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WASHINGTON'S LABYRINTHINE WAYS
By Otto J. Hetzel
Otto J. Hetzel is a professor of law emeritus at Wayne State University and practices law in Washington, D.C.
The House Wrestles with the Unthinkable-Loss of Substantial Numbers of Members in a Terrorist Attack. On June 2, 2004, the House failed, by a vote of 63-353, to pass H.J. Res. 83, proposing an amendment to the Constitution allowing governors to appoint replacements if more than half of the state's House representatives died in a terrorist attack so that Congress could still act. While senators already can be appointed by governors, opponents refused to accept other than direct election of representatives. The resolution would have allowed appointees to act until new elections could be held; current office holders were to nominate in advance two persons as possible replacements so members could temporarily be replaced without changing the political balance of the body. Resolving these political concerns is integral to any solution. Unless interim appointments can be made, some members fear that a president who survives some catastrophic event could exercise dictatorial powers until elections in affected states could be held. Recently enacted legislation sets a forty-five-day maximum for such elections. So much for checks and balances during that time. Six weeks in an emergency status could have long-lasting effects.
Adoption of Budget Resolution Appears Unlikely Before Congress Adjourns. Despite ostensible Republican control of both Houses of Congress and the Presidency, "pay as you go" demands by Democrats and a handful of Republicans in the Senate, requiring that any future tax cuts be offset either by spending cuts or additional tax revenues, have created an impasse in adopting a 2005 budget resolution. The number of days Congress will be in session is dwindling, especially when breaks will be taken for each party's convention.
A budget resolution sets the "marks" for various appropriation committees. The House is proceeding informally in the interim to allocate funds to its committees. Neither tax increases nor cuts in popular programs is viewed as politically palatable. So, handling the costs inherent in making permanent the President's 2001 tax cuts that primarily benefit the wealthy, his stated primary domestic agenda, may have to await fall elections results.
Another consideration preventing consensus is the increasing discomfort being felt for adding to the mounting annual deficits already in excess of $400 billion, especially for fiscal conservatives of both parties. If the tax cuts were made permanent, an additional $1.7 trillion could be added to the deficit over the next ten years. The failure to enact a budget resolution also means tax matters will continue to be subject to Senate rules requiring sixty votes to cut off debate. Three important tax cuts, however, do appear to have sufficient bipartisan support to be enacted permanently: the child tax credit made applicable to those left out initially, extension of the 10 percent bracket to cover more middle income taxpayers, and a reduction in the taxes creating a "marriage penalty."
Senate Consideration of Military Funding Delays Vote on Class Action Changes. In order to address military spending measures, Senate Majority Leader Bill Frist (R-Tenn.) deferred a vote on a bill that would transfer jurisdiction over many class actions from state to federal courts, where restrictions would prevent bringing many of the suits. He also did not have the sixty votes needed to force a vote. Acceptance of the military funding bill will require resolution of a number of disputed issues in addition to approving further billions to fund added costs for ongoing military operations, such as funds for new body and equipment armor, a military pay raise, the handling of disposal of nuclear waste, troop levels in Iraq, and spending for missile defense and new nuclear weapons.
Senate Approves Emergency Request for a Further $25 Billion for Carrying on Military Operations in Iraq and Afghanistan Adding It to $422 Billion Military Spending Bill, But Imposes Prior Approval and Reporting Requirements on Its Use. In an indication of increasing congressional resistance to providing a blank check for military operations, while the Senate with unanimous bipartisan support added the additional funds requested by the White House as "support for the troops," unusual provisions were imposed requiring advance consultation with congressional leadership and a written report five days before commitment of these funds. Members of both parties voiced criticism of the Pentagon's previous inaccurate estimates for the cost of operations. The bill would also extend military health care coverage to National Guard and Reserve personnel who currently constitute 40 percent of the troops serving in these operations, an expense justified to ensure that they are "medically fit" when called up.
A Warning That the Impact of Tax Cuts and Increased Military and Domestic Security Spending Is About to Come Home to Roost. Federal agencies have been advised by the Office of Management and Budget (OMB) that spending for discretionary domestic programs will take a big post-election hit in the Fiscal Year 2006 budget that will be determined starting next January. The OMB memorandum, "Planning Guidance for the FY 2006 Budget," sets formulas that would mean, for instance, that educational spending for that fiscal year would be reduced by $1.5 billion, veterans' medical support by $900 million, and the National Institutes of Health by $600 million. Ironically, these are programs currently touted by the White House as reflecting Administration priorities in the current election.
