CEO Hawaii Human Resources, Inc. (HiHR)
Chairman, The Hawaii Group, Inc. (The HiGroup)
808-695-2221mdelaney@thehawaiigroup.com

The Hawaii Group and Hawaii Human Resources
Acquire New Companies and Expand to the Island of Hawai`i

Following its 2009 launch and five years of steady growth thereafter, Hawaii Human Resources (HiHR) and The Hawaii Group (HiGroup) continue to expand their reach, serving an ever-widening geographical area and offering a broad range of professional services to employers across the state. With the recent acquisition of HRBenefix’s Hawaii Operations and Kiria Payroll Services on March 31, 2014, HiHR now will have a solid presence on the Big Island, serving all areas from Kona to Waimea to Hilo.

HiHR’s purchase of HRBenefix’s Hawaii Operations and Kiria Payroll Services’ assets adds 51 new clients to HiHR’s’s already impressive roster. With 725 employees located on the Big Island, Maui, and Oahu, and an estimated $20 million annual payroll, these acquisitions represent a significant step towards HiHR establishing a strong presence on the Big Island.

Based in Kailua-Kona, longtime local businessmen Larry Marr and Jesus Menendez launched HRBenefix and Kiria Payroll Services in 2011. Both Marr and Menendez will continue working with HiHR, along with the internal staff members who will stay on under the new HiHR ownership and name. HiHR’s Big Island team will remain focused on maintaining strong client relations while continuing to grow HiHR’s Big Island client base.

As many of HRBenefix’s clients currently operate with employees on the ground in California, Arizona, Oregon, Colorado, Nevada, and Wisconsin, Marr and Menendez will also work on enhancing and expanding PEO and payroll services on the mainland from their Colorado and Pennsylvania offices.

“This is an exciting development for me both professionally and personally,” said Matthew S. Delaney, CEO and Chairman of HiGroup and HiHR. “I’ve known Larry since he worked for Hilton, and Jesus and I go way back to the 1990s, when we both worked at Sunterra Resorts. We all have similar hospitality backgrounds and a strong focus on transparency, immediate action, and top-quality client service. We all share nearly identical business philosophies and that will help make this a seamless transition, both for our internal staff and our clients.”

“In addition to preserving continuity with quality services and security by keeping our new Big Island team in place, HiHR provides our new clients access to increased resources, expertise, cutting-edge technology, and other business support services. Now they can rely on us for seamless integration and instant access to staffing, recruiting, accounting, and marketing services through The Hawaii Group’s family of service entities” stated Scott Meichtry, co-owner of The Hawaii Group.

”We are delighted to partner with the Hawaii Group to offer even more service options for our clients” said Jesus Menendez, COO at HRBenefix. “This is a big step forward for our Big Island Team, and furthers our commitment to providing outstanding service options to Hawaii’s small businesses” added Menendez.

“In addition to the Big Island presence, both parties will continue to look for ways to partner together on mainland expansion opportunities” Delaney added.

About HiHR and HiGroup
Hawaii Human Resources, Inc. (HiHR) is one of Hawaii’s fastest growing companies. Formed in 2009, HiHR provides customized human resources solutions for over 900 Hawaii businesses covering over 10,000 employees across Oahu, Maui, Big Island, Kauai, and Molokai. HiHR offers comprehensive outsourcing support, including human resource advisory and consulting services, health benefits administration, workers’ compensation and risk management, payroll, accounting, and business insurance.

The Hawaii Group (HiGroup) is the parent company to a family of companies that provides complementary services to businesses of all sizes in Hawaii. HiGroup encompasses human resource administration (HiHR), employment and staffing solutions (HiEmployment), accounting (HiAccounting), health care staffing (HiNursing), home care staffing (HiHomeCare), and marketing (HiMRK). Learn more atwww.TheHawaiiGroup.com

About HRBenefix
HRBenefix, with offices in Denver, CO, Souderton, PA, Salt Lake City, UT and Toronto, Canada, provides outsourced employee administrative services as a Professional Employer Organization (PEO) for companies large and small. It offers human resources and payroll outsourcing, health insurance, workers’ compensation, and retirement services administration, as well as human resources compliance and consulting.

HRBenefix Films, LLC
Earlier this year, HRBenefix created HRBenefix Films LLC, a joint venture between Dreams Film Studiosand HRBenefix. Offering payroll management and PEO services for employees working on films, TV series, documentaries, and TV commercials, HRBenefix is pioneering a new area of customized, outsourced employee administration services to the audiovisual industries in the United States, Spain, and Canada.

The House GOP this election year is suffering from something of a Goldilocks complex, in which some members dismiss any given proposal as too hot, and others complain it's too cold, while only a shrinking majority say it's just right. To pass anything without Democratic support, Republicans have precious little margin for error and must strike a balance to satisfy members on both sides of the party's ideological divide.

They achieved it in passing Rep. Paul Ryan's fiscal blueprint—but barely.

The annual budget vote has largely been an uneventful affair since Republicans took back the majority in 2011. In fact, the proposals put forth by Ryan, easily the most popular and well-respected Republican in the House, have represented islands of consensus amid waters churned by internal strife. GOP lawmakers have largely set aside ideological battles and rallied around Ryan's efforts, which are governing blueprints that achieve the party's goal of balancing the budget.

This time was different. A record number of Republicans—12—voted against Ryan's proposal, and the opposition came from all corners of the party. Some moderates thought it slashed too much spending; some conservatives thought it didn't cut enough; others voted against it for a variety of political or ideological purposes.

On top of that, a bloc of conservatives were tempted to join the opposition to send a message to GOP leadership about a maneuver—some called it "sneaky"—to pass a controversial bill by voice vote weeks earlier. Had only seven more GOP members defected, Ryan's budget would have been defeated on the House floor, and Republicans would have gone home for the two-week Easter recess embarrassed and facing fresh speculation about a shakeup in leadership.

Ironically, disaster was averted when some of the conference's most reliable "no" votes wound up supporting the budget, edging a victory for Ryan (and GOP leadership). Lawmakers like Justin Amash of Michigan, Joe Barton of Texas, and Tim Huelskamp of Kansas, all of whom had voted against previous iterations of the Ryan budget, supported this year's version.

Still, the episode laid bare the challenges GOP leadership faces in attempting to pass anything of significance this year. With no Democratic support expected for major GOP proposals, Republicans must maneuver very carefully to secure the 218 Republican votes needed for passage (assuming every eligible member votes).

The Amashes, Bartons, and Huelskamps of the conference voted for the GOP budget. But would they, and like-minded lawmakers, assist leadership in passing a health care alternative? An unemployment bill? An immigration-reform package? History suggests that, unless those measures were tailored to appease the far-Right of the House GOP, the answer would be no.

Republican leadership officials have long been bearish on their ability in an election year to piece together that GOP coalition—especially when voting on big, controversial pieces of legislation—and have therefore settled on a strategy of passing safe measures aimed at uniting the party and keeping the spotlight on the shortcomings of Obamacare. That approach was validated by the budget vote.

For example, Ryan's budget, with its steep cuts to domestic spending programs, proved too conservative for several House Republicans seeking reelection in competitive districts. Rep. Chris Gibson of New York, who faces a stiff Democratic challenge from venture capitalist Sean Eldridge, voted no. So did 10-term Rep. Frank LoBiondo of New Jersey, who's bracing for one of the toughest reelection fights of his career. Both said the budget slashed too much spending, and both occupy vulnerable seats that could swing toward the Democrats with one risky vote.

On the flip side, for some GOP lawmakers, Ryan's budget was not sufficiently conservative. This was embodied by the Georgia delegation, where Reps. Paul Broun, Phil Gingrey, and Jack Kingston are fighting for the rightward flank in this year's Senate primary. Predictably, all three voted against the budget for not cutting deep enough, fast enough. (Broun and Gingrey had voted against previous Ryan budget; Kingston, desperate to demonstrate his ultraconservative bona fides, joined them this time.)

And then, as always, there was the reliable opposition from a predictably unpredictable bloc of Republicans who will skate to reelection in their dark-red districts, yet love to buck their party line nonetheless. In this camp are moderate Rep. David McKinley of West Virginia, who rejects Ryan's steep Medicare cuts; libertarian-leaning Rep. Thomas Massie of Kentucky, who said the budget didn't slash enough spending; and Rep. Austin Scott of Georgia, who said he preferred the Republican Study Committee's far-right alternative.

In the end, Ryan's standing within the conference made it narrowly possible to pass something that faced opposition from both sides of the ideological spectrum. But it's not likely to happen again. After all, if it was that hard to build consensus for a budget that achieves a laundry list of long-held GOP priorities, imagine the difficulty of finding the sweet spot on something more complex, such as a health care alternative (which Republicans were promised a vote on this year).

Republican leadership recognizes the Goldilocks complex. And, having barely escaped last week's budget vote, they understand better than ever the difficulty of getting it just right.

Every election year brings a new class of wealthy political outsiders hoping to book a ticket to Washington on their own dime. The special election in Florida's 19th Congressional District provides the latest example: Republican Curt Clawson loaned his own campaign $2.65 million and doused the district with TV advertising ahead of the April 22 primary in the safely Republican seat.

But most self-funders have their eyes trained on the November general election, and many have already spent hundreds of thousands of dollars toward that goal. The new batch of federal fundraising disclosures this week will give us a fresh look at which candidates are pumping their own money into their campaigns. In particular, keep an eye out for this group of 10 self-funders gunning for House districts, Senate seats, and governors' mansions across the country:

Tom Wolf (Democrat, candidate for Pennsylvania governor, contributed at least $10 million in personal funds)

Polling has Wolf as the indisputable front-runner in the Democratic primary thanks to name recognition from an avalanche of TV ads paid for with $10 million he's put toward his campaign. His money was originally thought to have come from the success of his family's kitchen-cabinet company, but the source of those funds has lately been a source of scrutiny and controversy. The Philadelphia Inquirer reported earlier this month that $4.45 million came from a personal bank loan that can't be repaid with campaign funds. Over $1 million more came from his stake in the sale of a contracting company that was illiquid, and the rest includes gains from the stock market. "I really cobbled together everything I had," Wolf said, indicating he doesn't have much more to give. At the end of the first quarter, Wolf reported $7 million in the bank. If he makes it through the primary he'll have to step up his ability to raise money through traditional avenues to compete with Gov. Tom Corbett, who spent over $25 million in his 2010 campaign.

Bruce Rauner (Republican, Illinois governor, $6.5 million)

Republican venture capitalist Bruce Rauner earned his millions over the course of a three-decade career with the Chicago-based private-equity firm GTCR. Rauner hasgiven more than $6.5 million to his campaign, but through the March primary he'd also raised an impressive $8 million in donations on top of that. Given that his estimated net worth is in the hundreds of millions, this shows a degree of restraint from a man who's capable of spending much, much more. His money could give him a big financial advantage over incumbent Gov. Pat Quinn, a Democrat, particularly given the high cost of paid exposure in the Chicago media market, which Rauner has been peppering with a continual stream of TV ads. Despite Rauner's seemingly inexhaustible resources, Democrats won't be at a loss for money themselves—the Democratic Governors Association and labor unions are expected to dole out big dollars to defend the party's most vulnerable governor.

David Alameel (Democrat, Texas senator, $3.75 million)

National Democrats haven't devoted significant resources to a Senate race in Texas in decades. But they're glad David Alameel did this time around. Alameel's campaign has been sustained almost entirely by a $3.75 million personal loan, and although he has virtually no shot of becoming the Lone Star State's next senator, his wealth could help Democrats avoid a major embarrassment. Alameel faces Lyndon LaRouche acolyte Kesha Rogers, who has repeatedly called for President Obama's impeachment, in a May Democratic primary runoff election, and the party would like to avoid having Rogers as a standard-bearer, even in a lost-cause campaign. Alameel, a Dallas dentist, certainly has the resources to continue to pour money into the campaign if he wants to—he also spent $4.5 million on an unsuccessful bid for a House seat in 2012.

George Demos (Republican, New York's 1st Congressional District, $2 million)

Demos is a former Securities and Exchange Commission lawyer making his second attempt at unseating Democratic Rep. Tim Bishop in this district covering the eastern half of Long Island. Through the end of 2013, Demos had loaned his campaign $2 million, which gave him an early start running TV ads, but his self-funding may all be for naught. He dropped out of the GOP primary in 2012 when the nomination appeared likely to go to 2010 candidate Randy Altschuler, and most of the New York GOP establishment is behind state Sen. Lee Zeldin, considered a top Republican recruit, in this year's primary.

Terri Lynn Land (Republican, Michigan senator, $1.7 million)

As Michigan has developed into a major 2014 battleground Senate race, Terri Lynn Land's commitment to spend $5 million on the Senate race could prove all the more crucial. Through the end of 2013, Land had pumped $1.6 million into her campaign account, which gave her a slight cash-on-hand advantage heading into 2014, and sheadded another $100,000 in the first three months of this year. Unlike the other Senate candidates on this list, however, Land does not have to worry about burning through her cash supply in a costly primary, and can focus entirely on Democratic Rep. Gary Peters.

David Perdue (Republican, Georgia senator, $1.65 million)

In the crowded GOP primary race for Georgia's open Senate seat, which includes three sitting congressmen, David Perdue has relied heavily on his own cash to compete. The former Dollar General and Reebok CEO has personally contributed $650,000 to his campaign through the end of 2013 on top of a $1 million loan, which together accounted for 65 percent of his total haul. He still lagged behind Rep. Jack Kingston in the overall GOP cash race; the congressman raised $4.2 million through the end of last year. Kingston's campaign recently announced it raised another $1.1 million in the first three months of 2014, meaning Perdue may have to dip back into his own account to keep pace as the race heats up, even though he said back in October he does "not believe in self-funding a campaign."

Sean Eldridge (Democrat, New York's 19th District, $715,000)

Eldridge is the husband of Facebook cofounder and New Republic Publisher Chris Hughes, and he has already put $715,000 toward unseating two-term Republican Rep. Chris Gibson in this upstate New York district. As Politico wrote last week, "that figure is sure to rise exponentially because he's promised to match each contribution he receives, dollar for dollar." Eldridge started a venture-capital firm, Hudson River Ventures, and has been investing in local businesses, but his wealth coupled with his youth and recent migration from Manhattan to the district will make it tough for him to avoid the perception that he's trying to prematurely buy himself a seat in Congress.

Mark Jacobs (Republican, Iowa senator, $521,000)

Like Perdue, Mark Jacobs used a personal cash infusion to help jump-start his campaign during the early stages of a multicandidate Republican primary. As of the end of 2013, Jacobs gave his campaign $321,000 and loaned it another $200,000, which together comprised 56 percent of all the money his campaign brought in. Hoping to set himself apart at the outset, Jacobs went up with his first TV ad in December, then aired a second in March. But like the rest of the GOP field in the Iowa, he remains widely unknown, according to a recent Suffolk poll. Given that, and Republicans from Mitt Romney to Sarah Palin endorsing rival GOP candidate Joni Ernst, it wouldn't be surprising if Jacobs's first-quarter report showed another significant personal contribution to help boost his bid.

Doug Ose (Republican, California's 7th District, $500,000)

Apparently, Doug Ose has missed being a member of Congress. So much so that the Republican who represented the area a decade ago (and left due to a self-imposed term-limit pledge) has put a half-million dollars of his own money behind his bid in the state's 7th District. Self-financing provided Ose with an early boost, as he was the first candidate in this race (one of the most competitive of the cycle) to go the air with a TV ad earlier this month. Ose is the only candidate to have reported his 2014 first-quarter totals, and while he will likely continue to lag behind Democratic Rep. Ami Bera in cash, it will be more telling to watch whether he outraises the other two GOP contenders in the race ahead on the state's open primary in June.

Mary Burke (Democrat, Wisconsin governor, $400,000)

Democrats might have overestimated Mary Burke's ability to self-fund her bid against Republican Gov. Scott Walker, and it could quite literally leave them shortchanged. Burke made her money as a former executive of Trek Bicycle, a company her father founded, and her personal wealth kept other Democrats out of the race from the start. Through the end of 2013, Burke had put over $400,000 toward her campaign, but in arecent interview with Wisconsin Public Radio she said she can't self-fund to the degree observers originally assumed. "I will put into this race what I can, but I can't self-fund it. I'm not a Ron Johnson or a Herb Kohl. I don't have that type of wealth," Burke said. Instead, she hopes to rely on traditional fundraising efforts. At the beginning of the year Walker reported $4.6 million in the bank compared with $1.3 million for Burke, leaving her with a lot of ground to cover.

The conservatives' exasperation with leadership is well known. And now, in discreet dinners at the Capitol Hill Club and in winding, hypothetical-laced email chains, they're trying to figure out what to do about it. Some say it's enough to coalesce behind—and start whipping votes for—a single conservative leadership candidate. Others want to cut a deal with Majority Leader Eric Cantor: We'll back you for speaker if you promise to bring aboard a conservative lieutenant.

But there's a more audacious option on the table, according to conservatives involved in the deliberations. They say between 40 and 50 members have already committed verbally to electing a new speaker. If those numbers hold, organizers say, they could force Boehner to step aside as speaker in late November, when the incoming GOP conference meets for the first time, by showing him that he won't have the votes to be reelected in January.

The masterminds of this mutiny are trying to stay in the shadows for as long as possible to avoid putting a target on their backs. But one Republican said the "nucleus"of the rebellion can be found inside the House Liberty Caucus, of which he and his comrades are members. This is not surprising, considering that some of the key players in that group—Justin Amash of Michigan, Raul Labrador of Idaho, and Thomas Massie of Kentucky—were among the 12 Republicans who refused to back Boehner's reelection in January 2013.

Amash, chairman of the Liberty Caucus, warned at the time that there would be a "larger rebellion" down the road if Boehner's leadership team did not bring conservatives into the fold. Such an insurrection never materialized, however, as Boehner deftly navigated a series of challenges last year and wound up winning over some of the malcontents.

But conservatives, increasingly irritated with what they see as a cautious approach taken by their leadership, are now adamant that Boehner's tenure should expire with this Congress.

"There are no big ideas coming out of the conference. Our leadership expects to coast through this election by banking on everyone's hatred for Obamacare," said one Republican lawmaker who is organizing the rebellion. "There's nothing big being done. We're reshuffling chairs on the Titanic."

Boehner isn't the only target. The conservatives find fault with the entire leadership team. Privately, they define success as vaulting one of their own into any one of the top three leadership spots. But they think they're less likely to accomplish even that limited goal with a narrow effort focused on knocking out one person or winning a single slot. That's why this time around, unlike the ham-fisted mutiny of 2013, rebels are broadening their offensive beyond Boehner's gavel.

Cantor, next in line for speaker and once considered a shoo-in to succeed Boehner, has found himself in conservatives' crosshairs in recent weeks.

With Boehner out of town in late March, Cantor was charged with pushing a "doc fix" bill across the finish line. When it became apparent the measure might not clear the House floor, Cantor authorized a voice vote, allowing the bill to pass without registered resistance. This maneuver infuriated conservatives, who felt that leadership—Cantor in particular—had cheated them. Rep. Mick Mulvaney of South Caroline yelled "Bullshit!" outside the House chamber.

Some conservatives are still seething.

"I'm getting used to being deceived by the Obama administration, but when my own leadership does it, it's just not acceptable," Rep. Matt Salmon of Arizona said last week, after Cantor met with a group of angry Republican Study Committee members.

Cantor told conservatives that a voice vote was "the least-bad option," given the circumstances. But many Republicans aren't buying it. Moreover, they said that with Boehner out of town, Cantor had an opportunity to impress them with his management of the conference—and didn't.

"It's an issue of trust. If you want to have a majority that is governing, and a majority that is following the leader, the rest of us need to be in a position where we trust our leadership," Labrador said this week, adding, "When you have politicians actually playing tricks on their own party, and their own members of Congress, I think that erodes the trust the American people have in the rest of us."

"I can't think of a time where I felt my trust had been more violated since I've been here—and that's pretty stiff competition," Mulvaney added.

Cantor's allies say the whole episode has been overblown. But there's no question that it has stirred fresh disillusionment within the rank and file. And it's not just the tea-party members up in arms. One House Republican who is friendly with Cantor, and hardly viewed as a troublemaker, predicted, "If there's another vote like [that], Eric won't be speaker. Ever."

This backlash has emboldened some of leadership's conservative critics. Now, they say, they might try to force Boehner out and also demand that Cantor bring on a conservative deputy before agreeing to vote for him as speaker.

"Eric would make that deal in a heartbeat," said a Republican lawmaker who supports Cantor but opposes Boehner.

Neither Cantor nor his office would comment on leadership races.

Even if Cantor does ascend to speaker, there could be fireworks further down the leadership ladder. Doubts persist about whether Majority Whip Kevin McCarthy, Cantor's closest friend in Congress, should earn a promotion to majority leader. The Californian is universally well liked, but some colleagues aren't sold on his performance as whip. And if McCarthy does earn the No. 2 spot, there will almost certainly be a free-for-all to succeed him as whip, imperiling the expected advance of Chief Deputy Whip Peter Roskam.

Amid all the bold talk about Boehner and Cantor and the other leaders, some conservatives are thinking smaller. There is talk of meeting with leadership officials this fall and making demands about steering committee appointments and chairmanships. The idea would be to redistribute the decision-making and shake up what Rep. Louie Gohmert calls the "centralized, stovepipe dictatorship" that runs the congressional wing of the GOP.

Some members are convinced that Boehner will spare everyone the drama and decide to leave on his own. Sources close to the speaker have begun leaving the exit door ever so slightly open, and rumors of his retirement are now running rampant throughout the conference.

"All of this hinges on whether John is running for reelection," Mulvaney, who refused to vote for Boehner's reelection in 2013, said of the potential leadership shuffling.

"I'd say about 80 percent of us expect him to step down after the elections," added one House Republican who has known Boehner for many years.

Boehner insists that he'll seek another term as speaker.

"Speaker Boehner is focused on the American people's top priority: helping our economy create more private sector jobs," said Boehner spokesman Michael Steel. "He has also said—publicly and privately—that he plans to be speaker again in the next Congress."

But conservative plotters promise that, unlike 15 months ago, they've got the numbers to prevent that from happening. Even if they can't recruit an alternative to pit against him, they'll tell Boehner in the November conference meeting that they plan to vote against him on the House floor in January "until kingdom come," one GOP lawmaker said.

It's similar to the strategy conservatives used in 1998 to depose Speaker Newt Gingrich, who gave up his gavel in November once it became apparent that conservatives had the numbers to block his reelection on the floor in January. In this case, Boehner won't be able to win a majority vote of the House if a large bloc of conservatives sticks together and votes against him. Sooner rather than later, the conservatives predict, the speaker would spare himself that humiliation and step aside.

But as of yet, there is no sign of a serious conservative challenger willing to run for a top leadership job, let alone for Boehner's.

Organizers are actively recruiting two highly respected conservatives—Jeb Hensarling of Texas and Jim Jordan of Ohio—hoping that one will agree to lead their opposition movement. But both have told colleagues they aren't interested. And the other frequently discussed scenarios, such as RSC Chairman Steve Scalise running for whip, would hardly qualify as the splash conservatives are determined to make.

The attempted overthrow in 2013 failed in part because conservatives didn't have an alternative candidate for on-the-fence Republicans to rally around. Now, with each passing day, organizers fear history could repeat itself.

"Somebody has to step forward," said Rep. Tim Huelskamp of Kansas, one of 12 Republicans who refused to back Boehner's reelection in 2013. "This is not something where after the election you can step forward. There's going to be months and months of [planning] needed."

Allies of the current leadership team dismiss the legitimacy of any challenge to the ruling order, and they predict that any conservative coup—especially one aimed at winning the speakership—will fail. One senior Republican said that there are only "three Republicans capable of winning majority support to become speaker of the House: John Boehner, Eric Cantor, and Paul Ryan."

This year saw more Republicans than ever vote against Budget Chairman Paul D. Ryan’s spending blueprint, which passed the House Thursday 219-205. Here is a breakdown of the 12 Republicans who voted against the Wisconsin Republican’s budget and why.

The Georgia Senate Hopefuls

Reps. Paul Broun, Phil Gingrey and Jack Kingston are three of the candidates in a crowded Georgia Republican Senate primary, and their voting patterns have aligned over the past several weeks as they’ve sought to minimize attacks from other camps.

Broun and Gingrey have voted against Ryan’s budgets in the past, but Kingston has been a reliable vote for leadership. That pattern broke Thursday, when Kingston joined his colleagues in voting against Ryan’s resolution. 

The Committee Exiles

Rep. Walter B. Jones of North Carolina was among the members leadership purged from plum committees in 2012, in part because they voted against leaders’ priorities too often. The defrocking did little to change their voting patterns. Jones and Rep. Justin Amash of Michigan voted against Ryan budgets previously and were among the first to say they would again do so this year. But Amash voted for it Thursday.

A spokesman for Amash said he did not vote for previous Ryan budgets because he believes they violated the law by calling for spending levels different from the parameters set by the Budget Control Act. This year, however, the budget is in line with an agreement Ryan hashed out with Senate Budget Committee Chairwoman Patty Murray, D-Wash., so he supported it.

Meanwhile, Rep. Tim Huelskamp of Kansas flirted with voting against the budget this year, but ultimately tallied a “yes” vote. Rep. David Schweikert of Arizona, the other member to be pulled from his committee assignments, has since come back into the fold; he voted for the budget Thursday.

The Conservative ‘Hell No’ Caucus

Reps. Thomas Massie of Kentucky and Rick Crawford of Arkansas voted against Ryan’s budget last year and repeated their “no” votes this year. Massie is in the same libertarian-leaning ideological camp as Amash and he has said he would support a budget with deeper spending cuts. Crawford has said he is seeking permanent spending controls, rather than a nonbinding resolution.

Reps. Austin Scott of Georgia also voted no, noting he voted instead for “the most conservative budget put forward, the RSC budget.” He added, though, “I have great respect for Chairman Ryan and the work he has put into crafting solutions for our country.”

The Vulnerable Incumbents

Rep. Chris Gibson of New York faces less-than assured re-election prospects in the general election, and he has voted against the Ryan budget previously. Gibson, a veteran, told local press in the past that the measure spends too much on the military. The Rothenberg Political Report/Roll Call rates this race a Tilts Republican contest.

Rep. Ralph M. Hall of Texas is facing a heated primary challenge from a conservative, and put his first “no” vote on the board for a Ryan budget this year, likely looking to inoculate himself from right-of-center attacks ahead of his runoff race.

The Newbies

Rep. David Jolly of Florida, who won a special election earlier this year, is one of only two members never to have voted for a GOP budget. In his rookie Ryan budget vote, Jolly stuck with the defectors.

Rep. Vance McAllister of Louisiana did not vote. He has been absent all week while he deals with a scandal.

Retiring Rep. Jon Runyan of New Jersey was also not present. His office said he was a no-show because he is recovering from surgery in his home state.

The Moderates

Rep. David B. McKinley of West Virginia has long voted against Ryan’s budgets, holding that they cut Medicare too deeply.

Frank A. LoBiondo of New Jersey issued a statement to CQ Roll Call saying the Ryan budget cut too much.

“While I remain concerned about the $17 trillion in national debt, my immediate focus is ensuring the residents in my district have the critical assistance they need to survive,” he said. “It has been incredibly disappointing and frustrating to watch the economy not fully recover, reinforcing  a lack of confidence in our businesses that stifles investment and job creation. With double-digit unemployment in my district, further reductions in food stamps, the children’s health insurance program, student loans and other essential domestic programs vital to the families I represent is not something I can support at this time.”

SARASOTA, Fla., April 3, 2014 /PRNewswire/ -- SUNZ Insurance Company announced today the recent hiring of Brian Fischer to serve as in-house legal counsel for the Sarasota-based company.

SUNZ Chief Operations Officer Glen J. Distefano said, "We are very pleased to have found such an experienced and reputable veteran for our in-house legal counsel. Brian's claims and premium expertise in the area of Workers' Compensation particularly in the Professional Employer Organization and Staffing industries is a tremendous addition to SUNZ and will help us enhance our quality assurance, operations and the future growth of our company."

Prior to SUNZ, Fischer focused on private practice in the area of Workers' Compensation law for over 27 years.  For the last 10 years, Fischer represented Professional Employer Organization, Staffing Companies and other corporations, handling various aspects of large deductible and insurance captive Workers' Compensation insurance programs. In addition, he negotiated program communications as well as disputes with insurance companies and disputes arising out of insurance company receivership proceedings; involving collateral, paid loss reimbursements, as well as premium and audit disputes.

Fischer has represented insureds through arbitration proceedings in both state and federal court before the National Council on Compensation Insurance (NCCI), the Florida Workers Compensation Appeals Board, and the Florida Office of Insurance Regulation. During this time, Fischer counseled several employee leasing companies in the development of and management of their internal claims handling process associated with large deductible Workers' Compensation programs. He is a long standing member of the Department of Financial Services Workers' Compensation Fraud Task Force and has represented and counseled numerous employers through the statutory stop work order process.

Fischer earned his Bachelor of Science from Florida State University in 1984 and his Juris Doctorate in 1987 from Shepard Broad Law Center at Nova Southeastern University.  He is admitted to practice in the State of Florida and the U.S. District Court, Southern District of Florida.

Fischer said, "With everything I have learned from 27 years of law practice in the Workers' Compensation system, from claims handling to fighting fraud to customer service, what a wonderful opportunity to join a carrier that puts such a focus on doing things the right way."

At SUNZ, Fischer's duties include the oversight and management of the claims handling process for its Professional Employer Organization and Staffing Company insureds as well as assisting with matters of reinsurance and regulatory compliance.

Read more: http://www.digitaljournal.com/pr/1831310#ixzz2yED3eeDG

Distinguishing employees who are full-time from those who are not takes up a good deal of real estate in final regulations published in the Federal Register on February 12 implementing the Act’s employer shared responsibility rules (the “final regulations”). When determining whether an employee is a full-time employee, it is also necessary to determine who employs the full-time employee. To identify the proper employer, the final regulations look to the “common law employer/employee” standard. In two-party employment arrangements, i.e., where the employer hires the employee directly without an intermediary, identifying the common law employer and the common law employee is a simple matter. This determination gets exponentially more complicated, however, when the employee is instead hired through a staffing firm or Professional Employer Organization (PEO).

The question of who is the common law employer/employee is not new. For purposes of the Federal tax code and ERISA, employers have historically been required to distinguish between workers who are their common law employees and workers who are not. This distinction is important, for example, when complying with payroll tax and withholding at the source provisions. It also affects the design and maintenance of tax qualified retirement plans and welfare plans. The Affordable Care Act’s employer shared responsibility rules (which are codified at Internal Revenue Code § 4980H) add another, compelling reason to properly determine a worker’s status as a common law employee: if at least one of an (applicable large) employer’s full-time (common law) employees qualifies for a premium tax credit from a public insurance exchange, then the employer may have liability under the Act’s employer shared responsibility requirements if the employer fails to make an offer of group health plan coverage to at least 95% (or 70% in 2015 under a transition rule) of its full-time (common law) employees. What’s at stake here is best illustrated with an example.

Employer A has 300 employees, all of whom are full-time. Of these, 250 are direct hires, and 50 are hired through Staffing Firm B. For all months during calendar year 2017, Employer A determines that the 250 direct hires are its common law employees. Employer A makes an offer of coverage under its group health plan to all of these employees. Staffing Firm B also makes an offer of coverage to all of its full-time employees, including the 50 workers placed with Employer A (whom Staffing Firm B has determined are full-time for Code § 4980H purposes). On audit, it is determined that the 50 workers placed through Staffing Firm B are the common law employees of Employer A and not Staffing Firm B. Absent the relief described below, Employer A would be deemed to make an offer of coverage during 2017 not to 100% of its full-time (common law) employees as it anticipated, but rather to only 83%. As a consequence, if at least one of Employer A’s employees qualified for a premium tax credit from a public insurance exchange, Employer A would incur a non-deductible excise tax for 2017 of over a half of a million dollars.

Comments submitted in response to the proposed Code § 4980H regulations urged the Treasury Department and the IRS to adopt a special rule under which an offer of coverage would be counted for Code § 4980H purposes if made by another, unrelated entity—e.g., under the circumstances outlined in the above example or in the case of a multiemployer or single employer Taft-Hartley plan. In response, the final regulations clarify that for purposes of Code § 4980H, an offer of coverage includes an offer of coverage made on behalf of an employer by an unrelated entity. However, where the employer is a client of a “professional employer organization or other staffing firm,” there is a further requirement:

“the fee the client employer would pay to the staffing firm for an employee enrolled in health coverage under the plan [must be] higher than the fee the client employer would pay to the staffing firm for the same employee if the employee did not enroll in health coverage under the plan.”

The combined reference to “professional employer organization or other staffing firm” is troublesome, in our view. In their informal comments, representatives of the Treasury Department and the IRS, expressing their own, non-binding views, assert (rightly) that these terms have no independent significance. That is, common law employer status does not depend on whether the third-party is a PEO or a staffing firm. But as a practical matter, PEOs and staffing firms are different. At least since 2002 (as a consequence of IRS guidance dealing with 401(k) plans maintained by professional employer organizations), it has been widely if not universally presumed that a PEO is not a common law employer, while the opposite is generally true in the case of mainstream staffing firms. Historically, contract and temporary workers placed by staffing firms have been treated as common law employees of the staffing firm and not the client organization. These conclusions are, to be sure, broad oversimplifications. But they have endured presumably because the multi-factor tests for establishing common law employee status are complex and difficult to administer.

Fortunately, there is nothing to prevent a staffing firm from taking advantage of the special rules relating to “offers of coverage on behalf of other entities,” but it will require some modifications to each firm’s administrative systems. The rule says nothing about how much higher the fee must be in cases where the worker placed by the staffing firm elects coverage. A nominal amount appears sufficient. What’s less clear is whether the increased fee must appear as a higher amount in the bill rate, participant-by-participant, or whether the incremental charge could simply be included in the aggregate bill rate (but with appropriate record-keeping back-up).

Separately, there is a lingering issue not addressed in the final regulation (since it is outside the jurisdiction of the Treasury Department and the IRS): where a staffing firm that makes an offer of coverage to a worker is determined not to be the common law employer, the plan under which the offer is made is most likely a multiple employer welfare arrangement. Such a plan would be required to file a Form M-1 annually with the Department of Labor. If the plan was self-funded, then it might be treated as an unlicensed insurance company for state insurance law purposes. If the plan is fully-insured, in most states it could not cover small groups (many state insurance codes do not permit combining a number of small group plans to make a large group plan). While many of the PEOs that offer group health plan coverage have claimed (and duly report their) MEWA status, to our knowledge no staffing firm has done so to date.

On balance, the provisions of the final regulations governing offers of coverage on behalf of other entities should be welcome. It will take some time, however, for standards and best practices to emerge. The relationship to other Federal laws and state insurance codes will also have to be sorted out.

Ray Callaway, who has been a carpenter for 27 years, works on a temporary dining room for the Harvard Business School in Boston in late 2013.

After more than six years, the U.S. private sector has at last regained the jobs lost in the Great Recession.

The economy added 192,000 jobs in March, the 42nd consecutive month of growth, the Bureau of Labor Statistics reported Friday. All the gains were in the private sector, pushing nongovernment employment to 116 million, just above the prior record set in January 2008, when the recession was just beginning. The private sector lost 8.8 million jobs in the recession and has gained 8.9 million since.

But the wounds of the recession are far from fully healed. Total payrolls remain more than 400,000 below their prior peak due to deep cuts in the number of government workers, especially at the state and local level. And the adult population (16 years and older) has grown by 14 million since the recession began, meaning the U.S. job market is nowhere close to fully recovered on a per-capita basis. The long-term unemployment crisis drags on, the legacy of what is by some measures the slowest recovery since World War II.

Nonetheless, the private-sector rebound marks a milestone, however partial. Here are a few other key nuggets from Friday’s report:

Solid growth: Some economists had predicted a monster jobs report in March after weak hiring to start the year. That didn’t happen: The gain of 192,000 jobs was pretty much consistent with the recent pace of growth. But it also turns out those early months weren’t quite as weak as initially thought; the government revised up its estimate for January and February growth by a combined 37,000 jobs. Taken as a whole, job growth is holding steady, neither accelerating nor slowing down.

Wages tick back down: Last month’s jobs report showed average wages jumping by 9 cents an hour, sparking a debate over whether the increase represented a one-month blip or an early sign that employers were being forced to raise pay to attract employees — a good thing for workers but also a possible harbinger of inflation. Friday’s report won’t resolve that debate, but it should ease inflation fears at least a little. Hourly wages fell a penny and are up a modest 2.1 percent over the past year.

The snow melts: Friday’s report does more to resolve another debate from last month’s report: how much of an impact winter weather had on the job market. The answer: a lot. With the snow melting in March, the job market began to return to normal. In February, 6.9 million full-time employees worked part time because of bad weather. In March, that number tumbled to 600,000. As a result, the average workweek — the number of hours worked by the average employee — fully reversed a three-month decline. That bodes well for hiring, because it suggests companies need more labor.

Good news in the labor force: The number of Americans with jobs — a different measure than the count of payroll jobs — grew by nearly half a million. But the unemployment rate held steady at 6.7 percent, as the number of unemployed workers grew slightly, too. That might sound bad, but it’s actually a good sign — the steep decline in the share of Americans working or looking for work has been one of the most worrisome trends in the slow recovery. Some 40,000 people re-entered the labor force to look for jobs, and the number of “discouraged workers” (people who have stopped looking for jobs because they don’t think they can find them) is down 13 percent over the past year. Both numbers are hints that the job market may be gaining enough strength to draw back in some workers who had given up.

Our usual caveat: The jobs report is probably the most important monthly economic report, but don’t take the numbers as gospel. The preliminary figures are routinely revised by tens or even hundreds of thousands, and the more detailed numbers have even bigger margins of error. The longer-run trends are more reliable, but treat any big claims — from this site or any other — with appropriate skepticism.

Four Republicans voted to bring an unemployment benefits extension to the floor last week but then voted to filibuster the bipartisan deal on Wednesday.

Dan Coats of Indiana, Bob Corker of Tennessee, Ron Johnson of Wisconsin and Patrick J. Toomey of Pennsylvania all voted Wednesday to block the bipartisan agreement led by Sens. Jack Reed, D-R.I., and Dean Heller, R-Nev.

Joining Democrats to pass the bill were Kelly Ayotte of New Hampshire, Susan Collins of Maine, Dean Heller of Nevada, Mark S. Kirk of Illinois, Lisa Murkowski of Alaska and Rob Portman of Ohio. They helped put the measure over the top, narrowly topping the 60-vote threshold, 61-38.

Final passage could be as early as Thursday.

We’ve posted the Senate clerk’s tally sheet showing how all the senators voted:

By Josh Kraushaar

Ask Republican voters if they support federal funds to pay for hurricane recovery and infrastructure improvement, and many would say they do. Ask them if they support earmarks, and the response would be resoundingly negative. Over the next few months, the battle to define appropriations will be in full swing in three crucial GOP Senate primaries—Georgia, Kentucky, and Mississippi—and the results will go a long way toward defining the future ideological direction of the party.

What's striking is that after spending years on the defensive over earmarks, the establishment is beginning to fight back by changing the terms of the debate. Facing the toughest election in his career, Sen. Thad Cochran of Mississippi is airing adshighlighting his role delivering federal aid to the state's Gulf Coast in the wake of Hurricane Katrina. Senate Minority Leader Mitch McConnell, while avoiding the subject during the primary, is expected to tout his work securing funds for disadvantaged parts of Kentucky as a major theme in a tight general election. Rep. Jack Kingston is gaining momentum in the crowded Georgia primary, despite his background as a House appropriator. He recently defended his role in crafting budgets with earmarks as getting "a little mud on your face" as part of the process.

Any veiled support of pork is a risky proposition in a Republican primary—just ask Iowa Senate candidate Joni Ernst, who touted her experience castrating hogs as proof she can cut wasteful spending in Washington. But with Democrats challenging in all three races, proving value to your constituents is still a tried-and-true formula for a general election. Indeed, New Jersey Gov. Chris Christie used House Republican opposition to the level of funding for Hurricane Sandy relief as a rallying cry for his reelection campaign.

In a sign the tide has shifted, former Mississippi Gov. Haley Barbour offered an unapologetic defense of Cochran's influence bringing home federal funds in a columnthat ran last week in the Sun Herald. In it, he touted Cochran being in position to chair the Senate Appropriations Committee if Republicans retake the Senate, and highlighted his vote to reopen the government after the shutdown last October. It's not surprising to see Barbour, one of Washington's most imposing power brokers, defend the importance of influence and seniority. But it was unusual for him to do it so publicly—taking the tea party on and directing his message to a conservative Gulf Coast audience who has benefited from the federal-recovery largesse.

"Haley's got some balls," said his nephew, Henry Barbour, who is running the pro-Cochran Mississippi Conservatives super PAC. "When a state gets hit by the worst natural disaster in the history of the country, most people understand federal government has a proper role there."

The Mississippi Senate primary, taking place on June 3, is the most consequential test of where the Republican Party stands on the role of federal spending. Even Cochran insiders regard the six-term senator as being in serious trouble, polling around 50 percent with softer support than his tea-party-backed rival, state Sen. Chris McDaniel. But his campaign's willingness to embrace the argument that influence and seniority still matters—one that Republicans have shied away from lately—could embolden Republicans to tout their clout, especially after primary season is over.

"The political environment favors McDaniel, and sometimes it's hard to overcome the political environment, one that's sick of Washington," one Cochran ally said. "But as Trent Lott once said, 'Pork is federal spending north of Memphis.' "

All three upcoming races featuring appropriators in tough Senate races—Cochran, Kingston, and McConnell—also share another characteristic. Democrats are aggressively contesting all three seats on Republican turf, and their recruits don't have to be ambivalent about federal spending. Until the GOP landslide of 1994, Democrats retained a congressional stronghold in the South even as the national party drifted left, thanks to their veteran members' ability to deliver money to their home districts. While the partisan makeup has dramatically changed since then, voters still appreciate the politicians with a record of providing to their constituents.

"Our message is better in a primary than in a general election," conceded one conservative strategist.

McConnell's campaign is a clear-cut example of the delicate balance Republicans face on this front. Scott Jennings, who is running McConnell's super PAC, recalled how the senator's 2008 campaign ran targeted TV ads in each of the state's media markets "as a recitation of the earmarks we'd gotten in different parts of the state." Now, with primary challenger Matt Bevin hitting him on wasteful spending, he's avoided the subject. "You have to be more careful what you say these days," Jennings said.

But if McConnell wins the nomination, he's expected to talk more about his record delivering for the state. McConnell's soft spot in his last election was in eastern Kentucky, where he lost numerous coal-producing counties by double-digits, even as Mitt Romney won the surrounding district with 75 percent of the vote in 2012. McConnell's campaign has been aggressively tying Democrat Alison Lundergan Grimes to President Obama's energy policies, but he'll also need to shore up his own support in coal country. One McConnell strategist lamented that House Appropriations Committee Chairman Harold Rogers, R-Ky., gets all the credit for money earmarked to the impoverished district, overshadowing McConnell's role.

