Bloomberg News

Tech Visas to Trade Ignored by Least-Productive Congress (1)

December 10, 2013

U.S. Capitol Building

U.S. Congress has taken plenty of time off this year. The House has been out 191 days, and the Senate 199 days. Photographer: Andrew Harrer/Bloomberg

Business Roundtable lobbyists wanted 2013 to be the year lawmakers, free of immediate election pressures, would revamp U.S. immigration policy, pass a debt-lowering budget and expedite a pair of trade deals.

Instead, Congress is on pace to have its least productive year ever, with just 56 pieces of legislation signed into law so far. The former record low, reached in 1995, was 88 new laws.

‘‘The major issues that we think are necessary to jump-start the American economy continue to languish,” said Bill Miller, top lobbyist for a group that represents chief executives of companies such as Wal-Mart Stores Inc. (WMT:US) and Microsoft Corp. (MSFT:US)

As the business agenda lagged, Congress this year completed work on measures such as one that speeds disabled veterans through airport security and another that converts some federal land in Wyoming into a local shooting range.

Bigger-ticket items -- expanding skilled-worker visas sought by technology companies, restoring defense spending for weapons systems and lowering tax rates -- didn’t come to a vote in both chambers.

The reasons are many. Partisan rancor grew deeper as a result of the October government shutdown. Elected officials in both parties fretted about primaries for party loyalists who would accuse them of abandoning their principles.

Time Off

Plus, Congress has taken plenty of time off this year. The House has been out 191 days, and the Senate 199 days. And leaders gobbled up much of the agenda with debate on measures the other chamber had no plans to consider.

The Democratic-led Senate passed measures boosting the nation’s $7.25 hourly minimum wage and prohibiting employers from firing or refusing to hire workers because of their sexual orientation, measures that went nowhere in the House.

Meanwhile, the Republican-led House voted 46 times this year to repeal the 2010 health-care law, measures the Senate has no plans to consider. Republicans’ insistence on curtailing Obamacare led to the 16-day government shutdown in October.

With weightier decisions pushed into 2014, many lobbyists say they doubt lawmakers can overcome partisan divisions before midterm elections where Republicans seek to retake control of the Senate and Democrats try to cut into the 232-seat Republican House majority.

Also, the immigration, trade, deficit-reduction and other matters must compete for time against a possible revision of the U.S. tax code and a multiyear highway bill that faces opposition from lawmakers backed by anti-tax Tea Party movement.

Immigration Measure

Whether Congress will complete a revamp of immigration policy is very much in doubt, said Carl Guardino, president and CEO of the Silicon Valley Leadership Group. While the Senate passed a comprehensive immigration measure in June that included skilled-worker work visas benefiting technology companies, the House took no action this fall.

“By delaying a solution and taking this into an election year, they’ve turned Mount Whitney into Mount Everest,” said Guardino, whose San Jose, California group’s members include Intel Corp. (INTC:US) and Apple Inc. (AAPL:US) California’s Whitney is the largest mountain in the contiguous 48 American states, yet less than half as tall as Everest, the world’s largest.

The split-party gridlock that began after Republicans took control of the House in 2011 is creating uncertainty in the U.S. economy and for businesses, said Ed Yardeni, president and chief investment strategist at Yardeni Research Inc.

‘Positive’ Gridlock

“There was a time not long ago that gridlock was seen as a positive for the economy and for industry,” Yardeni said. “Gridlock was a sign of success in our political system, because it showed the system was in balance. But now the factions are so far apart and their differences so irreconcilable that it’s creating problems for the economy.”

After three years of standoffs over the budget and the U.S. deficit, negotiators are now eying only a limited plan to ease some of the automatic cuts next year. That deal wouldn’t end uncertainty for holders of U.S. debt and for businesses, Yardeni said.

Defense contractors receive signals about what weapons systems the government might buy from the separate annual defense authorization and defense appropriations measures, said Dan Stohr, a spokesman for the Aerospace Industries Association, which includes Lockheed Martin Corp. (LMT:US) and General Dynamics Corp. (GD:US) as members.

Defense Authorization

While Senate and House negotiators yesterday reached agreement on a compromise Pentagon authorization bill that could pass by year’s end, defense firms still lack the kind of lawmaker consensus they need on specific expenditures in an appropriations bill, Stohr said. They also can’t be assured Congress will agree on new deficit-cutting targets, he said.

“There are serious doubts about whether it could pass both houses,” Stohr said of a budget plan that would curtail some of the defense-spending reductions.

Randy Belote, a spokesman for General Dynamics, says the automatic cuts prevent the Falls Church, Virginia-based weapons manufacturer from making decisions about staffing levels for specific programs, and the cuts will worsen matters.

“While we began to see the impact in 2013, 2014 has all the earmarks of being horrible,” he said. “We’re imploring Congress to adopt a stable budget that we can work towards.”

Other executives bemoan delays in advancing the biggest tax-code changes since 1986. Fred Smith, chief executive officer of FedEx Corp. (FDX:US), says putting off a revamp off misses opportunities to help job creation and spur the economy.

‘Not Spending’

“We are not spending enough for equipment and software, and that’s why we can’t create the jobs,” Smith said Nov. 15 on CNBC.

Some lobbyists say they see at least some chance to push legislation next year, particularly limited measures that could help cut red tape.

The House in September passed legislation that streamlines the permitting and environmental reviews for mining projects, and Democratic Senator Ron Wyden of Oregon and Republican Senator Lisa Murkowski of Alaska are working on a version. Nancy Gravatt, a senior vice president at the National Mining Association, said that raises the prospects of changing the regulations next year.

“It’s probably the bright spot,” Gravatt said. “The actual movement of legislation that benefits mining and minerals has really been limited.”

Banks’ Priorities

Small banks haven’t given up on action in 2014 on measures important to them, including changes to housing finance policy, said Paul Merski, the top lobbyist and chief economist for the Independent Community Bankers of America.

At the same time, independent banks are focusing on more than 20 regulatory modifications that would help the industry.

“Because of midterms, many members are going to want to go home and campaign on accomplishments,” Merski said. “It’s hard to campaign on gridlock. I think there will be some willingness early on to form some comprises and alliances and get some things over the finish line and to the president.”

Meanwhile, 2013 is shaping up to be a year that will be remembered for roadblocks and delays in Congress, punctuated by occasional half-steps.

Scores of measures were put off, including a reauthorization of the Amtrak passenger rail system, and not a single annual appropriations bill was completed. If the annual defense authorization bill isn’t acted on this year, it will be the first time ever.

Farm Bill

Meanwhile, negotiators on a farm bill that benefits processors including Archer-Daniels Midland Co. (ADM:US) pushed their work into early next year after failing to reach an agreement on food-stamp cuts. And Congress probably won’t agree by year’s end to extend tax breaks that expire Dec. 31, affecting wind turbine makers, motorsports track owners, filmmakers and mass-transit commuters.

While Obama’s approval ratings are near record lows, the public’s view of Congress is at rock bottom.

A Nov. 7-10 Gallup Poll found that Americans’ approval of the way Congress is handling its job dropped to 9 percent, the lowest in the polling firm’s 39-year history of asking the question. The poll of 1,039 U.S. adults had a margin of error of plus or minus 4 percentage points.

To contact the reporter on this story: Laura Litvan in Washington at llitvan@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net


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