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“Lame Duck” Legislative Session Begins in Washington

With the 116th Congress slated to be established on 3 January 2019, newly elected members have already arrived in Washington for orientation. However, a short “lame duck” legislative session will be held first beginning on 13 November through the Christmas break. That session will be led by the Republican Party in both chambers and include various lawmakers who have either lost their re-election bids or announced their retirement.

Members of Congress will consider a number of important issues during the lame duck session. The most critical matter facing lawmakers is that only five of the 12 appropriations bills for the federal government have passed and funding for the agencies covered by the other seven bills expires on 7 December. The departments of Defense, Health and Human Services, Labour, Education and Veterans Affairs are funded through October 2019, but funding for all other departments and agencies depends on passage of some sort of appropriations legislation or, at a minimum, “continuing resolutions.”

A particular concern is whether there will be timely passage of appropriations legislation to keep the Department of Homeland Security operating beyond 7 December. President Trump has threatened to allow a “partial government shut-down” unless funding for DHS provides more than US$20 billion for a U.S.-Mexico border wall, one of his key 2016 campaign pledges. Multiple press reports also indicate that Secretary of Homeland Security Kirstjen Nielsen is about to be replaced. Other press reports speculate that Secretary of Commerce Wilbur Ross, Secretary of Interior Ryan Zinke, Secretary of Defense James Mattis and/or Chief of Staff John Kelly could also soon be leaving the Trump administration, although the White House has not confirmed any of these rumours. 

A lack of funding for DHS would directly affect U.S. Customs and Border Protection, one of DHS’ component agencies. In prior government shutdowns, CBP’s essential border inspection functions were maintained while less time-critical elements – such as work on new computer functionality or the issuance of binding rulings by the Office of Regulations and Rulings – were not carried out until the shutdown ended. 

The “Farm Bill” is another piece of legislation that was not completed before the mid-term elections. The previous Farm Bill expired on 30 September, and while the House and Senate have both passed different versions of the legislation a conference committee tasked with reconciling the differences between the two bills has not yet been able to complete its job. Although the Farm Bill’s primary focus is on U.S. domestic agricultural and food security issues, it is also seen as a safety net for farmers who may have been negatively affected by the Trump administration’s trade policy. Moreover, it includes certain other international trade, credit and export promotion programmes.   

The other major issue for the lame duck session is leadership planning for the 116th Congress. In the Senate, no major leadership changes are anticipated with the Republicans still in control, although there will be some changes in committee leadership. In the House, the current speaker of the House is retiring and the Republicans must decide who will be their minority leader, along with other leadership positions. More critically, the Democrats will be electing the new speaker of the House. Nancy Pelosi, the House Democrats’ leader for the past 16 years, including as speaker of the House when the Democrats were last in the majority, is making a strong bid to become House speaker in a House Democratic closed-door election to be held on 28 November.

Meanwhile, observers largely believe that the changes in congressional representation will allow President Trump to continue his hard line on trade issues. There has been support among both Republicans and Democrats for Trump’s focus on objectionable mainland Chinese trade policies (although somewhat less for the particular methods he has chosen), which could embolden him to continue that approach. For example, he could make good on threats to raise tariffs on even more imports from mainland China or open a new investigation on worker rights issues in that country. Both parties have been more muted in their support for other trade restrictive measures the president has taken or threatened, including higher tariffs on steel, aluminium, automobiles and auto parts, but analysts say that with each party controlling one chamber of Congress prospects for any effort to overturn those measures are dim.

However, the changes could also make it more difficult to secure approval of the U.S.-Mexico-Canada Trade Agreement, some observers say. For example, Rep. Neal and other Democrats have said they intend to push Trump to further strengthen the agreement’s labour, environment and enforcement provisions, even though they represent an upgrade from NAFTA. While the current trade promotion authority law guarantees a congressional vote on a USMCA implementing bill regardless of any Democrat objections, if those concerns are not sufficiently addressed a Democrat majority could either vote the bill down or revoke its TPA protections, which in either case would effectively kill the agreement. On the other hand, in such an event Trump could opt to withdraw from NAFTA and blame Democrats for leaving U.S. workers worse off.

House Democrats have also said they plan to subject Trump administration trade policies to more active scrutiny through investigations and hearings. This oversight could influence the development of trade agreements the White House plans to negotiate with the European Union, the United Kingdom and Japan. It could also serve as a brake on more extreme measures the president might consider such as withdrawing the United States from the World Trade Organisation. There could also be a renewed effort to advance legislation limiting the trade authorities wielded by the executive branch, an effort that has gained some bi-partisan support but is not deemed likely to succeed in the near future.

Content provided by Picture: HKTDC Research
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