In addition, McConnell strategists are concerned about his standing in the counties surrounding Fort Knox, where he touted his work fending off cuts in the last campaign—cuts that later became reality, with its combat brigade stripped and thousands of tank personnel eliminated.

"How many Democrats voted for McConnell in the past because they understood the need for pork, understood his ability to get the government to deliver? Now there's concern there will be a dropoff," the McConnell strategist said.

As the establishment legislators become more comfortable asserting their prerogatives, they face a critical verdict from their core voters in these upcoming contests. At stake: Whether we'll see members of Congress running on their experience and clout again.

"Republican primary voters, by and large, aren't interested in rewarding federal officeholders who are good at spending tax dollars," said Barney Keller, spokesman for the Club for Growth, the leading outside group enforcing the fiscally conservative line. "They're interested in rewarding officeholders who are good at cutting spending and limiting the size and scope of government."

A well-funded conservative outside group is devoting significant money to make North Carolina Rep. Walter B. Jones the first incumbent to fall this cycle, but Republicans in the state are skeptical the sudden burst of spending will ultimately be enough to take Jones out.

With the investment by Ending Spending Action Fund, a super PAC formed by TD Ameritrade founder Joe Ricketts, Jones faces what will likely end up as the best-financed primary opposition of his 20-year congressional tenure. The group reported last week spending $156,000 on an ad attacking Jones, one of the last remaining Republicans from the class of 1994, for his “liberal” voting record and for “losing his North Carolina values.”

It’s a significant ad buy in the 3rd District, located along the Tar Heel State coast. But while Republican strategists say the outside money may give Jones his most competitive challenge to date, they also downplay Jones’ chances for defeat in the May 6 primary.

“People see the money, people see the outside spending, they see who is spending from the outside — you have Joe Ricketts’ PAC, which is a recognizable name — and they see that and think [Jones] is vulnerable,” said one unaffiliated Republican operative. “But I just think Walter’s entrenched in that district. Walter’s father was a congressman from that district before him, and I just don’t see him as being vulnerable.”

Jones’ top primary challenger is Taylor Griffin, a former aide to President George W. Bush and operative at the communications firm Hamilton Place Strategies. He moved back to North Carolina to challenge the incumbent and has criticized Jones over his conservative credentials.

Jones entered the election year with $127,000 in cash on hand — a meager war chest when compared to the might of the Ricketts super PAC’s capabilities. The group spent $13 million last cycle, mostly to assist Republicans in the presidential and Senate races, according to Political MoneyLine. Jones first-quarter fundraising report, due April 15 to the Federal Election Commission, will shed light on whether he has picked up the pace in the wake of the primary challenge.

Griffin reported just $87,000 in cash on hand by the end of last year, which doesn’t provide him with much to introduce himself to voters in his own advertising — a crucial component to go along with the outside help. And unaffiliated North Carolina Republicans noted that Griffin’s D.C. background — his recent move to the district and the Capitol Hill fundraiser headlined by a scroll of D.C.-based Republican operatives — could prove to be an issue for him in the race.

Still, they added that if the money keeps flowing into the district, Jones will have to quickly come up with the funds to defend himself in the six-week run-up to the primary.

“It’s going to be a tough sell to say Walter Jones doesn’t have North Carolina values, but if they have money it will be real,” North Carolina Republican operative Carter Wrenn said.

In 1994, Jones succeeded his father, former Democratic Rep. Walter Jones Sr., and has since built a brand as a social and fiscal conservative. His turn against the Iraq War invited a competitive 2008 primary challenger, but Jones vastly outspent him and won with 59 percent of the vote.

The incumbent’s votes over a 10-term career don’t put him squarely within any sortable group of members on Capitol Hill, something Republicans say could actually help him in a district with a strong libertarian lean.

“Walter Jones has been a household name for 50-plus years, so it’s a tall order in any stretch of imagination,” said another unaffiliated Republican operative in the state. “He’s been his own guy. If you ask about Walter Jones, people say he’s very much a social conservative and he does take stands sometimes that divide conventional political thinking. But people respect him for his reasons behind them all.”

With a squeezed calendar, the Senate will likely not hold a final vote passing a bill reviving emergency unemployment insurance benefits until next week.

Senate Majority Leader Harry Reid said he plans to turn to the bipartisan unemployment extension compromise as quickly as possible under Senate rules, but there’s business to tend to first — namely an aid package for Ukraine and several pending judicial nominations.

“We’ll finish the judges in 24 hours. Under the new rules, we can do that fairly quickly,” the Nevada Democrat said. “I’m going to start unemployment right on the tail of Ukraine.”

Absent an agreement, there could be two separate cloture votes in relation to the unemployment insurance legislation, meaning that if debate time available under Senate rules is consumed, it would very easily run into next week.

Reid and other Democrats agreed to jettison an International Monetary Fund overhaul package opposed by many Republicans as part of the Ukraine aid bill. The nomination votes are ahead of the unemployment insurance benefits in the queue because Reid moved to cut off debate on those before senators departed for their most recent recess.

“We’re going to do judges today and tomorrow, and then we’ll do unemployment and we’ll see what the House is going to do on SGR,” Reid said. “We kind of have to wait for them before we go charging forward.”

The sustainable growth rate, or SGR, is the Medicare payment formula for doctors. Without a patch or a more permanent fix, doctors would once again face draconian cuts next month, cuts that no one really ever expects to take effect.

Finance Chairman Ron Wyden, D-Ore., went so far as to call the current SGR system “Medicare make-believe” speaking with reporters Monday.

Reid says he prefers a long-term solution that Wyden’s working on, but he signaled the door is open to another short-term patch.

Emotional Preparation--
Make sure it's not just a "bad day." Change for the sake of change is the wrong reason to sell. What goals to you want to achieve, personally and professionally? What changes do you want in your life? What do you want to create for your business, your clients and your employees? What do YOU want?

Review Your Options --
Review all your options, not just for an exit. Perhaps a different model is an option, or additional growth, or funding. If you decide to sell, you must feel confident you have looked down every alley and KNOW this is the right path.

Professional Preparation--
Complete a thorough review and analysis of your company - prepare, or have someone help you prepare a review all aspects of your PEO. How do you compare to other PEOs, what are your strengths and weaknesses? Is there a better model? Are there changes you can make now that make your company more profitable in the future? Is there a more efficient way to manage risk?

Be clear on what your company is Worth --
Get a professional valuation; know what you are worth and what a realistic transaction structure may look like for your specific PEO.

Tax Treatment --
Evaluate tax treatment for your company. Understand how specific tax implications differ by types of consideration - stock, cash, notes, or a combination. What does that mean for you and your shareholders?

Parameters for an Exit -
Know what your parameters are for selling. Examples include price, structure, equity participation, tax treatment, key employees/employment agreements, autonomy, transition and integration. What can you tolerate? Be realistic.

Understand the Process-
Once you decide to jump into the selling waters - have someone explain the process in excruciating detail so you know what to expect. Confidentiality agreements, marketing, buyer/partner options, due diligence, legal documents - and how does that close and the wire of your money honey actually happen?

Just JUMP!
Once you are mentally and professionally prepared to sell - then just "JUMP!" We have never seen a better time to consider a sell. And yes, you will continue to hear from us! Silva Capital Solutions, Inc. has completed 47 PEO transactions - we understand you and your business. We now offer CLIENT VIP DAYs, strategic meetings here in our Atlanta office -- to guide you through each step of your journey.

Today, tomorrow or in the future - we are here to serve. Call us if we can help in any way! CHEERS!!

Look for our next newsletter in this series- "I'm smart - Why use an Advisor?"

By Josh Kraushaar

FreedomWorks issued an unusual round of endorsements this week. The conservative group, which won publicity for backing intraparty challenges to Senate Minority Leader Mitch McConnell and Rep. Mike Simpson, decided to play it safe this time. It endorsed three senators and nine congressmen, none of whom face any serious competition—Republican or Democratic. It stayed out of the contested Oklahoma primary for Sen. Tom Coburn's seat, but endorsed Republican James Inhofe, who doesn't face any GOP opposition. In South Carolina, FreedomWorks is backing Sen. Tim Scott, who's a lock for reelection, but it isn't doing anything against vulnerable Sen. Lindsey Graham, who's also on the ballot this year.

All told, it's a sign that the group has stopped sticking its neck out for long-shot conservative insurgents and is content to put some easy victories on the board.

It's a far cry from the early ambitions of the aggressively antiestablishment group, which entered the cycle boldly challenging sitting senators, including the chamber's most powerful Republican. Now they're content to focus on their support for members of Congress who are as close to reelection locks as they come. Indeed, FreedomWorks' latest slam-dunk endorsements are emblematic of scaled-back efforts from leading outside conservative groups.

Of the 10 "RINOs" in the House flagged for defeat by the Club for Growth last year, only one faces a primary opponent. With two of their leading Senate challengers' campaigns fizzling, the Senate Conservatives Fund has now decided to back conservatives inHouse primaries. And after raising only $766,000 in 2013—less than one-third of their 2011 fundraising—FreedomWorks is now backing Republicans who are so safe that they don't need any outside help. Conservative groups are even disagreeing on which races to target.

2014 is shaping up as the year the Republican establishment is finding its footing. Of the 12 Republican senators on the ballot, six face primary competition, but only one looks seriously threatened: Sen. Thad Cochran of Mississippi. More significantly, only two House Republicans are facing credible competition from tea-party conservatives: Simpson and Rep. Bill Shuster of Pennsylvania—fewer than the number of conservative House Republicans facing competition from the establishment wing (Reps. Justin Amash, Walter Jones, and Kerry Bentivolio). With filing deadlines already passed in 23 states, it's hard to see that dynamic changing.

Even the Club for Growth, one of the first outside groups to target Republican members of Congress, has been notably disciplined this year. Last February, the Clubencouraged candidates to run against 10 squishy House Republicans, launching aPrimaryMyCongressman.com site featuring the so-called RINOs. Only one qualified challenger emerged. Their PAC is targeting just one Republican senator (Cochran, facing state Sen. Chris McDaniel) and one Republican congressman (Simpson). Meanwhile, they've joined forces with the party establishment in backing Senate candidates Rep. Tom Cotton of Arkansas and Dan Sullivan of Alaska. The endorsement of Sullivan is significant, since they backed Joe Miller's losing general-election campaign against Sen. Lisa Murkowski in 2010. Miller's running again, but this time they're opposing him in the primary.

Given the mood of the Republican electorate, it's striking to see the disconnect between the number of conservative Senate primary challenges and the low number of conservatives running against House incumbents. With 211 Republicans running for reelection, only two are credibly being challenged from the right—less than 1 percent. That suggests the hunger for throwing out Republican senators is as much a product of outside intervention as a reflection of genuine grassroots opposition.

"There are a lot of Ted Cruz imitators that believe all you need to do is make the race national and raise a bunch of money online and get national groups to endorse you and everything will take care of itself," said one conservative strategist, lamenting the quality of prospective challengers. Many national groups, likewise, seem to be overestimating their own ability to reshape a race with a mere endorsement.

As my Atlantic colleague Molly Ball writes in the latest issue of Democracy, the tea party "is now more properly regarded as one faction among many in the Republican coalition—and a poorly organized, arriviste faction at that." She noted the fundraising struggles among most of the leading Senate tea-party challengers—in marked contrast to the quick millions raised by previous favorites, like Nevada's Sharron Angle and Delaware's Christine O'Donnell in 2010.

That doesn't mean the influence of the conservative grass roots has petered out. If anything, it demonstrates the success conservatives have successfully reshaped the House to their liking in recent elections. This year's Senate class of Republicans, who won their last election before the emergence of the tea party, is merely a lagging indicator. Outside groups are still poised to play a significant role in open primaries, where it's easier to have an impact than against entrenched incumbents.

While the national focus has been on the targeted Republican senators, it's crowded primaries in Georgia, North Carolina, and Iowa that concern Republican strategists the most.

Republicans fear that weak, too-conservative candidates in these races could cost them valuable seats—with control of the Senate at stake. With the exception of FreedomWorks' backing of physician Greg Brannon in North Carolina, most conservative groups have remained on the sidelines in these crucial contests. But that could change if the Georgia and North Carolina races head into runoffs, or if the Iowa nominating fight heads to a convention (if no one wins 35 percent or more of the vote in a primary). For now there's an uncomfortable GOP détente—with neither side tipping the scales yet.

If outside conservative groups endorse like-minded candidates like Rep. Paul Broun of Georgia, Iowa talk-show host Sam Clovis, and Brannon in these primaries, expect a heated ideological battle to break out over the future of the party. But if they pull their punches, it's a sign that even tea-party sympathizers recognize the peak of their influence has passed.

By: Jennifer Haberkorn
A once-bipartisan proposal to finally reform the deeply flawed way that Medicare pays doctors succumbed Friday to the partisan politics of Obamacare, particularly the unpopular individual mandate.

The House voted 238-181 to replace the payment formula — the complicated equation that for more than a decade has required annual “doc fixes” — and to pay for it by delaying Obamacare’s individual mandate for five years.

A dozen House Democrats joined Republicans in the vote, but the bill is dead on arrival in the Democratic-controlled Senate.

The Senate plans to return a volley after next week’s recess with a plan that appears just as unlikely to move in the House because it completely avoids the issue of how to pay for the reform proposal. However, newly minted Senate Finance Committee Chairman Ron Wyden has said that he wants to see a bipartisan vote and could end up adding a pay-for — or the promise of one.

The underlying policy voted on Friday has been agreed to by the top Republicans and Democrats on the Finance Committee as well as the House Energy and Commerce and Ways and Means committees. And after years of bitter complaint about the Sustainable Growth Rate, lawmakers’ bipartisan, bicameral consensus on a replacement has been widely applauded, especially by medical groups.

The bill would eliminate the SGR and replace it with a new formula that would drive physicians to meet quality metrics tied to their payments — a critical, fundamental shift. The goal is to pay providers for treating a person’s disease or illness instead of focusing on the quantity of the tests or treatments they prescribed.

But when the six committee leaders failed to settle on a way to afford the $138 billion reform plan, the leadership of both chambers began pushing partisan pay-fors that stand little chance of becoming law.

Republicans argue that delaying the mandate until 2019 is nearly as long as the White House is allowing people with canceled plans to remain on their pre-Obamacare policies. Under the administration’s latest announcement, people can retain their old insurance through 2017.

Rep. Charles Boustany (R-La.), a physician, blamed the Senate for refusing to negotiate on payment methods.

“We’ve agreed on the policy, but we have a problem coming up with the pay-fors,” he said on the House floor Friday. “But the talks broke down in a divided government. Senate leadership has refused to negotiate in good faith. … We’re going to pass this bill to get those discussions started.”

Rep. Bill Pascrell (D-N.J.) accused Republicans of throwing the bipartisan talks away “in order to score some really poor and cheap political points.”

The bipartisan negotiators have not met since agreeing on the policy last month, before Max Baucus left his post as Finance chairman and was replaced by Wyden. It’s unclear whether those talks will resume.

“The breakthrough achieved by our committee would permanently replace the deeply flawed SGR formula,” said Rep. Sander Levin (R-Mich.), the top Democrat on the Ways and Means Committee. “The underlying policy agreement is broadly supported by both providers and beneficiaries, but today’s exercise is opposed by groups representing seniors, doctors, health plans and others because it guts the Affordable Care Act.”

The existing Medicare formula calls for new cuts to providers as of April 1. The negotiators had hoped to be able to put the new formula in effect by then. But more likely than not, they’ll have to institute a new patch — expected to be nine months or longer — to block the cuts from taking place.

Friday’s bill was the second vote against the Affordable Care Act’s individual mandate this month. In another measure unlikely to get any traction in the Senate, 27 Democrats joined Republicans to delay the mandate’s penalties for 2014.

President Barack Obama told the Congressional Hispanic Caucus leadership Thursday evening he’s considering more changes to the enforcement of immigration laws, amid growing unrest among his allies over his deportation record.

“The President emphasized his deep concern about the pain too many families feel from the separation that comes from our broken immigration system,” the White House said in a readout of the meeting. “He told the members that he has asked Secretary of Homeland Security Jeh Johnson to do an inventory of the Department’s current practices to see how it can conduct enforcement more humanely within the confines of the law.”

The readout continued, “The President thanked the Members of the CHC for their work on these challenging issues, and expressed his strong desire to work together to put pressure on Congressional Republicans to pass bipartisan comprehensive immigration reform as soon as possible.”

Obama met in the Oval Office with Congressional Hispanic Caucus Chairman Ruben Hinojosa, D-Texas, CHC Immigration Task Force Chair Luis Gutierrez, D-Ill., and House Democratic Caucus Chairman Xavier Becerra of California.

Gutierrez had pointedly called the president the “deporter-in-chief” and “dishonest” on the issue just last week.

But Gutierrez sounded positive in a statement late Thursday:

“The President directed Secretary Jeh Johnson to review with the CHC a menu of options that can be implemented to reduce the pain of the current enforcement escalation and end the deportations that separate families.

“I will meet with Secretary Johnson next week to present options and then the entire CHC will meet with him to discuss those and other options that the Department of Homeland Security is developing when Congress returns after recess.

“Just as important, Republicans should step up to the plate and take action on immigration reform and not abandon the American people on this important issue. And in the absence of action by House Republicans, administrative action is imperative.

“It is clear that the pleas from the community got through to the President. The CHC will work with him to keep families together. The President clearly expressed the heartbreak he feels because of the devastating effect that deportations have on families.

“This began a new dialogue between the CHC and the White House that had been dormant for too long. The CHC Members who met with the President were adamant that the President needed to act. I agree with the President that the ultimate solution and responsibility for fixing our broken immigration system rests with the Republican majority in the House of Representatives and we will work together to demand Republicans take action.”

The meeting comes as prospects for an immigration overhaul seem as bleak as ever, with Democrats ripping Republicans for legislation aimed, in part, at rolling back the president’s executive actions sparing young people brought here illegally by their parents from deportation.

Republicans believe the president has already stepped outside of the law on a range of issues, including halting deportations for the young. And with hopes for an immigration overhaul fading, many immigration advocates have increased pressure on the White House to act unilaterally to halt deportations that break up families, and the Hispanic Caucus has been considering a resolution urging the president to act.

Obama has repeatedly resisted doing so.

“Relief delayed is relief denied,” said Pablo Alvarado, director of the National Day Labor Organizing Network, in a statement after the meeting. “The President has no excuse to continue his unjust deportation policy, and the Congressional Hispanic Caucus should not delay joining what is now a consensus position that the President can and should suspend deportations, expand deferred action, and end the disgraceful Secure Communities program.”

Telling positive anecdotes about Obamacare, demonizing “dark money,” and using the Senate floor are all part of the plan.
By Michael Catalini

It’s no secret Senate Democrats are in for a tough election. They started the cycle with more vulnerable seats than Republicans, the economy still lags in parts of the country, and some will have to answer for Obamacare.

But Democrats are lining up their counterpunches, a one-two-three combination that will highlight positive anecdotes on the Affordable Care Act, demonize Republican “dark money” in contested races, and rally the base from the Senate floor, with legislation on the minimum wage and equal-pay protections—and this week’s overnight talkathon on climate change.

While lawmakers are sometimes reluctant to lay a political lens over what some say is simply sound policy, it’s clear Senate Democrats are doing everything they can in the chamber to pull the odds in their favor.

“Look, I’m not gonna say people aren’t thinking about the elections,” said Democratic Sen. Tim Kaine of Virginia. “But issues have to be measured ultimately by whether they’re good policy. Good policy is good politics.”

Senate Democrats are defending 21 seats, seven in states won by Republicans in 2012, while Republicans are defending considerably less territory, risking only Georgia and Kentucky. Republicans need to net six seats to retake the majority.

Obamacare is perhaps the largest liability for Democrats, and Sen. Chris Murphy of Connecticut has taken the lead in trying to rebut Republican rhetoric with positive anecdotes about the law.

ADDRESSING OBAMACARE

“I think there’s been a real desire within the caucus to go on the offense, especially after last fall when Democrats spent much of the time on defense, in part deservedly because of the condition of the website,” Murphy said, adding, “Democrats have been looking for a means through which to tell the really positive stories.”

Lawmakers in tough races and those from states where the law is unpopular are not playing a big role, but Murphy nevertheless encourages Democrats not to run away from the law.

“I’ve run in one close contested election as a supporter of the law, and I think time has shown that supporters of the law who try to pretend as if they didn’t vote for it end up losing more often than not,” he said. “I do think that Democrats who support this law should be out front, talking about the benefits even while they make the case for common-sense changes.”

THE ECONOMIC MESSAGE

Democrats are adding to their Obamacare efforts with an economic message. They have made no secret of their intention to pursue economic issues that motivate their voter base, including a minimum-wage increase, equal-pay-for-equal-work legislation, and an extension of long-term unemployment-insurance benefits.

This week, they added climate change to the list of issues. Led by Sen. Brian Schatz of Hawaii, Democrats talked overnight on the Senate floor about the perils of man-made climate change. Unlike with the other economic efforts, though, there’s no accompanying legislation, and Republicans roundly criticized the event as a public-relations ploy.

Whether the talkathon produces any meaningful debate or legislation seems dubious. But the issue is popular with Democratic voters in some states. In Virginia, where Democratic Sen. Mark Warner faces Republican challenger and former Republican National Committee Chairman Ed Gillespie, Kaine says he has taken voters’ temperature on the issue and found it to be a winner.

“Virginians want to be leaders in this stuff,” Kaine said. “When I was running in 2012 I asked people—because I’m such a strong believer [that] we’ve got to do something about climate—I asked people what they thought, and Virginians agree, not surprisingly.”

DEMONIZING DARK MONEY

The Koch brothers, the conservative billionaires who are pouring millions into Senate races in states like North Carolina, Louisiana, and Michigan, are also increasingly at the receiving end of Senate Democratic campaign rhetoric. Majority Leader Harry Reid famously said on the floor that the GOP is “addicted to Koch.”

Sen. Kay Hagan of North Carolina, perhaps the biggest target of so-called “dark money” spending, regularly headlines emails with a disparaging remark about the Kochs. The Democratic Senatorial Campaign Committee has made reference to the Koch brothers in no fewer than 77 emails in the last four months. Sen. Carl Levin of Michigan, whose retirement is opening up a seat now being contested by Democratic Rep. Gary Peters and Republican Terri Lynn Land, said economic questions are likely to be the top issue in the Great Lakes State, but that outside spending could also tip the scales. That explains why Reid has been shining a light on the spending, Levin said.

“There’s a real question about the way in which huge gobs of outside money try to come into the states to try to influence the outcome,” he said. “The Koch brothers are the biggest example of it.”

But will the Democratic response—essentially talking about it through a megaphone—help in the election?

“Well, I’m optimistic,” he said. “But it’s gonna be a close race.”

One can make several arguments about the FL-13 special election outcome, but the bottom line remains that while it is appropriate to classify this district as competitive, President Obama carried FL-13 in both 2008 and 2012. Despite a relatively even funding environment (campaign, independent, and Super-PAC money combined) and a Democratic candidate was at least as good as, if not probably a lot better than the Republican alternative—a lobbyist—Democrats still lost. This loss underscores how completely different the turnout dynamic is in a presidential election year vs a special election or a midterm election; both of the latter usually consisting of an older and whiter voter demographic. If Democrats are to make a plausible argument for regaining a majority, they need not only to win races like this one in FL-13, but also in other districts that are even more unfavorable to Democrats.
In the NBC News/Wall Street Journal poll released on March 12th, President Obama had his lowest job approval ratings yet, coming in at 41 percent approval, versus a 54 percent disapproval rate among respondents. His approval ratings on handling the economy and foreign policy were both also at 41 percent, with 56 and 53 percent respectively disapproving. On more personal level, 41 percent saw Obama positively, 15 percent had neutral feelings about the President, and 44 percent reported negative feelings. When asked whether they preferred a Congress controlled by Democrats or by Republicans, respondents provided data that gave the GOP a one point edge overall. While that might sound insignificant, this poll question, for whatever reason, has historically been skewed three to four points towards Democrats. Despite the rather consistent skew towards Dems, these new numbers appear pretty much comparable to the two-point GOP edge in the last NBC/WSJ poll taken just before the 2010 Republican landslide victory.
When asked whether they thought the new health care law was a good idea or a bad idea, just 35 percent said it was a good idea, 49 percent said bad idea, both very similar data points to the results of this same question in December and January. Attitudes towards President Obama and the Democrats signature policy achievement are very negative and not getting any better.
The polling in four key Senate states were conducted by Hickman Analytics, an extremely competent Democratic polling firm headed up by Harrison Hickman, who has been in the business for over 30 years. The surveys were conducted for the Consumer Energy Alliance, a group supporting construction of the Keystone XL pipeline. In Arkansas, where Obama’s favorable ratings are just 32 percent, with a 65 percent unfavorable rating, Democratic incumbent Mark Pryor led his GOP challenger, Rep. Tom Cotton, by just three points among all likely voters. A lead of just 40 to 37 percent is a dangerous place for an incumbent to be, particularly when that that lead is over a lesser known opponent. Worse for Pryor, he trailed by Cotton two points, 41 to 39 percent, among definite voters, a group that most likely represents the demographics of the midterm election turnout. Pryor still holds an 18-point effective name recognition advantage over Cotton, suggesting additional room for growth for the challenger.
In Colorado, the survey testing incumbent Democrat Mark Udall was conducted before the GOP replaced their weak challenger, Ken Buck, with a far more attractive challenger, Rep. Cory Gardner. Udall led Buck by four points among likely voters (46 to 42 percent) and three points among the tighter screened definite voters (46 to 43 percent). Obama had a 44 percent favorable rating, coupled with a 52 percent unfavorable rating; it is important to recall that he carried the state in both 2008 and 2012.
The survey taken in Louisiana showed GOP Rep. Bill Cassidy leading incumbent Democrat Mary Landrieu by four points among likely voters (46 to 42 percent) and nine points among definite voters (49 to 40 percent). Cassidy’s effective name recognition was just 42 percent, half of Landrieu’s 95 percent, suggesting growing room for Cassidy. Obama had just a 41 percent favorable, 56 percent unfavorable rating in the state.
In North Carolina, incumbent Democrat Kay Hagan led her likely GOP challenger, state House Speaker Thom Tillis by four points among likely voters (45 to 41 percent) and five points among definite voters (47 to 42 percent). Tillis’ effective name recognition was just 34 percent, well under Hagan’s 84 percent, again, showing potential for growth for Tillis. Obama’s favorable ratings were 46 percent, unfavorable 50 percent.
With each of these sets of numbers, keep in mind that for well-known incumbents, there is a tendency for WYSIWYG (What You See Is What You Get), that incumbents generally don’t grow their actual vote much above their poll numbers, undecided voters tend to break more for challengers. That’s why these numbers should be so troubling for Democrats.
The bottom line here is that at least for today, this election is not about the myriad of problems facing the Republican Party (with minority, young, female and moderate voters) but instead is about President Obama and the Affordable Care Act, both deeply unpopular. The fight for the Senate is being fought in terrain far more challenging for Democrats (read more Romney than Obama states) and with a midterm electorate that is older, whiter, and much tougher for Dems than the one that re-elected Obama in 2012. Environmentally, this election reflects a mood not dissimilar to 2010; the big difference being in the House, where Democrats have relatively few vulnerable seats to protect, so the possibility of a party shift at a magnitude similar their 63-seat loss four years ago is extremely unlikely.
For those who like to get into the weeds, links to the full NBC/WSJ poll questionnaire as well as to the questionnaires and key crosstabs for the Senate race polls in Arkansas, Colorado, Louisiana and North Carolina are provided below:

Brady, the Texas Republican, is next in line to chair the powerful House Ways and Means Committee. When Chairman Dave Camp steps down in 2015 due to term limits, Brady, the most senior Republican on the panel, plans to replace him.

But seniority isn't everything on Capitol Hill – not when Ryan, the House Budget Chairman, former vice presidential nominee, and conservative wunderkind is concerned.

Ryan, who is term-limited at the Budget Committee, declared in mid-December that the Ways and Means chairmanship would be his next pursuit. It's been widely assumed since then that he would be awarded that job without hesitation. Ryan is well-liked by leadership, respected throughout the conference, versed in issues of taxation, and outranks almost every Republican on Ways and Means.

Everyone, except for Brady.

In an interview taped for C-SPAN's "Newsmakers," Brady said Ryan is a "terrific leader" but made clear that he won't give up the Ways and Means gavel without a fight.

"Bottom line, I feel like I'm qualified and prepared to lead the committee, and at the right time I'm going to make that case to my colleagues," Brady said. "I think we have a strong case to make."

But Brady, who also called Ryan "a terrific friend," emphasized that the internal campaigning will be respectful.

"I don't expect it to be acrimonious in any way. The truth is, Paul and I have similar principles on many of these issues," Brady said. "We are friends. We talk about this. We're clearly both focused on being positioned to lead this committee in the future."

Ryan's office declined to comment.

The chairmanships of various House committees are determined by the Republican Steering Committee, comprised of leadership officials as well as some rank-and-file lawmakers. The Steering Committee interviews candidates before making recommendations on chairmanships, which are then brought before the entire House Republican Conference for ratification.

Brady said "the time is not quite right" to begin campaigning for the position, and he would not specify how much longer he'll wait. But, he pointed out that with Camp's recent release of the committee's tax reform proposal – one three years in the making – both he and Ryan are currently consumed with promoting Camp's plan.

"We're both, in my view, focused on helping advance this tax reform discussion draft, which I think is critical," Brady said, later adding: "We're fortunate that we're going to build off a very strong foundation from Chairman Camp."

Brady, though well-respected in conservative circles and well-liked by Republican leadership, isn't the imposing figure on Capitol Hill that Ryan is. Still, he doesn't sound afraid to go toe-to-toe with the man who could one day occupy the Speaker's office, if not the White House.

"I think a competition of ideas is really healthy for our conference," Brady said.

WASHINGTON (Reuters) - U.S. job growth accelerated sharply in February despite the icy weather that gripped much of the nation, easing fears of an abrupt economic slowdown and keeping the Federal Reserve on track to continue reducing its monetary stimulus.

Employers added 175,000 jobs to their payrolls last month after creating 129,000 new positions in January, the Labor Department said on Friday. The unemployment rate, however, rose to 6.7 percent from a five-year low of 6.6 percent as Americans flooded into the labor market to search for work.

"It reinforces the case for the economy being stronger than it's looked for the last couple of months," said Bill Cheney, chief economist at John Hancock Financial Services in Boston. "It makes life easier for the Fed and feeds into continuing the tapering process."

The report also showed the largest increase in average hourly earnings in eight months and the payrolls count for December and January was revised up to show 25,000 more jobs created during those months than previously reported.

Investors on Wall Street cheered the report. U.S. stocks ended mostly higher, with the Standard & Poor's 500 index closing at a record. The dollar bounced off a four-month low, while prices for U.S. Treasury debt fell, with the yield on the benchmark 10-year note hitting a six-week high.

Interest rate futures showed that traders ramped up bets on the Fed raising rates a bit sooner than had been previously thought. They now point to a 54 percent probability of a rate hike in June 2015.

Unusually cold and snowy weather has disrupted activity in much of the United States for months, and a few economists had begun to speculate that the U.S. central bank could reconsider its plan to wind down its bond-buying stimulus.

The eastern and central United States experienced record low temperatures last month, and ice and snow blanketed densely populated areas during the week employers were surveyed for February payrolls. The winter storms left Wall Street bracing for a much weaker report. Economists had forecast nonfarm payrolls rising by only 149,000 jobs.

The weather, however, did have an impact. It cut into the length of the average workweek, which hit its lowest level since January 2011 and led to a drop in a measure of total work effort. But economists expect a reversal as soon as this month.

"The economy will defrost in the spring and heat up in the summer," said Michelle Meyer, a senior economist at Bank of America Merrill Lynch in New York. "We should see solid gains in job growth in coming months."

The smaller survey of households from which the unemployment rate is derived showed 6.9 million people with jobs reported they were working part-time because of the weather. That was the highest reading for February since the series started in 1978.

It also showed 601,000 people could not get to work because of the weather, the highest level for February since 2010. Economists said job growth in February would have been as high as 200,000 if not for the weather.

Payrolls averaged about 205,000 new jobs per month in the first 11 months of 2013, but that figure dropped to just 129,000 for December, January and February.

GROWTH SLOWDOWN TEMPORARY

Fed officials, from Chair Janet Yellen on down, view the recent economic weakness as largely weather-related and temporary. The policymakers have suggested it does not meet the high bar they have set in terms of what it would take for them to stop scaling back their bond-buying stimulus.

The Fed has already reduced its monthly bond purchases by $10 billion at each of its last two meetings, and a similar reduction is expected when officials next meet on March 18-19.

But the weather is not the only factor behind the lull in activity. Businesses are working through a huge pile of unsold goods accumulated in the second half of 2013, which means they have no incentive to place new orders with manufacturers.

In addition, the expiration of long-term unemployment benefits for more than one million Americans in December and cuts to food stamps are also hurting spending.

As a result of these temporary factors, growth in the first quarter is expected to slow to an annual rate below 2 percent. The economy grew at a 2.4 percent rate in the final quarter of 2013.

Economists welcomed the rise in the unemployment rate as a sign of labor market strength, since it was driven by Americans taking up the hunt for work.

"Evidently, the potential employees think the economy is improving and there are more jobs to be had," said Sung Won Sohn, an economics professor at California State University Channel Islands in Camarillo, Calif.

A measure of underemployment that includes people who want a job but who have given up searching and those working part-time because they cannot find full-time jobs dropped to 12.6 percent, its lowest level since November 2008.

Despite the improvement, the labor market is still far from a full recovery. The percentage of working-age Americans with a job, a broad gauge of labor market health, was steady at 58.8 percent last month. It has not risen much since the recession ended nearly five years ago.

In addition, the number of Americans who have been out of work for more than six months rose in January.

Job gains last month were fairly broad-based, with private sector payrolls rising 162,000 and government adding 13,000 jobs. Manufacturing payrolls rose by 6,000 jobs, the seventh straight monthly increase.

Construction payrolls, which surprised in January by logging hefty gains, increased by 15,000 last month.

Insurance employment recorded its largest gain since July, possibly boosted by implementation of President Barack Obama's signature healthcare law. Healthcare payrolls also advanced.

There were, however, declines in retail, information and transportation and warehousing employment.

Average hourly earnings rose nine cents.

"This gain, along with a rise in jobs, supports our case for better real incomes in 2014 and, thereby, a better outlook for consumer spending," said John Silvia, chief economist at Wells Fargo Securities in Charlotte, North Carolina.

(Reporting by Lucia Mutikani; Editing by Tim Ahmann, Paul Simao and Chizu Nomiyama)

Rep. Ralph M. Hall, R-Texas, will face a late-spring runoff against a self-funded primary challenger.

As election results poured into the Lone Star State on Tuesday night, it was clear that freshman Rep. Marc Veasey, a Democrat, and Rep. Pete Sessions, a Republican, would be all-but-certain to return to Congress for another term.

Across the state, Sen. John Cornyn, R-Texas, easily defeated Rep. Steve Stockman, R-Texas. There will be a runoff for Stockman’s seat in the 36th District.

All primary runoff races will take place on May 27.

4th District
Hall had 45 percent of the vote, five points below the threshold to avoid a runoff, when the Associated Press called the race. His GOP opponent, attorney John Ratcliffe, had 30 percent of the vote with 22 percent of precincts reporting.

A Texas Republican operative had ominous words earlier Tuesday for 90-year-old Hall’s political future if he was forced into a runoff.

“My theory is if Ralph has to go to a runoff, he’s already lost,” the Republican said. “If a majority of the electorate votes against him, that’s a serious problem for Ralph Hall.”

Hall announced in December that this was his last race, but he has made that pledge several times before. Still, this cycle was expected to be his toughest re-election challenge in decades.

Ratcliffe ran an organized, self-funded effort. He spent about $400,000 of his own money as of his latest fundraising report.

This race is rated Safe Republican by Rothenberg Political Report/Roll Call.

23rd District
Former Rep. Francisco “Quico” Canseco received 41 percent of the vote when the Associated Press called the race, with 58 of precincts reporting. Ex-CIA officer Will Hurd has 40 percent of the vote so far.

The pair will advance to the runoff.

The GOP nominee will face freshman Rep. Pete Gallego, a Democrat, this fall in the Lone Star State’s most competitive House district.

This race is rated Leans Democratic by Rothenberg Political Report/Roll Call.

33rd District
In the race for Texas’ 33rd District, Veasey led his opponent with 74 percent of the vote, with 0 percent of precincts reporting at the time the Associated Press called the race.

His Democratic challenger is Tom Sanchez, who spent over $1 million of his own money in an effort to oust Veasey. This race is rated Safe Democrat by Rothenberg Political Report/Roll Call.

32nd District
Sessions defeated a tea party rival, Katrina Pierson, who had the backing of FreedomWorks and former Alaska Gov. Sarah Palin in the race for Texas’ 32nd District.

Sessions had 69 percent of the vote when the Associated Press called the race. Pierson had 31 percent of the vote.

Pierson earned national attention for her race, but few Texas Republican operatives said that Sessions faced any real challenge in the primary.

This race is rated Safe Republican by Rothenberg Political Report/Roll Call.

36th District
Former Woodville Mayor Brian Babin and businessman Ben Streusand will advance to the runoff to succeed Stockman, who ran for Senate.

Babin led a crowded field with 35 percent, with 27 percent of precincts reporting at the time the Associated Press called the race. Streusand trailed him with 24 percent of the vote.

The GOP nominee will all the but certainly win the seat in November.

This race is rated Safe Republican by Rothenberg Political Report/Roll Call.

So - why is 2014 a HAPPY year for PEO/HRO Mergers & Acquisitions??

The economy:

• *Financial metrics such as employment, GDP, customer confidence, and home values show steady, albeit slow, recovery. Gradual improvement in market conditions = greater consumer confidence = greater M&A confidence,
• *Buyers are sitting on cash - reserves are looking good for deal flow,
• *Large deals came back in 2013, typically middle market deals, like PEO, follow.

PEO/HRO Industry:

• *PEO valuations are solid. We have seen well run PEOs sell for good value - thus setting the watermark for valuations in 2014,
• *A number of PEO acquisitions were completed in 2012 and the first half of 2013 - those companies are integrated - and buyers are hungry for more,
• *The investment community recognizes that PEO/HRO leaders know how to get deals done and how to make deals accretive - assimilation and integration are proven,
• *Today's PEO/HRO financial and operational model has matured with more predictable cash flow. Value-add services plus proven earnings on risk management, show stability in our industry,
• *Running a PEO becomes more complex every day. Finding a buyer/partner/investor who can take over the administrative "stuff" allows business owners and shareholders to do what they love - sell & service clients,
• *Healthcare - what can we say - PLEASE LET ME GIVE THIS HEADACHE TO SOMEONE ELSE!
• *Baby boomers are getting to the age where they want to "Take some chips off the table" - enjoy life NOW, not when they are too old to do so - what better time?

BOTTOM LINE - The stars are aligned in the economy and in the PEO/HRO industry. Outsourced business service companies, including PEO companies - are HOT commodities! There are more buyers than sellers - valuations are solid - and for many, the time is right. 2014 will be a blast for Silva Capital - let us know if we can serve you - today, tomorrow or in the future!

Look for our next newsletter - "I think I want to sell my PEO - WHAT NEXT?"

Silva Capital Solutions, Inc. | | wanda@silvacapital.com | http://www.silvacapital.com
1564 Valley Reserve Court
Kennesaw, GA 30152

WASHINGTON When President Obama unveils his budget request Tuesday, it will mark a starting point for Obama and Republicans to begin framing the choice facing voters ahead of the fall elections.

Americans hoping to see a renewal of broad talks to cut the nation’s debt will be disappointed. And the conversation surrounding the budget release already has taken a partisan edge.

“I will send Congress a budget that will create new jobs in manufacturing and energy and innovation and infrastructure, and we’ll pay for every dime of it by cutting unnecessary spending, closing wasteful tax loopholes,” Obama said in a speech Friday. “Now, Republicans have a different view.”

Already, the White House has said the president will step back from his earlier attempt to persuade Republicans to accept a grand bargain to reduce the soaring national debt that would include entitlement changes (something liberals abhor) and raising tax revenue (something conservatives hate).

Instead, Obama’s proposal will detail $28 billion in new domestic funding, including funding for new manufacturing hubs, job training and early childhood education that will be offset by cost savings elsewhere. The Defense Department will get an additional $28 billion in its 2015 budget, but the administration is also calling for a smaller Army by 2019.

The plan will take off the table what is known as “chained-CPI,” a proposal that would lead to less generous increases in Social Security benefits annually. The White House and its allies are using that decision to attempt to underscore that House Speaker John Boehner and his fellow Republicans have shown a lack of willingness to negotiate.

“The president included that in last year’s budget, as part of an agreement ... where he said, ‘Republicans, you should join me in at least closing some tax loopholes,’ even one for the purpose of reducing our long-term deficit,” Rep. Chris Van Hollen, D-Md., said on Fox News Sunday. “Republicans could not not even identify a single tax loophole they would close.”

Polls suggest that stepping back from the deficit conversation is good politics. Only 8% of Americans put budget or deficit issues as the top issue facing the U.S., a recent Gallup Poll found.

The White House has made the case that the pressure to slash the deficit has been somewhat mitigated by a projection that the deficit will come in at $514 billion in the current year, the lowest since Obama took office.

Republicans say the White House is downplaying the independent Congressional Budget Office’s calculation that the annual deficit is projected to balloon to over $800 billion by 2022.

“They are more worried about their next election than the next generation,” Sen. Rob Portman, R-Ohio, told the American Action Forum last week.

The budget President Barack Obama sends to Congress on Tuesday will be a month late and hundreds of billions of dollars short.

But no matter, the Capitol’s conventional wisdom holds, that the unenforced legal deadline for his submission was Feb. 3, and that he’ll propose acquiescing in significant deficits for the indefinite future. A truce has been called in the fiscal wars, the thinking goes, and so Obama’s fiscal 2015 document will be little more than the ritualistic starting point for the most desultory budget debate of this decade.

In the big picture, that is the way it looks to play out. But there are several secondary policymaking and political storylines that could make the budget beat interesting in 2014.

The reasons it’s supposed to be a snooze are by now well understood: The rare bipartisan budget deal reached and ratified in December decided the grand total for discretionary spending in the coming year, so there’s minimal reason for an appropriations deadlock. The latest debt limit extension has locked away that particular countdown clock until well after the elections. That means there’s no new fiscal cliff in sight, allowing both Obama and top Republicans to set aside their last, best offers in pursuit of a grand bargain on deficit reduction.

These are five subplots most worth watching.

House Republicans. Speaker John A. Boehner is promising his side will produce and push to adoption a budget resolution with a path to balance in a decade. Writing most of it shouldn’t be too heavy a lift, on the assumption that in this election year Budget Chairman Paul D. Ryan will start by reviving the entitlement program overhauls from his previous three budgets — and sticking with the $1.014 trillion spending cap he agreed to with Senate Budget Chairwoman Patty Murray.

