ahead of the February 18 Continuing Resolution deadline. “Hopefully, a few days after we come back, there will be an omnibus,” Leahy said to reporters. Sen. Leahy’s Appropriations Committee Counterpart, Ranking Member Richard Shelby (R-AL), shared uncertainty on the ongoing progress. “It’d be hard to get it by the 18th, but if we can make huge progress, we’ll probably get it done soon,” Shelby told reporters. He shared that the negotiations are “a lot better off than we were a month ago.” Conversations surrounding additional pandemic relief funds, specifically for the restaurant and travel industries, have picked up recently and lawmakers expect the White House to weigh in. Other key items left to be resolved include support for Ukraine against a potential Russian invasion, top-line FY22 funding numbers, and other contentious policy riders. This marks an ambitious schedule for omnibus negotiations during the recess and the weeks to follow.

After being stalled in Congress for weeks, BBB Act negotiations are slated to return to the Congressional foreground. President Joe Biden publicly acknowledged last week that his social and clean energy package will be forced to narrow in scope. “I think we can break the package up, get as much as we can now and come back and fight for the rest later," Biden said. He mentioned two components that he hopes to negotiate into the package. “One is the Child Tax Credit, and the other is help for the cost of community colleges." These two provisions and many others form the original multi-trillion dollar package could be passed in a variety of ways. At the top of the list is the piecemeal approach, which would trigger issues within the reconciliation process and would need a ruling from the Senate Parliamentarian. The main climate provisions seem to have enough support in the Senate so far, leaving billions of dollars in funding for health care, labor and education to resolve. Sen. Joe Manchin (D-WV), who was chiefly responsible for stopping the initial House-passed BBB package from being considered in the Senate, called for a “clean sheet of paper” regarding restarting negotiations on the legislation. 

The House will introduce their version of the U.S. competitiveness bill “soon” according to Speaker Pelosi, with the aim of investing in semiconductor production, increasing research capacity and enhancing supply chain efficiency. Last year, the Senate passed the U.S. Innovation and Competition Act (S. 1260), which authorizes $190 billion for U.S. technology and research to compete with China and provides $52 billion to increase U.S. semiconductor production. President Biden said last week that surging inflation had "everything to do with the supply chain" and that the United States had the capacity to become self-reliant on the computer chips it needed to manufacture automobiles. The White House Competition Council will meet today to discuss efforts to promote economic competition while driving down prices. This all comes as a recent report cited the U.S. hitting a 40 year high in inflation.

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