The memo is consistent with an announced White House policy of reducing the budget deficit by over half over the next five years, through 2009, without raising taxes or reducing military and domestic security spending. By then, the total impact of such cutbacks would mean that $45 billion less would be available for domestic discretionary spending even without consideration of inflation's impact on programs such as housing, nutrition aid for poor pregnant women and children, and environmental protection. The effect of extending tax cuts and reducing domestic spending needs to be understood. It is essentially a transfer of income from those who currently need this assistance to those who are the far wealthier beneficiaries of the tax cuts.
To put this into perspective, domestic discretionary programs amount to under 17 percent of federal spending, so without reductions elsewhere, cuts will be into the "meat" and perhaps in some cases even into the "bone" of support for low- and moderate-income citizens. Domestic policy issues are clearly major considerations on the table in this fall's elections, and showing the impact of making tax cuts permanent should not be hidden, but needs to be explained and justified up front.
Legislation Recreating the U.S. Administrative Conference Under Consideration. Congress terminated a small but critical federal agency in 1995, the U.S. Administrative Conference (ACUS), which provided widely accepted recommendations for fair, efficient, and effective procedures for administrative agencies. Representative Chris Cannon (R-Utah), chair of the Subcommittee on Commercial and Administrative Law of the House Judiciary Committee, held hearings in May receiving testimony supporting recreation of the conference from Justices Scalia and Breyer, each of whom had been involved with the conference during its earlier existence. The American Bar Association has officially added its support for revival of the conference, which operated on a bipartisan basis and provided expert evaluation of administrative processes.
D.C. District Court Overrules the Federal Trade Commission (FTC) and Holds Lawyers Exempt from Gramm-Leach-Bliley Act's Privacy Notice Provisions. Unless reversed on appeal, a D.C. federal district court decision holding lawyers exempt from FTC regulations requiring notice of privacy policies to clients under Title V of the Act (those forms financial institutions send you and doctors require patients to acknowledge) means the FTC will not investigate or initiate legal action against attorneys who provide financially related legal services to individual clients. The action brought by the ABA pointed out that mandatory rules of attorney conduct, enforceable on the state level, provide better protection for client confidentiality. The FTC must decide whether to appeal by July 12, 2004.
Committee Appointed to Review Judicial Discipline and Disability Policies. Chief Justice William H. Rehnquist has created a committee to review judicial implementation of the Judicial Conduct and Disability Act of 1980 that will be chaired by Justice Stephen G. Breyer, who earlier served as counsel to the Senate Judiciary Committee when it adopted the Act. The committee, made up of former chief judges of courts of appeal and Rehnquist's administrative assistant, is to respond to criticism of failing to implement the 1980 Act and, in particular, to discipline judges who do not adhere to the minimum sentencing guidelines imposed by the U.S. Sentencing Commission. House Judiciary Committee Chair, Representative F. James Sensenbrenner, Jr. (R-Wis.) lauded creation of the committee to respond to his criticisms.
President and Vice President Each Retain Private Counsel in Investigation Arising Out of Leak to Press by White House Source of Identity of Covert CIA Agent. This White House has now come under the same scrutiny accorded to its recent predecessors as a Department of Justice investigation progresses (the Attorney General has personally recused himself and the Special Counsel Act has lapsed) as to "who and why" a CIA agent's identity was leaked to the press, among them, Robert Novak, who published it in his column. A grand jury has been meeting and White House aides have testified. Newspaper accounts indicate an interview with the Vice President has occurred, perhaps to confirm statements made by aides in those proceedings. Prosecutors have subpoenaed some reporters, a step that cannot be taken under prosecutor guidelines until other avenues have been exhausted. The news media involved have indicated they will fight the subpoenas.
Revealing covert agent identities by those under a duty of secrecy can potentially trigger criminal prosecution. Former Ambassador to Iraq, Joseph Wilson, a career diplomat who has criticized Bush's handling of the situation in Iraq, after originally being asked by the CIA to investigate the matter, publicly challenged the President's assertion in his 2003 State of the Union Address that Saddam Hussein had sought to purchase uranium in Africa. While the White House ultimately conceded that evidence to support the President's statement was insufficient and probably inaccurate, some person(s) in the White House apparently wanted to punish Wilson for speaking out. Calls were made to the press deliberately leaking his wife's identity as a covert CIA operative, some claim, to discredit his statements. Wilson is now on tour for his book, The Politics of Truth, that describes the incident.
While White House Counsel can advise the President, when potential criminal matters may be involved and the President might be personally interviewed, obtaining outside counsel retains his personal attorney-client privilege. Counsel identified as possibly representing the President has had relevant experience in such situations as an attorney for one of the principals in Watergate and the Iran-Contra matters.