Suspense may be in store when he puts that plan on the floor this spring. Few if any Democrats will vote for it on “it would destroy Medicare” grounds alone, meaning adoption may require 95 percent support from Republicans. But in December, only three-quarters of the GOP conference voted for the Ryan-Murray plan; the remaining 62 opposed it principally on the grounds that the new and slightly increased spending cap was too high.

An inability of the majority to secure House adoption of its own fiscal blueprint would be a first in the 40-year history of modern budget law and would expose the internal divisions the party so hopes to obscure during campaign season.

Senate Democrats. On the other side of the Capitol, the questions are whether the majority will even try to win adoption of a companion budget resolution, and whether it’ll take much of a political hit if it doesn’t.

Last year the Democrats wrote a budget resolution for the first time since 2009, for two reasons: The GOP had gained some traction with its “the other side is shirking its duty” argument. And the exercise got the caucus nearly unified behind the causes of breaking the sequester (to allow more domestic spending) and ending tax breaks for the rich (to mop up some red ink.) This year, the landscape is different. Most Democrats are willing to live with the new appropriations cap for at least this year, and those in re-election fights would just as soon avoid having to face the fusillade of politically tricky policy amendments that always get offered in the budget “vote-a-rama.”

So look for Majority Leader Harry Reid to prevent a debate on the floor — and watch for the GOP to say little about it. That’s at least partly because it was the Republicans who ended up with the “abdicators of responsibility” label last year when they declined to name negotiators to find a compromise with the Senate budget plan for which they’d been clamoring.

Defense. If there’s a place where another effort to break the sequester gains attention — or at least flexes an enormous amount of military-industrial complex lobbying muscle — it will be over the Pentagon budget.

Defense Secretary Chuck Hagel guaranteed as much when he detailed the reductions in weaponry, manpower, benefits and bases the Obama administration would choose for living under the caps. After the coming year, those caps mean only slight annual defense funding increases into the early 2020s. Congressional priorities would be rebuffed by many of the Hagel cuts, which include shrinking the National Guard and the Army and mothballing the Air Force’s A-10 “Warthog” tank-killer aircraft. (All that would happen even though Obama’s own budget will call for exceeding the defense cap by $28 billion next year, and the nondefense cap by the same amount, to accommodate some priorities.)

But, from the start, there’s very little chance Congress will agree to push the military “top line” above $500 billion. Democrats will remain flatly opposed to any trimming of domestic spending in order to help out the military — the only way to boost defense while living within the overall limit. Democrats would also be open to raising more revenue and splitting it between defense and the rest, but that’s an obvious non-starter for the GOP. And Republicans will remain divided on the other option: raising the discretionary ceiling again and putting almost all the new money toward troops and their equipment. Defense hawks want that, but absent a new national security emergency, don’t have the clout to triumph over the budget hawks.

Transportation. The trust fund for financing road, bridge and mass transit projects will be drained by summer, jeopardizing as many as 700,000 jobs just weeks before Election Day. How to replenish those coffers looks to be the most high-profile fiscal challenge that both sides are ready to address this year.

Obama last week called for giving this fund a four-year, $150 billion shot in the arm through an overhaul in the corporate tax code that his budget will explain. The same day, House Ways and Means Chairman Dave Camp unveiled a tax overhaul that sounded similar, if less ambitious: $127 billion in corporate taxes earmarked for public works in the next eight years.

Either way, the new revenue from businesses — along with the current federal taxes on gasoline and diesel fuel, which haven’t gone up in two decades — would be enough to keep up with demand for new construction and repairs until the end of the decade.

That alignment looks at first blush to be the makings of a rare bipartisan accord this campaign season. But the president’s power to push a big plan seems limited, Republican resistance to anything called a tax increase is emphatic, and the business community’s ability to resist being tapped to pay for public works looks unbeatable.

Leadership. Beyond all the big policies and macro political dynamics, the budget machinations will be another important proving ground for two of the most ambitious, involved and recently accomplished members of the current Congress.

As the 2012 GOP vice presidential nominee readies for his next move — to the Ways and Means chairmanship, most likely, with the speakership and a White House run both eventual possibilities — Ryan will be closely watched for signs that he’s making something politically problematic for his party. The same holds true for Murray, who hopes to move into the next top Senate Democratic leadership job that comes open.

The pair generated considerable praise for engineering the last budget deal, but politicians at their level don’t get judged by their most recent laurels for long.

House Budget Chairman Paul D. Ryan has said he wants the Ways and Means Committee gavelnext year, but the Wisconsin Republican will face a challenge from Rep. Kevin Brady, R-Texas.

Brady, the current chairman of the Joint Economic Committee, told columnist Al Hunt in an interview that will air Friday evening that he wants the top slot on the Ways and Means Committee, where he is currently the No. 2 Republican.

Reigning Chairman Dave Camp, R-Mich., must relinquish his title next year due to term limits.

“He’s a terrific leader, a good friend,” Brady said of Ryan, according to early transcript of a portion of the interview that will air on Bloomberg TV. “But the point is, I’m qualified and prepared to lead this committee. At the right time, I’m going to make that case to my colleagues. This is all about the ideas and how we can move tax reform, trade, entitlement reform forward, so it’s good to have a healthy competition.

“I’m going to be in a position to lead this committee,” Brady continued. “We’ll see how all of it goes. … Hopefully we’re going to present two good choices.”

Ryan’s press office did not immediately return a request for comment.

Unlike the House Democratic Caucus, the House Republican Conference does not place as great a premium on seniority in doling out plum committee leadership assignments, though it does count for something. While Brady is No. 2 on the panel, Ryan comes in just after him at No. 3.

There’s also a sense among House Republicans that because Ryan is has a high profile and is well-liked, he can move into whatever job he wants, within reason. That could make any head-to-head race against him a challenge.

• By Lauren Gardner
• Roll Call Staff
• Feb. 26, 2014, 12:46 p.m.

Solar energy represented less than 1 percent of the domestic electricity generation mix in 2012 but has experienced dramatic growth in the interim with help from both the federal government and the private sector.

Manufacturing and solar installation jobs grew by about 20 percent between September 2012 and November 2013, totaling nearly 143,000 positions across the country, according to a report released this month by the Solar Foundation. The industry installed 2.3 gigawatts of power in 2013, Energy Secretary Ernest J. Moniz said, calling it “a banner year for solar.”

Solar is also the second-largest source of new power generation in the U.S. after natural gas, said Rhone Resch, head of the Solar Energy Industries Association.

Today, about 1,100 megawatts of solar power from five projects supported by federal loan guarantees is being delivered to the grid, according to the Energy Department, and 10 percent of current domestic capacity in the resource is financed by the program.

The Energy Department’s loan office helped support the first five utility-scale photovoltaic plants in the U.S. that are larger than 100 megawatts, a spokeswoman said. The next 10 large-scale facilities were able to secure financing solely from the private sector.

The department still has billions of dollars in loan guarantee authority that Moniz has said it plans to distribute to worthy projects across the energy sector, though those would have to qualify under a different loan program from the one added under the 2009 stimulus law, which has since expired.

Without a long-term investment tax credit extension or a change to when solar companies are considered eligible to qualify for it, Resch said utility-scale growth will drop off as residential and commercial solar systems become more popular.

“The more certainty that policymakers can provide, the more investment we will have in the solar industry, and the lower our cost will be in the long run,” he said.

But it’s not clear that the IRS will deploy much in the way of resources to aggressively search for individuals who don’t get coverage this first year. Enforcement of the individual mandate likely will be a huge challenge for the agency, both because of the difficulties in figuring out who doesn’t have insurance and the political problems it would pose for the Obama administration.

“I’d be very surprised if there’s much in the way of enforcement. It just doesn’t seem plausible,” said Federal Policy Group Managing Director Ken Kies, a former top congressional aide. “The IRS is in a tough spot. They don’t have the resources to do this. This is a whole different responsibility for them they never had before.”

The insurance requirement has never been popular in polls, and congressional Republicans have made it a major issue. This month, House Republicans unveiled a bill (HR 4064) to delay the requirement, often called the “individual mandate.”

But it’s not clear if a postponement is even needed given the realities faced by the IRS and the fact that many people will be exempt.

The first question: How will the agency know if someone didn’t have health coverage in 2014? The simplified answer: Taxpayers will tell them. If confused or dishonest taxpayers don’t report it accurately, chances are the IRS will not know right away.

Even if the Obama administration wanted to track down every person who did not have coverage in 2014, the agency will not have all the data it needs to accomplish that. This year the IRS is not expected to have any massive database pinpointing which taxpayers have coverage. With 140 million tax returns to process, the agency will need to primarily rely on self-reporting the first year.

“Individuals will report their own coverage on the 2014 income tax return that they file in 2015,” wrote IRS officials in an emailed response to questions. “The accuracy of the information shown on the tax return is the responsibility of the taxpayer.”

The exchanges also will report who’s on their insurance rolls, but the Congressional Budget Office projects that will only account for about 6 million Americans.

This situation is expected to just be temporary, though — there will be more detailed reporting by employers and insurers in later years that will give the IRS a fuller picture of who’s insured.

The law’s authors and regulators also allow for a long and growing list of exemptions to the mandate, making the IRS enforcement duties more complex. The latest came when the administration exempted people whose health insurance policies were canceled because the coverage did not meet benefit requirements under the health care law.

A few of these exemptions — such as a waiver for people with a religious objection to health coverage or financial hardship — require individuals to get certificates from the new marketplaces.

For some others — such as people who are in the country illegally or have a short health coverage gap — it will be reported on 2014 tax forms. That means those taxpayers will be claiming an exemption on their own.

The 2014 forms aren’t public yet and probably won’t be issued in draft form until at least the summer. It’s not clear what kinds of documentation will be required of those Americans who believe they are exempt.

Other problems could abound. Taxpayers could make mistakes. Tax prep service officials and accountants are eager to see more details on how consumers should report coverage next year so they can prepare themselves and their customers.

“We tell the IRS, the more you can tell us, the more we can help taxpayers,” said Theresa Pattara, director of regulatory affairs and public policy of H&R Block.

Some exemptions involve details that could baffle taxpayers. The definition of health care coverage itself could confuse some people.

Consumers also may be startled if they find they owe the IRS money because they got deeper discounts on their subsidized health insurance than they should have. That’s due to a related section of the law also administered by the IRS.

Many people who buy insurance on their own will qualify for tax credit subsidies extended under the law that help them buy plans in the new marketplaces. People get the money upfront as a discount that lowers their monthly insurance premiums when they buy insurance through the marketplaces. The federal funding is for people with incomes between the federal poverty line ($11,490 a year for one person) and four times the poverty line.

But the tax credit is a projection based on what people think they’ll earn, which could end up higher or lower than expected. If consumers don’t report income changes, they could get higher subsidies than they are entitled to receive.

Congress gave the IRS tools to enforce these two parts of the law — the individual mandate and the tax credits. But the tools are quite different.

For the fines for people who do not buy insurance, the agency was not authorized by Congress to do much more than send letters demanding the money and take the penalties from any refunds the taxpayers may be owed. That’s not insignificant, because most Americans get refunds. The IRS can capture that money owed whenever a taxpayer is due a refund, even in future years.

And while the IRS may not hunt for people who mistakenly or deliberately did not report a lack of coverage in 2014, officials may find some of them during audits for other reasons.

But people who owe fines for not getting health coverage cannot be thrown in jail. The agency can’t impose a lien on your property or a levy to take it away.

However, for any subsidy overpayments, the IRS can use liens and levies.

Nonetheless, most Americans do not want to risk running afoul of the IRS, which can add interest to debts and pursue perjury charges if people lie.

“The vast majority of taxpayers properly file their tax returns and pay what they owe in a timely manner,” IRS officials wrote to CQ Roll Call. “By doing so, taxpayers avoid paying additional amounts.”

If the IRS were to really go after people who did not buy coverage this year, it would create yet more bad publicity just as the Obama administration is recovering from the flawed rollout of the federal exchange website that is handling enrollment for 36 states this year.

“Because things were slow to get put into place, it’s likely they’d take a lighter approach to enforcement at first,” said Gary Claxton, vice president of the nonpartisan Kaiser Family Foundation. “The evidence won’t be as clear and the penalties are lower than in later years.”

In addition, administration officials seem to be aware that many taxpayers are still learning the details of the law.

“It’s not about getting the money,” said Claxton. “It’s about getting people’s attention.”

House Ways and Means Chairman Dave Camp appears determined to take one last stab at making good on his promise to pass an overhaul of the nation’s tax code by the end of the 113th Congress.

On Wednesday, the Michigan Republican told GOP members of the committee that he would, next week, release a “comprehensive discussion draft” of a tax code rewrite, one that would make the tax code “simpler and fairer for families and employers, and … strengthen our economy — meaning higher wages and more take home pay for the American worker.”

“It is time to make a choice,” said Camp in his email to colleagues, obtained by CQ Roll Call. “We can choose to have a real discussion about what tax reform can mean for American families and employers or we can choose to cower to special interests and maintain the status quo. Clearly, I choose the former.”

Though Camp’s decision to unveil his draft legislation marks a turning point for proponents of overhauling the tax code on both sides of the aisle, the political odds remain stacked against him.

His Senate counterpart and staunch ally, Democrat Max Baucus of Montana, has left Capitol Hill to serve as ambassador to China. Baucus has been replaced at the helm of the Senate Finance Committee by Sen. Ron Wyden, D-Ore., with whom Camp has no established rapport.

Democrats on the Ways and Means Committee on Wednesday were also already grumbling about the forthcoming discussion draft. Aides to minority members of the panel told CQ Roll Call that they were not on the official receiving end of Camp’s memo and learned only of the developments through media reports or from Republican colleagues who shared the email as a courtesy.

“It appears Chairman Camp only informed Republicans on the Ways and Means Committee … no surprise there,” one staffer for a Ways and Means Democrat said.

“We have not been briefed on it,” said another Democratic committee aide. “This is written exclusively by Republicans.”

Democrats will also likely balk at Camp’s suggestion that his draft legislation could be subject to “dynamic scoring.” The controversial scoring method takes a measure’s broad economic impact into account; Democrats have typically resisted dynamic scoring for tax bills, contending that Republicans have tried to overstate the economic impact of tax cuts.

Above all else, Camp is battling against time, with the legislative calendar already cut short due to the midterm elections.

But he’s got some preliminary support from leadership, at least.

“The speaker strongly supports tax reform to help get our economy moving and create more American jobs, and thanks Chairman Camp for his continuing work on this important issue,” said Michael Steel, John A. Boehner’s spokesman.

Read Camp’s full memo below:

The following note is from Chairman Camp to GOP Ways and Means Members, who have been blind copied on this email. Members should feel free to contact him with any questions. Committee Staff is also available for any questions.

As we travel around our districts, we see first hand that real families are struggling – they haven’t seen a pay raise in years, many have lost hope and stopped looking for a job and kids coming out of college are buried under a mountain of debt and have few prospects for a good-paying career. We’ve already lost a decade, and before we lose a generation, Washington needs to wake up to this reality and start debating real policies and offering concrete solutions to strengthen the economy and help hardworking taxpayers. As we all know, tax reform is one way we can do that.

We also know that many in Washington are scared by the prospects of tax reform; they don’t want to look special interests in the eye and say the game is up. Well, it is. We simply cannot afford the business as usual mentality that keeps Washington comfortable, but complacent. We have to get beyond the talking points and the political posturing. The American people are fed up and it is time for Washington to put the needs of hardworking taxpayers first.

Together, we have seriously and thoughtfully considered the implications and the benefits of tax reform. And, after much work by all of you, the staff (including the staff of the Joint Committee on Taxation) – not to mention several discussion drafts, countless hearings, meetings and invaluable input from job creators and families across the country – it is time to make a choice. We can choose to have a real discussion about what tax reform can mean for American families and employers or we can choose to cower to special interests and maintain the status quo.

Clearly, I choose the former. That is why next week I will release a comprehensive discussion draft to overhaul our tax code to make it: (1) simpler and fairer for families and employers, and (2) strengthen our economy – meaning higher wages and more take home pay for the American worker.

As we have discussed, critical to understanding how tax reform can affect families and job creators is having a modern, up-to-date economic analysis that captures the dynamic effect. Only then can we know the real, positive impact tax reform can have on our economy, and more importantly, on family budgets. On that front, there is an important update. While the Joint Committee on Taxation is the sole scorer of tax bills, and will provide a dynamic analysis of the plan, earlier today CBO Director Elmendorf stated that he is willing to provide a dynamic analysis of tax reform. This is something he did for Democrats on the Senate immigration bill. I view this as a positive step. The debate used to be about getting a dynamic score; now we will have a choice of multiple scores.

Please enjoy the remainder of the District Work Week, and I look forward to continuing our work to strengthen the economy through comprehensive tax reform when we return to Washington next week.

-Dave

The embattled HealthCare.gov site features a time line for implementation of the Affordable Care Act. It ends in 2015.

They wish.

If there was any chance that health care reform would soon feel more like the law of the land and less like a piñata that gets refilled and rehung daily, the White House essentially put that notion to rest this week when it punted the deadline for medium-sized employers to comply with the law yet another year.

Now, businesses with 50 to 100 employees have until 2016 to offer their workers affordable insurance or pay a penalty—just about the time presidential primary season is getting underway and this president is rendered an afterthought.

The policy effect of the delay on the ACA is minimal, most experts say. But in the political battle over Obamacare, now in its fifth smash year, the news was one more indication that the front has moved to the next presidential election and beyond to the incoming administration.

The law "will be on the front burner in Washington and in every Republican campaign through 2016," predicts Patrick Davis, a GOP consultant in Colorado.

That election likely will mark the fourth straight election cycle in which the ACA is a major issue, if not the central issue—an eternity in politics. Call it Obama's Forever War. "It's the gift that just keeps giving," says Douglas Holtz-Eakin, the former chief of the Congressional Budget Office during the Bush administration, who launched a conservative health care think tank last month.

Holtz-Eakin is among many critics who viewed the delay of the employer mandate as a means for the White House to avoid ugly headlines. The requirement at least raises the possibility that, faced with the deadline, businesses will hire fewer full-time workers or, more dramatically, deep-six their health care coverage outright and dump workers into the ACA's insurance exchanges.

Supporters of the law have long insisted that won't happen, but kicking the mandate down the road is one way to help ensure that if that does occur in large degrees, it might be Hillary Clinton's problem, not President Obama's.

In the meantime, the drip-drip-drip of Obamacare's ups and downs remains a preoccupation of both Republican message-makers and the Washington press corps. Along with the mandate delay, the last week has seen a furious battle over a CBO report about the effects of the law on the labor force and more close-quarter combat about the total number of enrollees on the exchanges.

The ACA continues to devour far more political oxygen than it should given the relatively few Americans it currently affects. There was, not that long ago, a thought that the exchange rollout might cement the ACA's place in the firmament. But theHealthCare.gov fiasco scrambled that calculation. Now, says Holtz-Eakin, "there's no end in sight."

Politically, the White House and vulnerable Democrats in Congress have rocking on their heels ever since. Something like the mandate delay emboldens Republicans who believe—whether it's sound strategy or not—that the law is vulnerable to renewed attack.

"Every time the administration gets cute and thinks they can manage Obamacare as a political liability with a delay, they basically ensure that action provides Republicans with yet another opportunity to drive a contrast before voters," says Kevin Madden, a former Mitt Romney adviser who now works as a GOP strategist.

Such delays, frets Democratic Leadership Council founder Al From, reinforce the view that the federal government simply isn't up the task of working out the details of large-scale reform, weakening his party's argument for continued control of the White House. "When people have no faith in government, they vote Republican," he says.

And in another sign that the GOP is thinking about 2016, party leaders have been re-tailoring their political message, using fewer scare quotes to rally the base and framing the argument against the ACA in Reaganesque phrases about entitlement versus work. Witness Rep. Paul Ryan's comments last week about the law being a "poverty trap" that robs people of the "dignity of work."

On a policy level, the shaky start means that it will take even longer for the benefits of the law, including whether the plans available under the exchanges are worth the cost, to reveal themselves to the majority of Americans who remain skeptical.

Two or three years at a minimum, says Drew Altman, president and CEO of the Kaiser Family Foundation. "There will be implementation land mines for a very long time" allowing Republicans to chip away at the law's foundation by what Altman calls "death by anecdote."

The first benchmark will come this spring if the administration fails to meet its own goals for enrollment and for the mix of the young and healthy to the risk pool. While analysts say the make-up of the federal pool is rather insignificant compared with the composition of state pools, GOP critics won't hesitate to pounce on the shortfall.

Another involves the now-delayed employer mandate. Since employers are not yet required to certify that they offer their employees coverage, that means there's no way to verify whether those workers are eligible for subsidies on the exchanges. (It's been called an "honor system.") That will, Holtz-Eakin says, inevitably lead to cases of fraud uncovered by the media.

A third and more potentially troublesome flashpoint will come closer to midterm Election Day, when consumers and small businesses face another round of policy cancellations in advance of 2015. Many businesses locked in their 2014 rates early last year in fear of the ACA—and some could experience steep premium hikes. That could damage Democratic prospects for retaining Senate control at a critical time.

It's a cascade effect. A GOP takeover of the Senate would then ensure Congress would be in full anti-ACA mode through the 2016 campaign, passing legislation that likely would be vetoed by Obama. "It guarantees two more years of this," says Mo Elleithee, spokesman for the Democratic National Committee.

Obamacare will haunt Democrats in other ways by then. When the White House delayed implementation of the so-called "Cadillac" tax on high-dollar health care plans to 2018 because of union objections, it ensured that the next wave of candidates for president will be under heavy pressure to pledge to repeal the tax as a condition for labor support. Doing so would renew cries of favoritism and selective enforcement that are dogging Obama now. The same would happen if the White House decides, as some have speculated, to scrap the employer mandate outright before it does any harm.

And if Clinton runs, she'll have to run as the architect of the individual mandate, the requirement that everyone purchase health insurance. (Obama basically co-opted that aspect of her plan.) Should a challenger "take even one step away from the mandate inside a Democratic primary," Kevin Madden says, "the party would fracture."

None of this means continually hammering away at the ACA for the next three years will secure the White House for the GOP. Elleithee, naturally, sees it as a political loser. And Democratic strategist Steve McMahon contends time is needed for the political narrative to be rewritten. "The boogeyman stories always seem to punch through," he says. The law "will get there eventually."

Six Senate Republicans switched from “nay” to “aye” on the critical vote allowing the nation’s debt limit to be extended, a copy of the official Senate vote tally sheet provided to CQ Roll Call on Thursday suggests.

The tally sheet is the only record of which senators may have switched their votes because the Senate clerk — in a break with tradition — didn’t name names during the nearly hourlong vote. Capitol Hill reporters are protesting that change, still within the rules, as lacking transparency.

The actual tally sheet that Senate clerks use to manually record votes is available to interested parties in the Capitol, and CQ Roll Call has posted a PDF copy.

Sens. John Barrasso of Wyoming, John Cornyn of Texas, Jeff Flake of Arizona, Orrin G. Hatch of Utah, John McCain of Arizona and John Thune of South Dakota appear to have switched their votes from “nay” to “aye.” It is possible that some of the markings on the page are due to clerical error.

As reported Wednesday, several of these senators had emerged together from the GOP Cloakroom to flip their votes at the same time, after Minority Leader Mitch McConnell of Kentucky and John Cornyn of Texas joined together to push the tally over the 60-vote threshold.

But this sheet suggests that McConnell had not actually cast a vote before indicating support of the debate-limiting motion.

The Senate voted to send a one-year debt limit suspension to President Barack Obama’s desk Wednesday, after a high-drama cliffhanger that ended when Minority Leader Mitch McConnell, R-Ky., and Minority Whip John Cornyn, R-Texas, voted “aye” to end a filibuster.

The Senate voted 67-31 to end a filibuster on the legislation threatened by tea party firebrand Sen. Ted Cruz, R-Texas, in a vote that took nearly an hour to complete as senators wrestled with their decision. The Senate then voted 55-43 to pass the bill with a simple majority threshold.

McConnell and Cornyn voted to cut off debate when the measure appeared stuck just short of the 60 votes needed.

A dozen Republicans voted with Democrats in all, most in a clump after McConnell and Cornyn led the way: John Barrasso of Wyoming, Susan Collins of Maine, Bob Corker of Tennessee, Jeff Flake of Arizona, Orrin G. Hatch of Utah, Mike Johanns of Nebraska, Mark S. Kirk of Illinois, John McCain of Arizona, Lisa Murkowski of Alaska and John Thune of South Dakota.

Cruz forced the 60-vote threshold, putting his fellow Republicans on the hot seat as they had to choose between a filibuster — potentially leading to the nation’s first ever default and a government shutdown — and putting the issue behind them ahead of the midterm elections.

Cruz had argued Republicans should stick together to extract spending cuts from Democrats and President Barack Obama, but McConnell privately had counseled against another shutdown showdown.

Kirk said his party was sharply divided over strategy behind the scenes, including a dispute between McConnell and Cruz. He told reporters why he planned to vote to advance the debt limit bill: ”I just want the orderly administration of the U.S. debt,” he said.

Cruz and outside tea party groups have ripped the party’s leadership in both chambers for caving to President Barack Obama’s demands for a clean debt limit hike. But the House voted narrowly to pass the debt limit Tuesday after Speaker John A. Boehner, R-Ohio, said Republicans were unable to unite behind any alternative.

The difficulty of the vote may suggest that debt limit brinkmanship may just be on hiatus, even if it’s over for this Congress.

Once signed by the president, the debt limit will be suspended until March 2015, at which point it will be raised to whatever level of debt has been incurred. That number will likely be at least $500 billion higher given the expected size of the federal deficit.

Administration officials said the latest delays are designed to give businesses more flexibility and a longer transition period to begin offering health insurance to their workers.

The Affordable Care Act requires large employers—those with more than 50 full-time employees—to either provide health insurance to their workers or pay a penalty. The mandate was scheduled to take effect this year, but the Treasury Department previously delayed the deadline until 2015.

Now it's delaying the coverage requirement even further.

Businesses with 50 to 99 full-time workers—people working at least 30 hours per week—don't have to comply with the mandate until 2016, under final regulations the Treasury Department released Monday.

Larger employers aren't getting an outright delay but will have more time to fully comply with the mandate. Employers with more than 100 full-time workers must offer coverage to 70 percent of their full-time employees this year, and 95 percent after that, to avoid paying a penalty.

The administration noted that only about 4 percent of employers are eligible for one of the breaks announced Monday, although those businesses employ about 72 percent of all private-sector workers.

The vast majority of large employers already provide health benefits to their full-time workers. Monday's changes are unlikely to make a significant difference in how many people the Affordable Care Act ultimately covers.

Monday's regulations also clarify that volunteers—for example, volunteer firefighters—aren't counted as full-time employees, and they give employers more flexibility when counting workers' hours. Those steps were designed to "kind of mitigate the way the 30-hour definition works," a Treasury official said.

Officials said businesses will have to attest that they're not cutting employees just to qualify for the additional delay but noted that businesses are still free to cut their workforces for economic reasons.

Asked where Treasury found the legal authority to phase in the employer mandate, officials said the department has "broad authority" to implement tax laws in a way that will ease the administration of those laws.

"We think a phase-in approach really is a way to administer the law better," a senior Treasury official said.

Sunday, February 9, 2014 | 12:30 p.m.
House Republican leaders enter this short legislative week saying they are confident the nation will not default on its debts, but a deal with Democrats to ensure that won't happen remains elusive.

Majority Leader Eric Cantor has announced a floor action schedule that includes the possibility of a vote on the debt ceiling by Wednesday.

GOP House members are still considering a number of preconditions for raising the debt ceiling, including a short-term extension of the current sustainable-growth-rate formula through which physicians are reimbursed under Medicare, as well as a restoration of military pension cuts that were included in the December budget agreement.

By Wednesday afternoon, however, House Democrats leave for Camrbidge, on Maryland's Eastern Shore, for their annual issues and policy retreat, where both President Obama and Vice President Joe Biden will make appearances. After that, House members aren't scheduled to return to session until Feb. 25.

Already, the Treasury Department has begun instituting the first of several "extraordinary measures" to stay under the current $17.2 trillion debt limit, and there is little certainty as to how long that approach can continue. Treasury Secretary Jacob Lew late last week warned lawmakers in a letter that his department will all but completely exhaust its ability to pay its bills by Feb. 27.

Sen. Patty Murray and other Democrats insist they will not accede to any GOP demands in return for raising the debt limit, and they continue to press for an up-or-down vote on a clean bill.

Without some breakthrough, tensions could rise Tuesday at a hearing of the Senate Budget Committee, chaired by Murray, at which Congressional Budget Office Director Douglas Elmendorf is scheduled to testify.

Here's what else is happening in Congress this week:

• Senate Majority Leader Harry Reid plans to move forward with a cloture vote Monday on the repeal of part of the budget legislation that cut military pensioners' cost-of-living adjustments.
• The Senate Health, Education, Labor, and Pensions Committee will hold a hearing Thursday on the minimum wage, which Democrats have identified as a key election-year issue. Reid and Chairman Tom Harkin plan to move a minimum-wage bill later this year, likely after the debt-ceiling legislation, lawmakers say.
• The House Rules Committee on Monday will hold a hearing to set floor procedures for a vote later in the week on the Consumer Financial Protection and Soundness Improvement Act, containing what Republicans depict as reforms the Consumer Financial Protection Bureau.
• The House Science Committee's Environment Subcommittee will hold a hearing Tuesday on the Secret Science Reform Act of 2014, aimed at Environmental Protection Agency regulations.
• The Senate also could move forward with a measure to require the Bureau of Land Management and the Forest Service to keep lands open to hunting and recreational fishing. It would also reauthorize a wetlands conservation measure and allow states to issue electronic duck stamps, among other provisions.

If the bill fails that test vote as expected—Republicans want the measure to contain an offset to address the cost—the Senate is likely to proceed to a broader package from Veterans' Affairs Committee Chairman Bernie Sanders later in the week.

That bill reverses the cost-of-living adjustment reduction and expands access to other veterans benefits. But it too is expected to face challenges from Republicans, who oppose the bill's reliance on off-budget Overseas Contingency Operations funds.

Though Boehner (R-Ohio) did not formally endorse the idea as his own, he did ask his lieutenants to test it among rank-and-file ­Republicans.

Boehner’s inner circle said he is casting about to find a solution that can pass the House without rupturing the fractious Republican conference, in which disagreements over past debt-limit strategies have caused considerable turmoil. He also wants to avoid a dramatic partisan fight with the White House, which has long resisted GOP attempts to extract major concessions on the debt ceiling.

“Right now, Jesus himself couldn’t be the speaker and get 218 Republicans behind something, so I think Speaker Boehner is trying his best to come up with a plan that can get close to that,” said Rep. Patrick J. Tiberi (R-Ohio), a longtime Boehner ally. “Whatever we move, there will be critics everywhere, but at the end of the day we still have to govern.”

This week, Treasury Secretary Jack Lew said the government will run short of cash to pay its bills by the end of the month unless Congress grants additional credit authority.

“Unlike other recent periods when we have had to use extraordinary measures to continue financing the government, this time these measures will give us only a brief span of time,” Lew said Monday in a speech at the Bipartisan Policy Center. “Given these realities, it is imperative that Congress move right away to increase our borrowing authority.”

Outside the House chamber Wednesday night, the plan was gaining momentum, with dozens of GOP members saying they could back it. The benefits for retired military personnel were reduced in last year’s bipartisan budget agreement, which cut $6 billion in payments to veterans over the next 10 years.

“I’d support it in a heartbeat,” said Rep. Doug Lamborn ­(R-Colo.). “We need to figure this thing out, and that’s a way to do it.”

Rep. Virginia Foxx (R-N.C.) said, “A lot of people are supportive right now, and this idea could be a vehicle that wins backing from a lot of Republicans.”

The idea emerged after support for two earlier proposals fizzled. One would have involved another attempt to repeal parts of President Obama’s signature health-care law, while the other would have tried to force Obama’s hand on approval of the Keystone XL oil pipeline.

According to two people pres­ent, Boehner argued that the military-benefits maneuver could force some Democrats to join Republicans and also win support from conservatives, who have voiced frustration with the reductions in payouts for retired military personnel.

Boehner’s approach — moving toward a possible tweak to federal pension funding — signals a departure from past debt-ceiling debates, in which Republicans have frequently demanded sweeping conservative measures in exchange for an extension. It also underscores Boehner’s desire to avoid a partisan standoff with the White House ahead of the midterm elections.

In recent years, debt-ceiling debates have been a chance for House Republicans to try to leverage concessions from the White House and Senate Democrats in the ongoing battle over spending and deficit control. But after October’s government shutdown, many in the House say they have little appetite for another standoff. Some members say they just want to get it behind them. “Look — we owe the money and we’ve got to do something,” said Rep. Peter T. King (R-N.Y.), a longtime Boehner supporter. “It’s time to end the drama and get it over with.”

Others say that, in the end, Republicans will have to pass a “clean” bill, one with no strings attached, so they should just move on it now. “It’s going to end up being clean anyway,” Rep. Justin Amash (R-Mich.) said Tuesday. “I don’t see anything they can put on the table that I would support as some sort of trade-off.”

Even tea party favorites are giving Boehner room to pursue options considered less than optimal by House conservatives.

“There is a pragmatism here,” said Rep. Michele Bachmann (R-Minn.). “You’ve got to know when to hold them and when to fold them. My assessment is that most of us don’t think it’s the time to fight.”

Several Democratic aides, who requested anonymity in order to discuss internal matters, said House Democratic leaders will probably balk if Boehner moves ahead with the plan, since Democrats have insisted that they will not negotiate over the debt ceiling. But they did not rule out the possibility of some Democrats supporting such legislation, amid the clamor in both parties to restore the cuts.

This week, aides to Senate Majority Leader Harry M. Reid (D-Nev.) said the Senate will soon bring forward its own legislation to restore the benefit cuts, taking up a spending bill sponsored by Sen. Bernard Sanders (I-Vt.), the chairman of the Veterans’ Affairs Committee. House Republican aides said Reid’s overlap with Boehner’s potential plan is helpful, especially as Republican leaders look for a debt-limit demand that could win Democratic votes.

But the House GOP’s path is far from settled, in spite of Wednesday’s turn toward a new proposal. On Monday, House Republicans, in informal whip countstaken by the leadership, rejected the two previous options for the debt-limit ­discussions. Those measures had mixed support, and the new ­military-benefits pitch will face similar challenges, with the House’s conservative bloc uneasy with any legislation that would extend the borrowing limit.

One key concern raised late Wednesday by House Republicans: making sure a restoration of benefits is balanced by cuts to other federal programs, in order to not have the measure be cast as a spending increase by watchdog conservative groups that are closely watching Boehner’s playbook. There have also been grumbles about whether a change to the budget deal would violate the carefully crafted terms hashed out in December by Congress’s budget chairmen, Rep. Paul Ryan (R-Wis.) and Sen. Patty Murray (D-Wash.).

House Republicans are looking at a handful of other options, should the military-benefits idea fizzle. Those include the “doc fix,” which would alter the way doctors are reimbursed for Medicare treatments, as well as changes to the federal budget that would reduce fraud and abuse or reduce mandatory spending levels, with the latter championed by the Republican Study Committee, a conservative House caucus.

But if House Republicans cannot find common ground soon on its debt-limit strategy, Boehner’s inner circle acknowledged Wednesday that a clean debt-limit hike — without strings attached — could be in the offing.

CAMBRIDGE, Md. – Speaker John A. Boehner of Ohio and his lieutenants came to the GOP retreat looking to convince the conference to go big and back an immigration overhaul, a real health care alternative and more. They left with mixed results.

For three years, Republicans have struggled to coalesce around an alternative to Obamacare. This year, Majority Leader Eric Cantor of Virginia vowed his party would finally vote on its own health care plan — something easy to say and harder to do. And Boehner tried to unite the restive conference around a controversial rewrite of the nation’s immigration policy, something that could actually become law.

Of course, it’s no secret that the GOP hasn’t been able to unify on much other than opposition to the president — something President Barack Obama alluded to in a sit-down interview with CNN’s Jake Tapper on Thursday and in his State of the Union address, when he challenged Republicans to bring forward their own ideas.

“In order to maximize our year, it’s important that we show the American people we’re not just the opposition party, we’re actually the alternative party,” Boehner told reporters Thursday morning.

Cantor and National Republican Congressional Committee Chairman Greg Walden of Oregon both served up variations of the Boehner line to the press.

The GOP push for the year is twofold: show they can govern on the major issues of the day while tamping down on GOP infighting and present a unified face to win control of the Senate.

“We know we’re inextricably bound to them,” Rep. Tom Cole of Oklahoma said of the Senate. “We certainly don’t want to do things that make it harder for them.”

Majority Whip Kevin McCarthy of California began the Thursday retreat meetings by presenting a breakdown of House Republican voting patterns by committee, class and geographic region, an attempt to show that dissent of the past years has not been exclusive to the younger, more tea-party-infused classes of 2010 and 2012.

Republicans generally coalesced around the idea of presenting their own health care bill, so it is now leadership’s task to consolidate the ideas and decide whether to move forward with one or several bills.

“I think it’s real important we spell out we have an alternative to this terrible thing called Obamacare,” said Rep. Jim Jordan of Ohio.  “As the only part of the federal government that’s currently in Republican hands, I think it’s important we lay out a vision for how we think the country can go.”

But the conference remains bitterly split on an immigration overhaul. Those divisions manifested Thursday, when Republicans held an open debate on principles handed down by Boehner.

Republicans lined up behind three microphones to deliver their thoughts on immigration in one-minute bursts: one microphone for those who support an overhaul, another for those who support the effort but think it’s the wrong time to act, and the third for Republicans who just outright oppose a policy rewrite.

The three-microphone setup may have established the GOP middle ground on the issue as pro-overhaul, but anti-action this year — a dilemma some members said may prevent leadership from pushing ahead.

“The majority of us are for immigration reform,” Rep. Raúl R. Labrador of Idaho said Thursday night after the immigration discussion. “But they understand: not with this president and not with this Senate.”

Boehner and his team believe Republicans would be served well by an overhaul, but as he is wont to say, a leader without a flock is just a man out for a walk. So the speaker told members that the discussion is ongoing and no decisions have been made on any step of an immigration rewrite.

Members repeatedly voiced concerns that Obama could not be trusted to apply tighter border enforcement laws. “The challenge is can we deal with that, can we deal with forcing an administration that nobody trusts to deal with the things that we think need to be dealt with?” said Rep. Mario Diaz-Balart of Florida, a proponent of acting this year.

A number of members also voiced concern that Republicans would open themselves up to political attacks from both Democrats and Republican opponents by acting in 2014.

And they are divided over the political risks of an immigration overhaul not just in the short term — Walden told reporters that a proposed policy rewrite would come after the majority of GOP primaries had already taken place — but over the long haul as well.

Rep. Michele Bachmann of Minnesota asked her colleagues on Thursday if Republicans thought Democrats would support an immigration overhaul if 80 percent of those immigrants who would be “granted amnesty” would vote Republican.  She said an immigration overhaul in this fashion would create a “permanent Democrat majority bloc.”

In an interview with CQ Roll Call, Bachmann said multiple members told the conference behind closed doors that an immigration overhaul was “a suicide mission.”

One of those members, Rep. John Fleming of Louisiana, said he thought leadership would cool its efforts to push an immigration rewrite this year.

“My sense is that the consensus here is that we should not move forward and that leaders will abide by that,” Fleming told CQ Roll Call. “On a political basis, this is a suicide mission for Republicans. Why would we want to change the topic for a very toxic problem Democrats have with Obamacare?”

Fleming said Financial Services Chairman Jeb Hensarling of Texas, Science Chairman Lamar Smith of Texas, and Budget Vice Chairman Tom Price of Georgia — all of whom are influential in conservative circles — spoke in front of the conference to say an overhaul should not move forward this year.

In the near term, Republicans will have to tackle a hike to the debt ceiling. The retreat ended without a resolution on how leaders can sell the vote to their members.

“Upbeat.” That’s the adjective being used as much as any other to describe the tone ofTuesday’s State of the Union address. Members from both parties could be forgiven for hearing it a bit differently.

The speech may well be remembered longest for its genuinely stirring finale, when President Barack Obama merged the story of a 10-times-deployed and gravely wounded Afghanistan war veteran, who was sitting in the balcony, with the country’s difficult path toward a more perfect union. “Like the America he serves, Sgt. 1st Class Cory Remsburg never gives up, and he does not quit,” Obama declared to a sustained and teary-eyed standing ovation.

But in the preceding 63 minutes, the president mixed it up plenty with the audience in the House chamber. And he made clearer than ever that he views the Capitol as a readily avoidable impediment — generating headlines about Obama pursuing a “year of action” mainly on his own authority. He also took a handful of swipes at Congress, and they were arguably aimed at least as often at the institution’s bipartisan shortcomings as at his Republican tormentors.

The japes were somewhat subtle, by the standards of today’s political discourse. And they are being overlooked, probably for a couple of reasons that have to do with the ritualized ways of the modern State of the Union:

The lawmakers themselves have become almost excessively adept at cooking up their partisan talking points hours beforehand, and repeating them verbatim with minimal regard to what they actually hear. So not all that many of them picked up on his poking one-liners — all of which were at the relative low end of the dismissive-disdainful-disparaging spectrum.

At the same time, the White House has become just as savvy at the game of advance spin. Officials say they’re doing a favor to the mainstream media elite by describing the speech’s tone and substance in advance, because otherwise the press will have almost no time to form an independent assessment between when the teleprompter goes off and when their deadlines arrive. So it’s not surprising the coverage bought in to the message that unnameable senior administration officials dished out on background Tuesday afternoon: Obama is not out to pick a fight with Congress; he remains eager to work with them but wasn’t willing to wait any longer for signs of collaboration.

On Wednesday, when he followed the presidential tradition of road-testing lines from the speech, Obama avoided looking down on the Hill — even reminding his audience at a Costco in suburban Maryland that “ultimately Congress does have to do its part” if the minimum wage is to be raised nationwide.

At a U.S. Steel plant near Pittsburgh, he offered details about another piece of his agenda for helping the personal finances of low-wage workers, which he is doing without Congress: have the Treasury create a new after-tax, federally guaranteed savings program for people whose employers don’t offer retirement plans — that’s as many as half the nation’s workers.

Something similar is available to federal employees, which is what created the opening for Obama’s most gratuitous un-grace note on Tuesday night. Knowing that perceptions about special privileges, heightened by the Hill’s tortuous efforts to be minimally effected by Obamacare, are contributing the record-low approval numbers for everyone in Congress, the president could not resist saying that his “myRA” plan would help regular people “save at work just like everyone in this chamber can.”

