August 8, 2022

CALENDAR:
The House will come back on Friday to take up the Democrats’ tax-and-spend bill that just
passed the Senate yesterday. Then both chambers will be off until the middle of September.

THIS WEEK IN THE HOUSE:

The House will consider the Senate amendment to H.R. 5376, the reconciliation bill.

LAST WEEK IN THE SENATE:

The Senate came back to work on Monday, and voted to invoke cloture on the nomination of
Elizabeth Wilson Hanes to be U.S. District Judge for the Eastern District of Virginia.

On Tuesday, the Senate voted to confirm her to that position. Then the Senate took up S. 3373,
the Honoring Our PACT Act, a bill to provide healthcare and disability benefits to more than 3.5
million veterans who had been exposed to toxic substances during the course of their service.
The bill came to the floor under an agreement that allowed three Republican amendments at a
60-vote threshold.

First up was an amendment offered by Kentucky Republican Sen. Rand Paul. Sen. Paul’s
amendment would have offset the increased spending authorized by this law by temporarily
prohibiting the spending of any federal funds by the U.S. Agency for International Development
other than spending for Israel. That amendment went down by a vote of 7-90. For those keeping
score, the other six senators to vote with Sen. Paul were Marsha Blackburn of TN, Mike Braun of
IN, Bill Hagerty of TN, Ron Johnson of WI, Mike Lee of UT, and Roger Marshall of KA.

Then the Senate took up the Toomey amendment to S. 3373. This is the amendment that caused
a huge fight in the Senate, and I’m going to take a moment to explain it. The bill would have
taken $400 billion in veterans’ healthcare spending and moved it from the discretionary
spending side of the government’s accounting books to put it on the mandatory spending side of
the ledger. The difference, of course, is that discretionary spending requires an affirmative vote
every year, while mandatory spending does not – mandatory spending is on autopilot. That
maneuver, if allowed, would leave a $400 billion hole in the discretionary spending side that
could later be used for anything a future Congress wanted. Even though Sen. Toomey is retiring
at the end of the current Congress and won’t be here for future spending fights, he recognized
that this was a recipe for fiscal irresponsibility. So, he proposed an amendment that would have
removed that provision, and ensured that veterans’ health spending stayed on the discretionary
side of the ledger. Democrats, not surprisingly, did not like his amendment, and they defeated it
by a vote of 47-48.

Then the Senate took up an amendment offered by Tennessee Republican Sen. Marsha
Blackburn that would have allowed veterans seeking care under this law to go outside the VA
system if necessary, to find care at non-VA facilities. Democrats opposed this as an attempt to
“privatize” the VA system. The amendment went down to defeat by a vote of 48-47 – remember,
even though the “aye” side got more votes than the “nay” side, it fell short of the 60-vote
threshold that was required.

On Wednesday, the Senate considered the matter of Finland and Sweden joining the North
Atlantic Treaty Organization. Before moving to a vote on final passage of the resolution, the
Senate first considered an amendment offered by Sen. Paul of Kentucky. The amendment was
quite simple: “Article 5 of the North Atlantic Treaty does not supersede the constitutional
requirement that Congress declare war before the United States engages in war.” Article 5 of the
North Atlantic Treaty is the provision that provides that if a NATO ally is a victim of an armed
attack, each and every other member will consider that act of violence as an armed attack
against all.

Utah Republican Sen. Mitt Romney opposed the amendment, and argued that the amendment
was unnecessary, because the NATO treaty already has language that says provisions in the text
should be carried out in accordance with its member nations’ own constitutional processes The
Paul amendment went down by a vote of 10-87. The other nine senators who voted with Paul
were Mike Braun of IN, Ted Cruz of TX, Steve Daines of MT, Josh Hawley of MO, Ron Johnson of
WI, James Lankford of OK, Mike Lee of UT, Cynthia Lummis of WY, and Roger Marshall of KA.

Then the Senate considered the resolution of ratification to allow Finland and Sweden to join
NATO, and passed it by a vote of 95-1, with only Missouri Republican Sen. Josh Hawley voting
against it.

On Thursday, the Senate took up S.J.Res. 55, a Congressional Review Act resolution of
disapproval against a Biden Administration Council on Environmental Quality rule relating to
“National Environmental Policy Act implementing Regulations Revisions,” which would make
permitting for infrastructure projects more complicated. That resolution passed, by a vote of 50-
47. Then the Senate voted to confirm Roopali H. Desai to be a U.S. Circuit Judge for the Ninth
Circuit Court of Appeals. Ms. Desai’s confirmation took just 50 days from nomination to
confirmation vote, the fastest confirmation for a circuit court nominee since the Clinton
Administration. And if you want to know what’s so special about her that she deserved such a
speedy confirmation vote, it’s this – she previously worked as Arizona Sen. Kyrsten Sinema’s
campaign attorney, and at the time her confirmation vote was scheduled, Majority Leader
Schumer was wooing Sen. Sinema for her support on the Democrats’ reckless tax-and-spend bill.
Then the Senate confirmed a ton of Biden nominees by voice vote – 32, by my count.

