Skip to content

Katrina Sinks Estate Tax

With the aftermath of one of the worst natural disasters to hit the United States still unfolding and the death of Chief Justice William Rehnquist opening up a second vacancy on the Supreme Court, a new round of political conundrums and partisan wrangling greets Members of Congress as they return to work today after more than a month away from Washington.

[IMGCAP(1)] The floor of both chambers today will likely be reserved for speeches on a resolution expressing sympathy for the as-yet-unknown number of victims of Hurricane Katrina. A separate resolution will address Rehnquist’s death.

But behind closed doors, Republicans will be meeting to overhaul their entire fall schedule while simultaneously trying to undo the damage their party — and particularly their president — has suffered from perceptions that disaster relief measures were bungled at the federal level in the wake of Katrina.

Meanwhile, Democrats will likewise be plotting their next moves, and are already attempting to seize on dissatisfaction with the Bush administration’s handling of the evacuation of the citizens of New Orleans.

Senate Democrats appeared to score political points by using the backdrop of the humanitarian crisis in Louisiana, Mississippi and Alabama as a way of pushing a controversial repeal of the estate tax off the Senate calendar.

Majority Leader Bill Frist (R-Tenn.) announced Monday that the Senate would not take up the estate tax as planned, but would instead focus on legislation related to the hurricane disaster, including action today on a bill to allow federal courts to move their proceedings in times of emergency or disaster. Frist said the Senate would take up the estate tax at an unspecified “later” date.

Republican and Democratic leaders from both chambers will also meet with Bush this afternoon to talk about hurricane relief efforts, while rank-and-file Members will be briefed by Cabinet members this evening.

On Wednesday, the resolution honoring Rehnquist will be the only piece of business in the Senate due to the chief justice’s funeral. On Thursday, however, the Senate will move to the Commerce-Justice-science appropriations bill. Frist said the CJS spending bill would provide, among other things, small-business emergency loans and funding for local law enforcement, which he described as “much-needed funding in this post-Katrina environment.”

Even if Frist had decided to move forward with the estate tax in the absence of fresh legislation dealing with the hurricane disaster, Democrats were prepared to temporarily filibuster the estate tax bill today, said Jim Manley, spokesman for Minority Leader Harry Reid (D-Nev.). Though many Democrats were originally expected to support the bill, Reid rallied his troops to oppose going to the measure by making the case that Congress should be trying to help the victims of Katrina instead.

Frist noted the new political realities in his Monday press conference, saying the Senate’s “responsibility is to act and to act aggressively with meaningful solutions.” Frist then broadly outlined a number of initiatives he believes Congress will have to deal with in the near future, including extending unemployment insurance for hurricane victims, giving victims access to housing, encouraging the rebuilding of residential neighborhoods, providing tax incentives for job creation for displaced workers, dealing with problems in shipping and agriculture along the storm-ravaged Mississippi River, and another supplemental spending bill to $10.5 billion Congress authorized for relief efforts Friday.

Reid’s office on Monday also released a list of proposed Katrina-related legislation that could be quickly brought to the Senate floor this week, and many of the Democratic proposals appeared similar to Frist’s list, though they are likely to differ in the details.

Reid suggested that Congress pass measures ensuring that victims of the hurricane have immediate access to Medicaid, the health insurance program for the poor, as well as access to food stamps and low-income housing vouchers from the Department of Housing and Urban Development. Reid has also proposed a measure to give tax breaks to people who offer shelter to victims as well as a bill to provide more funding to schools taking in displaced students.

Last week, House Minority Whip Roy Blunt (R-Mo.) suggested that Congress may well need to pass an economic stimulus package, complete with tax cuts, in order to ensure that Katrina’s effects on gas prices and other commodities do not drag down the entire U.S. economy. That sentiment was echoed by Frist. Republicans have also floated a revamped energy bill that could more immediately deal with rising gas prices, to supplement the measure Congress passed at the end of July.

No changes in the House schedule were announced by Monday afternoon, but Ron Bonjean, spokesman for Speaker Dennis Hastert (R-Ill.), said on Friday that “Hurricane Katrina takes immediate priority for the Congressional leadership.” In fact, relief efforts will be topic A at House GOP leadership team meetings this week, he noted, while secondary issues will include developing a comprehensive fall legislative agenda.

In the meantime, the House is scheduled to take up a Coast Guard reauthorization bill and several other noncontroversial measures.

The fall agenda in the House is expected to include conference reports on the nine annual appropriations bills that have yet to be sent to the president. Many of them face tougher hurdles than in past years because this is the first year in which bills with disparate subcommittee jurisdictions must be reconciled. In previous years, the issues each bill dealt with matched exactly, even if the monetary amounts did not. Of course, given the fact that the deadline for appropriations bills is Sept. 30, it seems likely that many, if not most, of the nine remaining will be wrapped into a catchall spending measure.

In addition, House GOP leaders have said they want to deal with an immigration law rewrite that at the very least will include border security issues, a budget reconciliation measure that is slated to slash Medicaid funding and agriculture programs by billions of dollars, and potentially a Social Security overhaul bill.

Democrats tried to poke holes in other parts of Congress’ fall agenda, which will likely force lawmakers to remain in session well into November. With hundreds of thousands of newly homeless and jobless people displaced by Katrina, Manley said GOP plans to cut as much as $10 billion from Medicaid may not be “the right thing to do at this point.” Those cuts are expected to come as part of a filibuster-proof budget reconciliation package later this month.

Even though the legislative aspects of Congress’ response to Katrina won’t be fully addressed this week, the tragedy on the Gulf Coast threatens to overshadow other important and contentious issues in the weeks to come — notably, public unrest over the Iraq war. During the August recess, Iraq became the issue that dominated the month as anti-war protesters amassed outside Bush’s Crawford, Texas, ranch and lawmakers found themselves dealing with constituents concerned about the continuing death toll in Iraq.

Even a stalwart conservative like Sen. Trent Lott (R-Miss.) said before the hurricane hit, “Even in my state … patience is running thin. Our patience is not long [for wars]. After all, most of the great wars of history seldom lasted for more than four years, and we’re getting close to four years here.” But, obviously, now Lott’s attention is focused elsewhere.

Still, dealing with anxiety among Democrats and Republicans over the Iraq war and the administration’s plan for winning it may simply be postponed until later this fall. After all, Senate Armed Services Chairman John Warner (R-Va.) has vowed to call Defense Secretary Donald Rumsfeld before the panel in the next few weeks to answer questions about progress in the Iraq war.

In yet another hearing that could prove embarrassing to the Bush administration, Warner also plans to call witnesses this fall to testify about who has been held accountable in the Abu Ghraib prisoner abuse scandal in Iraq, according to his spokesman.