Two other call downs could fairly apply to Democrats as much as Republicans. When Obama admonished that “this Congress needs to restore the unemployment insurance you just let expire for 1.6 million people,” he was surely aware that leaders of his party did no more than leaders on the other side to preserve benefits for the longtime jobless when it was legislatively possible: as a rider to the year-ending bipartisan budget deal.

And when he promised personal efforts to boost pre-kindergarten enrollment “as Congress decides what it’s going to do,” Obama knew full well that figuring out how to pay for his universal pre-K aspiration was part of the much larger budget talks all sides have tacitly abandoned for the rest of his presidency.

To be sure, Obama aimed a couple of zingers exclusively at congressional Republicans. His line, “When our differences shut down government or threaten the full faith and credit of the United States, then we are not doing right by the American people,” was one more belated spanking of the GOP for its politically misguided tactics of last fall.

“Let’s not have another 40-something votes to repeal a law that’s already helping millions of Americans,” because “the first 40 were plenty,” was a chuckle-worthy defense of his health care law. It also was the setup line for Obama to just-a-little-bit-patronizingly remind Republicans of the campaign consultants’ traditional advice: “We all owe it to the American people to say what we’re for, not just what we’re against.”

Through it all, Speaker John A. Boehner was just a couple of feet behind the president’s left shoulder, visible in all but the tightest of tight shots as the manifestation of both his party and the entire legislative branch. Maintaining his equanimity in that situation, he told fellow House Republicans earlier in the day, is what makes the final Tuesday in January the “hardest day of the year” for him.

But Boehner almost always kept his composure in check and his tongue out of his cheek. The biggest exception? His penchant for choking up was on full display when Obama mentioned the speaker’s upbringing in generating one of the night’s few big bipartisan applause lines. That “the son of a barkeep is speaker of the House,” the president said, is evidence that “here in America, our success should depend not on accident of birth, but the strength of our work ethic and the scope of our dreams.”

Tuesday, January 28, 2014 | 11:39 p.m.
President Obama, seeking to rebound from a rough year and facing an emboldened opposition in Congress, sought Tuesday night to rally the country behind him for a flurry of executive actions he promised would strengthen economic recovery and protect the middle class.

In his fifth State of the Union address, the president in 1 hour and 11 minutes tried to cast himself less as a partisan than as the one leader in Washington looking out for the whole country. He insisted he was not looking for a fight with Republicans, who control the House and spent much of 2013 blocking his agenda. Noting that some of his proposals need congressional action, he insisted, “I’m eager to work with you.”

“America does not stand still—and neither will I,” he said. “So wherever I can take steps without legislation to expand opportunity for more American families, that’s what I’m going to do.” Democrats erupted in applause, but House Speaker John Boehner, directly behind the president, remained seated and stone-faced.

Senate Republicans showed their disapproval of the president’s agenda by largely withholding their applause. Minority Leader Mitch McConnell orchestrated a rapid response to the address, blasting out five emails throughout the speech and jabbing Obama over the Keystone XL pipeline, coal in Kentucky, and the job market for college graduates.

Several GOP lawmakers walking back to the Senate after the speech said they heard areas of possible agreement, but some said they are not impressed with Obama’s determination to go around Congress where he can.

“The president has to deal with Congress whether he’s happy to or not,” said Sen. Susan Collins of Maine.

Rep. Cathy McMorris Rodgers, the House Republican Conference chair, later gave the official Republican response, championing what she contended is “a more hopeful Republican vision.” She also took the obligatory GOP poke at Obama’s health care law, declaring that “it is not working”—a strong contrast to Obama’s endorsement of the law.

Though the audience for the address has declined steadily since Obama drew 48 million viewers in 2010, Tuesday’s television viewership was expected to approach or match last year’s 33 million. Almost certainly it was the largest audience he will get this year, and the White House was determined to take advantage of it to bounce back from a year of sagging popularity and the troubled Obamacare rollout.

In the speech, Obama offered a series of modest proposals, befitting a president entering his sixth year in office. Bunched under the rubric of “opportunity for all,” they included many items on the progressive wish list: an increase in the minimum wage, help for the unemployed, protection of voting rights, higher fuel-efficiency standards for trucks, more aid for education, removing some subsidies for the rich, more spending on infrastructure, an assault on income inequality, a program for climate change, and an end to discrimination against gays. As he did in last year’s address, he also prodded Congress to move on comprehensive immigration reform and overhaul the federal tax code, specifically closing sections that reward companies for moving American jobs overseas.

He also gave a stout defense of his embattled health care law, even gently mocking House Republicans for their dozens of efforts to repeal the law in part or completely. “Let’s not have another forty-something votes to repeal a law that’s already helping millions of Americans.… The first 40 were plenty. We all owe it to the American people to say what we’re for, not just what we’re against,” he said.

Obama was less enthused when he touched on trade, an issue on which he loses many Democrats in Congress, who espouse more protectionist measures. On this, the president sided more with the business community and mainstream Republican policy, urging the Congress to give him the trade promotion authority he has requested. It is needed, he said, “to protect our workers, protect our environment and open new markets to new goods stamped ‘Made in the U.S.A.’ China and Europe aren’t standing on the sidelines. Neither should we.”

His most defiant moment with Congress came when he strongly repeated his threat to veto anything Congress passes that slaps new sanctions on Iran and interferes with American diplomatic efforts to get Iran to halt its nuclear program.

“Let me be clear,” he said. “If this Congress sends me a new sanctions bill now that threatens to derail these talks, I will veto it.... We must give diplomacy a chance to succeed.”

A year after he devoted a large segment of his address to gun control—and only three days after a gunman opened fire in a mall only 30 miles away from the Capital—the president had only one brief paragraph on the subject, decrying “the lives that gun violence steals from us each day.” He pledged “to keep trying, with or without Congress, to help stop more tragedies from visiting innocent Americans in our movie theaters, and our shopping malls, or schools like Sandy Hook.”

ENERGY AND ENVIRONMENT

Going Big on Gas

Ignoring environmentalists who are urging him to oppose all fossil-fuel production, Obama doubled down on his support for natural gas, calling it “the bridge fuel that can power our economy with less carbon pollution that causes climate change.”

Obama repeated the “all of the above” mantra that leaders of most of the nation’s major environmental groups have urged him to drop. “The all-of-the-above energy strategy I announced a few years ago is working, and today, America is closer to energy independence than we’ve been in decades,” he said.

The president’s full-throttled endorsement of natural gas—both as an economic driver and as a tool to cut carbon emissions—received the most attention in what was a relatively minor focus on energy and climate issues compared with those of his previous speeches to Congress.

Obama mentioned only in passing—and not by name—the Environmental Protection Agency’s regulations to cut carbon emissions from the nation’s power plants. He also didn’t say anything about his administration’s defense of those rules, which are already facing attacks from congressional Republicans and industry groups. The president did tout the growth in solar power, however. “Every four minutes, another American home or business goes solar,” he said.

Much of what Obama talked about on energy and environmental issues he has already done or announced, including tougher fuel-efficiency standards for trucks. Left unmentioned in the speech was any talk of wind energy, biofuels, nuclear power (not to be confused with nuclear weapons, which Obama did speak of), coal, and the Keystone XL pipeline.

HEALTH CARE

Enrollment Pitch

Health care got more attention than it’s had in a State of the Union since 2010. Obama defended the Affordable Care Act on its merits but also used the high-profile speech to make a pitch for enrollment.

“Moms, get on your kids to sign up. Kids, call your mom and walk her through the application,” Obama said. The administration is set to spend millions of dollars over the next two months to encourage people to enroll in the health care law’s new coverage option, and Obama’s direct appeal during the State of the Union was another clear sign that the White House believes its best political argument is simply to get as many people covered as possible.

But that didn’t stop the president from taking a few cracks at Republicans for their fixation on repealing Obamacare—or, at least, holding symbolic repeal votes to squeeze Democrats ahead of this year’s midterms.

“If you have specific plans to cut costs, cover more people, and increase choice—tell America what you’d do differently. Let’s see if the numbers add up,” Obama said.

Kentucky Gov. Steve Beshear won a shout-out from the president for successfully implementing a state-run insurance exchange in a deeply red state. The state has one of the most effective exchanges in the country.

“Kentucky’s not the most liberal part of the country, but he’s like a man possessed when it comes to covering his commonwealth’s families,” Obama said.

NATIONAL SECURITY

Iran, Afghanistan

Obama used his bully pulpit to promote the recent deal that world powers reached with Iran as a foreign policy breakthrough. The agreement curbed the progress of Tehran’s nuclear program and rolled parts of it back “for the very first time in a decade,” Obama said.

U.S. diplomacy matters just as much as military might, the president argued, defending ongoing negotiations even as Israel and some in Congress criticize the interim deal as not being strict enough.

Obama also ramped up pressure on lawmakers—including fellow Democrats—seeking more sanctions against Iran as negotiations continue. Promising to veto those sanctions, he said that “for the sake of our national security, we must give diplomacy a chance to succeed.”

If that fails, all options—presumably including military action—are still on table. “I will be the first to call for more sanctions,” Obama said, “and stand ready to exercise all options to make sure Iran does not build a nuclear weapon.” This public promise may sway some of his critics.

The president also touted his role as a peacemaker. With the end of combat operations in Afghanistan this year, he said, “America’s longest war will finally be over.” Obama is considering leaving a small force of U.S. troops for narrow counterterrorism and training missions—if such a deal can be reached with Afghanistan. Outgoing Afghan President Hamid Karzai has so far refused to sign the security agreement both countries have already negotiated.

Obama stressed the need to close the Guantanamo Bay prison—a goal that has eluded him since the beginning of his presidency. “With the Afghan war ending, this needs to be the year,” Obama said. It actually could happen. The defense authorization bill Obama signed late last year relaxed restrictions on transferring detainees to the custody of foreign countries.

TECHNOLOGY

Broadening Broadband

Obama announced a step forward in his proposal to improve Internet access in schools on Tuesday. A partnership between the Federal Communications Commission and companies including Apple, Microsoft, Sprint, and Verizon will bring high-speed broadband Internet to more than 15,000 schools and 20 million students over the next two years, Obama said.

The issue is one of the few domestic initiatives Obama can get done without congressional support. The FCC already pays for Internet access in schools and libraries through a program called “E-Rate” that is funded by fees on monthly phone bills. Last year, Obama called on the agency to dramatically expand the program to provide high-speed Internet to 99 percent of all students. The White House provided few details about the partnership announced Tuesday, but it appears to be a combination of the existing E-Rate program and donations from the major technology companies.

Another major tech issue that Obama highlighted in the speech was patent reform, urging Congress to pass legislation that allows “our businesses to stay focused on innovation, not costly, needless litigation.” The House passed legislation last year aimed at combatting “patent trolls”—firms that use bogus patent-infringement claims to extort settlements out of businesses—but the Senate has yet to act.

But one issue that was notable for its almost complete absence in the speech was the controversy over National Security Agency surveillance. Obama laid out his views for reforming the agency in a speech earlier this month, and he showed little interest in devoting more attention to the controversy. He did, however, promise to work with Congress to reform the surveillance programs.

• Roll Call Staff
• Jan. 28, 2014, 11:53 p.m.

Democrats loved the president’s speech; Republicans hated it. What else is new?

President Barack Obama’s State of the Union address didn’t bridge the partisan divide in Washington, nor did anyone — least of all the White House — expect it to do so. But the pre-canned tweets, prebuttals and lightning-fast reaction from congressional leaders on both sides of the aisle turned the legislatively modest presidential agenda quickly into chum for partisan consumption.

Speaker John A. Boehner, R-Ohio, who spent much of the speech sitting glumly behind the president, said the president “is clearly out of ideas.”

“With few bipartisan proposals, Americans heard a president more interested in advancing ideology than in solving the problems regular folks are talking about,” Boehner said. “Instead of our areas of common ground, the president focused too much on the things that divide us — many we’ve heard before — and warnings of unilateral action. The president must understand his power is limited by our constitution, and the authority he does have doesn’t add up to much for those without opportunity in this economy.”

Boehner did however, offer to work with the president on immigration, patent changes, skills and education, and energy and water infrastructure — leaving room for some actual legislating before both sides focus on the November elections.

House Majority Leader Eric Cantor, R-Va., said Obama may have said that he’s “eager” to work with Congress but that hasn’t been the case.

“For years, President Obama has chosen to withdraw from policy debates and ignore our Constitutional balance of power,” he said in his statement. “Let’s put away the pen, and pick up the phone and work together to find common ground. That is something all Americans expect of the Congress, as well as the President.”

Democrats predictably cheered a speech sprinkled throughout with red meat for the Democrats to fire up their base in November — from a minimum wage hike to equal pay for women to extending unemployment insurance.

Sen. Charles E. Schumer, D-N.Y., issued a statement squarely focused on the elections. “The key issue of the 2014 elections will be who can do more for the middle class — raise middle class incomes and create more good paying jobs,” he said. “The President’s speech shows that he gets it. Helping the middle class will supersede every other issue in November.”

Schumer said in an interview that he doesn’t think many Democrats would react negatively to Obama’s threat to do more via executive actions.

“I think very few,” Schumer said when asked. “The No. 1 thing the American people are frustrated about is government’s inability to help them. [It’s] government. They don’t say the legislative branch, they don’t say the executive branch. And they want some action. I think everyone prefers that we do it with Congress and there are a few signs we can do it within Congress on a few issues. But faced with the choice of nothing or executive, I think ... 90 percent of Americans and 90 percent of Democrats would say ‘go for it.’”

Senate Majority Leader Harry Reid, D-Nev., also cheered the speech.

“President Obama tonight described the progress we’ve made as a nation and pointed the way to where we need to go,” he said.

“Giving hard-working Americans a raise by increasing the minimum wage is a good place to start. The Senate will vote on this proposal in the coming weeks, and I hope Republicans will join us in turning this and other common-sense proposals into law.”

Sen. Patty Murray, D-Wash., hoped the speech would lead the way to build on the bipartisan budget deal she helped craft last year. “I am ready to keep working to build on the bipartisan budget deal, and I hope Republicans are ready to join me at the table,” she said.

House Judiciary Chairman Robert W. Goodlatte of Virginia, meanwhile, urged the president to pay more attention to House GOP ideas on issues like immigration.

“If President Obama is serious about immigration reform, he will listen to new and different ideas presented by House Republicans to improve our immigration system because House Republicans and the American public have rejected the Senate approach and the President’s sweeping executive actions that have resulted in the dismantling of our immigration laws,” he said in his statement. “Our immigration system is in desperate need of reform and I remain committed to working on this critical issue with my colleagues. However, we don’t need another massive, Obamacare-like bill that is full of surprises and dysfunction after it becomes law,” he said.

Goodlatte also vowed to push for an overhaul of the NSA’s surveillance activities, and he backed the president’s call to end abusive patent litigation.

Other Republicans noted the central dichotomy of the speech — with Obama repeatedly offering to work with members of Congress and yet around them at the same time.

Sen. Rob Portman, R-Ohio, called the speech “strange.”

“There seemed to be an interest on reaching out, but he threw out some red meat for the base.”

“The President’s decision to issue Executive Orders, to make recess appointments, or to suspend enforcement of certain laws is inconsistent with our Constitutional system of checks and balances,” said Sen. Susan Collins, R-Maine. “Americans are rightfully disappointed with the gridlock and partisanship so prevalent in Washington these days, and I share this frustration. The President is in a unique position to foster compromise, and he should recommit to work with members of Congress in order to reach consensus and move our country — and our economy — forward.”

Portman said Obama did give Republicans “some openings on trade” as well as energy.

Portman, looking from notes during the speech, said he is also interested in the proposal for startup retirement accounts.

“I do a lot work in the retirement area,” Portman said.

But he thought that Obama may have given 401(k)s short shrift, which Portman said has been a good program.

Emma Dumain, Daniel Newhauser, Humberto Sanchez, Matt Fuller and Niels Lesniewski contributed to this report.

• Roll Call Staff
• Jan. 27, 2014, 7:04 p.m.

A Congress known for epic dysfunction and expected to be a foil for President Barack Obama’s State of the Union address is starting to creak to life — this time with an agreement on a five-year farm bill announced Monday.

The farm bill deal would be the first formal conference report of the 113th Congress — coming more than a year in and joining recent budget and spending compromises as signs Congress can get at least some of the work that used to be of the vanilla variety done.

Of course, the fact that the farm bill is more than a year overdue merely emphasizes how dysfunctional Congress has been of late.

Nonetheless, the relief at the Capitol in recent weeks has been palpable.

“It is a conference report,” said Senate Agriculture Chairwoman Debbie Stabenow, D-Mich. “And we’re still smiling at each other.”

Senate Appropriations Chairwoman Barbara A. Mikulski, D-Md., who shook hands with House Appropriations Chairman Harold Rogers, R-Ky., on her own $1 trillion spending bill a few weeks back, walked by Stabenow and a small group of reporters in the Capitol basement and exclaimed, “Your turn!”

House leaders planned to bring the bill to the floor Wednesday, before Republicans head to Maryland’s Eastern Shore for their annual issues retreat.

“We haven’t slept for a while. ... [We’re] running on caffeine and adrenaline at the moment,” Stabenow said when asked about how the critical final dairy compromise came together. “I’m very pleased to say we have brought everyone together.”

Other conferees, including House Agriculture Chairman Frank D. Lucas, R-Okla., also backed the deal.

“Compromise is rare in Washington these days but it’s what is needed to actually get things done,” noted Rep. Collin C. Peterson, D-Minn., the ranking member of the committee.

The recent spate of agreements has raised hopes both at the White House and on Capitol Hill that Congress will be able to hammer out at least a few more modest deals before both sides set their sights exclusively on the November elections.

Senate Majority Whip Richard J. Durbin struck an optimistic note Sunday on NBC’s “Meet the Press,” suggesting “a new bipartisan spirit” with the latest budget deals.

“We certainly need it on Capitol Hill,” the Illinois Democrat said. “Speaker [John A.] Boehner had to stand up to his tea party Republicans and say I know it’s bipartisan, I know it’s a compromise, we’re going forward. If he continues in that spirit, maybe we’ll get a farm bill after waiting on the House for two years.”

And White House senior adviser Dan Pfeiffer mentioned the farm bill Sunday on CNN’s conveniently named “State of the Union” show on a relatively short list of measures on which Democrats and Republicans could work in harmony.

“There were some items right before Congress we can do together, passing immigration reform, extending unemployment benefits for 1.6 million Americans, patent reform, innovation act ... the farm bill. There are things they can get done,” Pfeiffer said.

But the respite from partisan standoffs on big-ticket business probably won’t last long.

Obama is preparing a “year of action” speech Tuesday that’s certain to push past Congress and outline a host of executive actions, and both parties are preparing their political messages heading into the midterm elections. But the lawmakers in attendance Tuesday night will be on the verge of what once would have been called routine, but now counts as a major legislative achievement — passing a farm bill important to both rural and urban lawmakers alike.

Senate Majority Leader Harry Reid, D-Nev., said Monday that he plans to take up the measure during the current three-week work session. “It’ll reduce the deficit and cut waste and fraud, all while protecting hungry children and families,” he said.

The measure would provide about $20 billion in deficit relief, money that could theoretically be used elsewhere to pay for other priorities such as reviving the extended jobless benefits, which has been a key priority for congressional Democrats and the White House.

The deal will cut food stamps by $8 billion over a decade, far less than the $40 billion sought by the House and double the $4 billion sought by the Senate, by limiting the ability of states to use minimal energy subsidies to qualify residents for the program.

Stabenow defended the level, despite opposition from some liberals, such as Rep. Jim McGovern, D-Mass.

“We have done nothing that changes eligibility or eliminates anyone from food assistance help,” she said. “We have gone after waste, fraud and abuse and we are tightening up this connection with [the Low Income Home Energy Assistance Program.]”

The deal doesn’t exactly portend a return to the “good old days,” but Monday’s conference agreement suggests that the system sometimes still functions, albeit belatedly.

White House officials have also mentioned transportation and infrastructure efforts to boost the economy. A conference committee has been established to work out differences between the chambers on a water development reauthorization, with a new highway bill needing to move this year, too.

The conferees still have to sell the package to the rank and file, although there are no immediate signs of trouble.

There have been no shortage of stumbling blocks since the Senate passed a bipartisan farm bill in 2012 without the House taking action. Much to the consternation of Stabenow and like-minded lawmakers, the budget agreement designed to avert the fiscal cliff at the start of 2013 included a farm program extension that maintained the often-derided system of direct payments for another year.

Currently, the tax-writing committees in Congress are debating proposals to fundamentally change the tax laws. The debate over this legislation will undoubtedly involve impassioned floor speeches about large corporations and loopholes.

It is important to remember that the charitable contribution deduction is a “lifeline and not a loophole.” I hope the debate will also reference the charities working to provide shelter to the homeless or feed the hungry, the after-school programs keeping children off the streets and the small businesses giving back to its community by stocking the local food pantries. This debate must also be about you and me giving what we can to help those in need, and the charitable contribution deduction makes this possible.

Should the charitable contribution deduction be cut, capped or limited, the results could be catastrophic for those who need it the most. Currently, the top statutory tax rate for income and charitable deductions is 39.6 percent. The “after-tax cost” for high-income taxpayers is $604 for a $1,000 charitable contribution. In a proposal put forth by the administration earlier this year, the tax benefit of all itemized deductions — including charitable contributions — would be capped at 28 percent. The difference is substantial — the net cost of that $1,000 donation would rise to $720. This increased cost will translate into a significant drop in giving — almost $10 billion annually according to a well-respected Washington think tank.

Limiting the value of charitable contributions would be especially catastrophic to charities such as the Jewish Federations that operate in a “90-10” fiscal environment. Many charities receive more than 90 percent of their charitable contributions from less than 10 percent of their donors. While we and many other nonprofits receive hundreds of thousands of donations each year, we still rely on the charity of top donors to support our work in the community. Although most of these top donors do not give solely because of tax advantages, they often use tax strategies to maximize the effectiveness of that gift, in terms of both timing and the size of the donation.

The charitable contribution deduction has been part of the tax code for almost a hundred years, and it is vital that lawmakers continue to use tax policy to encourage charitable giving, especially in current economic conditions. We are grateful that a bipartisan group of legislators has recognized the importance of protecting this deduction as Congress rewrites the tax code. Key members of the Senate Finance Committee — John Thune, R-S.D., andRon Wyden, D-Ore. — have sent letters to their colleagues urging the protection of the charitable donation deduction. The senators reminded their colleagues that proposals to cut, cap or limit deductions would cost nonprofit and philanthropic organizations billions of dollars each year.

Even in our fragile economy, Americans still want to give back to those who need help the most. However, charitable giving will suffer should the deduction be limited. It is crucial that Congress follow the leadership of Thune and Wyden and protect the charitable contribution deduction. If Congress cuts, caps, limits or alters the deduction, the results could be devastating for those who need help the most. Now is the time for reaching out and helping those less fortunate — not to make it more difficult to help those in need.

Matthew S. Delaney
Chief Executive Officer, The Hawaii Group, Inc. (HiGroup)
808-695-2221
mdelaney@thehawaiigroup.com

Honolulu, Hawaii (January 1, 2014) – The Hawaii Group (HiGroup) and Hawaii Human Resources, Inc. (HiHR) has recently purchased JS Services, Inc., a professional employer organization (PEO) and employee leasing company that has been serving the Hawaii business community’s ongoing human resource needs for the past thirty-two (32) years.

The acquisition will take place immediately though JS Services will continue operating at its well-established location on Waialae Avenue. HiHR and JS Services structured this acquisition to ensure that JS Services, Inc. will survive and continue operating under the “JS Services, Inc.” name, with the same office and retaining 100% of JS Services existing staff. All parties are working hard to ensure that business will go on as usual for JS Services’ 337 clients.

In addition to preserving continuity and quality services and security, HiHR will also offer JS clients increased access to new resources and expertise, cutting-edge technology, and other business support services like staffing, recruiting, accounting, and marketing services through The Hawaii Group’s family of service entities.

Jack Schneider, CEO of JS Services, Inc., established the company back in 1982, building it from a small business to a notably large company with a loyal following of approximately 337 clients. Schneider saw the early benefits of the employee-leasing business model, where smaller to mid-size companies could outsource payroll functions and tedious paperwork burdens to help streamline and leverage day-to-day business operations and expertise. JS Services saves companies tons on unnecessary administrative costs and continues to bring in a steady stream of clients. Under Schneider’s leadership, JS Services, Inc. currently generates over $10 Million in annual revenues.

Partnering with HiHR was an easy decision for Schneider. “We are looking forward to this new partnership with HiHR,” said Schneider. “This fresh, new leadership team is just what we need to take us into the next year and beyond. We believe exciting things are in store for the future.”

HiHR was also quick to recognize the value of partnering with JS Services. “Jack has been a valuable mentor to me since I started HiHR in January 2009, five years ago. I
appreciate the trust and confidence Jack has placed in HiHR and our Executive Management team to carry on great service to his very loyal and long-standing clients,” stated The Hawaii Group CEO Matt Delaney.

HiHR is ecstatic about how the combined forces of the merger will add more
comprehensive services, improved technology and benefits to its growing client base. “Our strength is in our technology and the HiTouch service we provide to our clients,” explained Harry Byerly, President of HiHR. “We are the only HR Outsourcing firm in Hawaii that will completely customize services for each and every client” stated Scott Meichtry, HiHR co-owner and Executive Vice President. “If our clients only want HR Advisory services, payroll only, or full outsourcing, we listen to our clients and come up with a program that works for them.”

“There are so many necessary but time-consuming tasks in running a business,” noted
Byerly, “from payroll… to TDI… to workers’ compensation. The paperwork alone
could really bog you down. Collectively, we can help our clients use their time more
productively. It’s a great way to start off the New Year,” he added.

About HiHR and The Hawaii Group:
Hawaii Human Resources, Inc. (HiHR) is one of Hawaii’s fastest growing companies.
Formed in 2009, it provides customized human resources solutions for over 450 Hawaii businesses and over 8,000 employees across Oahu, Maui, Big Island, Kauai, and
Molokai. HiHR will service over 850 clients and over 9,000 employees after its successful acquisition of JS Services, Inc. and OneSource, Inc.

HiHR offers comprehensive outsourcing support, including human resources and health benefits administration, payroll, accounting, workers’ compensation and risk management, and business insurance. Trusting HiHR with these services allows companies to focus on their core business issues and ultimately increase productivity and profitability while better avoiding and containing HR-related risks.

The Hawaii Group (HiGroup) is the parent company to a family of companies that provides complementary services to businesses of all sizes in Hawaii. It encompasses marketing (HiMRK), accounting (HiAccounting), employment and staffing solutions (HiEmployment), health care staffing (HiNursing) and home care staffing (HiHomeCare), and human resource administration (HiHR). Learn more at www.TheHawaiiGroup.com.

About JS Services:
Jack Schneider incorporated JS Services in 1982. Back then, there were only 40 Employee Leasing Companies in the country, unlike today. Now there are thousands. As a reputable payroll services company, JS Services handles everything from payroll, health insurance, worker’s compensation, and more. That’s why they’ve become the trusted payroll service company on Oahu for over 30 years. Learn more at www.jsservices-hawaii.com
###

Media Contact:
Lani Corrie
Corrie Creative
(808) 256-4317
lani_corrie@yahoo.com

• Roll Call Staff

At the dawn of the election year, Senate Republicans feel a renewed sense of optimism in their fight to net the six seats necessary to win the majority in 2014.

The stumbling rollout of Obamacare has given the GOP hope it can loosen the Democrats’ grip on the majority by ousting its four most vulnerable incumbents.

Still, several factors could influence how things appear in the final months of President Barack Obama’s second midterm cycle. And Democrats have proved in recent years they know how to win tough Senate races.

Will the Obamacare implementation improve? Will the economy rebound? How big of a fight will Republicans put up over the debt ceiling? And how about the GOP’s pesky primaries?

These unknowns are why optimism — but not overconfidence — is the overriding feeling among the Senate GOP.

“I’m more bullish about the GOP’s chances in the Senate now than I have been at any point this cycle,” said Dan Judy, a pollster at GOP firm North Star Opinion Research. “The shutdown seems like a distant memory and the Ryan/Murray deal went a long way to settling things down so that our guys can really focus on the midterms.”

Meanwhile, Democratic pollster Celinda Lake cited GOP primary issues, well-prepared candidates and demographic changes among the reason for Democrats’ positive outlook, even as Obama’s approval ratings hover in the low 40s.

The GOP’s own unpopularity “gives these senators the ability to individually define their opponents, and Senate races have the kind of money necessary to individualize,” Lake said.

Here is a rundown of the competitive Senate playing field as it stands today, with Rothenberg Political Report/Roll Call race ratings:
Most Vulnerable Incumbents Sen. Mark Begich, D-Alaska
The late Aug. 19 primary gives the eventual GOP nominee less than three months to focus solely on Begich. Former Natural Resources Commissioner Dan Sullivan is outraising his opponents, and a super PAC backing him just launched its first ads against Begich.

Rating: Tossup/Tilt Democrat
Sen. Mark Pryor, D-Ark.
Democrats are defending Pryor in part by defining Republican Rep. Tom Cotton as a “reckless and irresponsible” alternative. The state is trending Republican, and Cotton has the support of both the national party and conservative outside groups.

Rating: Tossup/Tilt Republican
Sen. Mitch McConnell, R-Ky.
The Senate minority leader faces opponents on his right and left. Before taking on Secretary of State Alison Lundergan Grimes, McConnell must first dispense with Republican businessman Matt Bevin, who is supported by conservative outside groups.

Rating: Lean Republican
Sen. Mary L. Landrieu, D-La.
Landrieu has never won an election with more than 52 percent in the Bayou State, which voted 58 percent for Mitt Romney in 2012. This year she’s facing a top Republican recruit in Rep. Bill Cassidy. They’ll face off in the November jungle primary with Republican Rob Manness, who is backed by conservative outside groups, before a likely runoff.

Rating: Pure Tossup
Sen. Kay Hagan, D-N.C.
Despite a crowded GOP primary that could weigh down the eventual nominee, Republicans are at least aided here by its early date (May 6). Still, the incumbent has been preparing for this race for nearly a year already, and Republicans could end up with a weaker candidate than they hoped. Speaker Thom Tillis is the party’s top recruit there, but he faces tea party favorite Greg Brannon and pastor Mark Harris, among others.

Rating: Tossup/Tilt Democrat
Top-Tier Open Seats Georgia: Retiring Republican Saxby Chambliss
This primary could have the greatest effect on the competitiveness of the general of any Senate race this year. Reps. Paul Broun and Phil Gingrey are likely to coalesce conservative primary voters, who could propel one of them to the top of a crowded field. Former Points of Light Foundation head Michelle Nunn, a Democrat, is raising serious cash and awaiting her opponent.

Rating: Republican Favored
Montana: Retiring Democrat Max Baucus
What this race looks like in November will depend on how quickly Baucus is confirmed as ambassador to China and whom the Democratic governor appoints to replace him. Republican Rep. Steve Daines and Democratic Lt. Gov. John Walsh will likely face off in the general in this top pickup opportunity for the GOP.

Rating: Tossup/Tilt Republican
South Dakota: Retiring Democrat Tim Johnson
Democrats missed out on their top two potential recruits and now appear likely to lose the seat in November. Former Gov. Mike Rounds is the favorite among the Republicans, but he faces a crowded primary before likely meeting former Democratic congressional aide Rick Weiland in the general.

Rating: Republican Favored
West Virginia: Retiring Democrat Jay Rockefeller
GOP Rep. Shelley Moore Capito entered the race in November 2012. She’ll likely face Secretary of State Natalie Tennant, a Democrat, in another top GOP pickup opportunity.

Rating: Lean Republican
Second-Tier Open Seats Iowa: Retiring Democrat Tom Harkin
Democratic Rep. Bruce Braley may have to wait out both a crowded Republican primary and convention before knowing whom he’ll face in November.

Rating: Lean Democrat
Michigan: Retiring Democrat Carl Levin
Democratic Rep. Gary Peters is facing Republican former Secretary of State Terri Lynn Land. Republicans have won only a single Senate race in this state since 1972.

Rating: Democrat Favored
Democrats in Other Competitive States Sen. Jeanne Shaheen, New Hampshire
Shaheen’s greatest challenge could come from former Sen. Scott P. Brown, R-Mass. Brown hasn’t announced his plans yet, but winning a Senate race in two different states is nearly unprecedented.

Rating: Democrat Favored
Sen. Mark Warner, Virginia
It’s hard to find an incumbent from a purple or red state in a better position than Warner. And it remains to be seen what former Republican National Committee Chairman Ed Gillespie’s path to victory will be.

By Ed O'Keefe, Updated: January 14 at 9:51 am
Updated and corrected 11:48 a.m.

Congressional negotiators released the details of a massive $1.1 trillion spending bill that would fund federal agencies through the rest of the fiscal year and end the lingering threat of another government shutdown.

So, what's in it? We quickly sifted through the legislation, consulted supporting documents from Democratic and Republican aides, and called out some of the more notable and controversial elements below.  (If you want a detailed report on each of the 12 pieces of the broader spending bill, it's all here.)

ABORTION
The bill once again bans the use of federal funding to perform most abortions; bans local and federal funding for abortions in the District of Columbia; and federal dollars for abortions for federal prisoners; and bans the use of U.S. foreign aid on abortions. But the agreement doesn't codify the so-called "Global Gag Rule" that bars nongovernmental organizations that receive federal funds from providing women information on certain health programs.

AFFORDABLE CARE ACT
The agreement doesn't provide any new funding to implement the health-care law and maintains current funding levels at the Centers for Medicare and Medicaid Services, the primary agency overseeing the law. But appropriators targeted a few controversial elements of the law.

First, there's a $1 billion reduction in the Prevention and Public Health Fund, a move Republicans say will keep administration officials from using the money to pay for elements of the health law. The bill also slashes $10 million for the Independent Payment Advisory Board, often referred to by Republicans as the "unelected bureaucrats" or "death panels" that are set to advise government officials on health-care issues.

AIRPORT SECURITY
The Department of Homeland Security will take a $336 million cut in funding, with most of the reductions at the Transportation Security Administration. In a victory for Republicans who have sought for years to boost the use of private security contractors, the agreement increases funding for private security screeners and caps TSA's overall screening personnel at 46,000.

AFGHANISTAN
The measure includes $85.2 billion for military operations in Afghanistan, a $2 billion cut from fiscal 2013 due in part to ongoing troop reductions. But the agreement also withholds money for the Afghan government "until certain conditions are met," including a decision to sign a new bilateral security agreement.

BORDER SECURITY
The agreement includes $10.6 billion for Customs and Border Protection, about $220 million more than the previous fiscal year. In a victory for California lawmakers and border security advocates, $128 million is allotted to expand the busy U.S.-Mexico border crossing station between San Diego and Tijuana, Mexico. But the sum is less than the $226 million originally sought by the Obama administration.

CONGRESSIONAL SPOUSES:
The omnibus includes a $174,000 bereavement payment to Beverly A. Young, the widow of the late congressman C.W. Bill Young (R-Fla.). This is a customary payment made to the spouse of a lawmaker who dies in office and equals one year's salary.

DISASTER FUNDING
Appropriators set aside about $6.55 billion for the Disaster Relief Fund used by the Federal Emergency Management Agency to provide assistance to affected individuals and city and state governments.

DISTRICT OF COLUMBIA
There's $673 million for the District, about $2.2 million below last year. The sum includes $232.8 million for D.C. courts, $226.5 million for criminal offender supervision and $48 million for school improvements.

But there are two big blows for the District. First, there's no language allowing D.C. budget autonomy. Secondly, there's only partial funding to continue building out the Department of Homeland Security's new campus in Anacostia, a project that District leaders consider critical to the revitalization of Southeast.

EMBASSIES
Despite concerns for embassy security following the Sept. 11-12, 2012, attacks on two U.S. outposts in Benghazi, Libya, the bill provides $224 million less for embassy security, maintenance and construction costs than in fiscal 2013. The bill bans the construction of a new embassy in London and bars the State Department from closing the chancery at the U.S. Embassy in the Holy See and merging it with the one at the U.S. Embassy in Rome for security reasons, a project first pushed by George W. Bush's administration.

EPA
Democrats successfully blocked attempts by Republicans to prevent the agency from regulating greenhouse gas emissions and to repeal new clean water regulations.

FLOOD INSURANCE
The legislation delays certain premium increases triggered by changes to the FEMA's flood insurance program. It's a big issue of concern for dozens of lawmakers in several areas, who strongly oppose changes that were made in a major flood insurance reform bill a few years ago. The language is an especially big victory for Rep. Bill Cassidy (R-La.) and Sen. Mary L. Landrieu (D-La.) as they continue to face each other in the hotly contested Louisiana Senate race.

GITMO
The legislation bans the Obama administration from transferring terrorism detainees from the U.S. detention facility at Guantanamo Bay, Cuba, to facilities in the United States. It also prohibits any money from being spent to "modify any facility in the U.S. to house detainees," a direct slap at attempts to build a terrorism detention site at a facility in Illinois.

GUNS AND AMMO
Several issues regarding gun control are in the bill. There's language prohibiting various import and export criteria related to firearms. The legislation restricts the Justice and Homeland Security departments from establishing programs similar to the “Operation Fast and Furious” gun-running program. In response to allegations that the administration has been stockpiling ammunition for use by federal agents, the measure also requires DHS to provide detailed reports on its purchase and use of ammunition.

Democrats also stopped Republicans from blocking gun sellers from reporting multiple sales of rifles or shotguns to the same person. Finally, the legislation provides more money for National Instant Criminal Background Checks program to meet "increased demand."

GOVERNMENT CONTRACTORS
The legislation prohibits any funding to require that contractors bidding for federal contracts disclose campaign contributions. The Obama administration has openly flirted with issuing executive orders that would require contractors to provide campaign disclosures.

HEAD START
In a big boost for education funding, there's $8.6 billion allotted for the program, a $1.025 billion increase. Within that funding is $500 million for Early Head Start and $250 million in grants to expand preschool programs.

IMMIGRATION
With the Obama administration still deporting thousands of illegal immigrants on a daily basis, there's $2.8 billion for detention programs operated by Immigration and Customs Enforcement. That funding helps to pay for 34,000 beds for detainees, "the highest detention capacity in history," according to the House Appropriations Committee. There's also $114 million to continue funding the E-Verify program used to help companies check the immigration status of job applicants. The bipartisan immigration reform proposal passed by the Senate last year would add additional funding to the program.

Democrats successfully blocked GOP attempts to prohibit the Justice Department from using federal funds to mount legal challenges to state immigration laws. And they blocked a GOP-backed rider that would have stopped ICE from prioritizing the deportation of dangerous criminals and instead forced the agency to target all groups, including  the children of illegal immigrants.

THE IRS
The scandal-ridden tax-collecting agency comes in for special scrutiny this year. There's no funding "to target groups for regulatory scrutiny based on their ideological beliefs or to target citizens for exercising their First Amendment rights." And the agreement requires the agency to provide reports on its spending on training and bonuses. And, in response to those "Star Trek" parody videos, there's no funding "for inappropriate videos."

JOE BIDEN
The legislation enacts a pay freeze for the vice president "and senior political appointees."

LIBYA
There's a ban on foreign aid for Libya until Secretary of State John F. Kerry "confirms Libyan cooperation" with ongoing investigations into the September 2012 attacks on the U.S. compounds in Benghazi. The measure also includes additional money to upgrade several temporary diplomatic missions around the world.

LIGHT BULBS
The measure bars funding to enforce new light bulb standards that would ban the use of incandescent bulbs. The proposal was first introduced and set in motion by the bush administration, but the Obama White House seized on the issue and allowed the change to continue, despite the sustained consumer demand for older bulbs.

MILITARY PAY
The legislation authorized a 1 percent pay increase for U.S. military personnel. The agreement also authorizes 1,361,400 active-duty troops and 833,700 reservists.

MILITARY VETERANS
In a change to the bipartisan budget agreement, lawmakers agreed to restore a cut in the cost-of-living adjustments to the pensions of disabled working-age veterans. The fix is a victory for members of both parties who sought to quickly restore the funding, even as they try to reverse the pension cuts for all veterans, which is likely to occur next year.

NUCLEAR WASTE
Consistent with current policy, the agreement doesn't provide any funding to further develop the Yucca Mountain site in Nevada. Senate Majority Leader Harry M. Reid (D-Nev.) and other Silver State lawmakers have fought for years to keep the government from using the location for nuclear disposal.

OFFICIAL PORTRAITS
In a blow to one of the coolest perks of serving in the Cabinet, the legislation bars the use of federal money "for painting portraits."

U.S. POSTAL SERVICE
In a blow to those seeking to revamp the nation's mail service, the legislation bars postal officials from ending Saturday mail delivery — a move endorsed by a majority of Americans — or from closing far-flung rural post offices — a tricky issue fraught with political concerns. Postal officials for years have been seeking to end Saturday deliveries and to close smaller, less profitable locations.

SEXUAL ASSAULT IN THE MILITARY
In compliance with the defense authorization bill passed last month, the agreement provides $157 million for the Pentagon’s sexual assault prevention programs and $25 million to expand a victims’ counsel program for troops involved in rape or sexual assault cases.

THE WEATHER
The bill includes $5.3 billion for the National Oceanic and Atmospheric Administration, including money for the National Weather Service to keep running and building key weather satellites.

FEDERAL WORKER PAY (AND PARTYING)
The measure authorizes a 1 percent pay increase for civilian federal workers and U.S. military personnel. But in response to several embarrassing examples of excess spending by federal agencies (IRS! GSA!), the bill also puts in place new bans and limitation on certain conferences, official travel and employee awards.

SCHOOL LUNCH
The agreement provides the Agriculture Department with enough money to provide an estimated 5.6 billion free or reduced-price school lunches and snacks for about 32.1 million eligible schoolchildren

TRAINS
The legislation places overtime limits on Amtrak employees. And it includes no federal funding for high-speed rail projects in California, the Northeast corridor and elsewhere. But in a win for rail advocates, the agreement doesn't include a policy rider that bans the government from ever providing federal dollars for such projects.

Carter said he doesn’t think the House should take up an immigration policy overhaul this year because it would be a distraction from the health care law. 

Speaker John A. Boehner of Ohio is making a mistake pushing for an immigration overhaul this year, according to one of the House Republican Conference’s former top immigration negotiators.

Rep. John Carter of Texas, one of four GOP congressmen who was part of bipartisan negotiations over comprehensive immigration policy changes last year, said voting on the matter this year would distract from the party’s efforts to highlight flaws in President Barack Obama’s health care law.

Boehner told the conference and the press last week that leaders and committee chairmen will produce a blueprint outlining agreed-upon principles for overhauling the nation’s immigration system, leading many to speculate that votes on the issue could be held later this year.

“I’m opposed to voting on a bill this year,” said Carter, who was a member of GOP leadership last Congress. “I was in conference when John announced that. It was a surprise to me as much as it was a surprise to anybody else.”

Carter added that the votes could leave Republicans vulnerable to primary attacks from the right, especially if, as is expected, the changes take on the question of the legal status of some 11 million undocumented immigrants living in the United States.