The Senate took a break Friday, and then came back into session Saturday to take up the tax-
and-spend reconciliation bill.

First up were two bed-check votes, to make sure all the Democrats were in town and able to
make it to vote. The first was a vote to discharge from the Committee on Environment and
Public Works the nomination of David M. Uhlmann to be Assistant Administrator of the
Environmental Protection Agency. That motion passed by a vote of 51-39. Then, by a vote of 56-
35, the Senate confirmed Constance J. Milstein to be Ambassador of the United States to the
Republic of Malta.

Then Leader Schumer brought up a Motion to Proceed to H.R. 5376, the original House-passed
reconciliation bill. After holding the vote open for more than two hours – I’m told, but have not
been able to confirm, that the vote was held open because Leader Schumer’s office had not
properly coordinated the timing of the vote with the vice president’s office, and consequently
she was not in the chamber and available to cast her needed tie-breaking vote – the motion was
agreed to by a vote of 50-50, with Vice President Kamala Harris finally entering the chamber and
casting the tie-breaking vote.

Then began the 20 hours of debate that is available when a bill moves under the rules of
reconciliation. Except no one wanted to spend all 20 hours debating this bill. So after about four
hours of debate, they started voting on amendments. The first was voted on at 11:31 PM last
night, and the last was voted on at 2:50 PM this afternoon. Over the course of more than 15
hours, the Senate considered 36 amendments and motions to commit, all but two of which were
rejected.

During the course of the Vote-a-Rama, Democrats voted to double the size of the IRS; increase
taxes on oil and gas; sell oil from the Strategic Petroleum Reserve to communist China; and allow
the IRS to audit companies and individuals with incomes lower than $400,000.

Democrats wanted to add a provision capping out-of-pocket spending on insulin at $35 per
month for patients in Medicare and in private insurance plans. The parliamentarian ruled that
Democrats could do that for Medicare patients, but not for patients in private insurance plans.
Democrats left the entire provision in the bill anyway, daring the Republicans to challenge the
inclusion of private insurance plan patients. Republicans challenged it, and then Democrats tried
to waive the rule to keep the whole provision in the bill. Seven Republicans voted with all the
Democrats to waive the budget rules, but such a motion requires 60 votes, so the Democrats’
attempt failed, and now the $35 per month cap on spending on insulin will only apply to
Medicare patients.

Toward the end of the Vote-a-Rama, South Dakota Republican Sen. John Thune offered a clever
amendment that would exempt some of the subsidiaries of private equity firms from the 15
percent corporate minimum tax. He knew from a conversation he’d had with Sen. Sinema that
she had been surprised to see on Saturday, when Democrats introduced the final version of the
bill, that these subsidiaries had been targeted for the 15 percent minimum tax, and that had
upset her – she did not want them taxed further.

Thune proposed to offset the $35 billion in lost tax revenue (what you or I would call “tax
savings”) by extending for a year the $10,000 cap on SALT deductions that is set to expire in
2025. That provision alone could have caused significant trouble in the House – there’s a group
of House Democrats that have already vowed they will not consider any tax measure that does
not include significant reform or outright repeal of the SALT deduction cap, so extending the
deduction cap was a brilliant maneuver on Thune’s part. The Thune amendment passed with all
GOP votes and seven Democrats – the pairs of Democrat senators from Arizona, Georgia,
Nevada, and Maggie Hassan of New Hampshire – in other words, the four most vulnerable
Senate Democrats running for reelection this year, plus their Democrat seat-mates from three of
those states.

Now Senate Democrats were in a fix. They’d just seen their bill amended in a way that would
make it virtually impossible to pass the House. So they immediately turned around and offered a
clever amendment of their own, to revise the funding offset mechanism in the Thune
amendment. Offered by Virginia Democrat Sen. Mark Warner, the amendment strikes the
extension of the $10,000 cap on the SALT deduction and instead extends for two years a tax
code provision that limits how much in losses pass-through businesses are allowed to deduct
each year.

That exchange came at the end of the Vote-a-Rama – in fact, those two votes were the final two
votes on amendments before Senate Republicans called a halt to the voting spree. A few
minutes later, the Senate voted to pass the amended version of H.R. 5376 by a vote of 50-50,
with Vice President Kamala Harris casting the tie-breaking vote.

And then they were done.

