(AP/Alex Brandon/J. Scott Applewhite/Photo montage by Salon)

The GOP's insidious Christmas list: How congressional Republicans are planning to screw the country this holiday season

While most people are busy soaking in the holiday spirit, Republicans are planning to gut essential regulations


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David Dayen
December 1, 2015 3:57PM (UTC)

It’s that time of year again. Twinkling lights are strung outside suburban McMansions, jolly Santas bounce children on their knees at local malls, and Congress prepares to pass unwanted, damaging legislation.

This is the Capitol Holiday Rush, and it has become as familiar as Salvation Army bell ringers at supermarkets. Republican leaders recognize that even the 24-hour, social media-infused news cycle doesn’t matter in the month when Christmas carols and shopping sales predominate. Holiday cheer becomes the perfect cover – an opportunity to aggressively force through otherwise unthinkable ideological priorities with minimal public outcry.

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The proven method of success here is to use policy riders – you could call them Christmas ornaments – hung upon a must-pass piece of legislation. The White House can reject the must-pass bill and risk unnecessary harm, or swallow it with the riders intact. Maybe all the ornaments don’t get through, but enough do to make a difference in the air we breathe, the products we buy and the economic risk we tolerate.

Last year, the Holiday Rush produced a repeal of Dodd-Frank-created regulation of derivatives, along with cuts to pensions and Pell grants, giveaways to Blue Cross and Blue Shield, rollbacks of protections for endangered species and contributions to the Green Climate Fund, and dozens of other ornaments. This year the wish list is no smaller: children of the 1 percent seeking presents from Santa have fewer desires than Republican Congressmen and their lobbyist backers.

There’s so much to be done, in fact, it won’t fit in one bill. The Holiday Rush started the day before Thanksgiving, when President Obama signed a defense authorization bill that, for the fifth consecutive year, includes restrictions on transferring detainees from the prison in Guantanamo Bay, Cuba. Obama’s usual move is to grouse about this and stress the need to close Gitmo, but to resignedly sign the bill for fear of “hurting the troops.”

This week, we’ll get the final details of a House-Senate compromise on a long-term transportation bill. As I wrote for Salon a couple weeks ago, the final product will likely include a package of 15 deregulatory financial services measures. It will also probably pay for maintaining roads and bridges by transferring the Federal Reserve’s capital surplus account, which covers temporary losses to the Fed’s balance sheet. This gimmick – the Fed already remits money to the federal Treasury every year, but sending it all at once allows Congressional bean counters to claim it “pays” for roads – could undermine the Fed’s independence, by forcing the central bank to focus on earning money instead of managing the economy.

Fed chair Janet Yellen had a choice to make, whether to allow a stealth undermining of the institution she controls, or endorse an alternative funding source: eliminating a 100 year-old, risk-free dividend the Fed gives to big banks. Politico gave away the game a couple weeks ago: the Fed quietly preferred the transfer of the surplus account to cutting the bank dividend. Yellen would rather wound the Fed than take profits from the banks.

That’s not all for the Holiday Rush. There’s also a package of “tax extenders” – mostly corporate tax giveaways routinely advanced every year. And Congress may rewrite federal education policy in time for Christmas break as well.

But the big present, the White House Christmas tree of legislation, is the omnibus spending bill to fund the government beyond the current deadline of December 11. House Speaker Paul Ryan has openly stated that “there will have to be some riders” in the spending bill for it to advance through Congress. Hundreds of riders already embedded in Hosue spending bills take aim at financial, environmental, health care, campaign finance and labor rules.

A key pre-Thanksgiving test of whether some deregulatory riders have bipartisan support produced a big victory for the powerful auto dealer lobby, when 88 House Democrats voted to chill Consumer Financial Protection Bureau scrutiny of racial discrimination in car lending. Expect that rider atop of the list of demands for the omnibus, with Republicans pointing to its bipartisan support to force it through.

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Treasury Secretary Jack Lew announced last week that any riders weakening Wall Street reform in the omnibus would trigger a veto from the President. These include measures gutting CFPB funding, delaying a Department of Labor rule that would force financial advisors to act in the best interest of their clients, and raising the $50 billion asset threshold that triggers more stringent regulatory scrutiny for financial firms.

But recent events will make it harder for the White House to hold the line. The only Congressional vote that has broken through the media bubble lately is the Republican bid to restrict Syrian refugee transfers to the United States. That will likely emerge as a key rider in the omnibus, either requiring Department of Homeland Security sign-off for every refugee or blocking resettlement funds for the families. If the White House takes a stand – and so far they have strongly opposed changes to refugee policy – they may offer other riders safe passage as compensation.

Even if the White House waves a Syrian refugee rider through, the high-profile fight keeps other riders shrouded in darkness – and in the Holiday Rush, secrecy is the main goal. The Intercept obtained a recording of a strategy call by energy lobbyists, welcoming the Syrian refugee rider as giving cover to their efforts to nix environmental regulations.

Without an agreement on riders by December 11, the government shuts down. But it’s easy for Democrats and the White House to quietly submit to Republican hostage demands, amid non-stop renditions of "Jingle Bells." And this year, there are even more distractions: to the extent anyone is tuning into the news, they’re getting a steady diet of Donald Trump and the presidential race. Congress is non-existent in the priority order, yet for the time being they still make the laws, and this inattention allows for plenty of mischief.

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There’s no real solution to this problem, but a couple things are worth a shot. One, while you can’t restrict Congressional legislating to non-holiday periods, it is worth demanding that they do their job on time. The traditional calendar sets the beginning of the fiscal year on October 1, meaning that Congress is supposed to have completed all spending bills – the must-pass legislation most ripe for rider shenanigans – by that time. This has become optional for years, and there’s no real organizing around holding lawmakers to that timetable, and preventing the Holiday Rush.

In addition, even a small pushback on a particular rider can make a difference in Washington, if the leadership feels the pressure. Congress makes this as hard as they can by scheduling their most devious schemes in between Christmas parties, but it’s not impossible. It just takes some awareness and engagement.

That’s the ultimate antidote to the Holiday Rush. But we don’t have Bernie Sanders’ political revolution just yet, with millions of fully engaged citizens. Which makes it more likely we’ll wake up on New Year’s Day with a legislative hangover, wondering just what was passed while we were too busy making merry.


David Dayen

David Dayen is a journalist who writes about economics and finance. He is the author of "Chain of Title: How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud," winner of the Studs and Ida Terkel Prize, and coauthor of the book "Fat Cat: The Steve Mnuchin Story." He is an investigative fellow with In These Times and contributes to the Intercept, the New Republic and the Los Angeles Times. His work has also appeared in the Nation, the American Prospect, Vice, the Huffington Post and more. He has been a guest on MSNBC, CNN, Bloomberg, Al Jazeera, CNBC, NPR and Pacifica Radio. He lives in Los Angeles.

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