“I personally think this is the wrong time from our standpoint to go forward on immigration,” he said. “It’s an election year. I mean Texas is in the middle of primaries right now.”

That said, Carter would contribute to policy change efforts if he is asked, he said. His views on timing do not necessarily mean he will oppose bills if they come to the floor.

Carter’s criticism echoes that of some of the staunchest critics of an immigration overhaul, underscoring just how difficult it will be to pass anything this year. Rep. Steve King, R-Iowa, for instance, said that he’s worried that leadership is heading down a path many GOP members would rather avoid.

“I’m concerned about an effort to stampede our conference,” he said. “Any day that we’re discussing immigration here, having a debate on the floor or in committee and capturing the news media cycle on it, is a day that we’re not fixing the calamity of Obamacare.”

Others in the conference are cheering Boehner’s move, however, including Rep. Mario Diaz-Balart, R-Fla., who is engaged in negotiations hoping to produce piecemeal immigration bills.

“I’m ecstatic about it. I think it’s a very important step to make sure the House and the country realizes what the Republican principles are,” he said.

GOP leaders have said from the start that border enforcement should be the first priority of any immigration overhaul effort, and sources speculate it will top the list of principles.

Homeland Security Chairman Michael McCaul, R-Texas, passed a bill through his panel last year that begins to deal with border enforcement, and he said he expects to follow that effort next month with a border enforcement strategy that includes a price tag. He said his discussions with Customs and Border Protection officials leads him to believe he can write a bill that spends less than the $60 billion the Senate allotted for enforcement.

A top priority, he said, is redeploying military assets used in Afghanistan and Iraq to the border, including sensor technology and drones. When asked whether American would be comfortable with domestic drone use, he said he thinks their use at the border is appropriate.

“They don’t like drones internally in the United States, but if you’re defending our borders with them, there’s more of an appetite for them,” he said. “I mean, they’re not drones equipped with hellfire missiles. It’s purely for surveillance.”

It’s rare in politics that anything other than a presidential contest is viewed as a “must win” — but the special election in Florida’s 13th District falls into that category for Democrats.

A loss in the competitive March 11 contest would almost certainly be regarded by dispassionate observers as a sign that President Barack Obama could constitute an albatross around the neck of his party’s nominees in November. And that could make it more difficult for Democratic candidates, campaign committees and interest groups to raise money and energize the grass roots.

Fundamentally, the district, left vacant by the death of longtime Republican Rep. C.W. Bill Young, looks competitive but has a slight Democratic tinge. Barack Obama carried it 52 percent to 48 percent in 2008, but he had a more narrow victory four years later, when he won 50 percent to 49 percent.

But fundamentals are only a small part of the Democratic advantage in the district this year. Campaign-related factors should strongly benefit the Democrats, as well.

Alex Sink is certain to win the Democratic nomination in the Jan. 14 primary. Sink, whose late husband, Bill McBride, was the unsuccessful Democratic nominee for governor in 2002, was elected Florida’s chief financial officer in 2006.

Four years later, she was her party’s gubernatorial nominee. In that toxic political environment for Democrats, Sink lost to multimillionaire GOP businessman Rick Scott by a mere 61,550 votes out of more than 5.3 million cast – a margin of just more than 1 point. In that contest, Scott spent $73 million of his own money (including money from his wife’s revocable trust), according to theOrlando Sentinel. But Sink carried the 13th District by 2 points in that race.

Democrats have rallied behind Sink’s congressional bid so completely that 2012 Democratic nominee Jessica Ehrlich, who wanted to run in the special election, was forced out of the contest.

Republicans, on the other hand, won’t choose their nominee until next week. The GOP primary seems to boil down to David Jolly, a longtime aide to Young who left his staff to become a Washington, D.C., lobbyist in 2007, and state Rep. Kathleen Peters, who is serving her first term in the Florida Legislature.

The Republican primary has not been without rancor (it has even divided members of the late congressman’s family), and the eventual nominee will have to unite his or her party quickly, raise funds for the special election and immediately start to engage Sink.

Money could be a significant problem for the GOP.

In her Dec. 25 online fundraising report, Sink showed total contributions of $1.43 million, with just more than $1 million in the bank. In his late December report, Jolly showed just under $142,000 on hand, while Peters reported less than $18,000 in the bank.

The calendar also favors the former Florida CFO, who is clearly more prepared to launch a top-tier campaign after the polls close next week than her eventual Republican opponent will be. While a mere eight weeks separate the special primary and the special election, the window is even narrower than that, because absentee ballots for domestic voters are tentatively scheduled to be mailed on Feb. 4 and early voting begins March 1, according to the website of the Pinellas County supervisor of elections.

Given all of the advantages that Sink has — the district, her experience and proven electoral success, her money in the bank and her united party — and the problems the GOP nominee will face, shouldn’t the likely Democratic nominee be a clear favorite to win the special election, getting her party one seat closer to the majority in November?

The answer is “yes,” and if this seat had become open in 2006 or 2007, there is little doubt that Democrats would have been solid favorites to win.

But the president’s weak poll numbers nationally and the problems associated with the launch of the health care law could undermine Sink’s obvious advantages, particularly in this Central Florida district, where 22 percent of residents are 65 or older. (Republican strategists believe that voters 65 and older could constitute close to 30 percent of the special-election electorate.)

If swing voters decide to use the special election as an opportunity to register their displeasure with the president or punish Sink because she is a member of Obama’s party, the eventual Republican nominee’s prospects could rise.

And Democrats are worried that the composition of the special-election electorate will make the contest more challenging for their nominee than it would be in a regularly scheduled election.

Still, all things being equal, Sink has enough advantages to produce a narrow but clear victory. So, while a victory would constitute a takeover and give her party’s talking heads an opportunity to demonize the Republicans in Congress once again, it would not be surprising.

On the other hand, since most nonpartisan handicappers and analysts have for years expected this seat to go Democratic when it became open, a Republican victory in March would likely say something about the national political environment and the inclination of district voters to send a message of dissatisfaction about the president. And that possibility should worry the White House.

The National Republican Congressional Committee would love to keep this Florida seat in the special election. The Democratic Congressional Campaign Committee cannot afford to lose it. Those are two very different perspectives that reflect the relative importance of this election to the two parties.

TAMPA, FLA. — McHenry Consulting, Inc., a leading national firm specializing in the professional employer organization (PEO), staffing, and outsourcing sectors, today announced that Erica S. Whyman has joined the organization as the Director of Recruiting and Human Capital Strategies.

Whyman brings more than a decade of progressive human resource and consulting experience to her role at McHenry Consulting. As Director of Recruiting and Human Capital Strategies, Whyman will be responsible for all human resource advisory services for the firm’s clients including human capital strategies and advisory services, talent acquisition, human resource process improvement, employee relations, organizational development and succession planning.

Whyman served nearly a decade with Oasis Outsourcing, a national professional employer organization. Her career at Oasis began in compliance and underwriting, moving into HR Management, where she managed four regions and a team of 20 plus HR consultants. Whyman was selected as the Senior Manager of HR Strategy to lead a cross functional team targeting client retention.

Beyond her tenure at Oasis, Whyman formed an independent consulting business to assist small and medium size business in establishing HR infrastructure as well as business and management strategy. Whyman also served as a staff writer for the Florida Health News writing health related articles and establishing a monthly column focusing on women’s health issues. Whyman graduated Cum Laude with a Bachelor of Science in Human Resource Development from the University of Florida and holds the SPHR designation.

“We are pleased to welcome Erica to our professional advisory team to build and expand upon our successful recruiting and human resource advisory practice. Her experience and results oriented solutions approach will be a complement to the firm’s mission of performance optimization and profit improvement for our clients,” stated Dan McHenry, the firm’s President and Business Advisory Group Practice Leader.

“I am thrilled at the opportunity to join McHenry Consulting; I have been watching the firm for years and know that their industry expertise is unequaled. I am excited about contributing not only to the human resource practice but to the overall goals and success of the company and its clients,” stated Erica Whyman.

To add Ms. Whyman to your network, click here to go to her LinkedIn profile to send an invitation or, alternatively, send a congratulatory note to erica@mchenryconsulting.net.

For more information contact Dan McHenry at dan@mchenryconsulting.net, visit the firm’s website at www.mchenryconsulting.net, or visit the McHenry Channel.

About McHenry Consulting, Inc.

McHenry Consulting is a Tampa based firm specializing in the professional employer organization industry. Backed by over a century of rich and diverse experience, our team of advisors delivers combined expertise in strategic services, business and organizational performance, human capital and talent management, mergers and acquisitions, technology and operating platforms, and healthcare strategies. The firm’s client base is diverse in size and scale and ranges from the large national publicly traded companies to the small and middle business market.

House-Senate negotiators are slated to meet Monday in hopes of narrowing their last differences over a $1 trillion-plus omnibus spending bill that attempts to fill in the blanks after December’s budget deal and avoid another shutdown next week.

If last month’s agreement said how much Congress can spend this year, the giant appropriations measure now spells out where the dollars will go. Hundreds of pages long, it literally touches every corner of the government. But its very scope also invites conflict over everything from Wall Street’s banks to Appalachia’s coal industry — championed by House Appropriations Committee Chairman Hal Rogers (R-Ky.).

The challenge now is to find balance — and be fast about it.

Funding levels for President Barack Obama’s new health care law remain an open issue, for example. But with the Supreme Court already poised to step into the contentious debate over contraceptive coverage, negotiators would prefer to avoid legislative riders on the same mandate.

The Pentagon’s base budget, which is expected to end up near $488 billion, represents its own middle ground: $24 billion less than the House approved in July but $20 billion more than what sequestration once threatened this month.

At the same time, non-defense appropriations will be restored to $492 billion — roughly the same level as before the March automatic cuts but less than what President George W. Bush enjoyed in the last years of his administration.

New investments in science and medical research will be possible. Less glamorous accounts like project-based rental assistance for low-income tenants will come up short by as much as $1 billion.

Looking overseas, compromises are in the works on U.S. assistance to Egypt. Refugee aid is slated to be increased significantly given the continued bloodshed in Syria and Africa. But Treasury faces continued resistance as it tries to make good on past pledges needed to open the door for countries like Brazil, China and India to play a greater role in the International Monetary Fund.

Working through the holidays, Appropriations clerks have made substantial progress already. But the next few days are pivotal as Rogers and his Senate counterpart, Chairwoman Barbara Mikulski (D-Md.) meet face-to-face to sort out the most difficult issues, kicked up to their level for final decisions.

The mood is guarded, the window narrow.

The government remains under a stopgap continuing resolution due to expire Jan. 15 and Congress leaves soon after for its mid-January recess. As a practical matter some extension of the CR will be needed — and should not be controversial if the omnibus is proceeding on course. But the Appropriations leadership wants to keep any extension short so that the pressure is on to complete passage before lawmakers leave on Jan. 17.

For the committees, it’s a test of whether powerful members, like Rogers, will suppress their own individual agendas and move ahead together.

For Congress more broadly, it will tell a lot about how much was really learned from the past year — a record of failure that seriously hurt the institution in the eyes of the American public.

Adding to the stakes now is the fact that the House and Senate Agriculture committees are also pressing to complete their own long-delayed farm bill in this same two-week window.

Staff talks continued through the weekend on final legislative language in hopes of having the full farm bill conference meet late this week, perhaps Thursday. If an agreement can be ratified then, the pressure will be on to move quickly onto the House floor before the mid-January recess.

The fact that two such giant pieces of legislation — each with a checkered-past and cause of considerable heartache — should suddenly converge at the Capitol’s doorstep is quite extraordinary.

But in both cases the fundamental question for Congress is the same. It is better to move forward after coming this far after so long? Or will lawmakers find it easier to fall back into more fighting?

Failure is not without a big price — both in terms of policy and politics.

If the omnibus collapses, Congress will have to revert to another year-long CR that surrenders its influence over government agencies. If the farm bill stalls again, Republicans will have to explain to their rural constituents why they have been unable to deliver legislation for two Congresses in a row.

But without doubt, the choices now are also more detailed, often more difficult than the budget agreement in December.

That bill passed the House by a better than 3-1 margin, but it seems very unlikely that Speaker John Boehner (R-Ohio) can do better than the 169-62 split he enjoyed then among his Republicans. Democratic support is vital, and the next two weeks will tell a lot about the chances of any cooperation for the remainder of this year.

Having been burned so often in the past, the Appropriations leadership is heading down this trail with abundant caution.

There has been more than the usual secrecy in discussing even non-controversial pieces of the omnibus — really 12 bills in one. But the basic outlines of the giant measure will conform to the targets set in December, and it is possible to glean some details from these numbers.

Total discretionary spending will be about $1.012 trillion, of which $491.8 billion is designated for non-defense spending and $520.5 for defense, which includes not just the Pentagon but nuclear weapons programs overseen by the Energy Department.

Measured in real dollars, adjusted for inflation, this is significantly less than the last years of the Bush presidency and well short of the $1.058 trillion that Obama had requested for fiscal 2014.

Even in nominal dollars, discretionary spending for transportation and housing programs will be about 24 percent less than the Democrats’ high-water point in fiscal 2010.

In this context, the omnibus is best understood as a major reset of government-wide appropriations and a bid to restore some order after all the turmoil of recent years.

The dynamics are different in that the December budget deal makes it harder for any single-issue legislative rider to block funding for its entire chapter of the omnibus bill. Specific levels of spending were set last month and these have been allocated among the 12 titles of the bill. Thus if one title fails to close, it can’t be forced to revert to the lower spending levels in the current stopgap CR without disrupting the larger December deal.

For example, in similar House-Senate negotiations last spring, a dispute over high-speed rail funding in California made it impossible to close the appropriations chapter dealing with transportation and housing programs. The same California fight persists today. But even if no agreement is reached, the revised spending allocation for transportation and housing would still prevail and is about $3 billion over what’s now allowed in the current CR.

Negotiators are hoping that this helps to tame those threatening to hold up the bill for a single policy rider. These disputes are still among the most ticklish, and the chapter funding the Interior Department and Environmental Protection Agency is a traditional magnet for legislative provisions. Even nutrition programs are not immune, as seen in a backroom fight now over whether potatoes are among the vegetables qualified for purchase under the WIC program to help pregnant women and their infant children.

Rogers’ Appropriations office refused any comment on his own set of coal-related riders. But the Kentucky Republican has spread his wings this year to include even the foreign aid chapter of the omnibus bill which fund the Export Import Bank.

In line with Obama’s climate change priorities, the Ex-Im board of directors voted Dec. 12 to revise its environmental guidelines to limit future financing for coal-powered generating plants overseas. And this appears to be the target of a House rider attached to the bank’s appropriations, blocking enforcement of any rule that has the effect of denying funding for “power-generation” projects that would “increase exports of goods and services from the United States.”

Ex-Im has said the new carbon rules are not intended to impact U.S. exports of coal. In fact the bank is being sued in California by a coalition of environmental groups for having provided loan guarantees to assist a Pennsylvania-based company — Xcoal Energy &Resources — which exports coal from Appalachia to Asia. But the board’s decision is a blow to U.S. manufacturers of turbines and mills used in coal-powered plants abroad and these corporations are part of the larger coal coalition championed by Rogers.

One way to fight riders is for negotiators to add one of their own.

No decisions have been made but there have been discussions of using the omnibus to make what could be one popular fix to the December budget deal. That bill achieved about $6.2 billion in long-term savings by trimming 1 percentage point from the future cost-of-living increases for military retirees up to their 62nd birthday. Proponents argued that the cut would only be borne by working-age retirees who could afford the cut because they had found other jobs. But the language was written in such a way that it inadvertently hit those with disabilities as well.

Fixing this problem could be popular vote-getter and have no immediate cost in 2014 since the pension cost itself will not go into effect until the end of 2015. But there is a concern too that any such amendment will only open the door to other attempts to alter the December agreement and invite more trouble.

By Meredith Shiner

Patty Murray and Paul D. Ryan are lawmakers on the rise, and their recent budget framework might not be a mere passing of ships in the night — especially if their upward trajectories continue on parallel paths.

The Democratic senator and Republican representative like to downplay their personal ambitions, even though Ryan ran for vice president at 42 and Murray has become Senate Majority Leader Harry Reid’s go-to person for political and policy puzzles.

Both have been mentioned as potential future leaders of their respective parties, even though those prospects are likely years away. In that event, the Murray-Ryan deal of 2013 may be an early harbinger of what could become a significant working relationship in years to come.

Aides to the Washington Democrat and Wisconsin Republican declined to comment on the personal stakes each lawmaker has in their successful budget negotiations, but House and Senate sources noted they are in a much better position for having come together than they would have been had they failed.“I think that they both got something that can be used as a credential no matter what they do in the future, and that is a bipartisan legislative achievement — not a massive one, but a bipartisan legislative achievement on a typically controversial issue,” one House GOP leadership aide said. “If you’re going to make a case for leadership in the House, getting something done is important. It’s a prerequisite for achievement.”

Ryan has not been shy about his intention to take the House Ways and Means Committee gavel in the next Congress, a position that is term-limited to six years. And Reid told CQ Roll Call last month that he has no intention of stepping down as leader anytime soon.

Those time frames, however, line up pretty nicely for Ryan and Murray — young relative to many of their colleagues — to ascend at roughly the same time. Such a possibility wasn’t at the forefront of their thinking, aides say, but the amount of time and energy the two spent before a deal was struck — through months of breakfasts and meetings, and even a victory lap last month on NBC’s “Meet the Press” — reflects that both savvy politicians saw the value of investing time with the other.

On NBC, Murray and Ryan touted their getting-to-know-you process as central to a deal.

“I think it is a step forward that shows that there can be other breakthroughs and compromise if you take the time to get to know somebody, know what their passions are and know how you can work together,” Murray said.

Ryan agreed. “We spent a lot of time just getting to know each other, talking, understanding each others’ principles. We basically learned that if we required the other to violate a core principle, we were going to get nowhere and we were going to just keep gridlock. Then we spent a number of weeks finding where common ground existed and we went through this budget — where’s the waste, where’s the corporate welfare, what reforms can we do, what do we agree on — and then we put that together and that’s what this resulted in. We also wanted to try to make this divided government work at least at a minimum, basic, functioning level and so we had the impetus to do that.”

House Republicans have a strong hold on their majority, based on a redistricting advantage gained last cycle. But as the national GOP continues to struggle with broad demographic change, House Republicans likely will have to change their political trajectory toward the end of the decade to maintain that hold — a scenario that could advantage a Republican who has a proven record of working with Democrats. Ryan has a way to go, considering the ire he drew from Democrats with his previous budgets, but between this deal and the tax rewrite aides say he wants to accomplish in his tenure at Ways and Means, the next few years could prove to be formative ones.

If Speaker John A. Boehner’s tumultuous tenure were to end, Ryan appears well-positioned in any potential race against Majority Leader Eric Cantor of Virginia or Majority Whip Kevin McCarthy of California. While Cantor appears to be the favorite for speaker in Boehner’s absence, the House Republican Conference has proved unpredictable over the past few years. Additionally, Ryan may opt to spend a few years in the trenches at Ways and Means to further build his conservative bona fides, which have been modestly damaged by his push for an immigration overhaul as well as the budget deal that some conservatives felt did not achieve cost-cutting goals.

The internal politics might be more complicated on the Senate Democratic side, with three top lieutenants under Reid.

When asked about Murray and her ascent within his ranks in a December interview, Reid praised her leadership, noting that she had simultaneously led the supercommittee while also serving as chairwoman of the Democratic Senatorial Campaign Committee (a job she’s held twice). “This is a strong woman, a strong person I should say, and I think she’s one of the finest senators around here,” Reid said, adding that he didn’t really know what might happen to the Democratic leadership if he were to “drop dead.”

Most political observers count the No. 3 Senate Democrat, Conference Vice Chairman Charles E. Schumer of New York, as the odds-on favorite to replace Reid should he step down or retire. Majority Whip Richard J. Durbin of Illinois could be in the running, too. Both currently outrank Murray on the leadership ladder.

Anything on the Hill can change quickly, of course, and Murray would be able to make the case that she worked with Ryan as opposed to just crafting successful political rhetoric using him as a foil, and that could be helpful to both of them during the next leadership shake-up.

But as painful as the year was for members, covering the House was a pleasure, one which we here at 218 only had the honor of doing for about half the year.

In that short time, 218 — or “Goppers,” as we were formerly known, which rhymes with “Whoppers,” for all you still wondering about that — had more than a few favorite stories.

Among the labors of love, there was a piece about the 10 Republicans who could one day be speaker, a story on an internal August playbook that went out to House Republicans telling them to profess how they were fighting Washington, and a piece (in response to his “calves the size of cantaloupes” comment) asking the question: How do you solve a problem like Steve King?

We also had a few favorite profiles this year: Minority Whip Steny H. Hoyer, D-Md., on the art of whipping; Rules Chairman Pete Sessions, R-Texas, who told us everything Republicans do in the House should be aimed at taking back the Senate; American Enterprise Institute PresidentArthur Brooks, who told us about his visit with the Dalai Lama and his plan to lead the “new right”; and the enigmatic Rep. Walter B. Jones, R-N.C., who spoke from the heart about, among other things, his own grandfather’s suicide.

But one of the more interesting stories of the year was from the very beginning of January, back before there was a Roll Call House blog, when Speaker John A. Boehner was almost unseated by a conservative revolt.

A few weeks later, Roll Call went to Williamsburg, Va., to report from the annual House GOP retreat, where members engaged in some serious self-reflection. One veteran lawmaker called it “the most important retreat I’ve been to in my 28 years in Congress.”

By March, Roll Call noticed that a new power player was beginning to emerge in the House Republican Conference: Rep. Tom Cole of Oklahoma. Once a foe of Boehner’s, Cole would, over the next several months, cement himself as an unofficial spokesman for the speaker, fighting against what he saw as the recklessness of hard-line conservatives and “political immaturity.”

This was about the time Roll Call started its blog Goppers, which would later become 218. The blog began with a two-part interview with Boehner (Part I, where he beats back a question about retirement by saying, “I’m far from done,” and Part II, where he says “the sequester is here to stay” unless there’s a deal leading to a balanced budget).

In April, Majority Leader Eric Cantor, R-Va., was forced to pull legislation from the floor that would strip funding from one program created by the 2010 health care law to shore up another: the high-risk insurance pools. Roll Call ran an analysis of what that “GOP revolt” really meant. The implosion turned out to be a harbinger of trouble to come.

In June, the farm bill blew up. That prompted leaders to devise a novel strategy of dropping food stamps from the bill. The gambit worked, and the farm bill got through the House, first as a farm-only bill, then as a nutrition bill.

In the summer, there was also a hullabaloo over the National Security Agency’s blanket collection of phone metadata. Rep. Justin Amash, R-Mich., leading a group of libertarian lawmakers, threatened to sink the rule for the Defense appropriations bill if they didn’t get a vote on the NSA. They got their vote, but in the end, the NSA amendment was defeated.

The major event of the year in the House, of course, was the government shutdown and continuing resolution battle. Before House leaders went ahead with that ill-fated strategy, Republicans were complaining in July that Heritage Action was pushing the tactic on them without a plan B.

We found out firsthand what sort of intentions Heritage Action for America and Club for Growth had when we sat down with them and asked if they wanted to depose Boehner.

July was also the month when House Republicans learned they couldn’t pass all appropriations bills at sequester levels.

Then came the August recess, where we named the 10 most quotable members of Congress, detailed the Republican Study Committee’s plan to replace Obamacare and broke the story about Boehner and Cantor declining invitations to show up for the 50th anniversary of Martin Luther King Jr.’s “I Have a Dream” speech.

But the August recess was abbreviated by that whole Syria thing (if you remember that). The authorization for the use of military force in Syria, which President Barack Obama sprang on Congress, seemed destined for failure in the House from the very first classified briefing.

After Syria simmered down, the conversation was back on Obamacare, and House leaders decided to move ahead with the defund strategy. That, as we all know, led to the government shutdown.

218 broke the story about House Republicans meeting with Sen. Ted Cruz, R-Texas, in the basement of the famous Capitol Hill watering hole Tortilla Coast. (We also did a little follow-up.)

Of course, there was, perhaps, no better story this year than Arkansas GOP Rep. Tim Griffin’s 3-year-old son, John, coming to the House floor to vote for members.

After more than 16 days, the House voted to raise the debt ceiling and end the shutdown. Somehow, Boehner emerged from the shutdown in a better position with his conference.

While Republican approval ratings were in the tank following the shutdown, they quickly found a way to change the subject: Obamacare, and specifically, the disastrous Healthcare.gov rollout (though freshman Republican Trey Radel’s cocaine bust did distract from the conversation).

Republicans dinged frustrated Democrats and Health and Human Services Secretary Kathleen Sebelius for broken promises and a broken website. Meanwhile, Minority Leader Nancy Pelosiwas standing behind her words on Obamacare.

Eventually, the House passed a Fred Upton, R-Mich., bill that would allow insurance companies to continue offering existing health care plans. Like most of the House’s work product this year, it went nowhere on the other side of the Capitol.

In the last half of the year, after the Senate passed its own comprehensive immigration overhaul bill, various House members started having anxiety over how to proceed. Republicans remained split, with some more moderate Republicans in heavy-Latino districts opting to sign onto a version of the Senate bill being touted by House Democrats.

Democrats also squabbled over the best strategy for an immigration rewrite, and the House’s bipartisan immigration task force finally disintegrated.

The House did end, however, on a bit of a high note, passing a budget deal that seemed uncertain from the start. 218 broke down the budget vote, as well as the moments when Boehner blasted the outside conservative groups for opposing the deal (the first time and thesecond time).

We finished the year by analyzing what Heritage Action and Club for Growth did on the budget vote — more specifically, what they didn’t do — and where these outside groups stand with leadership as we head into 2014.

And even though members of Congress are now allowed to wish their constituents “Merry Christmas” in franked mailings, we’ll just leave it at, “See you next year.”

By Abby Livingston

The race for Senate in Mississippi boasts nearly every facet of the national GOP divide in a state already struggling with its sense of conservatism.

Six-term Sen. Thad Cochran, R-Miss., announced earlier this month that he would seek re-election, setting up a primary against a tea-party-backed challenger, state Sen. Chris McDaniel. Influential national conservative groups — Senate Conservatives Fund, the Club for Growth and the Madison Project — had already backed McDaniel.

But Cochran remains beloved by a certain class of Mississippi operatives who plan to put up a fierce fight to save him. GOP lobbyist Henry Barbour encapsulated that sentiment in September, when he warned McDaniel not to run.

“I think he will get his head handed to him, and that will be what he deserves,” Barbour said. “[But] it’s a free country.”

Thanks to inexpensive media markets in Mississippi, outside groups are expected to saturate the local television airwaves for this race.

But this race is fascinating and different from other tea party-versus-establishment battles for another reason: Mississippi is the nation’s poorest state. For many Mississippi Republicans, that makes this race about more than a referendum on Cochran.

A senior appropriator, Cochran serves with a relatively young congressional delegation. If McDaniel defeats him, the state will lose an advocate for the federal subsidies that have propped up its economy for ages. On the flip side, a McDaniels win signals the Magnolia State’s dependence on federal funds could change drastically.

Editor’s note: Not all congressional races are created equal, and Roll Call’s politics desk admits to playing favorites. So in the spirit of the holidays, these are a few of our favorite things (races) to cover this cycle. We’re shining a spotlight on our 12 most fascinating races through the new year — in no particular order. Happy holidays from @RollCallPols!

Check out more fascinating races of 2014: California’s 31st District, California’s 17th District, andIllinois’ 13th District.

If you thought Congress hit rock-bottom in terms of how many laws they enacted last session, check out the current House and Senate.

Congress will close the year with 58 public bills (the congressional term for measures with broad impact) enacted into law, assuming that President Obama signs the budget deal as promised. They may add a few to that in the last few days of the year. But it won't change substantially.

That's the lowest one-year output since at least 1947, and only the tiniest fraction of the 6,366 bills introduced by lawmakers, according to House and Senate records.

"It certainly feeds into the narrative that people find congenial—which is that Congress is not doing its job," suggests Ross Baker, a Rutgers University political scientist. "But I think that doing a kind of legislative body-count as the metric of an effective or ineffective House and Senate can be specious."

He added: "I think James Madison would have been baffled at that."

But the legislative performance in the first half of the 113th adds more fodder to the narrative building in recent years that it has become a dysfunctional, polarized, overly partisan legislative body.

Of course, House leadership has done away with "feel-good" and ceremonial bills that helped inflate totals in previous years. But those reductions do not account for the increased inability to agree on and enact laws, highlighted this year by a government shutdown when lawmakers could not agree on a spending bill in time to prevent it.

Along the way, public dissatisfaction has been registered in the low approval ratings afforded to Congress. Gallup reports that job-approval ratings for Congress in 2013 averaged 14 percent, the lowest in Gallup's history.

Even the "do-nothing" Congress that Harry Truman derided in 1947 and 1948 exceeded the output of the current House and Senate. The 80th session of Congress pushed through 395 enacted laws in its first year, and 511 in its second.

The only years that come close to Congress's 2013's output were 2011, when 90 laws were enacted, and 1995, when 125 laws were enacted. Last year, 148 public bills were signed into law.

By comparison, 258 bills were enacted in 2010—the last year Democrats were in control of the House, as well as the Senate—and 410 in 2000.

Democrats in the House minority are among those most eager to bring up the low number of bills enacted into law this year. Last week, before the House adjourned for the year, Minority Whip Steny Hoyer presented charts to reporters to make the point—and to say that Republicans are at fault.

"This is only one session [year] of the Congress, but the least productive Congress, certainly, in which I have served and least productive in many respects in history," Hoyer said.

Of course, there are other views. Michael Steel, a spokesman for House Speaker John Boehner, responded that "the House has passed a number of bills to help the private sector create jobs and protect American people from the impact of the president's health care law. Senate Democratic leaders have simply refused to act on them."

And there is truth to that. In fact, more than 40 repeals or partial repeals of Obamacare passed in the House have not passed the Senate. But suppose they had? Some of the very same Democrats now criticizing the lack of volume would have been tremendously distressed if those had passed the Senate—and therein lies the basis for Baker's contrarian view: The volume of enacted laws alone can be a misleading indicator of congressional success or productivity, especially in a divided Congress.

"I'm not denying the polarization—that it isn't a big impediment. And that alone is going to lessen the number of bills passed," Baker said.

"But clearly there are certain things they have to do that are important. I mean, the budget agreement was important, the appropriations bills that will have to be done now are important, and the 'doc fix' is important," he said.

And some lawmakers remain optimistic that 2014 may be different. For one thing, the recently-passed budget deal could eliminate some of the fiscal fights that have halted progress on other issues.

"I think it's pretty exciting," said Rep. Glenn Thompson, R-Pa. "There are so many problems that need to be resolved, and challenges that need solutions."

By Sarah Mimms and Michael Catalini

Though the Senate is poised to pass the Bipartisan Budget Act on Wednesday, lawmakers in both parties are already working to alter some of its provisions in the weeks and months ahead.

The measure is expected to pass handily, sending a bill to President Obama's desk that will reduce sequestration cuts by $63 billion and fund the government through Sept. 30, 2015. But that has not stopped lawmakers from making preparations to tinker with it after it passes, most notably with a provision reducing military pensions.

"Nothing is written in stone around here," said Sen. Carl Levin, chairman of the Senate Armed Services Committee. "This is a budget. A budget could be amended next year."

Levin said Tuesday that his committee will look into nixing the cuts to military pensions before they take effect in 2016. Under the budget agreement, military retirees under the age of 62 will see reductions in cost-of-living adjustments, but the committee could alter or eliminate that change, Levin said.

Republicans and Democrats in both chambers mentioned concerns about the pension provision when Sen. Patty Murray and Rep. Paul Ryan announced the budget deal last week. But Levin's commitment to a review eased some of that tension. Republican Sens. Rob Portman and John McCain both said that the possibility of changing the provision played a role in their decision to vote to bring the budget deal to the floor.

"That gives some of us some comfort," Portman said.

But apparently not every senator felt comforted. Sen. Jeff Sessions, R-Ala., called a vote Wednesday evening that would have allowed Republicans to add an amendment to the budget deal eliminating the military-pensions provision. The measure failed, predictably, on a nearly party-line vote in which only Sen. Kay Hagan, D-N.C., broke with her caucus to support the measure.

Sessions said that he pushed for the vote as a protest of Senate Majority Leader Harry Reid's decision to fill the amendment tree on the budget bill, preventing Republicans from filing amendments of their own. The vote also forced Democrats who have said they are sympathetic to veterans facing pension cuts to choose between getting rid of those cuts and siding with their leadership.

With the 46-54 vote, any changes to military pensions will likely be pushed into the New Year when the Senate Armed Services Committee takes up the measure. Levin and McCain cautioned Tuesday that the pension changes may not disappear. "I can't promise that we will repeal it," McCain said. But even Ryan, who worked the pension measure into the final budget deal over Democratic objections, has said that he is open to making changes.

"We delayed this provision so that it doesn't take effect until the year 2016, which gives Congress and the military community time to address the broader compensation issue, including this provision, if people believe there's a better way to solve this problem," Ryan told The Weekly Standard.

The budget bill cleared its biggest hurdle on Tuesday, when the Senate invoked cloture on a 67-33 vote, setting up final passage for Wednesday. A dozen Republicans joined Democrats to clear the 60-vote threshold, which was the last chance Senate Republicans had to derail the budget agreement.

A simple majority is needed to pass the measure Wednesday, and it is likely to hit that target easily. All 53 Democratic senators and the two independents who caucus with them support the bill, and some Republicans like Portman have agreed also signed on.

But the budget deal isn't set in stone, and with the specter of another government shutdown effectively off the table, even senators who supported the deal are talking about making changes when Congress returns in January.

Many Democrats cite concerns that the final deal did not include an extension of unemployment-insurance benefits, which expire shortly after Christmas. Reid has said the Senate will take up the issue after the holidays.

Murray acknowledged before Tuesday's vote that not everyone got what they wanted in the final deal. "This deal is a compromise, and it doesn't tackle every one of the challenges we face as a nation. But that was never our goal," she said on the Senate floor. "This bipartisan bill takes the first steps toward rebuilding our broken budget process. And, hopefully, toward rebuilding our broken Congress."

But with lawmakers already plotting to alter some of the provisions that allowed the compromise in the first place, that first step may be on shaky ground. Levin conceded Tuesday that changes to certain aspects of the budget bill could open up a Pandora's box, allowing Congress to re-litigate the entire deal when it returns in January. But the Michigan Democrat said that he wasn't too concerned.

"It's not—you know, there's nothing here that's permanent," he said.

The year-end spotlight will shine on the Senate this week as it considers final passage of the two-year budget deal, as well as confirmation votes on Janet Yellen to head the Federal Reserve Board and Jeh Johnson to lead the Homeland Security Department.

Other items already passed by the House will also reach the Senate floor, such as an annual policy bill for the Pentagon and legislation to extend the existing farm bill through January to allow for continued negotiations on a new, long-term version.

With the House already gone for the year, it is left to the Senate to approve the budget deal worked out by Rep. Paul Ryan and Sen. Patty Murray and that was passed by the House last week.

Heading into this week, some Senate Republicans have raised reservations about how the budget deal exceeds previously set budget caps and how it would also reduce some military pension benefits, while liberals worry about the exclusion of unemployment insurance from the legislation.

Yet senators acknowledge that without this deal, little else could pass and no one wants to take the blame for tanking a measure that will avoid another government shutdown come Jan. 15. So, expect the deal to get cloture, Republicans say, and then to pass.

Overall, the spending blueprint calls for funding government at annualized levels slightly more than $1 trillion through Oct. 1, 2015. It also would spare military and social programs of $63 billion in automatic "sequester" cuts, while allotting another $23 billion for deficit reduction—without raising taxes.

The Senate is expected to vote on cloture Tuesday and the final vote could come Wednesday.

Here are the other major items before the Senate this week:

• A vote is anticipated Monday on Johnson's nomination. Last week, Republicans protested the rules change that took away their power to block nominations, costing the Senate a great deal of floor time. But Republicans appear to have reached an agreement with Democrats heading into this week that would avoid additional hang-ups.

• On Wednesday, the Senate is expected to take up the National Defense Authorization Act, which the House passed last week. A sticking point, though, has been amendments, with Republican lawmakers bristling that Senate Majority Leader Harry Reid closed the process.

• The Senate Judiciary Committee has set a hearing Tuesday on the issue of predatory patent-litigation practices.

• A vote on Yellen's confirmation is set later in the week, which will make her the first woman to head the Fed.

With the recent pickup in the economic data, economists are divided over whether the Fed will begin to taper its $85 billion monthly bond-buying program this month or wait until next year. The market-moving decision will be released Wednesday afternoon, followed by a press conference with outgoing Federal Reserve Chairman Ben Bernanke.

Analysts say they expect Yellen to speak following the Fed meeting alongside Bernanke on Wednesday, if she is confirmed by then.

BUDGET AND APPROPRIATIONS

Tight Schedule

Senate Democrats will need five Republicans to join them in invoking cloture on the budget bill before they can vote for final passage—and they're expected to get them. Sens. John McCain and Jeff Flake of Arizona, as well as Sen. Susan Collins of Maine, said Friday that they would vote for cloture, and Republican leadership has indicated to their Democratic counterparts that they will have the votes.

Once cloture is invoked, the vote for final passage could come as soon as Tuesday afternoon or Wednesday.

Given the bill's prospects for passage, appropriators in both chambers are continuing their work to put together an omnibus spending bill for the remainder of fiscal 2014 at the $1.012 trillion top-line outlined in the budget agreement. The omnibus will need to pass before Jan. 15, or Congress will be forced to contend with another continuing resolution or government shutdown.

Senate Minority Whip Dick Durbin, a member of the Senate Appropriations Committee, said Thursday that he was confident that appropriators will finish their work in time. "There's a lot to do. But they're good people, and they want to get it done. We're back the 6th; the House is back the 7th of January. We have one week to finish the deal and be able to make the January 15 deadline," he said.

DEFENSE AND NATIONAL SECURITY

Averting Amendments

Senate Armed Services Committee Chairman Carl Levin, D-Mich., and ranking member James Inhofe, R-Okla., say they are confident they can persuade enough of their colleagues to approve the National Defense Authorization Act without amendments.

But several Republicans have raised objections to that process, including Sens. Tom Coburn of Oklahoma, and Rand Paul of Kentucky. Sen. Lindsey Graham, R-S.C., has said he wants assurances the Senate will take up Iran sanctions at a date certain before he supports the bill.

The House passed the defense bill Thursday before adjourning for the year on Friday, leaving the Senate with a take-it-or-leave-it option. There is much pressure to pass the bill, which enjoys a 51-year running streak and authorizes $552.1 billion in spending for national defense, including pay increases and hardship compensation for armed-services members.

On Iran, a bipartisan group of senators has been working on legislation meant to ensure that Iran dismantles any nuclear-weapons capabilities, including sanctions and other measures defining what a final pact should entail. But it is becoming increasingly less likely they will roll out additional legislation before the Senate adjourns. Either way, the Senate is not expected to act on the issue before the end of the year.

ECONOMY

Measuring Inflation

New inflation data will be released Tuesday and a third reading of third-quarter gross domestic product Friday.

On Monday, the Brookings Institution will host an event on systemic risk in the asset-management industry; Richard Berner, the head of the Office of Financial Research, will speak about a report his office issued as guidance for the Financial Stability Oversight Council on the industry. Asset managers have pushed back against the OFR's findings, which could pave the way for them to be classified as "systemically important" and thus subject to tougher regulation under the 2010 Dodd-Frank financial-reform law.

White House Council of Economic Advisers Chairman Jason Furman will speak about economic policymaking in the Obama administration at a Tuesday event hosted by the Council on Foreign Relations in New York City.

The Senate Finance Committee will hold a Wednesday hearing on Social Security, defined benefits, and private retirement accounts.

Finally, U.S.-European Union trade talks over the Transatlantic Trade and Investment Partnership are scheduled to resume in Washington this week.

ENERGY AND ENVIRONMENT

Roster of Nominees

Two Senate panels will consider a raft of high-level executive-branch nominees Tuesday.

The Senate Environment and Public Works Committee will hear from nominees such as Rhea Suh, who is President Obama's choice to become the Interior Department's sssistant secretary for fish and wildlife and parks, and Victoria Wassmer, the nominee to be the Environmental Protection Agency's chief financial officer.

The Energy and Natural Resources Committee will consider nominees for key posts at the Interior and Energy departments, including Neil Kornze as director of Interior's Bureau of Land Management and Marc Kastner as director of DOE's Office of Science.

WHITE HOUSE

Holiday in Hawaii

In sharp contrast to the last few years when Obama's Christmas vacation plans were up in the air until the last minute because of fiscal-cliff and other budget deadlines, the president plans a quiet week at the White House.

No late-night crisis meetings are on the schedule—just a planned departure Friday for the annual family journey to the president's birthplace of Hawaii.

Sunday, December 15, 2013 | 12:10 p.m.
When the Senate takes up the budget agreement this week, it will bring more than just fiscal relief.

For lawmakers, it will end four years of operating without a budget and bouncing from crisis to crisis, topped by a government shutdown that forced many to trim staff. Call it budget fatigue.

"That's a good way of putting it," says Rep. Alcee Hastings, D-Fla.

The constant fiscal battles of recent years sucked up bandwidth in Congress. They landed lawmakers in fights that could not be won, tainting the politics and eclipsing other important issues. The lopsided and bipartisan passage of what is universally referred to as a small budget deal in the House on Thursday shows how eager some lawmakers are to move on.

"They are looking forward to doing the things we want to do instead of fighting over shutdowns all the time," said Budget Committee Chairman Paul Ryan last week. "We're just happy that we're getting this place working again."

Of course, the compromise agreement, which is expected to pass in the Senate this week and which does not have to be signed by President Obama, is nobody's version of perfect.

And still to be worked out are appropriations bills showing how spending will be parsed for this fiscal year and next. The bills should be passed by Jan. 15, when the current spending mechanism for government expires—and those could cause battles of their own.

In addition, the debt-ceiling suspension runs out Feb. 7, potentially sparking renewed fighting over government borrowing, although the Congressional Budget Office says various cash-management strategies at the Treasury Department could push the prospect of default into March or later.

But for now, Congress is venturing into harmonic territory that it has not walked for some time.

Rep. Tom Graves, R-Ga., says that budget weariness is real, but adds that it extends to the American public. "I think there's a little fatigue on their part from all of this mess," he said.

Rep. Tom Price, the No. 2 Republican after Ryan on the Budget Committee, agrees that much of the country is tired.

"When I'm home, what I hear from folks is we've got to get something done," he said. "The uncertainty that is out there, the frustration that people have is real. That is translated to us as well. We can't continue to lurch from crisis to crisis to crisis and expect any wise decisions are going to come out of it."

He added: "I think this relieves a lot of pressure. I think it lowers the temperature, and hopefully makes it so we can get some real things done on the policy side."

Rep. Glenn Thompson, a Pennsylvania Republican, calls the constant budget and fiscal turmoil "a drag."