Courts Approve Plaintiff Efforts to Establish Negligence in Handgun Distribution. The federal Ninth Circuit Court of Appeals allowed a wrongful death action to proceed against a gun manufacturer and rejected an attempt to obtain an en banc rehearing of the panel's 2-1 decision. An action was brought against Glock, Inc. and gun sellers, alleging negligence in the use of a distribution system that allowed the weapon to get into the hands of illegal buyers. It was used by a white supremacist to kill or injure five persons at a Jewish Community Center in Los Angeles County.
In other litigation brought by New York City against the firearms industry, a federal magistrate has permitted the city to obtain federal ATF data that trace the path of guns used in crimes. The judge rejected objections of Justice Department attorneys based upon language in appropriations measures stating that no federal funds could be used to release such tracing data, holding that Congress did not intend to restrict civil litigants from receiving firearms data under judicial subpoena.
The city's action is based upon the contention that the industry's marketing and distribution practices amount to a public nuisance by allowing criminals access to the weapons. A similar battle for access to such data is currently underway in Chicago's suit against the industry. In an earlier unsuccessful suit by the NAACP, such data were released by ATF, although access was strictly limited.
o Enforcing Bipartisanship. While civility and bipartisanship have suffered in Congress during these current contentious times, measures important to the majority party, such as appropriation bills like the huge six-year package for highway and transit spending currently in negotiations, have provided an opportunity for Democrats to force Republicans to respect the Democrats' right to participate on conference committees that fashion the final versions of legislation. Democrats have used the procedures required to create a conference committee that resolves differences between each House's version of legislation to stall resolution of the differences.
Last year, Republicans excluded and prevented Democratic members from even participating in discussions in some conference committees. In response, Democrats have resorted to procedural tactics to stall proceedings and regain their involvement in these final conference decisions. Republicans lack sufficient votes of their own to reach the sixty votes needed to impose cloture and cut off debate on any measure. Certain procedural steps are needed to set up and appoint Senate conferees to a conference committee. Normally, unanimous consent would be provided for the Senate to "insist" on its version of the legislation involved, request a conference with the House, and authorize appointment of conferees.
Democrats have refused to agree to handle these measures that way and have insisted upon separate votes on each step as a means to slow down the process so that their demands will be recognized. This seems to have worked on the transportation legislation because they would not allow matters to proceed until they were given a pledge by Senate Republicans that a final bill would not be agreed to that "undermines the bipartisan working relationship that has existed in the Senate" on such matters. Of course, there is also the implied threat given a close upcoming election that Democrats might take over control of the Senate, and there might be a "payback" opportunity.
HUD and Public Housing Industry Using Negotiated Rulemaking Procedures to Set Basis for Operating Fund Procedures. After three months of negotiations, on June 9, 2004, housing industry sources announced that a number of issues relating to establishing costs to be supported with federal funds for operation of public housing were resolved through a negotiated rulemaking involving representatives of various federal and state governments and housing industry organizations. A new development-based system of accounting, management, and funding will affect methods for calculating public housing operating costs, income, and utilities. The new rule is expected to take effect in October 2004. It will set a funding formula that would be applied to funds Congress provides for FY 2006
As a primary basis for establishing per-unit month (PUM) costs, the committee agreed to use a congressionally mandated 2003 Harvard Cost Study that determined cost levels for operation of FHA private sector facilities, supplemented for inflation, and with some additional payments and fees. Public housing authorities (PHAs) managing in excess of 250 units would convert to a project-based accounting system and project-based management within five years following publication of the rule.
The committee agreed to a transition period to phase in changes since some PHAs will receive increased allowances for costs and others with lower allowable expense levels would be decreased, An asset management fee of $4 PUM would be provided to PHAs managing over 250 units and half that to the others, that convert to project-based management and accounting. An additional PUM of $2 will be provided to offset information technology expenses and a similar amount as well for costs involved in operating as a public entity, since the Harvard Study looked to private management models to establish costs. Costs determined for resident participation would be added to allocations of the allowable expense levels approved. Reductions in funding provided as units are deprogrammed or demolished would continue to be phased in. To establish the level of rent collections from residents, for purposes of establishing the subsidy levels, rent collection levels for 2004 would be used, although appeals in cases of hardship would be allowed.
Congress left it to the participants to work out the details, and the negotiation process that is new to HUD seemed relatively successful, although not all differences were resolved. HUD is not required to accept the final regulation, but may find it hard not to do so.
Your correspondent
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