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Tags: Federal | Spending | Accord | Democrats

Federal Spending Accord Reached as Democrats Cave on Some Issues

Tuesday, 09 December 2014 07:57 PM EST

Congressional leaders agreed Tuesday evening on a spending bill to keep the U.S. government operating past Dec. 11 as Democrats accepted Republican demands to ease rules for banks and clean water, a Senate aide said.

The banking provision would be a big victory for Wall Street, letting JPMorgan Chase & Co., Citigroup Inc. and other lenders keep swaps trading in units with federal backstops.

Senate Majority Leader Harry Reid earlier Tuesday said that though Democrats opposed the Republican-sponsored policy proposals, his party wouldn’t be responsible for shutting down the government. The Senate aide spoke on condition of anonymity.

“There’s no reason the government should shut down,” Reid told reporters. He said Republicans were “going at some of the basics that we believe in and have become part of our makeup, that has been clean air, clean water.”

The House plans to vote on the $1.1 trillion measure on Thursday, according to a leadership aide who spoke on condition of anonymity.

Timing of a Senate vote hasn’t been announced, though current government funding ends that day. Congress would have to enact a stopgap plan if the spending measure isn’t passed by then. Reid has said the Senate may need to work through the weekend.

Clean Water

In addition to the Dodd-Frank measure on swaps trading, the spending bill would allow exceptions to clean-water laws for agricultural refuse, and block funding for rules to tax and regulate marijuana in the District of Columbia.

Some Senate Democrats oppose the Dodd-Frank proposal, including Sherrod Brown of Ohio and Elizabeth Warren of Massachusetts. Warren in a statement Tuesday called the change “reckless.”

Lawmakers included the provision in the 2010 Dodd-Frank law to protect taxpayers against bank losses after souring derivatives trades spurred a U.S. rescue of the financial industry in 2008.

The Federal Reserve and Office of the Comptroller of the Currency provided a two-year delay in 2013 on the condition that banks take reasonable steps to move swaps to affiliates that don’t benefit from federal deposit insurance and discount borrowing.

Representative Maxine Waters, the top Democrat on the House Financial Services Committee, said in statement the measure would be “risking our homes, jobs and retirement savings once again.”

Deportation Policies

The spending plan would put off until early 2015 a fight over Republican efforts to defund President Barack Obama’s plan to ease deportation policies for undocumented immigrants.

The policy disputes preview the partisan battles that will dominate Congress in 2015 when Republicans will control the Senate and have a larger majority in the House.

Democrats agreed to the changes after fighting off several others. Those omitted include revisions to District of Columbia gun laws and six other Dodd-Frank-related policy proposals, according to a Democratic aide who sought anonymity to discuss the talks.

The aide said Democrats also headed off 25 changes to environmental regulations, including those governing greenhouse gases, fish and wildlife and ceiling fans as well as one blocking climate research.

Gun Ammunition

The aide said the plan includes a proposal pushed by the National Rifle Association that lets gun manufacturers use lead to produce ammunition, and a labor provision exempting claim adjusters from overtime requirements during major disasters.

Senate Finance Chairman Ron Wyden, an Oregon Democrat, said the bill includes a one-year extension of a ban on taxing Internet access.

Reid said earlier Tuesday that if the House included the District of Columbia marijuana provision in the bill, “it’s going to be hard to take it out over here. But I oppose it.”

While the spending bill would fund most of the U.S. government through September 2015, the Department of Homeland Security would be financed only through February, said a House aide who sought anonymity to discuss the private talks

An agreement on the spending bill is a victory for Republican leaders seeking to clear the agenda to advance other items next year.

Lawmakers overcame the biggest risk to the spending bill last week as House Speaker John Boehner rejected Tea Party Republicans’ insistence on using it to defund Obama’s immigration orders. Instead, on Dec. 4 Boehner let members vent with a symbolic vote of disapproval.

Democratic votes probably will be needed for House passage as the spending measure is opposed by some Republicans who wanted to force a confrontation on immigration this month.

© Copyright 2023 Bloomberg News. All rights reserved.

Congressional leaders agreed on a spending bill to keep the U.S. government operating past Dec. 11 as Democrats accepted Republican demands to ease rules for banks and clean water.
Federal, Spending, Accord, Democrats
Tuesday, 09 December 2014 07:57 PM
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