Thompson said the long string of temporary, stop-gap budget measures in lieu of real deals has hindered legislative work to solve other problems lawmakers need to address. "I have nothing good to say about continuing resolutions. That's not only a drag. That's a nightmare," he said. "This puts us back into regular order and for a two-year process. It's pretty exciting from my perspective. And we didn't raise taxes to do it."

Still, for some, there will be lingering resentment and budget-war wounds.

"The reality is, we're a little over $17 trillion in debt—and if we continue on that path, it will harm this country in the way no military power has ever been able to do," said Rep. Trent Franks, an Arizona Republican. "Consequently, those of us concerned about that grow a little weary of our friends on the left being unable to see the train that is coming at all of us.

"And we are the ones portrayed as the bad guys," he said.

But Hastings is optimistic that a new era of bipartisan budget cooperation has dawned. "My hope is this is just the beginning," he said.

Rep. Gerald Connolly, a Virginia Democrat, says that what lawmakers are feeling isn't just budget-battle fatigue.

"I think that understates it. This is something else. This is maybe a recognition that we've gone too far in our constant fighting," he said. "We can't go home and play the same old song."

As he put it, "Even we are tired of it."

Lawmakers passed the bill, which extends current law until January 31, on a voice vote and sent it to the Senate, where the Democratic leaders oppose it and chances of passage are low.

The four top farm bill negotiators hope to agree soon on a framework for the new law so it can be passed when Congress returns to work in the new year.

"Pass the extension ... and we on the Agriculture Committee will take care of our business in January," said Frank Lucas of Oklahoma, the committee chairman. He said House and Senate negotiators were making "incredible" progress on a compromise bill.

Debbie Stabenow of Michigan, who chairs the Senate Agriculture Committee, says a sizable number of senators oppose the extension because it may trigger $5 billion in "direct payment" subsidies to growers. The new farm bill would end those subsidies.

In addition, Democrats argue the "dairy cliff" - an explosion in dairy prices caused by an underlying 1949 law - is a fiction.

"It's not necessary," said Rep. Jim Costa, California Democrat, in opposing the extension. Costa and Lucas were the only lawmakers to speak during the House debate.

Congress is more than a year late in replacing the 2008 farm law, which expired in fall 2012 but was extended until September 30. Dairy subsidies will revert on December 31 to terms of an underlying 1949 law that would double the price of milk in grocery stores.

Agriculture Secretary Tom Vilsack told reporters on Wednesday that "it is unlikely we would have that (price increase) in place" during January. It was the second time he ruled out an immediate price increase.

All the same, Lucas said the temporary extension was a prudent step that would end "panic" at the possibility of $8 a gallon milk.

"We are making significant progress in our negotiations with the Senate," said Lucas. "I'm confident we will complete the conference report in January."

The major issue for the farm bill is the size of cuts in food stamps for the poor.

Majority Leader Eric Cantor spearheaded the House call to cut $40 billion over 10 years with tighter eligibility rules that would disqualify up to 10 percent of food stamp recipients. The Senate voted for $4.5 billion in cuts by closing a loophole on utility costs.

Enrollment in food stamps has doubled and the cost of the program nearly tripled since 2004.

(Reporting by Charles Abbott; Editing by Gary Hill and Bob Burgdorfer)

Tuesday, December 10, 2013 | 10:15 p.m.
After weeks of closed-door talks, House and Senate negotiators finally unveiled a two-year budget deal Tuesday that attempts to calm the long-fought feud over spending on Capitol Hill. But the question remains whether they can sell it to rank-and-file lawmakers.

The deal is far from a grand bargain. But if approved by the House and Senate, the compromise would not only keep government funded and open beyond Jan. 15, but also would provide $63 billion in sequester relief over two years—all without new tax revenue.

“This is the first divided-government budget agreement since 1986,” said House Budget Chairman Paul Ryan, the chief Republican negotiator.

Whether the deal holds up could play out quickly. The House is expected to adjourn for the year on Friday, and leaders there are moving for floor action on the measure as early as Thursday. Ryan may face the most immediate challenge, meeting behind closed doors Wednesday morning to explain the agreement to skeptical House conservatives, many of whom have voiced opposition to any deal that raises spending levels.

Some Senate Republicans were also balking at the agreement Tuesday night.

“I’m concerned about it,” said Minority Whip John Cornyn of Texas, before the deal was even announced. “What I’ve heard is that it basically raises revenue through fee increases—doesn’t do anything to deal with the unsustainable entitlement issues and bust the budget caps.”

After the plan was released, Cornyn, who faces reelection in 2014, called it “concerning” and characterized it as “a more-spending plan.”

The deal sets top-line spending at $1.012 trillion for fiscal 2014, which exactly splits the numbers in the House and Senate budget proposals passed earlier this year. In fiscal 2015, the overall spending level would rise to $1.014 trillion.

The $63 billion in sequester relief is split evenly between defense and nondefense programs. In fiscal 2014, defense discretionary spending would be set at $520.5 billion, and nondefense discretionary spending would be set at $491.8 billion.

The sequester relief is described as being fully offset by savings elsewhere in the budget. In fact, the agreement includes dozens of specific deficit-reduction provisions, with mandatory savings and nontax revenue totaling roughly $85 billion. In all, the proposal would save $28 billion over 10 years by requiring the president to sequester the same percentage of mandatory budgetary resources in 2022 and 2023 as will be sequestered in 2021 under current law.

The plan does not deal with the debt ceiling, which is anticipated to be reached sometime after Feb. 7.

“This doesn’t solve all of our problems,” said Senate Budget Chairwoman Patty Murray, the principal Democratic negotiator. “But I think it’s an important step in helping to heal some of the wounds here in Congress, to rebuild some trust and show that we can do something without a crisis right around the corner.”

She acknowledged disappointment “that we weren’t even able to close a single corporate tax loophole as part of the plan.”

Ryan, whom conservatives describe as the most highly respected member of the House GOP when it comes to fiscal matters, seems up to the task of selling the deal. He repeatedly framed the agreement as “conservative” on Tuesday, emphasizing at the outset: “It reduces the deficit without raising taxes.”

However, some conservative lawmakers have been openly agitating for GOP leadership to pass a “clean” continuing resolution at sequester levels. That effort received significant outside support on Tuesday when the Conservative Action Project, an umbrella group representing a host of influential right-wing leaders, sent a letter to congressional Republican offices urging them to embrace sequestration and oppose the Ryan-Murray deal.

“Though conservatives support more spending restraint, the discretionary spending limits defined in the Budget Control Act represent a promise to the American people to marginally slow the growth of government,” says the letter, which is signed by Heritage Action CEO Michael Needham, Family Research Council president Tony Perkins, and American Conservative Union chairman Al Cardenas, among others.

The letter represents a sweeping rebuke of Ryan’s proposal from a broad coalition of influential conservative actors. “Legislation that raises federal revenue and spending levels is unacceptable to conservatives and the majority of Americans and should be rejected by Congress,” the letter says.

Ryan seemed to sense the looming challenge on Tuesday, and took care to frame the debate on his own terms.

“As a conservative, I deal with the situation as it exists. I deal with the way things are, not necessarily the way I want things to be,” Ryan said. “I have passed three budgets in a row that reflect my priorities and my principles and everything I want to accomplish. We’re in divided government. I realize I’m not going to get that.”

At one point, Ryan seemed to speak directly to his House GOP colleagues, perhaps previewing the pitch he’ll make to them at Wednesday morning’s conference meeting.

“As a conservative, I think this is a step in the right direction,” Ryan said. “What am I getting out of this? I’m getting more deficit reduction. The deficit will go down more by passing this than if we did nothing. That’s point No. 1. Point No. 2 is, there are no tax increases here. Point No. 3: We’re finally starting to deal with autopilot spending, that mandatory spending that has not been addressed by Congress for years.”

Ryan acknowledged that some conservatives will vote against the proposal, but predicted, “I think we will pass this through the House.”

There are potential sticking points for some lawmakers in the measures to help pay for the added spending, including increasing federal employee contributions to retirement programs by 1.3 percentage points. The proposal affects new employees hired after Dec. 31 of this year with less than five years of service.

Another provision would increase the premiums that private companies pay the federal government to guarantee their pension benefits.

Other revenues would come through a range of measures, from increasing Transportation Security Administration fees to repealing the requirement that the Maritime Administration must reimburse other federal agencies for costs associated with shipping food aid on U.S. ships.

Despite efforts by Democrats, an extension of unemployment benefits was not included in the deal. Those benefits for 1.3 million workers unemployed for longer than 26 weeks are set to expire on Dec. 28.

While both sides expect tough days ahead as Ryan and Murray attempt to sell the plan, it got a boost from President Obama, who released a statement supporting the deal late Tuesday.

“This agreement doesn’t include everything I’d like—and I know many Republicans feel the same way,” he said. “That’s the nature of compromise. But it’s a good sign that Democrats and Republicans in Congress were able to come together and break the cycle of short-sighted, crisis-driven decision-making to get this done.”

Matt Delaney and Scott Meichtry, owners of The Hawaii Group, have been interviewed and featured in thePacific Business News regarding the company’s expansion to the mainland and the way our business will be evolving to accommodate the change.

Delaney said the national expansion will also give the companies the ability to leverage each others’ back offices, and said it will be helpful to have staff working in different time zones available to clients.

Despite the plans for national expansion, Delaney said he is not shifting his focus out of Hawaii.

“We’re looking to continue with our rapid growth here in Hawaii in 2014, on all the islands,“ Delaney said, adding that Hawaii remains the priority, and is the engine that will help to fuel future opportunities.

House Democrats of all stripes are lining up against a stopgap spending bill that further entrenches the blunt sequester cuts.
GOP leaders could bring a vote as early as next week on a short-term continuing resolution (CR) likely to adopt the $967 billion sequester-level spending cap urged by many Republicans. But the pushback from Democrats this week has been near universal, with liberals and centrists alike vowing to join party leaders in opposition to any such measure.
“I’m not going to support a short-term CR that leads to a $967 billion level,” Rep. Steny Hoyer (D-Md.), the House minority whip, said Tuesday during a press briefing in the Capitol. “I believe that hurts our national security, it hurts our economy and it undermines our responsibility of running government at a level that is productive for our people.”
The opposition raises the chances of a government shutdown taking place in mid-January if a House-Senate budget conference fails to reach a deal on a broader framework to fund the government and scale back the sequester.

Although House Democrats had voted unanimously in October to reopen the government for three months at the 2013 level of $986 billion — including sequester cuts — most did so reluctantly and only under the premise that Congress would use the cushion of time to win a broader deal to soften sequestration’s effects on an array of domestic and defense programs.

While budget negotiators remain optimistic that they can reach such an agreement before Jan. 15, there’s been little evidence of a breakthrough, prompting GOP leaders to prepare a backstop CR if the talks fall apart.

No stopgap bill has been introduced, but a GOP aide said Tuesday that it would adopt the $967 billion levels for fiscal 2014 included in the 2011 Budget Control Act.

The threat of even deeper sequester cuts has ignited opposition from Democrats across the ideological spectrum. “Those numbers are very low — it doesn’t solve our problem, it is just kicking the can down the road,” said Rep. Kurt Schrader, a centrist Oregon Democrat. “Personally, as a Blue Dog, I think we should go after the bigger issues.”

Liberals piled on, with Rep. Raúl Grijalva (D-Ariz.), head of the Congressional Progressive Caucus, saying there’s no appetite within the party to cut further into low-income programs. “If the whole purpose is to just beat up on poor people, I cannot support that,” Grijalva said Tuesday.

Playing hardball ahead of a potential shutdown comes with political risks, but many Democrats said it’s more important to take a stand.
“Why would Democrats compromise on principle right now?” asked Rep. Bill Pascrell (D-N.J.) If House Democrats stick together in opposing a CR, it would force GOP leaders to corral their restive troops into a nearly unanimous vote to get it through. With 231 Republicans in his conference, Speaker John Boehner (R-Ohio) can afford only 15 defections before he must rely on Democratic support.
Rep. Gwen Moore (D-Wis.) noted that Republicans have already struggled this year to pass appropriations bills at the $967 billion level. In the summer, a transportation bill written to that level could not get majority support in the House, and had to be pulled.
“If you can’t get Republicans to agree to that level, it just shows it’s not a number that we can govern with,” Moore said.
In a change of dynamics, Boehner’s problems in a CR fight might not come from his right flank.
“I would consider voting for the CR, if it’s at sequester levels,” Rep. Justin Amash (R-Mich.), usually a conservative naysayer, said Tuesday.But getting Republican defense hawks and appropriators to go along could be a different matter. There are 26 GOP appropriators and 34 sitting on the Armed Services Committee, many of whom have been vocal critics of the sequester.

Rep. Hal Rogers, the chairman of the House Appropriations Committee, is one such critic. The Kentucky Republican declined Tuesday to weigh in on a CR until he’s seen it. But he suggested that GOP leaders should hold off on their CR plans “to make sure the pressure remains on the [budget] negotiators to do the number by the 13th.” Rep. Chris Van Hollen (Md.), a senior Democrat on the House Budget Committee who has a seat at the table of the budget talks, characterized the negotiations as “going very slow,” and cited 50-50 odds that an agreement would be reached eliminating the need for a CR. “It’s a jump ball,” he said. “It could go either way.”
Van Hollen said it’s “premature” to talk of CRs, and vowed to oppose any spending bill that comes to the floor this month short of a broad package.

“That would be a symbol of defeat,” Van Hollen said. “We should not leave town until we get an agreement on the budget. After all, it was the mantra around here for a long time, ‘No budget, no pay.’ Our view is, ‘No budget, no vacation.’
“There’s no CR required until Jan. 15, and I would oppose any effort to go home before we reach any agreement,” Van Hollen added. “That’s a widely shared view in the caucus.”

 | Some decidedly mixed economic signals are greeting lawmakers as they begin their balky return for the final month in this historically lackluster year of legislating.

Gloomy numbers for the opening four days of holiday shopping season were followed Monday by heartening reports about the pace of construction and manufacturing this fall. The biggest economic news before the end of the year, though, will be the monthly jobs report that’s issued Friday.

On the Hill, the overriding question is whether those indicators will spur or slow the budget talks. They have gained outsized attention because so little else is going on — even though the negotiators have made clear they’ve decided to reach for an extremely modest goal, hoping that hitting even a relatively easy target will send Congress home for the holidays to a sigh of voter relief.

The House returned from Thanksgiving on Monday, with top Republicans sounding pretty emphatic about the last votes of the year coming by the end of next week. That target adjournment seems overly optimistic to many, but it’s another indication of just how little is on the GOP leadership’s must-do list before the end of 2013. This, after all, is the first year in several without any hard and fast deadline galvanizing national attention. (The closest thing is the return of the “dairy cliff,” an expected steep rise in retail milk prices in early January unless some provisions of the stuck-in-conference farm bill are extended.)

Senators were given this week off in anticipation that they may be needed in the third week of the month, which means all the lights at the Capitol may not be dimmed until the weekend before Christmas.

But Friday the 13th is the nominal deadline — set, without any consequences for tardiness, in the deal that ended October’s partial government shutdown — for budget conferees to come up with some kind of middle ground fiscal blueprint.

House Budget Chairman Paul D. Ryan, R-Wis., and Senate Budget Chairwoman Patty Murray, D-Wash., seem to agree that total failure is not an option. They’re also sending similar signals about wanting to achieve something that won’t automatically be labeled with derision as “just another kicking of the can down the road.”

What they are inching toward is an agreement of modest scope but nonetheless lasting more than 20 months — promising an unexpected period of budgetary stability lasting until October 2015, essentially the halfway point between the coming midterms and the next presidential election.

The main provision would be a partial easing of the next two spending sequesters — not only the automatic curbs for the current budget year, set to take effect Jan. 15, but also the round of reductions set for the coming fiscal year, which starts in October. Negotiators are talking about a minimum of $30 billion and a maximum of $60 billion in sequester relief for both this year and next, sufficient not only to save the Pentagon from the coming round of cuts but to allow some domestic priorities to be reordered as well.

The final amount depends on what the dealmakers can agree is an appropriate handful of provisions to “pay for” the additional appropriations.

On the revenue side, nothing that might be labeled a “tax increase” is on the table — a prerequisite for the GOP. Instead, there’s talk of raising multibillion-dollar slivers of new money by boosting some fees — for aviation security, customs processing, the government’s pension backstop and mortgage services, for example — and selling more of the government’s frequencies on the broadcast spectrum.

On the spending side, curbs on Medicare and Medicaid have also been set aside — on the grounds they would be too politically toxic for Democrats. Instead, the recent focus has been on modest ways to curb other mandatory programs, especially benefits for federal retirees and the Postal Service.

A handshake deal in the next two weeks would reliably win the public embrace of both parties’ leaderships, and they could promise ratification votes early enough in the new year to ward-off any Christmastime anxiety about the Jan. 15 expiration date on the current stopgap spending law.

The assumption is the accord would soon enough gain grudging acceptance from majorities of both small-government Republican conservatives and big-government Democratic liberals — critical masses on each side willing to claim some credit for a rare piece of congressional compromise, especially one that allows them to promise constituents the government shutdown countdown clock has been turned off for almost two full years.

So will the economy’s own recent performance speed or slow the last steps to a deal?

The National Retail Federation reported that the four days of Black Friday weekend saw sales of $57.4 billion, a 3 percent drop from last year even though many more stores were open on Thanksgiving Day. That might give lawmakers reason to think they need to bend over backwards to give consumers a reason for optimism in the shopping season’s closing days.

But manufacturing accelerated to its fastest pace since April 2011, according to the monthly index from the Institute for Supply Management. And the Labor Department reported that builders poured money into their jobs in October at the fastest pace since May 2009 — thanks mainly to a 10.9 percent surge in spending on federal government projects. So, the 16-day partial shutdown hardly translated into idled construction sites. Some lawmakers might use those numbers as evidence the economy will do fine no matter what fiscal discipline Congress sets.

Look for the jobs report to tip the balance in favor of an agreement. Whether the numbers are below or above expectations (180,000 new payroll positions and a one-notch drop in the unemployment rate, to 7.2 percent) a crucial bloc of Republicans will want to avoid any possible blame for extending this destabilized recovery.

An interim deal with Iran on its nuclear program is complicating the future for the annual defense authorization bill, as Senate Majority Leader Harry Reid, D-Nev., must manage three clashing factions: senators intent on passing a new round of sanctions, a White House that opposes them and armed services negotiators who simply want to see their bill passed.

Republicans hellbent on attaching Iran sanctions to the pending defense authorization bill froze Senate action before Thanksgiving, and the Senate is scheduled for only one more week of work before Christmas. The Iran agreement has only brought more voices into the fold, with Democrats such as Sen. Charles E. Schumer of New York and Senate Foreign Relations Chairman Robert Menendez of New Jersey, calling for new sanctions legislation.

The tension between imposing stricter sanctions and approving the National Defense Authorization Act manifested itself in Reid’s own shifting statements. Last week, Reid vowed to push forward with a new sanctions bill after Thanksgiving, a move clearly designed to appease GOP members who refused to consent to amendments to the defense authorization bill without a promise on Iran first. But by Monday, the majority leader walked back his position, telling NPR that he would proceed with an Iran bill only “if we do need stronger sanctions.”

Armed Service Chairman Carl Levin, D-Mich., the manager of the defense authorization bill, said Reid’s previous, new-found commitment to an Iran sanctions measure was an effort to finish the bill while avoiding Iran amendments.

“I think he did what he needed to do today in order to avoid this issue interfering with the negotiations,” Levin said Nov. 21.

Sen. John McCain of Arizona, the former top Republican on the armed services panel, said that Iran sanctions and Reid’s then-vow to proceed on a bill had “no effect” on the larger defense authorization debate. But Sen. Lindsey Graham, R-S.C., one of the most outspoken advocates for stronger sanctions, said differently.

Graham is part of a contingent of GOP senators who are insisting on addressing the Iran issue. He said last week that he believed Reid’s promise to move forward was a good first step toward finding agreement, but warned that he and his allies would need another must-pass vehicle for an Iran bill if Reid removes the issue entirely from the defense bill.

“The Iran sanctions amendment they probably wanted to avoid. I think that’s probably why we couldn’t get a commitment on [proceeding]. If we could get an Iran sanctions legislation outside of the defense bill, that might give us a second chance at it,” Graham said. “[But] I want it to move on something that will get signed into law. I don’t know what vehicle, but I will be looking for a must-do vehicle.”

But as he announced the deal, Obama on Saturday night warned Congress against new sanctions, saying they could derail the talks and fracture the international coalition needed to enforce the sanctions in the first place. Secretary of State John Kerry made similar remarks from Geneva and said he had confidence in his former colleagues.

There are still more than 400 amendments pending to the underlying legislation. Levin said he had received unanimous agreement on 30 or so amendments to the bill but could not get a unanimous consent agreement on the floor to append them to the bill.

The chairman said he planned to do “a lot” of work on the amendment front to try to piece together a package that could get swift approval if Republicans choose to lift their objections. Last week, in frustration, Reid held a cloture vote on the bill itself in a last-ditch effort to wrap it up before Thanksgiving. Sen. James M. Inhofe, R-Okla., also exasperated by the Senate’s inability to make progress on the bill, had urged GOP colleagues to whittle down their amendment offerings or he would vote to close out debate.

“We’re a long way from giving up,” Levin said.

Levin and McCain talked on Nov. 21 about how detrimental failure to pass a bill would be for military families — and for both parties.

When asked how he might convince colleagues to cooperate, McCain said that veteran senators “know how to do” the defense authorization and that senators eventually would get on board with a bill that has passed every year for more than a half century.

“You convince them by saying, ‘OK. Here’s what we can do. Here’s what we can’t do.’ I’ve done it for years. It’s not rocket science. It’s hard. It’s harder this year because [Reid] only gives us a week, and it usually takes at least two weeks,” McCain said. “But it can be done because of the importance of the legislation. People don’t want to go home and say, ‘Your son’s not getting a pay raise this year because Congress refused to act.’”

There’s another trump card leaders might have in their hand if the situation gets dire. If Congress doesn’t pass an authorization, it would empower appropriators to make those decisions for them. If GOP senators don’t agree to proceed on the bill or approve it, that would leave No. 2 Democrat Richard J. Durbin of Illinois, the chairman of the Defense Appropriations Subcommittee, as the ultimate decider of how to deal with military spending.

Asked in late October about the possibility that he would gain more power if the defense authorization doesn’t happen, Durbin joked, “Wouldn’t that be nice? I’d like that.”

The Illinois Democrat added, “Well, you know, they’re given their chance.”

With the administration's deadline to fix the Obamacare website less than a week away, one question is bound to weigh heavily on the debate over the system: How well does it have to operate to be considered "fixed"?

The truth is, the system is getting stronger as it recovers from its disastrous launch, but experts say it still has a long way to go. The problems that continue to plague it could continue the torrent of criticism, making it tougher for the administration to rehabilitate the image of its signature law.

"There won't be a success until the website is working," said Bob Laszewski, a health care consultant who works closely with insurers.

Nov. 30 will mark the administration's self-imposed deadline to have HealthCare.govworking, as well as the end of the second full month of enrollment. And expectations for both of those milestones are modest.

Insurers say they've seen enrollment pick up in November as the administration made gradual improvements to the site, which serves 36 states. HealthCare.gov processed a paltry 25,000 sign-ups in October, but insurers say the process has gained steam over the course of this month.

They are concerned, however, about lingering problems. The site is still sending incorrect or incomplete information to insurance companies about the people who choose a plan, and industry officials are afraid the administration is about to flood them with more bad data than they can manage.

"There's still a lot of work to do to get the back-end processes working," said Robert Zirkelbach, a spokesman for America's Health Insurance Plans.

Jeff Zients, the former White House budget director leading the HealthCare.gov repair effort, said Friday that by Nov. 30, the site will be able to handle 50,000 users at once, the target it was supposed to meet when it launched last month.

Zients has also repeatedly said that issues with the information sent to insurers were at the top of his "punch list" for site repairs. But industry officials say those problems haven't been fully addressed—so the prospect of handling 50,000 people at a time is a scary one.

Bob Laszewski, a health care consultant who works closely with insurers, estimated that the site's back-end error rate is 5 percent. It needs to be lower than 1 percent for the site to be considered fixed, he said.

"They've made some progress on the back end, but it's still not where it needs to be," Laszewski said.

Some health policy experts also question the administration's definition of success for the site's user experience.

Administration officials have said they expect the site will work for about 80 percent of users by Nov. 30. Yet a 20 percent failure rate wouldn't be considered success in most industries, and it also might not be good enough to stem the tide of negative anecdotes about Obamacare enrollment.

"Twenty percent still leaves a lot of noise in the system … that leaves a lot of people with a bad experience," said Caroline Pearson, vice president at the consulting firm Avalere Health.

Jonathan Gruber, a health economist at MIT who helped design the Affordable Care Act, said the problems with an 80 percent success rate could go beyond optics.

If the administration means that 80 percent of people who want to actually enroll will be able to, that's "more than enough," Gruber said—once you've picked a plan, it's not a big deal to have to call the insurance company to sign up. But if only 80 percent of people are able to use the site to shop for coverage, he said, the administration will have a problem.

"I think virtually everyone who needs to shop on the website should be able to," Gruber said.

Because HealthCare.gov has been under repair throughout November, enrollment will likely still lag well behind the pace needed to hit the bottom-line goal of signing up 7 million people by the end of March.

Some state-based insurance exchanges have seen their enrollment numbers surge as they overcame their initial technical problems. California is now signing up 2,700 people per day, up from about 700 in the first week of enrollment. Even before that surge, though, California had enrolled more people than all 36 states that rely onHealthCare.gov.

The administration will release November's enrollment statistics in mid-December. Experts declined to make predictions about the numbers, but insurers generally say they're seeing the pace of enrollment pick up modestly.

To hit the 7 million goal, enrollment will need to make up the ground it lost in October and most of November, a challenge that California's surge suggests is possible—with a functional website.

But because many people—especially the young, healthy consumers so critical to the law's success—are expected to sign up later in the six-month enrollment window, Gruber said, November's figures won't say much about whether the administration is on track.

"I think they're pretty useless until close to March," he said.

For business-minded Republicans fed up with tea-party-led budget standoffs, the past few weeks have offered much to crow about.

A handful of business-backed challengers have taken on tea party incumbents in the House; the National Republican Senatorial Committee has pledged to fight in primaries and has cut ties with a tea-party-linked consulting firm; and the U.S. Chamber of Commerce spent heavily to help a Main Street Republican beat out his conservative opponent in Alabama’s 1st District GOP runoff.

The chamber’s $200,000 expenditure to help GOP lawyer Bradley Byrne narrowly beat tea-party-backed businessman Dean Young in Alabama was hailed as nothing less than “a turning point in American politics” by Forbes magazine, a sweeping assessment typical of reports on the race.

But it remains to be seen whether business groups will prove sufficiently bold, aggressive and well-funded to match the tea party activists they’re taking on. It’s far less risky to endorse the business-friendly candidate in an open-seat contest than to challenge an incumbent, as tea-party-aligned groups such as the Club for Growth, FreedomWorks and the Senate Conservatives Fund routinely do.

Many major GOP donors remain skittish following the 2012 elections, which saw massive spending by Republican super PACs with underwhelming returns. Indeed, conservative outside spenders have been considerably out-raised so far in this election by groups friendly to Democrats, a reversal of past trends.

“I frankly find it hard to believe that you’ll find much action from the business community against Republican incumbents,” said Dan Meyer, a senior vice president at the Duberstein Group. “That’s just not their norm.”

The big question is whether the U.S. Chamber of Commerce will put its considerable heft on the line in the rough-and-tumble world of contested primaries. The chamber spent $35.7 million in the 2012 elections, according to the Center for Responsive Politics, making it the fifth-highest-spending outside organization in the election cycle, excluding the political party committees.

But although the chamber deplored the recent government shutdown, the trade group helped elect many of the very tea party lawmakers who orchestrated that budget crisis, including Sen. Mike Lee, R-Utah. Asked about primaries at a recent breakfast hosted by the Christian Science Monitor, Chamber President and CEO Thomas Donohue replied with characteristic caution.

“We still have to see who’s running,” Donohue demurred. “We still have to see what happens in the next activity on the deficit. We still have to see what the circumstances are. We have a formal process for doing this, we will pursue that process, we will do whatever we perceive to be the best thing for the country and for the American business community.”

It was hardly a call to arms. And while news reports have made much of business-backed candidates taking on tea party incumbents in Michigan and Tennessee,  national organizations such as the chamber and the National Federation of Independent Business have largely stayed out of those races.

In Michigan’s 3rd District, for one, local business leaders have backed investment manager Brian Ellis. But the incumbent, tea party Republican Justin Amash, has actually received the maximumcontribution from Amway Chairman Steve Van Andel, who happens to chair the Chamber of Commerce’s board of directors.

Even in races where Republican Party officials and leading trade associations are eager to weigh in, the presence of heavy hitters whom tea party activists deride as the GOP “establishment” may actually harm business-minded candidates more than helping them.

“There should be more engagement, but it needs to be more organic, at the local level, and not a Washington-down approach,” said GOP strategist Brian Walsh, former communications director at the NRSC. “Because that could arguably have a negative effect on the candidate.”

To be sure, business-minded GOP donors are waking up. Former Rep. Steven C. LaTourette, who runs a pro-business operation that includes political action committees and advocacy groups, has seen receipts quadruple from $500,000 to $2 million in the past six weeks. LaTourette recently launched a national fundraising tour, starting with an Election Day luncheon at the University Club of New York with two dozen GOP business donors.

“What we’re trying to do is get the people who have been disenfranchised back into the Republican Party,” said Sarah Chamberlain, chief operating officer for LaTourette’s Main Street operation, which includes a new super PAC dubbed Defending Main Street. “We feel strongly that we need to be a big tent to carry on as a national party.”

Still, it’s unclear whether all the promises and media buzz from the GOP’s business wing will materialize into meaningful campaign investments. One GOP operative noted: “The real question everybody has is whether it’s going to turn into real dollars, or whether it’s a conversation that will come to an end. And no one quite knows yet.”

Sunday, November 17, 2013 | 12:00 p.m.
Time and again, Senate Democrats have delivered the votes for President Obama, from the initial roll call on the Affordable Care Act in 2010 to the standoff over the government shutdown.

Now, with many Democrats cast into shadow by the problem-plagued rollout of Obamacare, many are saying privately that they are feeling little love in return.

“There is a level of frustration about the entire situation because it’s an unforced error right after Republicans were as low as they’ve ever been,” said a senior Democratic Senate aide.

Obama has been accused before of neglecting the needs of congressional Democrats, from accusations that he could be more supportive during elections to grumbling about tough votes such as Obamacare.

Yet party unity has been a point of pride for Majority Leader Harry Reid and his fellow Democratic leaders. So total was the political victory over Republicans after the shutdown that these leaders filed into a television gallery for a post-vote news conference, which featured heavy doses of back-patting and thank-you speeches.

But that win passed quickly, followed by the rocky, trouble-filled rollout of the Affordable Care Act. Now, Democratic leadership has to back the politically unpalatable solution that Obama announced in a news conference last week. “The president’s announcement … we think is a step in the right direction,” said Sen. Dick Durbin of Illinois, the No. 2 Democrat in the Senate.

Yet other Democrats—particularly those facing reelection in 2014—are starting to examine their options. Sens. Mary Landrieu of Louisiana and Mark Udall of Colorado have each introduced their own legislation and are already splintering off.

Landrieu, for example, held her own news conference after the president’s on Thursday and said that a legislative fix would probably be necessary. Widely considered to be one of the most vulnerable Democrats facing reelection, she has not bucked leadership yet.

But 39 Democrats in the House defected to support a Republican bill to allow policyholders whose plans were canceled to keep them, and the question remains whether Senate leaders will have to eventually allow for some kind of legislative fix to forestall the political pummeling of vulnerable members like Landrieu.

“Reid, I think, is a realist. He knows that senators up for reelection in red and purple states could be the difference maker,” said William Galston, a former adviser to President Clinton and an academic at the Brookings Institution. “If the impression sinks in that Senate Democrats are simply the quiet accomplices or enablers of a policy that the folks back home are increasingly leery of, that opens up a huge vulnerability.”

For now, leadership is backing the president’s position. Reid said he spoke with Obama over the phone last week and felt “very comfortable” with the White House’s approach. That likely means leadership won’t be placing a bill on the floor just yet to try to counteract the negative political effects of the rollout.

“I don’t think it does at this point,” Durbin said when asked whether the law would need a legislative fix. “It remains to be seen.”

The key part of that statement is “at this point.” If the law continues to poison the political well, Reid may have no choice but to put a bill on the floor that lets his vulnerable members show they’ve acted to fix the legislation.

In a recent Quinnipiac University poll, the approval of Obamacare dropped from 45 percent last month to 39 percent now. Over the same period, opposition to the legislation jumped from 47 percent to 55 percent. Likewise, a recent Gallup Poll showed 55 percent disapproval of the law, with only 40 percent of the public approving.

When the Senate returns Monday, Democrats will have a chance to change the subject, with votes expected on D.C. Circuit Court nominee Robert Wilkins, a drug-compounding measure, and the defense authorization bill. Still, the political explosiveness surrounding the health care law seems to suggest Senate Democrats may indeed be compelled to take some action on the floor.

“They have to do something pretty conspicuous,” Galston said. “For Harry Reid that’s the difference between being the majority leader and minority leader—I assume he likes his job.”

Thursday, November 14, 2013 | 7:43 p.m.
President Obama might have temporarily defused a political powder keg within his own party on Thursday, but the Affordable Care Act shows signs of continued volatility, with congressional Democrats keeping a wary eye on the law's ongoing rollout and mulling whether to respond legislatively.

White House advisers, including Chief of Staff Denis McDonough, deployed to Capitol Hill to allay growing Democratic fears over the fumbled startup of the president's signature initiative, by and large securing support from Democratic leaders but leaving politically vulnerable members in a difficult position.

"The White House has learned a lesson that you shouldn't over-promise. You need to be able to do what you say and say what you do," said Rep. Jim Moran, D-Va.

McDonough showcased dozens of small improvements to HealthCare.gov, the struggling website for the federal insurance exchange, which helped reduce tensions among many frustrated House Democrats.

Senate Democrats emerging from a closed-door meeting with White House officials at the Capitol fell into two categories: leadership and others who said legislation to fix the law's flaws was no longer needed, and those, including red-state Democrats like Sen. Mary Landrieu of Louisiana, who said congressional action would probably be necessary.

"I said the president's announcement this morning was a great first step and we will probably need legislation to make it stick," said Landrieu, who already has proposed legislation to make changes in the health care law.

Added Sen. Max Baucus, D-Mont.: "It's a step in the right direction. We may need to go farther."

Even if legislation is pursued, it would face a rocky road. "There isn't a bill out there that could pass both the House and the Senate," a senior Democratic Senate aide said. "The constructive fixes have to be done administratively."

The aide added: "Are we going to go in a different direction? Are we going to say we still want legislation? I think that's still being discussed."

Assistant Senate Majority Leader Dick Durbin, D-Ill., backed the White House's proposal, telling reporters after the meeting that there's no need for legislation to fix the law. He also suggested he doesn't believe Republicans will act in good faith anyway to make any needed changes to the law.

"We have yet to hear the first Republican in the House or the Senate stand up and say, I'm ready to sit down and talk about constructive changes in the Affordable Care Act," Durbin said. "Their goal is clear. Defund it. Destroy it."

House Democratic leaders depicted a bill hitting the floor Friday from Rep. Fred Upton, R-Mich., as a step toward repealing Obamacare, and will offer a motion to recommit. The Upton bill would let people keep their insurance plans without requiring the companies to actually sell them. "We think our Democrats … a large part of them will be against the Upton bill," said House Minority Whip Steny Hoyer, D-Md.

But a number of vulnerable House Democrats are still undecided or open to voting for the proposal, such as Rep. Nick Rahall of West Virginia. Groups are running ads against him in his district, tying him to Obama's promise that people who like their plans can keep them.

"I'm concerned about my integrity with voters who have returned me here for 38 years," Rahall said. "They know me well enough to know I wouldn't purposefully mislead them and that I'm an honest straight-shooter, and always reflect their values. I just need to find the answers myself."

For his part, Obama acknowledged the political trouble he caused Democrats, suggesting just how deeply the law's implementation may have wounded the party.

"There is no doubt that our failure to roll out the ACA smoothly has put a burden on Democrats, whether they're running or not, because they stood up and supported this effort through thick and thin," Obama said Thursday. "And I feel deeply responsible for making it harder for them rather than easier for them to continue to promote the core values that I think led them to support this thing in the first place."

And so, with a little more than a year left in his current term, the nation’s 53rd speaker faces a choice: He can spend the next year much like the last, trying to reconcile the rambunctious tea-party wing of his conference with more-moderate Republicans in a stand against Democrats in the Senate and the White House. Or, he can work with House Democrats and a loose coalition of roughly 30 Republicans who have teamed in the last year to reauthorize the Violence Against Women Act, supply funding for victims of Hurricane Sandy, and end the government shutdown.

“History generally looks kindly upon those individuals who either stood outside the pack and displayed foresight and courage, or those with a knack for compromise and getting the job done,” said political pollster and author John Zogby. “It is hard to remember much written about those who simply kept their job.”

He added: “If a portrait in the hall and a wiki stating his title are sufficient, so be it.”

Boehner’s current strategy has brought more conflict than comity in recent months, but it has earned him a measure of respect within his conference—especially among freshman and sophomore conservatives—even as Republicans have been wounded in nationwide polls.

Yet there are also those who say he is squandering his leadership position in the face of enormous crisis, too often handcuffed by his own party to pursue compromise and legitimate legislative achievements.

“My sense is that John Boehner’s best legislative days are behind him,” said Sarah Binder, a senior fellow in governance studies at the Brookings Institution and professor of political science at George Washington University.

But not necessarily his days as speaker. The Ohio Republican is planning to run again for his congressional seat in 2014 and his spokesman, Michael Steel, says he “has been clear, publicly and privately, that he intends to be speaker again in the next Congress.

“And frankly, the idea that he might ever abandon his members and his principles is a stupid liberal fantasy,” Steel said.

What is clear is that Boehner is now almost halfway through his second session as the House’s top leader (he’s been the top Republican in the House since 2007, before the GOP took over the majority in 2011) and it would be very difficult to replace him.

House rules make it very hard to depose the speaker. One ham-fisted effort by several conservatives earlier this year failed to even generate a challenger bold enough to put his or her name out publicly. Even if one were to emerge now, the rules hold that a speaker must be elected by a majority of the entire House. That means any such challenger would require the near complete support of Boehner’s own conference and, lacking that, some unlikely support from Democrats.

Equally clear is that Boehner does have options in the time before he stands for a vote on his speakership again. There have been several instances in recent months in which Boehner has enjoyed the reliable backing of a “center-left” coalition of Republicans who, combined with large numbers of House Democrats, are capable of passing vital legislation.

This coalition includes 30 Republicans who voted to end the shutdown, to reauthorize the Violence Against Women Act, and to grant funding for Sandy victims. There are 44 who voted for at least two of these bills. Fully 87 Republicans helped to pass last month’s legislation to restart government funding and extend the debt ceiling, joining 198 Democrats in approving it against the opposition of 144 Republicans.

This group doesn’t recognize itself as a single organized caucus, and it is a mix of Old Bull members, younger Republicans, and longtime friends of Boehner. Looking at this, some congressional experts suggest Boehner could work to unify coalitions of Republicans and Democrats to support compromise solutions on fiscal matters, entitlement and tax reform, pieces of immigration reform, and other policies.

“History can be kinder to a leader who crossed the lines than someone who always stayed in between,” Zogby said.

But others offer pessimism. Being a unifier is “not how he got the job,” says Rice University political scientist Paul Brace.

Brace notes that Boehner was elected to Congress in a solidly Republican district by challenging a scandal-ridden incumbent, and that his career benefitted from opportunities arising from tumult in Republican leadership.

“He is a Chamber-of-Commerce or country-club Republican that achieved leadership largely because of divisions within the GOP, not because he could unify the party,” Brace said.

Binder recalled a time when Boehner had a reputation as a legislative deal-maker, citing his contributions to the No Child Left Behind law from his perch on the House Education Committee.

But she also said that “leading from the speakership is hard—he can’t command loyalty from his rank and file. And given the Far Right’s resistance to compromise and given the speaker’s unwillingness to govern with Democratic votes, his opportunities for landmark legislative deals seem particularly slim.”

William Hoagland, a senior vice president at the Bipartisan Policy Center and former Senate Budget Committee staff director, says the question is whether anyone else—such as Majority Leader Eric Cantor or Budget Chairman Paul Ryan—could do any better.

“At the end of the day, his legacy might simply be that he kept the House in Republican control,” Hoagland said. “Or maybe not.”

President Barack Obama’s “if you like it, you can keep it” promise has House Democrats facing a dilemma as they look ahead to a vote on Republican legislation to preserve existing health plans.

“There will be defections,” a House Democratic leadership aide predicted.

The bill, sponsored by House Energy and Commerce Chairman Fred Upton, R-Mich., would give insurance companies the option of continuing all existing health plans for a year. It’s considerably weaker than a proposal by Sen. Mary L. Landrieu, D-La., that would require insurance companies to continue offering existing plans, but the political power of the legislation may be no less potent: Are you in favor of keeping the president’s promise or not?

The problem for the White House, and House Democrats, is this: Keeping those old plans undermines the new insurance exchanges and reforms at the heart of the Affordable Care Act. They’d much rather have people enter the new exchanges and see them take advantage of the options for comprehensive benefits with the law’s other attributes — such as no more penalties for pre-existing conditions and no more gender discrimination — intact. That has presented two additional problems: The website woes have made signing up difficult for many, and others, particularly those making too much money to qualify for subsidies, are seeing higher premiums than they had under their old plans.

In a House Democratic Caucus conference call at the end of last week, leaders, unsurprisingly, said that they would urge a “no” vote on Upton’s bill.

Though the vast majority of Democrats will likely side with leadership, a sizable contingent of vulnerable caucus members — mostly freshmen — are expected to side with Republicans in bids to win over their more moderate-minded constituents ahead of the 2014 elections.

It’s a challenge to Democratic leaders who pride themselves on maintaining party unity — in stark contrast to GOP leaders who regularly struggle to corral their rank and file — and who hail passage of the health care law as their premier legislative accomplishment.

Both factors were weighing on Minority Leader Nancy Pelosi, D-Calif., when legislation came to the floor this summer to delay implementation of the individual mandate by one year. Pelosi lobbied members hard to oppose the bill, even as targeted lawmakers argued that their re-election chances hinged in part on that vote.

In the end, 22 Democrats voted “no,” a number one senior House Democratic aide said would probably have been higher without Pelosi’s work.

That same aide told CQ Roll Call that a similar scenario could play out this week, and it could be even more of a challenge for Pelosi. Millions have received cancellation notices from insurance companies, despite the president’s promise that they could keep their health plans if they like them, “period” — leading to a rare presidential apology and turbocharging political pressure for a fix in both parties.