IRAN NUCLEAR DEAL:

The on-again, off-again negotiations between Iran and the United States on reviving the 2015
nuclear deal are once again back on, and close to completion, according to the European Union’s
senior negotiator at the talks, reported the Wall Street Journal on Sunday afternoon. But it
remains unclear whether Iran will agree to the final deal that’s on the table.

The text could be finalized within hours, he said, but Iran still has to decide whether to yield on
its demand that the United Nations close its three-year investigation into Iran’s nuclear program
as a condition of signing on to the revived agreement.

The talks had stalled in March, when Iran refused to concede on its demand that the U.S. remove
the Iranian Revolutionary Guard Corps from its list of Foreign Terrorist Organizations. But the
talks resumed last week, when Iran softened that demand. Instead, Iran insisted that the U.N.
atomic energy agency’s probe – which is highly sensitive to Iran, which has always claimed it
never sought nuclear weapons in the first place – be shut down. Iran does not want the
International Atomic Energy Agency to find evidence that would lead it to conclude that Iran has,
in fact, been seeking to develop nuclear weapons. Western negotiators insist they will not
intervene to close down the IAEA investigation.

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PELOSI VISITED TAIWAN:

WaPo: Opinion: Nancy Pelosi: Why I'm Leading A Congressional Delegation To Taiwan

NYT: Why Pelosi's Visit To Taiwan Is Utterly Reckless

Axios: McConnell, 25 Republicans Say They Support Pelosi's Taiwan Trip

Bloomberg: China Announces Sanctions On Nancy Pelosi Over Taiwan Visit

AP: Taiwan Says China Military Drills Appear to Simulate Attack

IRAN NUCLEAR DEAL:

WSJ: Iran, U.S. Close In on Nuclear Deal Text but Hurdles Remain

ANOTHER TRY AT A RECONCILIATION BILL?

Hill: Inside The Secret Manchin-Schumer Deal: Dems Shocked, GOP Feels Betrayed

NYT: Democrats' Climate Deal Isn't Done Yet. Here Are The Remaining Hurdles

Bloomberg: Sinema's Silence On $433 Billion Manchin-Schumer Bill Keeps Everyone Guessing

Hill: Democratic Anxiety Grows Out Of Sinema's Silence

Hill: GOP Targets Sinema While Going All Out To Block Democratic Bill

WSJ: Sinema Says Democrats Agree To Remove Carried-Interest Tax Increase From Climate Deal

Hill: Sinema Announces Deal With Schumer On Taxes And Climate

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Politico: Sinema Signs Onto Dems' Party-Line Bill Ahead Of Momentous Saturday Vote

NJ: Sinema Tags Onto Reconciliation After Slashing Tax Provisions

WSJ: Sen. Krysten Sinema Wins Tax Changes To Democrats' Climate Bill

WSJ: Got Hidden Income? The IRS May Get More Money To Find You

RC: Democrats Race To Prep Sweeping Budget Bill For Weekend Votes

WE: Manchin Joins Schumer In Helping IRS Expand Its Abuse Of Taxpayers

WSJ: The IRS Is About To Go Beast Mode

NRO: Joe Manchin & Democrats' Inflation Reduction Act Of 2022 Is Absurd

Breitbart: Analysis: Latest Version of Senate Democrats’ Reconciliation Bill Raises Taxes on Small
Businesses

Brady on Manchin-Biden Bill: Attention Wal-Mart Shoppers -- More IRS Audits Headed Your Way

WSJ: Strassel: Whom Does AARP Serve?

WE: Parliamentarian Approves Energy and Drug Price Provisions in Inflatino Reduction Act

WSJ: Senate Passes Democrats' Climate, Healthcare and Tax Bill

NRO: Reform IRS, Don't Increase Budget

MISCELLANEOUS:
Hill: Senate Defeats Rand Paul Amendment Clarifying War Powers in NATO Resolution

RC: Veterans Toxic Exposure Bill Clears Senate After Tortuous Path

Politico: Republican Push To Overturn Biden Permitting Rule Passes Senate, With Manchin's
Support

NJ: Republicans Threaten Government Shutdown Over Infrastructure Permitting

AP News: Updates To Electors Law Desperately Needed, Senators Declare

NRO: Biden Signs Executive Order Directing Medicare Funding To Abortion Travel
Hill: Senate Votes 95-1 To Add Sweden, Finland To NATO

Fox News: Rand Paul Vows To Get Answers On COVID-19 Origins In Gain-Of-Function Hearing

AP News: The Downside: US Strike Shows Afghanistan Still Terror Base

Politico: Senate Sends Veterans Health Care Bill To Biden

Hill: GOP Agrees To Deal On Veterans Bill

WSJ: Moore v. Harper And Marc Elias's Curious Ideas Of Democracy'

WE: Department Of Education Miscalculated Student Loan Spending By $311B: Watchdog

Politico: Splitsville: McConnell And McCarthy Break On Big Votes