“The president has apologized, but that apology will be hollow unless Washington Democrats work with us to actually stop this train-wreck,” said Michael Steel, a spokesman for Speaker John A. Boehner, R-Ohio. “If they do not, the American people will certainly take notice.”

In conversations with CQ Roll Call, many House Democratic aides said that it was crucial to allow “front-liners” to do whatever it takes to keep their seats in the next Congress and not be bullied into upholding the party’s ideological purity.

One staffer for a senior House Democrat suggested the party should rethink broader Obamacare strategy and back some changes to the law.

Democrats, he wrote in an email, have “bitten the reins and been the work horse for this administration time and time again. We’ve defended health reform to the hilt with the promise that once it went into effect, the pain would have been well worth the struggle.

“It may be time to rally around some adjustments to the law,” he continued. “If the president can’t or won’t aggressively confront the insurance industry for exploiting this loophole, we’ve got to be proactive going into ’14.”

But a House Democratic leadership aide countered that the need for party loyalty, and a unified commitment to defending the health law, couldn’t be overstated. While some House Democrats might feel it “safe” to vote for the Upton bill because they don’t see it going anywhere in the Senate, a few Senate Democrats like Landrieu are starting to rally behind similar legislation.

“Members are going to have to realize that, to some extent, you can cause problems in the Senate if there is considerable House Democratic support on some of these things,” said the aide of the adverse effect those Upton “yes” votes could have if they provide leverage to Senate Democrats.

Of course, with the bill not scheduled to come to the House floor until the end of the week, a lot could change. The current legislative text could fall prey to conservative amendments, vaporizing Democratic support. The White House, which is exploring an “administrative fix” to address the dilemma, could unveil a plan that satisfies Democrats and, in their estimation, renders Upton’s bill irrelevant.

In the meantime, front-line Democrats are staying mum on their stances: None of the offices of the 22 Democrats who voted for the individual mandate delay would tell CQ Roll Call how the lawmakers planned to vote come Friday.

Sen. Joe Manchin III has followed through on introducing legislation to delay the individual mandate penalty under Obamacare for a year.

The West Virginia Democrat teamed up with his friend Mark S. Kirk, R-Ill., on the measure, which they announced late Thursday.

“We’ve worked through a few of these issues, but our job in Congress is far from over. We need to start working together to fix this law and make it work so that all Americans have access to affordable and reliable health care coverage,” Manchin said in a statement.

“We can start with a one-year delay of the individual mandate to eliminate penalty fees if individuals choose to not enroll for a health care plan in 2014. This commonsense proposal simply allows Americans to take more time to browse and explore their options, making 2014 a true transition year,” he added.

Manchin has been pushing for the mandate delay even though it may create political heartburn and tough votes for fellow Democrats, a possibility that #WGDB previously explored.

Almost all of the Democratic incumbents up in 2014 met with President Barack Obama for about two hours Wednesday to discuss the bungled rollout of the HealthCare.gov website for the federal health exchanges.

 President Barack Obama heard an earful at the White House Wednesday from Senate Democrats running for re-election next year who are fuming about the Affordable Care Act’s rocky rollout.

During a two-hour meeting that was not on the president’s public schedule, the president met with 15 Senate Democrats facing the voters next year, as well as Democratic Senatorial Campaign Committee Chairman Michael Bennet, D-Colo.

Sen. Mark Begich of Alaska issued a release after the meeting torching the administration.

“It is simply unacceptable for Alaskans to bear the brunt of the Administration’s mismanagement of the implementation of the Affordable Care Act and that is the message U.S. Senator Mark Begich delivered to President Obama today,” his office said in a statement blasted to reporters.

The release went on to say that Begich complained about “an unworkable website, technical glitches and inaccurate information about peoples’ individual situations. Begich demanded the administration fix the problems immediately so Alaskans, including the 55,000 eligible for subsidies to lower monthly premiums, can realize the many benefits due to them as a result of the health reform law.

“Alaskans should be appreciating the critical benefits of the Affordable Care Act but there is an understandable crisis in confidence because the administration has yet to get it off the ground,” Begich said.

Sen. Mark Udall of Colorado said he let the president know just how upset he is about the troubled health care law. He sent out a release saying that he had pressed the administration to extend the enrollment period due to the problems with HealthCare.gov, ensure that the data on the website is secure and make other modifications.

“The rollout of HealthCare.gov has not been smooth — to say the least — and I shared the concerns of Coloradans directly with the president,” Udall said in the statement. “Consumers should have the time they need to shop for a plan and enroll after the widespread problems with the website are fixed. I urged the president again to extend the enrollment period to give consumers enough time to make an informed decision about their family’s health insurance options. I also told the president that, for the Affordable Care Act to succeed, consumers need to be confident their personal information is secure. We need to do everything in our power to protect the online marketplace from hackers and cyberattacks.”

A White House official released a readout of the meeting “to discuss the progress that’s been made” and “hear their input on existing challenges” with the law.

“The President emphasized that he shared the Senators’ commitment to ensuring that Americans who want to enroll in health insurance through the Marketplaces are able to do so in time for insurance to start as early as January 1st, and throughout the open enrollment period which goes through March 31,” the official said. “He also discussed ongoing efforts to ramp up communication and education outreach to consumers who have received or might receive letters about how their individual market plans might be affected. In addition, the President also reiterated that the Administration is working to protect the privacy and security of consumers and to ensure that online Marketplace applications are protected by stringent security standards, with ongoing testing to help safeguard personal information.”

Udall also sent letters to Health and Human Services Secretary Kathleen Sebelius and to Marilyn Tavenner, who oversees the agency charged with implementing the law, outlining his concerns.

In addition to Bennet, Udall and Begich, attendees included the other Senate Democrats up in 2014: Cory Booker of New Jersey, Chris Coons of Delaware, Richard J. Durbin of Illinois, Al Franken of Minnesota, Kay Hagan of North Carolina, Mary L. Landrieu of Louisiana, Jeff Merkley of Oregon, Mark Pryor of Arkansas, Jack Reed of Rhode Island, Jeanne Shaheen of New Hampshire, Brian Schatz of Hawaii, Tom Udall of New Mexico and Mark Warner of Virginia. Ed Markey of Massachusetts, who is also up in 2014, did not attend because he was chairing a hearing on USAID and Peace Corps nominations.

After the meeting, the president’s trip to Texas was delayed about an hour. He is scheduled to give a speech on Obamacare and attend two high-dollar fund-raisers for the DSCC. Bennet boarded Marine One with him on the South Lawn and will make the trip.

The White House meeting came as Senate Democrats have grown increasingly concerned about the rollout, with Sen. Barbara A. Mikulski, D-Md., saying Tuesday that the early problems had created a “crisis of confidence.”

• By Steven T. Dennis

When a loyal leader on your own team says there is a “crisis of confidence” surrounding your signature initiative, you’ve got trouble.

That’s the phrase Democratic Sen. Barbara A. Mikulski of Maryland used repeatedly Tuesday morning to describe the rollout of the new health care law as she questioned Marilyn Tavenner, the head of the health agency tasked with overseeing the law’s implementation.

“I believe that there’s been a crisis of confidence created in the dysfunctional nature of the website, the canceling of policies, and sticker shock from some people,” said Mikulski, who has generally been a strong ally of the administration.

She cited a news report that 73,000 people in her own state are getting cancellation notices, “so there has been fear, doubt and a crisis of confidence” — and she’s worried people, particularly the young, won’t enroll as a result.

Indeed, the Affordable Care Act’s website woes, combined with millions facing the cancellation of their individual policies despite President Barack Obama’s assurances that would not happen, have put Hill Democrats in an increasingly awkward position — with no easy way out.

After celebrating their victory over the GOP during the government shutdown by sticking firm on Obamacare, vulnerable Hill Democrats are now looking for cover.

The White House now is in a race to fix the problems before demands within the Democratic Party for legislative fixes become overwhelming — either in the form of a proposal by Sen. Joe Manchin III of West Virginia for a one-year delay in the individual mandate or Louisiana Sen. Mary L. Landrieu’s new proposal to keep grandfathered plans online instead of generating more cancellation notices.

Landrieu, of course, is up for re-election in 2014, and it’s no secret the GOP intends to use the health care law’s troubles as fuel to defeat her and other vulnerable Democrats.

Senate Minority Leader Mitch McConnell called the developments “foxhole conversions” by Democrats. “I think we’re witnessing the beginning of a stampede away from the president’s signature accomplishment,” the Kentucky Republican said.

“I think what’ll be really interesting to see in the Senate is the number of Democrats in very red states who are up in ’14 and what they start demanding of the majority leader and the administration, in terms of adjustments to this law,” McConnell said. “We all know they were lockstep a couple of weeks ago — everybody voting against defunding, voting against delaying and all the rest. Now, it seems to me we’re hearing a kind of different tune.”

One such Democrat, Sen. Mark Begich of Alaska, said he’s going to look at Landrieu’s proposal as well as legislative fixes of his own.

“We have a couple in our office we’re kicking around but nothing to make public yet,” Begich said. “Whatever we can do to make sure people have insurance, we should be focused on. I’ve always said the whole law is not perfect, and you should always look for tweaks. I’m not afraid to tweak the law.”

The White House and Senate Majority Leader Harry Reid may be able to fend off meaningful defections for now. For example, Reid brushed off a question about allowing a vote on Landrieu’s bill Tuesday and dismissed McConnell’s remarks by saying the minority leader should worry about his fellow Republicans.

But if the administration can’t fix HealthCare.gov by the end of November as promised, there will be enormous pressure to do something. And apart from the mechanics of the law, the White House continues to struggle to explain how a key promise made by the president — that people would be able to keep their plans, “period” — isn’t coming true.

Press Secretary Jay Carney on Tuesday blamed insurance companies for not continuing to offer the grandfathered plans, saying that they had pulled the rug out from under people.

The White House has not endorsed any legislative tweaks aimed at restoring those plans — and warned if some were to pass, they could undermine the broader law.

“If you are going to assert that insurance companies can continue to offer substandard plans, bad-apple plans for example, that do not provide hospitalization or have carve-outs that exempt from coverage the very chronic condition you may have, often in a way that the purchasers of this insurance don’t even know ... that undermines the fundamental promise of the Affordable Care Act, which is that everyone in America should have access to affordable, quality health care coverage,” Carney said.

And, of course, in speech after speech — until Obama added the caveat about insurance companies Monday night — the president had been emphatic. On Tuesday, one of Carney’s many attempts to explain away the president’s words went like this: “He didn’t say ... ‘if your insurance company cancels your plan and gives you something else that’s worse, you can keep it.’ He said that ‘if you had a plan — if you have a plan that you like, you can keep it.’”

Carney said the people affected were only a portion of the 5 percent of the population in the individual health insurance market. But that is still millions of people who are being told now that they can’t keep their plans, and it’s causing an enormous political headache on Capitol Hill.

Faced with the shock from consumers over cancellation notices from their health insurers, House Democratic leaders on Thursday armed their rank-and-file members with tips on how to handle the fallout from constituents as they spend the next week on recess away from Washington.

Meanwhile, there's a split among House Republicans internally over whether they should maintain a public aggressiveness against the health care law while in their districts, such as continuing to charge that President Obama has broken his promise to Americans that "[i]f you like what you have, you can keep it—period."

Some House Republicans say their party should instead sit back and let the drip-drip of problems now dominating the news regarding the Affordable Care Act and theHealthCare.gov website play out on their own. But that's not the tack that top House Republican leaders are taking, and on Thursday they handed out their own talking points to members entitled: "Because of Obamacare … I Lost My Insurance."

By contrast, the Democratic memo sent out Thursday to members entitled "Talking Points—Key Points on Conversion Letters from Insurers" carefully avoids hitting the panic button. But the mere fact that scripted talking points are needed is another sign of which party is back playing offense and which is on defense regarding Obamacare.

A main suggestion in the damage-control memo sent out by the office of Minority Leader Nancy Pelosi, D-Calif., is for House Democrats to keep emphasizing that most people who are losing their plans will get better ones under the health law—and to try to correct any misperceptions about who is being affected.

Members are to underscore that more than 75 percent of Americans get insurance from their employer, Medicare, Medicaid, and the Veterans Administration, and that only 5 percent get insurance on the individual market. It is just a "subset of this 5 percent [who] are getting conversion letters from insurers," the memo tells members.

Democrats are also advised: "Those receiving notices will be able to enroll in a new plan with benefits and protections that do not discriminate based on pre-existing conditions, does not deny them key benefits like maternity, mental health, or prescription drug coverage, [and] cannot drop you when you're sick.... These are the provisions of the 'Patients' Bill of Rights' that they now have to buy into."

The rest of Democrats' memo provides wonkish detail that may not help much in face-to-face meetings with angry constituents. For instance, one point suggests members can explain that "insurers in the individual market often do not renew a particular policy for an individual, offering them a new product after they 'cancel' the existing one," and that "this practice contributes to high turnover in this market: from 35 to 67 percent of enrollees leave their plan after a year."

The memo to House Democrats came a day after Pelosi held a news conference in which she pointed out that about a decade ago there were problems with the rollout of President George W. Bush's prescription drug benefit under Medicare.

She noted headlines about the Medicare Part D program from back then blaring messages such as "Glitches Jam Medicare Drug Plan," "Confusion," and "Computer Crash."

But Pelosi told reporters that although many Democrats viewed the program as a giveaway to the pharmaceutical industry, "we served our constituents by facilitating their enrollment in Medicare Part D, contrary to what you see with this," referring to Republicans and Obamacare.

House Republicans enter the recess riding two opposite waves of thinking on how to proceed with efforts to undo Obamacare. The HealthCare.gov website problems and the news of policy cancellations have helped them rebound from public blowback over shutting down government and putting the nation on the brink of default.

As the rank and file left Washington, GOP leaders provided them with materials reflecting the more proactive view. The playbook instructs members to emphasize that President Obama sold his health care law on two major promises: that all Americans could keep their policies if they wanted and that health care costs would go down.

"Each of these promises has now been broken," the playbook states. It adds, "Obamacare is much more than a bad website; it's a bad law. Americans all across the country are already feeling the law's negative effects, such as rising premiums, limited access, and cancelled policies. This is happening to hardworking Americans in every corner of America—including your own district."

The playbook goes on to recommend, "When you're home, highlight the House Republican Conference's 'YourStory' project and encourage your constituents to submit feedback of their own experiences with Obamacare." It also provides members with various social-media and event strategies, and even a prewritten op-ed column that members can submit to local media and digital flyers.

The attack strategy was illustrated Thursday in another arena by House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif. He announced he has subpoenaed Health and Human Services Secretary Kathleen Sebelius for documents related to the troubled launch of HealthCare.gov.

But some within the Republican Party are advocating a more passive approach.

They point to the recent negative polling tied to the budget showdown as showing they might fare better against Obamacare by letting it succeed or fail based on the reaction of Americans now in search of coverage.

For these Republicans, the strategy is summed up by a Latin expression that means: "The thing speaks for itself." One House GOP leadership aide said Thursday, "To put it in context, we should just try to get out of our own damn way for now.... The website [snafus] have been happening for some time. But people are really upset now about the [policy] conversion stuff."

Wednesday, October 30, 2013 | 7:50 p.m.
It's supposed to be a committee of 29 separate voices from the House and Senate. But the early signals from the inaugural meeting of the bipartisan House and Senate budget conference are that it may operate more like a committee of two: Rep. Paul Ryan and Sen. Patty Murray.

Ryan said Wednesday that the committee won't be formally sitting down as a group again until Nov. 13—a fact that seemed to catch even some of the panel's members by surprise. That leaves barely a month before the panel's Dec. 13 deadline to report its recommendations back to Congress.

"That is a huge concern to me," said Sen. Jeff Merkley, D-Ore. "The American people expect us to be getting into the nitty-gritty, not just giving opening statements and checking out for two weeks."

Ryan said the lack of formal committee meetings before mid-November was because House and Senate schedules don't overlap until then.

But several members of the committee, charged with keeping the government funded past Jan. 15 and avoiding another shutdown, said the weeks between now and Thanksgiving are crucial to getting work done. Finishing before Thanksgiving could allow more time for the House and Senate to reach agreement, and give appropriators time to craft individual spending bills or a larger omnibus package.

"When you look at the hourglass … the time between now and Thanksgiving is crucial," said Sen. Ron Wyden, D-Ore.

Not that all committee members didn't get a chance to express themselves in opening statements Wednesday. One after the other, they spoke before the cameras, though the meeting was largely overshadowed by testimony taking place elsewhere over Obamacare. Their statements were marked by words like "together" and "compromise" and "agree."

Yet the two chambers are still sharply divided on the issues, such as new tax revenues and changes to entitlement programs like Medicare and Social Security.

The notion of a "grand bargain" that could tackle changes to entitlements, overhaul the tax code, and cut trillions from the national debt is being downplayed as highly unlikely, something both Ryan and Murray indicated in their opening statements and before.

Instead, the focus is on finding some way to soften the next round of sequester cuts and forging a spending plan through Sept. 30, 2014 (the rest of the current fiscal year) that would go beyond simply extending existing funding levels.

"Nobody has to abandon their principles," said Ryan, the House Budget Committee chairman. "Instead, we need to find out where our principles overlap. We won't solve all our problems … so let's focus on achievable goals. Let's find common ground."

Murray, the Senate Budget Committee chair, said, "This won't be easy—the House and Senate budgets are very different even for just this year. But if both sides are willing to move out of their partisan corners and offer up some compromises, I am confident it can be done."

Murray said the committee will be working between now and the next conference meeting. "Obviously we all need to get it done fairly quickly. The time is very short," she said.

But with no plans now to meet again until Nov. 13—and pressure to deliver progress by Thanksgiving—it appears evident that not all 29 members of the committee will be instrumental in the real negotiations.

Budget experts, including Steve Pruitt, a former House Budget Committee Democratic staff director, say most of the work of House and Senate conferences--especially a budget conference--typically gets done in private discussions between the House and Senate chairs, the ranking members, and at the staff level.

"That's where the progress will be—in the private conversations," said Sen. Bill Nelson, D-Fla. "You'll have some parameters by then. Then you've got another month to finalize it. "

Merkley acknowledged that budget leaders are preparing for conversations behind the scenes but argued that provides limited opportunity to work together. "I'm sure that is certainly part of it," he said. "But maybe having regular public gatherings would also help drive more speed behind the scenes."

Sen. Chuck Grassley, R-Iowa, told his colleagues in a statement, "The deliberations and deal-making shouldn't be done in the dead of night in a backroom with only a small handful of individuals."

Grassley said some of the public cynicism regarding Washington "comes from the fact that many of the recent budget deals have been concocted in a back office by a few leaders, and rank and file members were left to take it or leave it. They weren't debated. There was no deliberation. And nearly no one had an opportunity beforehand to even read them."

Whatever emerges will require the approval of majority of the committee's members before it can be sent as a recommendation to the full House and Senate.

Meanwhile, Wednesday's opening hearing did little to reset what have been relatively low expectations before the conference committee ever gaveled in. Ryan has said he is not seeking a grand bargain, and Democrats have further lowered the bar for success in recent days by making clear they are focused on trying to find a budget agreement for fiscal 2014—not one that extends for 10 years—and finding an alternative to the sequester cuts.

Some conference members said they would consider even small achievements major victories in the current environment.

"Let's get some of our more immediate issues resolved," said Sen. Mike Crapo, R-Idaho. "Let's lay some foundation and some progress for moving towards the bigger solutions. I think there is a little different expectation this time and hopefully it's one where we can be successful."

• By Niels Lesniewski
• Roll Call Staff
• Oct. 30, 2013, 1:16 p.m.

Gathering Wednesday morning for their first formal meeting, the leaders of the House and Senate Budget committees continued the recent pattern of setting low hurdles and reasonable expectations — while still being split as usual on the issue of taxes.

The meeting in the bowels of the Capitol in a room best known lately as the site of contentious House GOP conference meetings, kicked off with Senate Budget Chairwoman Patty Murray, D-Wash., handing off an unusually large gavel to her House counterpart, Republican Paul D. Ryanof Wisconsin. That’s because, as a matter of tradition, the two chambers alternate chairing conference committees.

“Nobody has to abandon their principles. Instead, we need to find out where our principles overlap. We all agree Washington isn’t working. We all agree there’s a smarter way to cut spending. And we all agree our economy could be doing a lot better. We won’t resolve all our differences here,” Ryan said in his opening statement. “We won’t solve all our problems. But we can make a good start. And we should, because we owe it to the country.”

“I hope that we might be able to exceed expectations,” said Sen. Mark Warner, D-Va., noting that he thought members on both sides had done a good job of narrowing the goals. He stopped short of suggesting a “grand bargain,” however.

Murray focused on what many lawmakers view as the first task of the conference — finding replacement savings for the sequester.

“I agree with those who say the very least this conference should be able to do — the absolute minimum — is find a way to come together around replacing sequestration and setting a budget level for at least the short-term,” Murray said. “This won’t be easy — the House and Senate budgets are very different even for just this year. But if both sides are willing to move out of their partisan corners and offer up some compromises, I am confident it can be done. So let’s start with something we do agree on. Democrats and Republicans have said replacing sequestration should be a priority for this budget conference.”

Democrats and Republicans differed on the issue of taxes, as was to be expected. Sen. Lindsey Graham, R-S.C., noted the nearly $1 trillion in new revenues over a decade in the Senate Democratic framework, while a number of Democrats from both chambers highlighted efforts to close what they term as loopholes in the tax code.

“In concrete terms, the difference between the House and Senate budgets is about $90 billion. Believe it or not, that’s just about what published reports say the Treasury loses every year, alone, from these offshore tax havens,” Sen. Bill Nelson, D-Fla., said. “Just these few examples could save more than enough to resolve the differences in the House and Senate budget plans, at least in the first year.”

Most of the real work won’t be done in public conference meetings, which is a good thing since the panel will not reconvene until Nov. 13, Ryan announced Wednesday morning. That’s because the House and Senate are once again operating on different schedules, with the House expected to take a recess next week.

“I hope we will hold a number of open sessions to discuss proposals in considerable detail so that we really understand how they would affect ordinary people and American prosperity,” said House Appropriations ranking member Nita M. Lowey, D-N.Y.

BY ANDREW TAYLOR
ASSOCIATED PRESS
POLITICS VIDEOBUY AP PHOTO REPRINTSLATEST BUDGET NEWSLAWMAKERS MEETING IN HOPES OF LIMITED BUDGET DEAL

MULTIMEDIAOBAMA'S 2011 BUDGET
WASHINGTON (AP) -- A House-Senate negotiating panel on the budget convened Wednesday to discuss ways of easing indiscriminate spending cuts slamming the Pentagon and domestic agencies alike.

Lawmakers on both sides struck a hopeful but cautious tone about the prospects of reaching an agreement that could make progress on curbing the automatic cuts that are the price for Washington's failure to strike a follow-up budget pact to a 2011 agreement to cut agency budgets.

The talks Wednesday in a dysfunctional Washington come after a sustained period of warfare among the main protagonists - Democrats controlling the White House and the Senate and Republicans leading the House - is yielding to a moment of smaller-scale talks between lieutenants of top House and Senate leaders.

The idea of a "grand bargain" blending tax increases with politically difficult savings from popular benefit programs like Social Security and Medicare seems to be off the table.

No sooner had the meeting gotten underway in a basement room of the Capitol than the chief negotiators hit one of the most difficult roadblocks facing them: Taxes.

"I want to say this from the get-go: If this conference becomes an argument about taxes, we're not going to get anywhere," said House Budget Committee Chairman Paul Ryan, R-Wis. "We won't resolve all our differences here. We won't solve all our problems. But we can make a good start."

Senate Budget Committee Chairman Patty Murray, D-Wash., said she's willing to consider longer-term cuts to autopilot-like spending on certain benefit programs in order to ease immediate across-the-board cuts to agency operating budgets. But she wants Republicans to put revenue into the mix, too.

"I'm ready to make some tough concessions to get a deal," Murray said. "But compromise runs both ways. While we scour programs to find responsible savings, Republicans are also going to have to work with us to scour the bloated tax code - and close some wasteful tax loopholes and special interest subsidies."

Lawmakers generally are trying to put together a smaller-scale deal that would ease across-the-board cuts known as sequestration that are hitting federal agencies. Virtually no one thinks a "grand bargain" blending hundreds of billions of dollars in new tax revenues and fundamental restructuring of expensive benefits programs is possible.

Democrats are still pressing for new revenues but are running into predictable opposition from GOP conservatives.

Wednesday's meeting involves speechmaking rather than real negotiating, but a consensus already seemed to emerge about limiting the scope of the talks to finding ways to deal with the across-the-board spending cuts.

Democrats are eager to ease cuts to domestic programs like Head Start preschools, education grants to local schools and infrastructure projects.

Republicans are especially worried about cuts to the Pentagon, which would grow even deeper after the turn of the year.

"We might as well shut down the Pentagon because it'll basically hollow them out," House Armed Service Committee Chairman Howard "Buck" McKeon, R-Calif., said.

The sequestration cuts began to bite in March, but an upcoming round of cuts will hit the Defense Department even harder. The Pentagon and domestic agencies have found ways to manage the automatic cuts through bookkeeping tricks and one-time maneuvers, but worries are running high that the round coming next year will be far worse.

Another obstacle to a deal is the reluctance of Democrats to cut domestic programs to pay for easing cuts to the Pentagon budget. If Republicans won't allow new revenues to be used to offset additional defense spending, negotiators would have to look at the Pentagon's popular Tricare health care program and its generous pension benefits.

Washington endured a lengthy power struggle this month over keeping the government open and raising its borrowing cap. Conservatives like Sen. Ted Cruz, R-Texas, advocated shutting down the government to try to force Democrats to defund Obama's health care law, but the maneuver backfired with the public.

Expectations for the talks are limited at best, given the acrimonious history, but both sides have an incentive to reach a bargain that would win favor among both GOP defense hawks and Democratic defenders of domestic programs.

"I'm always optimistic," Rep. Mike Simpson, R-Idaho, said. "Do I think it will happen? I don't know."

There is no place like home, for family or for work, according to Matt Delaney, who returned to his home town

of Lafayette to develop and expand the business he started in Hawaii five years ago. Almost a business adventurer, Delaney looks like nothing would be able to slow him down, not even the cancer that struck him some 15 years ago. Still going back to Hawaii regularly while his family is settled here, the CEO is focusing his energy on developing the California market for managing and outsourcing human resources functions, and more, and is thinking about expanding to the rest of the states. And his Lafayette company is hiring. Everything at CaHR in Lafayette speaks of local connections re-activated. The building Delaney is leasing belongs to his next door neighbor from a family he knew when he was growing up. To kick start his implementation in California he bought a Lafayette firm called Human Resource Advisor that belonged to Barbara Freet, whose daughter, Amy, went to Stanley Middle School with Delaney. Coming back to Lafayette to raise his family in Burton Valley and establish his California headquarters, he reconnected with many friends, including Michael Harrison, a Campolindo High School buddy who became a baseball pro before hanging up his mitt and going into sales; he is now CaHR's vice president of sales.  Delaney's professional life, however, has taken him quite far from Lafayette. After graduating from USC in accounting, he worked for E&Y Kenneth Leventhal Real Estate Group where he was a senior consultant and CPA. He became part of Sunterra's acquisition and development team, before becoming the CEO of Marc Resorts Hawaii which operated 22 resort properties with over 1,000 employees.

Twelve years before creating the HiGroup, Delaney held various executive positions in Hawaii. It is there that he saw an untapped market for human resource services. In the meantime, he found the time to marry Karen, his Camposweet heart. HiHR in Hawaii has 100 internal employees with 286 clients last year representing 5,000 employees - a nearly 500 percent increase in clients from the end of 2009, translating to $71 million in revenue.

The Lafayette office will provide human resource services for businesses of all sizes. "Businesses do not always have the resources to manage their workers' comp, payroll, and now the Affordable Care Act (ACA) benefits," says Delaney. He adds that the ACA, which can be confusing to a lot of business owners, is not something new to his company. "In Hawaii, we have had the pre-paid health care act since 1974 that companies have to subscribe to even if they have only one employee, so we know the game of eligibility, tracking the hours, et cetera," he said. "Right now there is so much confusion, and reporting compliance requirements, business owners will have to turn to somebody."

CaHR is a full resource outsourcing firm. "There are two models to manage employment and administrative functions," says Delaney. "PEOs (Professional Employer Organizations) where we are the co-employer handling all the back-office and taking responsibility for it, and ASOs (Administrative Service Organizations) providing the same services but with the paperwork being filed under the client's federal employer's identification number." CaHR also does full staffing and recruiting. "We already have clients in many states, but to develop the California market, it is important to have a local office," says Delaney, who believes in creating relationships with his clients, which means that he is looking for the right partners to expand in other regions. He also plans to diversify the services in California by adding accounting and marketing, just like HiHR does in Hawaii. "In a few years, all the subsidiaries will be regrouped under a national holding called Demand HR," he adds.

The market of CaHR is mostly small companies. "The laws in California are a pain in the neck for small companies," Delaney says, "but there is opportunity for us to come in and help." He adds that size is not an absolute limiting factor. "In Hawaii our smaller client has one employee, the biggest has 800." Right now CaHR is looking for a receptionist, an executive/personal assistant, a staffing manager, a recruiter, some sales people, a benefits specialist, and a payroll specialist.

The Hawaiian blessing of the office - a traditional blessing in the islands that honors those of the past, present, and future - by Kahu Curt Kekuna, is scheduled from 5:30 to 8 p.m. Oct. 25 at 201 Lafayette Circle, Suite 200. The energy, or "mana" (power within), left behind from the people who once held a place here, and even those before file. 

LAMORINDA WEEKLY | CaHR: Back to Lafayette to Manage Human Resources are honored and blessed, as they allow new energy to enter, dwell, and prosper. To RSVP, email mdelaney@ca-hr.com. For more information, visit www.ca-hr.com or call (925) 310-5400.

* Republicans don't understand THE DEBT CEILING

* Liberals don't understand THE DEBT CEILING

* NO ONE understands THE DEBT CEILING

* SO - Allow me to explain...

Let's say you come home from work and find there has
been a sewer backup in your neighborhood. Your home has sewage all the way
up to your ceilings.

What do you think you should do? Raise the ceilings or pump out the shit?

His proposal was rejected 57-42 on a straight party-line vote because, as Senator Chris Dodd (D-Conn) explained,"Passage of such a requirement would restrict home ownership to only those who can afford it."

I can't add anything to this.

WASHINGTON (Reuters) - A new round of U.S. budget negotiations starting next week should focus more narrowly on replacing automatic spending cuts rather than an elusive "grand bargain," House Budget Committee Chairman Paul Ryan said on Thursday.

Ryan told Reuters in an interview that simply maintaining the automatic "sequester" cuts was the fallback position for Republicans if Democrats do not agree to substitute longer-term savings on expensive federal benefits programs.

"We have spending cuts coming. The question is, can we get something that's better than this?" said Ryan, last year's Republican vice presidential nominee. "If we can get an agreement, it's obviously going to be better than the status quo."

He said reducing expectations could make the talks more successful than past efforts, such as the 2011 "supercommittee" that failed to find $1.2 trillion in savings over 10 years.

"My hope is that it has a better chance because we'll set more rational expectations of what we're setting out to achieve," Ryan said.

"If we focused on doing some big grand bargain, like those prior efforts ... then I don't think we'll be successful because we'll focus on our differences. Each party will demand that the other compromises a core principle and then we'll get nothing done," he said.

The 29-member negotiating committee, set in motion by last week's deal to end a government shutdown and raise the federal debt limit, will convene on Wednesday.

Ryan, who will lead Republicans on the panel, said there was a better chance of finding common ground with Democrats on "smarter" spending cuts to replace the across-the-board reductions to discretionary spending. He said those include reforms to "entitlements," which include the Medicare and Social Security programs for the elderly, Medicaid healthcare for the poor and some farm subsidy programs.

He noted that President Barack Obama had proposed changes to those programs, such as a lower inflation gauge for the Social Security retirement program's cost-of-living increases. His Democratic counterpart, Senate Budget Committee Chairwoman Patty Murray, also has proposed some ways to reduce healthcare costs by $275 billion over 10 years through new efficiencies.

Both parties want to mitigate the sequester's impact, especially with a further $109 billion round of cuts due to launch on January 15 - the same date that government agency funding runs out again. Military programs favored by Republicans would bear more than half of those cuts.

REVENUE STICKING POINT

Ryan reiterated his long-standing opposition to further tax revenue increases as part of the budget negotiations, saying a major tax hike for the wealthiest Americans in January was already hurting the economy.

"If people see this conference as an excuse to raise taxes, I don't think it's going to be successful," Ryan said.

Democratic Representative Chris Van Hollen, another member of the budget panel, told Reuters on Tuesday that Democrats would not agree to significant cuts in social programs without increasing revenues by eliminating some tax breaks.

Without that, they will not consider proposals such as the cost-of-living change or charging wealthier seniors more for their Medicare health coverage, Van Hollen said.

If the two sides remain at loggerheads over revenues and benefits cuts, Ryan said the sequester cuts would simply remain in place, hitting agencies and programs ranging from education to military readiness.

"It's not our preferred route to reducing deficit and spending, but it works," he said, adding that Republicans were "proud" of the fact it had produced tangible savings.

"If we can't replace these spending cuts with smarter spending cuts, then we'll take what we have," he said.

He also said he believed the panel could help ease some sequester pain on federal agencies and the military by offering them more flexibility to spend their reduced budgets more effectively.

He also would like the panel to discuss ways to support comprehensive tax reform, which he views as a revenue-neutral endeavor that jolts economic growth by closing tax breaks, reducing rates and simplifying a complex tax code.

The negotiating panel is due to issue a recommendation by December 13, requiring majority approval among panelists from each chamber - seven House of Representatives members and 22 Senate members. The January 15 expiration of government funding creates the threat of another government shutdown if the two sides cannot come to some agreement.

Ryan said he was not interested in threatening another shutdown, adding, "I'd rather focus on the here and the now rather than January 15."

WASHINGTON (Reuters) - As the White House struggles to fix the problem-plagued rollout of its healthcare reform law, President Barack Obama on Thursday will try to focus attention on another policy priority - immigration reform - with a call for congressional action.

The president, who listed immigration as one of three priorities for this year after the 16-day government shutdown concluded, will make a statement at 10:35 a.m. (1435 GMT) at the White House urging lawmakers to finish work on measures to strengthen U.S. borders and provide a pathway toward citizenship for millions of people who are in the United States illegally.

"The president has made clear the key principles that must be a part of any bipartisan, commonsense effort, including continuing to strengthen border security, creating an earned path to citizenship, holding employers accountable and bringing our immigration system into the 21st century," a White House official said on Wednesday.

"He will urge that Congress take up this issue in a bipartisan way."

The Democratic-controlled Senate passed a broad immigration reform bill earlier this year, but the issue has languished in the Republican-controlled House of Representatives

The push for reform was drowned out in recent months by budget controversies and Obama's healthcare law. Republicans triggered the government shutdown in an effort to defund or delay implementation of the law.

Since the shutdown ended, however, the law known as Obamacare has dominated headlines because of its glitch-filled centerpiece website, healthcare.gov. Obama pledged on Monday that the problems would be fixed, but the issue has become a headache for him and his administration when it was supposed to be his crowning domestic policy achievement.

Talking about immigration reform on Thursday could be an effort to deflect attention from the White House's healthcare woes. An aide to Republican House Speaker John Boehner, however, said the issue would not be taken up as one big bill like the Senate version that Obama supports.

Republicans were "still committed to a step-by-step approach that gives Americans confidence we did it the right way, rather than one big Obamacare size bill that no one understands," the aide said, adding a jab at the healthcare law.

The White House official said Obama would be joined on stage and in the audience on Thursday by immigration reform supporters.

"Commonsense immigration is good for the country and it's the right thing to do," he said. "It will grow the economy, reduce the deficit, and has broad support from both Democrats and Republicans, business and labor, as well as law enforcement and faith leaders."

Administration officials approached the contractors last week to see if they could perform the necessary repairs and reboot the system by Nov. 1. However, that goal struck many contractors as unrealistic, at least for major components of the system. Some specialists working on the project said the online system required such extensive repairs that it might not operate smoothly until after the Dec. 15 deadline for people to sign up for coverage starting in January, although that view is not universally shared.

In interviews, experts said the technological problems of the site went far beyond the roadblocks to creating accounts that continue to prevent legions of users from even registering. Indeed, several said, the login problems, though vexing to consumers, may be the easiest to solve. One specialist said that as many as five million lines of software code may need to be rewritten before the Web site runs properly.

“The account creation and registration problems are masking the problems that will happen later,” said one person involved in the repair effort.

The scrambling underscores the pressures on the administration to fix what is widely viewed as the president’s biggest domestic achievement. Millions of Americans have spent countless hours in frustration trying to use the federal Web site, healthcare.gov, and its extensive problems have become a political crisis for the administration, providing new opportunities for Republicans who want to roll back the health care law.

Over the weekend, officials sought to counter pronouncements of failure by announcing that almost half a million people have submitted applications for health insurance through the federal and state marketplaces, about half of them through state exchanges. But officials declined to say how many have actually enrolled in insurance plans, and executives from insurance companies, which receive the enrollment files from the government, say their numbers have been low. The enrollment period ends March 31; those who go without coverage may be subject to fines.

On Monday, Mr. Obama will host a Rose Garden event with people who have successfully enrolled in the health care exchanges. White House aides said he will acknowledge that the technical problems are “inexcusable,” but will note, as one adviser said, that the health care law is “more than a Web site.”

“There’s great demand for the affordable health care coverage made available by the A.C.A.,” Jennifer Palmieri, the White House communications director, said Sunday, referring to the Affordable Care Act. “The challenge for all of us — the state and federal governments and contractors alike — is to make sure the American people can access it simply. We won’t rest until they can.”

Senior officials took to the Sunday talk shows to defend the Affordable Care Act, and Republicans countered them. Senator Marco Rubio, Republican of Florida, said on “Fox News Sunday” that the early failures do not bode well for the rest of the health care law, adding: “In the 21st century, setting up a Web site where people can go on and buy something is not that complicated.”

One major problem slowing repairs, people close to the program say, is that the Centers for Medicare and Medicaid Services, the federal agency in charge of the exchange, is responsible for making sure that the separately designed databases and pieces of software from 55 contractors work together. It is not common for a federal agency to assume that role, and numerous people involved in the project said the agency did not have the expertise to do the job and did not fully understand what it entailed.

The people close to the project spoke on the condition of anonymity because they were not authorized to discuss the system’s problems.

Administration officials have been debating whether to designate one or more companies as the quarterback for information technology work on the federal exchange, a complex project that has cost more than $400 million.

Communications between the administration and contractors improved over the weekend as the Centers for Medicare and Medicaid Services began negotiating agreements with contractors on responsibility and deadlines for repairs, people involved in the project say. They hope to have a plan before a Congressional hearing set for Thursday.

“The issue right now is between C.M.S. and the White House,” a specialist said Friday before communications improved. “Everybody sits and waits and the meter runs.”

A part of the system, hidden from users, draws data from several federal and state databases to determine if consumers qualify for coverage and then calculates the subsidies for which they may be eligible. Another part of the system sends enrollment data to insurers. Several people involved in the project say that problems like those of the last three weeks are not uncommon when software from several companies is combined into a large, complex system.

Insurance executives said in interviews that they were frustrated because they did not know the government’s plan or schedule for repairs. Insurers have found that the system provides them with incorrect information about some enrollees, repeatedly enrolls and cancels the enrollments of others, and simply loses the enrollments of still others.

Correcting those errors, specialists said, could require extensive rewriting of software code. Insurers said it could be weeks before their data and the government’s could be reconciled.

Accurate enrollment data is essential. Even if consumers bypass the federal Web site and go directly to insurance companies to sign up for coverage, the Treasury Department will still need enrollment data to pay tens of billions of dollars in subsidies promised to insurers.

Confidential government documents show that some technical fixes have been made to the federal Web site, and specialists say the site is slowly improving.

Nevertheless, disarray has distinguished the project. In the last 10 months alone, government documents show, officials modified hardware and software requirements for the exchange seven times. It went live on Oct. 1 before the government and contractors had fully tested the complete system. Delays by the government in issuing specifications for the system reduced the time available for testing.

CGI Federal, a unit of the CGI Group, based in Montreal, has the biggest contract and is responsible for the architecture of major parts of the system, but not for its integration. Quality Software Services Inc., or Q.S.S.I., a unit of the UnitedHealth Group, developed the identity management system, another major component that allowed consumers to register and establish accounts.

The identity management system from Q.S.S.I., which also taps into government databases to retrieve users’ personal information, was a particular source of trouble when the exchange opened. Change orders show that on Oct. 4 — after millions of people had been trapped in technological loops trying merely to log in — the government asked CGI to help it devise a new identity management system to replace the one provided by Q.S.S.I. But specialists said that approach was abandoned as too risky. Ultimately it was decided to fix the current identity system.

According to one specialist, the Web site contains about 500 million lines of software code. By comparison, a large bank’s computer system is typically about one-fifth that size.

Last week's deal to extend the debt ceiling through Feb. 7 also restarted funding for government agencies, but only through Jan. 15. However, it also called for a bipartisan, bicameral budget conference to get to work on finding compromise on a longer-term spending plan, at least one to last through the end of the current fiscal year on Sept. 30.

The new panel's assignment is a tough one, given the wide differences in the budgets passed separately by the two chambers. Those extend not just to the respective levels of proposed spending, but to the treatment of entitlement programs, the future of the sequester cuts, and the prospect for taxes or other new revenues.

The conferees are due to issue a report on or around Dec. 13. They will be led by Senate Budget Committee Chairwoman Patty Murray, D-Wash., along with House Budget Chairman Paul Ryan, R-Wis., who did not even vote in favor of the deal that sets this all in motion. This week, as the Senate is out, staffs are preparing for next week's not-yet-scheduled first official meetings, and conferees are talking by phone, if not in person.

For now, questions abound over relatively simple matters like whether their deliberations will be public—or even perhaps televised. House Minority Leader Nancy Pelosi, D-Calif., is among those already calling for live coverage.

"If that table is closed down, if you are excluded from that, if there isn't live coverage," said Pelosi last week, "then it is hard to see how a product can come out of it that we can present to our members to say it was an honest debate.

"And you know what is contingent upon it, of course, is reopening government in January and lifting the debt ceiling in February," she said.

The chamber voted 285-144 late Wednesday night on the Senate-negotiated fiscal package, with 198 Democrats voting “yes” and 144 Republicans voting “no.” Democratic votes carried the package to passage, considering only 87 of 232 GOP lawmakers voted to extend both government funding and the debt ceiling. All Democrats who were present voted for the deal.

Earlier in the evening, the Senate voted 81-18 to pass the bill, and President Barack Obama made a statement shortly after the Senate vote to say he would immediately sign the bill.

“We’ll begin reopening our government immediately, and we can begin to lift this cloud of uncertainty and unease from our businesses and from the American people,” Obama said. Obama later signed the bill, and the government reopened Thursday morning.

The law funds the government through Jan. 15, 2014, and puts off the debt ceiling until Feb. 7, 2014, with the Treasury Department maintaining its ability to use “extraordinary measures” to extend the deadline.

The deal, which was brokered in the Senate after the House was unable to find enough votes for its own plan, would provide back pay for federal workers, including pay for about 800,000 workers who were deemed nonessential and furloughed during the shutdown. States that used their own funds to carry on government operations would also be paid back by the federal government.

Appropriations Chairman Harold Rogers, R-Ky., called the bill “the product of a final agreement between Republicans and Democrats to help put us back on stable ground with an open government and without the threat of default, as we look to find a long-term comprehensive solution to our multitude of fiscal problems.”

Rogers, who has seemed frustrated during much of the shutdown debate, said, “After two long weeks, it’s time to end the government shutdown. It’s time to take the threat of default off the table. It’s time to restore some sanity to this place.”

The vote bookends a bitter partisan battle over Obamacare. It doesn’t, however, heal the wounds from the past three weeks.

And while one obstacle might be over, others lie ahead. Lawmakers met Thursday morning to begin budget talks, which are now expected to be wrapped up by mid-December, but with no real prospects for a breakthrough given that both sides still seem dug in on the question of taxes.

Some House GOP moderates, such as Peter T. King of New York and Charles Dent of Pennsylvania, predicted from the beginning of the shutdown that it was only a matter of time before House Republican leaders would bring a “clean” continuing resolution to the floor — and eventually, a clean debt limit hike, too.

The lead-up to the vote, on legislation that squeezes the tiniest of concessions out of Democrats and the White House related to the 2010 health care law, was one of many twists and turns.

In late September, House Republican leaders were prepared to move on a CR that would force the Senate to take an up-or-down vote to defund Obamacare before it could vote on the spending bill itself. Rank-and-file Republicans, fresh from the August recess town hall circuit, called that plan a gimmick.

So to appease the Republican rank and file, Speaker John A. Boehner, R-Ohio, bowed to his conference; he gave them the defund-Obamacare-through-the-CR battle they and Sen. Ted Cruz, R-Texas, demanded.

But when it became clear — many say it was always clear — that Republicans would not be able to achieve a full defund, Boehner tried a series of other maneuvers aimed at providing Republicans cover and moving Democrats off the position that they would not negotiate: first a one-year delay to Obamacare’s individual mandate and the elimination of health care subsidies for Capitol Hill and executive branch staff; then an offer to go to conference as the shutdown began; then a host of mini continuing resolutions that would fund popular parts of the government.

The Senate and the White House weren’t having any of it.

By Wednesday afternoon, after Boehner and other members of GOP leadership told membersthey would vote Wednesday night on the Senate package following passage in that chamber,lawmakers emerged from the closed-door meeting with somber resignation of the facts at hand.

“It’s better to win than it is to lose,” said Ways and Means Committee Chairman Dave Camp, R-Mich. “We lost.”

But Republicans did get their sequester funding levels, which Democrats and Republicans have long said was a win for the GOP. And Boehner walks away from his conference seemingly stronger for having given his conference the fight it wanted on Obamacare.

As Boehner often says to his conference: Republicans live to fight another day. And with the CR expiring in three months and the debt limit pushed just off the horizon, those fights will come soon enough.

“We fought the good fight, we just didn’t win,” the Ohio Republican told WLW radio in Cincinnati. He said he expects the government to reopen Thursday.

Boehner also cautioned that there would not be a budget deal unless President Barack Obama and Democrats give up their demands for more tax hikes.

“If they’re going to hold onto their position that we’re always going to raise taxes, then we’re not going to come to a deal,” he said. “But hope springs eternal.”

As for the latest Senate deal, Boehner said that Republicans did everything they could to bring Democrats and the president to the negotiating table and fight Obamacare, but the Democrats refused.

“There is no reason for our members to vote no today,” he said.

Boehner said he would continue to fight.

“There is no giving up on our team and there is no giving up in me,” he said.

The speaker brushed off a questions about Sen. Ted Cruz, the Texas Republican who pushed the strategy of tying Obamacare to keeping the government open.

“We’re a little bit more independent minded than our friends across the aisle,” Boehner said.

Boehner later released a statement saying blocking the Senate deal would risk default and open the door for Democrats to extract a tax hike and increase spending:

WASHINGTON, DC – House Speaker John Boehner (R-OH) released the following statement regarding the bipartisan Senate agreement to reopen the federal government and avoid a national default: “The House has fought with everything it has to convince the president of the United States to engage in bipartisan negotiations aimed at addressing our country’s debt and providing fairness for the American people under ObamaCare.  That fight will continue.  But blocking the bipartisan agreement reached today by the members of the Senate will not be a tactic for us.  In addition to the risk of default, doing so would open the door for the Democratic majority in Washington to raise taxes again on the American people and undo the spending caps in the 2011 Budget Control Act without replacing them with better spending cuts.  With our nation’s economy still struggling under years of the president’s policies, raising taxes is not a viable option. Our drive to stop the train wreck that is the president’s health care law will continue.  We will rely on aggressive oversight that highlights the law’s massive flaws and smart, targeted strikes that split the legislative coalition the president has relied upon to force his health care law on the American people.”

According to Rep. Devin Nunes, R-Calif., the latest plan would drop a demand to delay the medical device tax in Obamacare and drop a demand for income verification under Obamacare. Instead, Republicans would target the health benefits of both lawmakers and congressional staff, as well as political appointees. This iteration of the plan would keep the government running until Dec. 15, instead of Jan. 15.

The latest changes came after the plan presented this morning by Speaker John A. Boehner was panned by many Republicans in his conference.

Republican leadership met in Boehner’s office Tuesday afternoon to discuss next steps, and a House GOP aide said that closed-door discussions were currently focused on two areas that could make the fiscal package more palatable to the rank and file — the so-called Vitter language targeting health benefits and changing the date on the CR.

The school of thought on changing the date is that it would give members another opportunity to force Senate Democrats and the White House to endure negotiations over hot-button items related to the health law.

The individual mandate goes into effect on Jan. 1, as well as a requirement that all employers offer insurance covering contraceptive and reproductive services.

Republicans seemed to have given up on securing any Democratic votes in the House, with Minority Whip Steny H. Hoyer of Maryland saying the GOP proposal leaders offered Tuesday morning was designed to “snatch confrontation from the jaws of reasonable agreement.”

It appears that Republicans are determining whether there is room to send the measure to the Senate with just enough Republican support — and just enough time — that the chamber could pass the legislation and avoid a debt default that the Treasury Department says, absent an agreement, would occur on Oct. 17.

The White House has already rejected the original proposal, and Senate Majority Leader Harry Reid, D-Nev., declared it would not pass the Senate.

Coming out of the meeting, leadership’s plan was unclear.

“There have been no decisions about what exactly we will do,” said Boehner after a nearly two-hour-long conference meeting. “We’re working with our members to find a way forward.”

House Budget Chairman Paul D. Ryan, R-Wis., said he was not going to “do the play by play.”

“We’re still working through this, and I’m not going to comment on speculation or what is a very fluid situation,” Ryan said.

Many House Republicans were in a similar holding pattern, waiting to see what leadership would ultimately put on the floor before pledging their support or opposition.

“I want to wait and see what the proposal is,” said Justin Amash, R-Mich.

Unfortunately, there is still sensationalist journalism when it comes to the Professional Employer Organization (“PEO”) industry.  Although there have been multiple white papers and reports, to include three in the last year and a half by the National Council of Compensation Insurance (“NCCI”), many continue to speculate on the purpose, impact and performance of the PEO industry.  Note that all three of these NCCI reports as well as other information and news on the PEO industry is available at www.peocompass.com, or theNCCI website.  My post regarding this study that came out this past August summarizes what Mr. Shuford found after further investigation to the speculation regarding the PEO industry:

“On Tuesday of last week, Chief Economist of the NCCI, Harry Shuford, presented the latest study on the PEO Industry at this past week’s WCI Conference.  He was joined by Mona Carter on stage to present the study as well as to discuss the PEO industry from a historical perspective.  The crowd burst into laughter when Harry related PEOs helping their somewhat historically tarnished reputations of the past as “as easy as getting chewing gum out of one’s hair”.  Mona spoke to the fact that the “mystical image of the PEO is 20+ years old”.
Bottom line from Mr. Shuford’s Presentation – by the numbers:

These are groundbreaking events for a much maligned industry in our opinion.  The industry allows its clients to grow their operations by allowing PEOs to focus on things like safety and other risk management services.

Download the previous NCCI PEO studies here:
August 20, 2013: NCCI Update on PEO Performance
May 16, 2013: Don’t Just Speculate, Investigate! The Story Behind the PEO Study
June 19, 2012: Professional Employer Organizations and Workers Compensation

The emerging plan would reopen the government until Jan. 15, 2014, and extend the debt limit into February — but it would not address the medical device tax, which many Republicans and Democrats would like to repeal.

A source familiar with the negotiations explained that Majority Leader Harry Reid pushed to get the repeal of the tax removed from the negotiations. The Nevada Democrat has been a vocal opponent of repealing the excise tax, at one point calling the idea “stupid” at a news conference.

The White House also pushed back against including a medical device tax rollback in the deal.

It appeared likely that the deal would punt the question of turning off automatic spending cuts, known as the sequester, to another round of budget talks, with a deadline of Dec. 15. But under one proposal, if the sequester came into effect there would be increased flexibility to deal with it.

Nothing’s finalized and things could change as talks continue, however. Senate Republicans had been expected to meet Monday evening, but that was delayed until late Tuesday morning due to concerns about attendance.

It looks like talks are leading toward including a requirement that the Health and Human Services Department certify that the agency is able to verify the incomes of those receiving subsidies to buy health insurance on the Obamacare exchanges.

That win for Senate Republicans would be paired with a Democratic victory in delaying a scheduled reinsurance tax under Obamacare that would hit in 2014 and run for three calendar years in order to create a pool of reserve funds for insurance company losses.

Insurers in the exchanges are required to cover higher-risk individuals (such as those with pre-existing conditions). Unions had pushed for that delay.

It amounts to $63 per covered individual.

“The statute requires all health insurance issuers and third-party administrators on behalf of self-insured group health plans to make contributions under this program to support payments to individual market issuers that cover high-cost individuals (payment-eligible issuers),” the Internal Revenue Service said in a fact sheet explaining that tax.

House Majority Leader Eric Cantor, R-Va., said the afternoon meeting between President Barack Obama and GOP lawmakers was “constructive” and “clarifying.”

“We had a constructive conversation. Agreed to continue discussions. Talks will continue tonight. And hopefully we’ll have a clearer way, path forward,” he said.

Other Republicans said the two sides were effectively negotiating — something they have been demanding all along.

House Appropriations Chairman Harold Rogers, R-Ky., said, “We agreed to try to make conditions for a CR,” which would reopen the government. “We’ll get back with each other tonight,” he added.

“We’re negotiating,” said Budget Chairman Paul D. Ryan of Wisconsin. “He didn’t say yes and he didn’t say no.”

House Republicans released a readout saying: “the President and leaders agreed that communication should continue throughout the night. House Republicans remain committed to good faith negotiations with the president, and we are pleased there was an opportunity to sit down and begin a constructive dialogue tonight.”

The White House in a readout said it was “a good meeting” that lasted about an hour and a half.

“The President, along with the Vice President, Treasury Secretary Lew, Denis McDonough and Rob Nabors listened to the Republicans present their proposal,” the White House statement said. “After a discussion about potential paths forward, no specific determination was made. The President looks forward to making continued progress with members on both sides of the aisle.  The President’s goal remains to ensure we pay the bills we’ve incurred, reopen the government and get back to the business of growing the economy, creating jobs and strengthening the middle class.”

As for Obamacare, the issue that prompted Republicans to refuse to pass a clean CR in the first place? Rogers said it was “not discussed in any substantive way.”

Earlier, Senate Majority Leader Harry Reid, D-Nev., and the White House said that they would not negotiate a budget deal until Republicans agreed to open the government, not just extend the debt ceiling.

A growing chorus of Republican senators support reopening the government either as part of or before any agreement to raise the debt limit, despite a House GOP plan to keep the government shuttered while taking the risk of default off the table.

A significant number of GOP senators dismissed the House Republicans’ proposal either as short-sighted or out of touch with the political and economic realities of the shutdown. And at least one member of the GOP Conference said Senate Minority Leader Mitch McConnell, R-Ky., is still active in leading conversations to resolve the current standoff, as Roll Call first reported last week.

“If we don’t reopen the government, we are failing the American people. We cannot continue to go on [like this],” said Sen. Susan Collins, R-Maine, who proposed a plan to reopen the government and raise the debt ceiling. “With each passing day, the harm is more widespread and the consequences will be more deeply felt by the American people and by our economy. I just don’t see how you can ignore the fact the government is shut down.”

“I don’t think we’re serving any policy or political goals by keeping the government shut down,” said Sen. Jeff Flake, R-Ariz., who last Congress served in the House.

“I don’t think we should just address the debt limit and not address the shutdown,” said Sen. Kelly Ayotte, R-N.H.

“We have two issues, obviously, and they’ve become consolidated here because of the timing. But we need to deal with both the continuing resolution issue and the debt ceiling in a responsible way,” said No. 2 Senate Republican John Cornyn, R-Texas. “Doing just part of it doesn’t solve the whole problem and we need to solve the whole problem.”

The more Senate Republicans call for the government to reopen, the more untenable the House position of perpetuating the shutdown may be.

Since the shutdown began Oct. 1, Senate Republicans have largely taken a back seat to their House colleagues, afraid that anything they might say or do would make Speaker John A. Boehner’s already difficult job nearly impossible.

But as Congress continues to hurtle toward a default deadline, Senate Republicans are beginning to get restless and are hoping to press forward with a plan of their own.

“We have a serious issue before us and it needs a serious solution and I think for any of us to talk about how that resolution may occur right now is just not a way to get there,” said Sen. Bob Corker, R-Tenn. “It’s best for us to complete these conversations. They’ve been very active, and Mitch has been leading those formally and I think we’re getting to a good place.”

McConnell has been floating a plan pegged largely to a framework put forth by Collins, which already has the support of Ayotte and Alaska Republican Lisa Murkowski. The current iteration of the Senate GOP plan would include a six-month continuing resolution to fund the government, a two-month debt limit hike and a repeal of the medical device tax.

Though it’s unclear what kind of support such a plan might get from Senate Democrats, the White House indicated Thursday it would be willing to accept a short-term debt limit increase. And Senate Republicans are growing tired of sitting around waiting for bills that actually open the government to come over from the House, because they’re not.

“We have a responsibility to lead in the Senate as well, as a separate legislative chamber. And at this point, we’ve been obviously waiting [for the House],” said Ayotte, who noted that she did support some of the stand-alone spending bills the House passed that Senate Democrats refused to take up. “However, we haven’t seen a proposal from the House that opens up the government again, another one. So I think there are many in the Senate that feel like we need to lead in the Senate and resolve this issue.”

Flake added that the “thought of many of [his] colleagues” was that they needed to address both the CR and the debt limit.

But not every senator sees it that way, given how difficult the House has been through this process. Sen. Lindsey Graham said Congress should pass what it can when it can. The South Carolina Republican said that while “more and more senators” believe an end to the shutdown is “possible” in the near future, the Senate should not summarily dismiss a bill that could avert government default, if only temporarily.

“I think it would be good to reopen the government, you know, but that’s a start, having a debt ceiling increase avoids one crisis,” he said.

Amid the government shutdown and debt-ceiling standoff—which has raised rhetoric sharply—they say the president has demonized what they consider healthy political opposition.

“The difference is, I don’t think his predecessors have antagonized the other side,” says Rep. Austin Scott, R-Ga., who was president of the tea-party-packed House Republican freshman class last session.

“Bill Clinton did not intentionally antagonize Republicans,” Scott said. “And I think that most of those [earlier] presidents would have welcomed the opportunity to negotiate. And if they’re right on their points, then certainly they’d want to negotiate.”

Similar sentiment was echoed by several of Scott’s fellow tea partiers Wednesday.

“I was tea party before there was a tea party,” said Rep. Trent Franks, R-Ariz., who has served in Congress since 2003. Obama, he said, “has tried to make some malevolent ghost, or evil spirit, out of the tea party.”

Rep. Joe Wilson, R-S.C., a member of the tea-party caucus who famously yelled “You lie!” to Obama during a speech before a joint session of Congress, was among those who agreed Wednesday with Scott’s view that the president has been too antagonistic.

“Whether it’s personal or not, it’s not good for the country,” said Wilson, who apologized after his outburst on the House floor, made when Obama said the health care reform law would not cover undocumented immigrants.

The comments came a day after Obama’s news conference, in which the president did use some rhetoric that House conservatives found difficult to swallow, likening them to extortionists. “I’m not going to [negotiate] until the more extreme parts of the Republican Party stop forcing John Boehner to issue threats about our economy,” Obama said, referring to the Republican House speaker. “We can’t make extortion routine as part of our democracy.”

Of course, Congress in general is not a gentle place. Tea-party Republicans have taken plenty of attacks from the legislative branch as well. Minority Leader Nancy Pelosi has called the House tea-party wing “legislative arsonists” for their demands. Senate Majority Leader Harry Reid has called them “anarchists.”

While some might see irony in a group of firebrand reformers complaining that Obama has not been a peacemaker, Scott, who remains a tea-party favorite, said he does not dispute that all presidents have a right to stand up for what they believe. Yet he also says there’s a sense among his colleagues that Obama just doesn’t like them.

“It’s obvious any time he goes on TV,” Scott said. “I mean, words he uses to describe Congress, the tone of his voice, what he says, how he says it.”

“The role of the president is to be the peacemaker. And just by definition, an antagonist is not a peacemaker. Really, all of our roles should be to be the peacemaker. It doesn’t mean you can’t stand up for what you believe in. But he has been anything but that,” Scott said.

Has the rhetoric gotten too personal?

“It’s not so much personal with many of us,” Scott said.

“I mean, even when we were freshmen, the only member of that administration that actually met with the freshman class was [former Treasury Secretary Timothy] Geithner,” he added. “Other than that, the administration just said, ‘They’re anti-Obama, they’re tea-party controlled.’ There was no effort, and has been no effort, by that administration to establish any relationships with anybody over here.”

Amid the government shutdown and debt-ceiling standoff—which has raised rhetoric sharply—they say the president has demonized what they consider healthy political opposition.

“The difference is, I don’t think his predecessors have antagonized the other side,” says Rep. Austin Scott, R-Ga., who was president of the tea-party-packed House Republican freshman class last session.

“Bill Clinton did not intentionally antagonize Republicans,” Scott said. “And I think that most of those [earlier] presidents would have welcomed the opportunity to negotiate. And if they’re right on their points, then certainly they’d want to negotiate.”

Similar sentiment was echoed by several of Scott’s fellow tea partiers Wednesday.

“I was tea party before there was a tea party,” said Rep. Trent Franks, R-Ariz., who has served in Congress since 2003. Obama, he said, “has tried to make some malevolent ghost, or evil spirit, out of the tea party.”

Rep. Joe Wilson, R-S.C., a member of the tea-party caucus who famously yelled “You lie!” to Obama during a speech before a joint session of Congress, was among those who agreed Wednesday with Scott’s view that the president has been too antagonistic.

“Whether it’s personal or not, it’s not good for the country,” said Wilson, who apologized after his outburst on the House floor, made when Obama said the health care reform law would not cover undocumented immigrants.

The comments came a day after Obama’s news conference, in which the president did use some rhetoric that House conservatives found difficult to swallow, likening them to extortionists. “I’m not going to [negotiate] until the more extreme parts of the Republican Party stop forcing John Boehner to issue threats about our economy,” Obama said, referring to the Republican House speaker. “We can’t make extortion routine as part of our democracy.”

Of course, Congress in general is not a gentle place. Tea-party Republicans have taken plenty of attacks from the legislative branch as well. Minority Leader Nancy Pelosi has called the House tea-party wing “legislative arsonists” for their demands. Senate Majority Leader Harry Reid has called them “anarchists.”

While some might see irony in a group of firebrand reformers complaining that Obama has not been a peacemaker, Scott, who remains a tea-party favorite, said he does not dispute that all presidents have a right to stand up for what they believe. Yet he also says there’s a sense among his colleagues that Obama just doesn’t like them.

“It’s obvious any time he goes on TV,” Scott said. “I mean, words he uses to describe Congress, the tone of his voice, what he says, how he says it.”

“The role of the president is to be the peacemaker. And just by definition, an antagonist is not a peacemaker. Really, all of our roles should be to be the peacemaker. It doesn’t mean you can’t stand up for what you believe in. But he has been anything but that,” Scott said.

Has the rhetoric gotten too personal?

“It’s not so much personal with many of us,” Scott said.

“I mean, even when we were freshmen, the only member of that administration that actually met with the freshman class was [former Treasury Secretary Timothy] Geithner,” he added. “Other than that, the administration just said, ‘They’re anti-Obama, they’re tea-party controlled.’ There was no effort, and has been no effort, by that administration to establish any relationships with anybody over here.”

Tuesday’s unyielding rhetoric, from both President Barack Obama and Speaker John A. Boehner, will not be publicly contradicted today. But, off camera, each of their teams will be working to figure out if they’re correctly interpreting signs from the other.

Both sides have given hints in the past 24 hours that they are open to a limited cease fire — a reopening of the government and an increase in the federal borrowing limit that might last only a few weeks, but could allow time to negotiate a broader budget deal.

Historically, there would be little noteworthy about back-channel water-testing about a bipartisan agreement to kick the budgetary can down the road for such a short time. But with federal agencies having started operating on reduced power eight days ago, and with the Treasury saying it could be out of money to pay the nation’s debts eight days from now, even the slimmest reed of compromise looks like an enormous deal.

“There’s a crack there,” Boehner said about the impasse on Tuesday night, although he cautioned against optimism.

To exploit that perceived opening, however, each side must be willing to do what it has insisted so often and so emphatically it is unwilling to do: Decouple negotiations over other big-ticket budget items from the immediate fight over the shutdown and the imminent fight over the debt ceiling. Like stubborn but exhausted spouses at the end of a circuitous and bitter squabble, both Obama and Boehner would need to jointly declare that they are willing to move on to the more important matters in their relationship without conceding they have abandoned their hard-line stance on the preliminaries.

In other words, they need to agree that they aren’t going to keep talking about what they’ve been talking about so they can start talking about something new.

For Boehner, the timing is crucial: He is getting solid reviews from the tea party conservatives for holding firm on the demands they had, but the unified nature of the GOP caucus is otherwise showing signs of fray. He will benefit the sooner he can claim some measure of victory, which will allow him to reset his troops in an organized line for the next confrontation.

This is where Budget Chairman Paul D. Ryan comes in. Today he’s out with a roster of proposals on which he thinks both sides can come to agreement — and none of them has anything to do with limiting or altering Obamacare.

Instead, the list includes means-testing of Medicare, changing the way inflation is calculated to hold down Social Security costs and committing Washington to a tax code overhaul.

Short-term borrowing by the Treasury Department became twice as expensive Tuesday as it had been the day before, one of the most significant signs of alarm in the bond markets since the financial crisis of 2008.

The stock market, meanwhile, continued the steady slide that began in mid-September, when Boehner (R-Ohio) embraced a right-wing strategy for using the budget battles to try to dismantle Obama’s signature health-care initiative. The Standard & Poor’s 500-stock index fell 20.67 points to 1,655.45 on Tuesday. The Dow Jones industrial average dropped nearly 160 points to 14,776.53 and has lost nearly 6 percent of its value since hitting a one-year high Sept. 18.

In a hastily planned news conference at the White House, Obama warned that default would be “insane, catastrophic, chaos,” and demanded that Boehner take the weight of that threat off the U.S. economy.

Once that happens, Obama said, “I am happy to talk with him and other Republicans about anything.” But Obama said he also told Boehner in a telephone call Tuesday morning that “having such a conversation, talks, negotiations shouldn’t require hanging the threats of a government shutdown or economic chaos over the heads of the American people.”

An hour later, Boehner fired back that Republicans will not yield until Obama comes to the bargaining table.

“I didn’t come here to shut down the government, and I certainly didn’t come here to default on our debt,” Boehner told reporters at the Capitol. But Obama, he said, is seeking “unconditional surrender by Republicans” before “he’ll sit down and talk. That’s not the way our government works.”

Both men spoke in calm tones, striving to appear reasonable. But with the shutdown in its second week and a critical deadline for government borrowing just eight days away, anxiety was building in Washington and on Wall Street.

Just last month, investors were willing to make short-term loans to the U.S. government virtually for free. On Tuesday, the one-month Treasury bill, which paid 0.13 percent interest on Monday, spiked to 0.27 percent — the highest rate since 2008. Borrowing for slightly longer durations has also become much more expensive in recent days.

“What we’re seeing is a greater concern that the Congress and the White House will not be able to reach an agreement in order to avoid tripping over the debt ceiling,” said John M. Canavan, an analyst with Stone & McCarthy Research.

The national debt hit the $16.7 trillion legal limit in May. Treasury Secretary Jack Lew has since employed a variety of emergency measures to conserve cash. Lew will exhaust those measures on Oct. 17, when he will be forced to rely on a cash balance of about $30 billion and incoming revenue to pay the nation’s bills.

Lew has declined to say when the United States is likely to begin missing payments, the definition of default. But independent analysts say it would happen no later than Nov. 1, when the Treasury Department must pay out nearly $60 billion to Social Security recipients, Medicare providers, civil-service retirees and active-duty military service members.

Economists, financial analysts and most policymakers agree that default would be catastrophic because U.S. Treasury bonds form the backbone of global financial markets. “It could well be that what is now a recovery would turn into a recession or even worse,” said Olivier Blanchard, the top economist at the International Monetary Fund.

Obama spoke to reporters and answered questions for well over an hour Tuesday, stressing that the consequences of congressional inaction on the debt limit would be far more devastating than lawmakers’ failure to fund federal agencies past Oct. 1.

“In a government shutdown, millions of Americans face inconvenience or outright hardship,” Obama said. “In an economic shutdown, every American could see their 401(k)s and home values fall, borrowing costs for mortgages and student loans rise, and there would be a significant risk of a very deep recession at a time when we’re still climbing our way out of the worst recession in our lifetimes.”

Obama ruled out taking unilateral action, by minting a platinum coin or by invoking Section 4 of the 14th Amendment, which states that the “validity of the public debt of the United States . . . shall not be questioned.” Setting aside the question of legality, Obama said such actions would create a suspect class of Treasurys that would prompt investors to demand higher interest rates or walk away altogether.

“There are no magic bullets here,” Obama said. “There’s one simple way of doing it, and that is Congress going in and voting.”

Boehner has insisted that the House will not agree to reopen the government or raise the debt limit without concessions from Democrats. Obama challenged him to test that assertion by putting legislation to a vote.

“At minimum, let every member of Congress be on record,” Obama said. “And if it fails and we do end up defaulting, I think voters should know exactly who voted not to pay our bills, so that they can be responsible for the consequences that come with it.”

On Tuesday, Democratic leaders in the Senate were laying plans to do just that. Senate Majority Leader Harry M. Reid (D-Nev.) introduced a bill that would suspend enforcement of the debt limit through the end of next year, after the 2014 midterm elections.

All 54 Senate Democrats — even those facing tough races — appeared to be falling into line behind the measure. GOP Senate leaders, however, were optimistic about holding their ranks and denying the bill the 60 votes it needs to overcome a GOP filibuster, a test that could come as soon as Saturday.

But during a closed-door lunch meeting Tuesday, veteran GOP senators expressed grave concerns about derailing the bill with no alternative plan for raising the debt limit by the Oct. 17 deadline, according to one Republican in the room.

House GOP leaders, meanwhile, unveiled a new strategy for handling the crisis, proposing to create a 20-member bipartisan “working group” to end the shutdown and raise the debt limit. The working group, to be composed of Republicans and Democrats from the House and the Senate, would be charged with brokering agency funding levels for fiscal 2014, perhaps replacing deep cuts known as the sequester with cuts to federal health and retirement programs.

The measure passed the House 224 to 197, with most Democrats voting no. But Democrats in the Senate quickly dismissed it as “supercommittee 2.0” — after the failed fiscal negotiations of 2011 — and noted that the group’s charge includes nothing about raising taxes on the wealthy, a Democratic priority.

The House also approved a measure to ensure that federal prison guards, U.S. Capitol Police officers and staffers at other agencies currently on the job would be paid as usual for the duration of the shutdown. A separate billpassed by the House over the weekend to provide back pay to furloughed personnel is still awaiting a vote in the Senate.

Both measures that passed Tuesday were presented to the House Republican rank and file in a closed-door morning meeting. After that session, Boehner told reporters that “there’s never been a president in our history that did not negotiate over the debt limit,” noting that Obama bargained not only with him in 2011 but also with moderate Democrats in 2010. The latter negotiation produced an agreement to create an independent fiscal commission known as Bowles-Simpson.

Boehner refused to say, however, what he hopes negotiations this time would produce.

“I’m not drawing any lines in the sand,” he said. “There’s no boundaries here. There’s nothing on the table. There’s nothing off the table. I’m trying to do everything I can to bring people together and to have a conversation.”

"We're not going to pass a clean debt-limit increase."

The Obama administration would be open to a bill that boosts the debt ceiling for a few weeks, a top White House official said on Monday, a move that could buy time for congressional Republicans and the White House to find a way to end the current series of fiscal fights.

National Economic Council Director Gene Sperling said that how much to raise the debt ceiling is up to Congress and that the administration would prefer a longer term solution.

“It is the responsibility of Congress to decide how long and how often they want to vote on doing that, the important thing is that they not threaten default and that they not put our country on the brink of that,” he said at POLITICO’s Playbook Breakfast in Washington. He added: “Longer is better for economic certainty and jobs, but it is ultimately up to them.”

The Treasury Department says the debt ceiling will need to be raised by Oct. 17 in order to avoid the risk that the government will default on its obligations.

Sperling’s remarks, however, signaled there may be a way to buy some time beyond that date while Republicans and the White House wrangle over re-opening the government and avoiding a government default.

Later in the day, White House press secretary Jay Carney echoed Sperling’s comments telling reporters that “our position has never been to say that the debt ceiling ought to be raised for a certain amount of time.”

Sperling emphasized that the White House will not accept a debt limit bill that includes Republican priorities such as delaying or changing the president’s signature health care law.

“The president has made clear that the era of threatening default has to be over,” Sperling said. “If we can get by the threatening of default… of course, the president has shown time and time again he is willing to negotiate.”

Republicans have chided the president for saying he will not negotiate over the debt ceiling, arguing that in the past it has served as the forum for hammering out budget deals.

“It’s stunning that President Obama would rather default on our debt than sit down with the other party to negotiate,” Brendan Buck, a spokesman for Speaker John Boehner (R-Ohio), said in a statement. “This reckless, arrogant approach threatens our economy and ignores decades of precedent under divided government.”

The debt ceiling fight is now being coupled with the debate over how to re-open the government, which partially shutdown on Oct. 1.

House Republicans have insisted on changes or delays to the president’s landmark health care law in exchange for funding the government. Democrats have balked, noting that there is no dispute over funding levels so Republicans are in no position to make additional demands for what has to be included in a spending bill.

Over the weekend, Boehner said a “clean” funding bill would not pass the House, an argument that President Barack Obama took aim at on Monday.

If Boehner and his colleagues are saying there aren’t enough votes, “then they should prove it,” Obama said while visiting the Federal Emergency Management Agency’s headquarters in Washington.

“The reason that Speaker Boehner hasn’t called a vote on it is that he doesn’t apparently want to see the government shutdown end at the moment unless he’s able to extract concessions,” Obama said.

At the POLITICO Playbook Breakfast, Council of Economic Advisors Chairman Jason Furman downplayed the idea that the administration can do anything to mitigate the impact of not raising the debt limit.

“You’ll have days, not weeks, until you deplete that money and you default,” Furman said of the Oct. 17 deadline. “It’s irresponsible to get to the 17th – but no, you don’t fall off a cliff instantly.”

Both Sperling and Furman said that only Congress can increase the debt limit and that Obama does not have theauthority to increase it himself.

While financial markets are worried about the threat of a default, some on Wall Street said they believe the Treasury Department will find a way to pay bondholders first — instead of taxpayers or government contractors — to avoid a technical default.

Sperling reiterated the administration’s position that this idea of prioritization is a bad and unrealistic option.

“Prioritization is not about avoiding default but managing default,” he said. “Prioritization is default by another name.”

“The fear is that once the United States fails to pay its bills, not only can it have a negative effect on the economy… but most people believe that for years and years to come we will all pay higher interest rates,” he said.

Sperling is a veteran of Washington budget battles having also served in President Bill Clinton’s administration. Relationships between the Clinton White House and congressional Republicans were often tense — particularly with then Speaker Newt Gingrich (R-Ga.) — but Sperling said Monday that in some ways that situation was better than the current fiscal standoffs in Washington.

“It’s hard for us to be nostalgic about the Gingrich era. Obviously we had a shutdown, impeachment,” Sperling said. “But I do feel that in the ‘90s, there was an ability when one side clearly was in the wrong place to figure out a way to have a correction.”

WASHINGTON — Republican efforts to resolve the fiscal standoff that has closed much of the federal government heated up Thursday, the third day of the shutdown, with new talks over a broad budget deal and an effort by more moderate House members to break the logjam.

Representative Paul D. Ryan of Wisconsin, chairman of the House Budget Committee, has initiated conversations with senior House Republicans on a broad deficit reduction deal that would allow some increases to federal programs squeezed by the automatic cuts known as sequestration in exchange for long-term changes to programs like Medicare and Social Security. The package would most likely include instructions to try to move along efforts to simplify the tax code as well.

Aides described those talks as “conversations about conversations,” not true negotiations, and they favored the term “down payment” on the deficit over “grand bargain.” But the “down payment” that Mr. Ryan is pursuing must come together fast, to provide a framework that Speaker John A. Boehner of Ohio can use to win over enough Republicans to reopen the government and raise the Treasury’s statutory borrowing limit before a government default in two weeks.

“The longer this goes, the closer we get to the debt limit and the more the two of these roll together,” said Representative James Lankford, Republican of Oklahoma and a member of the Budget Committee. “If any agreement is going to happen we’re going to have to have multiple negotiators rather than have Boehner come back with it.”

In a Capitol rattled by a shooting on the grounds that killed a woman and injured a police officer, tempers have flared and pressure appears to be mounting to resolve a stalemate that has shut large parts of the government, sidelined 800,000 federal workers and forced more than one million more to work without pay.

As the shooting incident was still unfolding, Representative Tim Griffin, Republican of Arkansas, took to Twitter to imply a connection with the shots fired outside the Capitol and the heated words inside. “Stop the violent rhetoric President Obama, Chuck Schumer and Nancy Pelosi. #Disgusting,” he wrote, only to delete the message later.

There were signs on Thursday, however, that some lawmakers were willing to work together to end the dispute. About 20 Republicans and Democrats signed on to a proposal that would reopen the government, finance it for six months and repeal the health care law’s tax on medical devices, a provision that has bipartisan opposition.

Representatives Charlie Dent, Republican of Pennsylvania, and Ron Kind, Democrat of Wisconsin, framed it as a compromise that both sides should be willing to accept to reopen the government.

“It’s important that we accept incremental progress when we can,” Mr. Dent said. “What we’re talking about here is leadership.”

Senator Lindsey Graham, Republican of South Carolina, approached Senator Charles E. Schumer, Democrat of New York, to try to open talks, also centered on the medical device tax as a face-saving victory for Republicans looking for a graceful way to back down.

And there has been some softening of the tone on the Republican side. Mr. Lankford, a member of the Republican leadership, conceded the “quandary” he faces in his district.

“Some people like the Affordable Care Act, and like what’s happening with it. Some people really don’t,” he said. “People have two minds as they walk through it.”

President Obama, speaking in a Maryland suburb of Washington on Thursday, tried to keep the heat on Republicans, saying what many in the party freely acknowledge: if Mr. Boehner allowed the House to vote on a spending bill to reopen the government free of any provisions that would undermine the health care law, it would pass with bipartisan support.

“Speaker John Boehner won’t even let the bill get a yes-or-no vote because he doesn’t want to anger the extremists in his party,” Mr. Obama said. If the speaker did so, he added, within minutes “we can get back to the business of governing and helping the American people.”

On Thursday night, the president canceled the last of his scheduled destinations in a trip he had planned for Asia, saying the government shutdown had made it impossible to travel to a Pacific Rim economic conference in Indonesia or an East Asian security conference in Brunei next week.Senate Democrats, certain of their advantage, said they had no intention of accepting even the modest compromise the House centrists were offering.

“I’m for changing the medical device tax,” Mr. Schumer said, “but I will not do it with a gun to my head.”

The House’s hard-liners, however, indicated that they were not ready to give in. Representative Phil Gingrey, Republican of Georgia, acknowledged that hundreds of thousands of furloughed federal workers were suffering, and more than a million more were working without pay.

“There’s some pain and suffering, but I don’t think that pain and suffering compares one bit to being stuck with a lifetime of Obamacare, so that’s why I’m holding pretty firm on this,” he said.

The House on Thursday sought to relieve some of the pain caused by the shutdown by pressing forward with a series of small spending bills to reopen the parts of government deemed most politically sensitive, voting to fund veterans’ programs and pay inactive National Guardsmen and reservists. Those bills followed measures to restart clinical trials at the National Institutes of Health, reopen national parks, monuments and museums, and allow the District of Columbia to maintain city services.

In a twist, House Republicans claimed they were supporting federal spending while heartless Democrats were blocking those efforts. Representative Renee Ellmers, Republican of North Carolina and a nurse, stepped to a microphone in the Capitol, her voice choked with tears, to call on Senator Harry Reid of Nevada, the majority leader, to allow a vote on the N.I.H. bill.

Conservatives in the House continued to insist that Senate Democrats, especially those running for re-election in Republican states, would crack first. “There’s incredible pressure on Senate Democrats,” said Representative Tim Huelskamp, Republican of Kansas.

But red state Democrats gave no indication they were feeling that pressure. Senator Mary L. Landrieu of Louisiana, one of the most endangered Democrats up for re-election in 2014, insisted that nothing was negotiable.

“Those games, those gimmicks are not going to work,” she said.

House Republicans continued with the piecemeal government funding approach Thursday, even as chatter turned to whether Speaker John A. Boehner could finally pull off a “grand bargain” on government spending and the debt limit.

On Wednesday, the Ohio Republican met with groups of GOP lawmakers who want to pass a clean CR to reopen the government. Boehner and the lawmakers discussed the possibility of a “grand bargain” — a new one that would raise the debt ceiling, fund the government, address the sequester and extract concessions on Obamacare.

But later Wednesday night, the speaker met with President Barack Obama, House Minority Leader Nancy Pelosi, Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell at the White House. And the negotiations — or lack thereof — seemed to have left a sour taste in the mouth of Republicans.

“The president reiterated one more time he will not negotiate,” Boehner said just after the White House meeting.

While it’s clear leaders were unable to immediately find a solution to reopen the government, the meeting, which lasted more than an hour, covered the CR and the debt limit, which expires Oct. 17. National Review’s Robert Costa also reported that Boehner brought up the idea of a “grand bargain” at the White House Wednesday evening.

Costa quoted a Democratic source as saying:

“Boehner raised the prospect of a grand bargain-type deal at the White House meeting and was laughed at because everyone feels like they’ve heard this song and dance before. The general feeling is, if he’s really ready to make some tough choices — read, revenue — then great. But the history of this from where we sit is Boehner talking a big game, then bailing as soon as he runs into the inevitable resistance from a certain faction in his caucus.”

Previous attempts by Boehner to craft a broad budget deal with the president have been swatted down by conservative elements of the House GOP.

This time could be different — if Boehner is willing to buck the tea party wing of the House GOP conference. On Thursday, The New York Times reported that Boehner has assured some GOP lawmakers he will not allow the U.S. to default on its debt — a scenario that would likely have catastrophic consequences for U.S. economy and the world.

As The New York Times reported, one Republican lawmaker said Boehner has said he would allow a debt ceiling increase to pass with a majority of Democratic votes:

“The lawmaker, who spoke on the condition of not being named, said Mr. Boehner indicated he would be willing to violate the so-called Hastert rule if necessary to pass a debt limit increase. The informal rule refers to a policy of not bringing to the floor any measure that does not have a majority of Republican votes.”

GOP aides cautioned that Boehner has long said he would not allow a debt default, and that he also will still demand concessions from the White House to pass an increase in the debt limit.

But still the partisan rhetoric and warfare continued.

On the Senate floor Thursday, Reid said that Boehner privately told him weeks ago he wanted a clean CR at the current funding levels — just the legislation Democrats are insisting on now.

Also on Thursday, Cantor criticized the president for his “my way or the highway” stance.

“We should sit down and have a discussion,” the Virginia Republican told reporters at a morning news conference. “But because there is an insistence on no negotiations, no talking, my way or the highway, we are here.”

While walking down a hallway, Cantor said he found it “unbelievable” that Obama “would call Speaker Boehner and others over to the White House just to let them know that he wouldn’t negotiate.”

Despite apparent behind the scenes maneuvering, the House voted 265-160 on a GOP bill that would pay military reserve personnel during the shutdown. It’s the fourth mini-continuing-resolution the House has passed, in addition to a bill that was signed by Obama to pay active duty military personnel.

While Democrats assented to military pay bill, they appear resolute in not allowing Republicans to fund only the popular pieces of the government in an effort to mitigate the effects of a shutdown — in reality and politically.

The ranking Democrat of the House Armed Services Committee, Rep. Adam Smith of Washington, summed up why Democrats agreed to paying the military during a shutdown, but not funding other important pieces of government.

“The troops are getting shot at,” Smith said. “They’re actually at war.”

As the shutdown stretches on, a bloc of moderate House Republicans could be the key to reopening government.

On Wednesday, Speaker John A. Boehner, R-Ohio, held meetings with groups of “pragmatist” lawmakers — as Michael G. Grimm, R-N.Y., described them — who want to pass a policy-rider-free continuing resolution and end the government shutdown as soon as possible.

Grimm said the group was “spitballing some ideas” on how to pass a CR that would fund the entire government, but he indicated that any plan would probably require a number of centrists to join Democrats in voting down a routine procedural motion in an attempt to seize control of the debate and the House floor.

Grimm also expressed support for wrapping negotiations over the debt limit, sequester and the CR into one.

“I do feel we’re moving in the right direction, but for me, it can’t be fast enough,” Grimm said.

It isn’t fast enough for Rep. Peter T. King of New York, who was one of the most vocal House Republicans criticizing the party’s strategy as the government headed to a shutdown.

King wasn’t invited to any of Boehner’s moderate meetings Wednesday, so he held his own.

King said he met in his office with roughly 10 members who support a clean CR, and they discussed “what the strategy would be.”

“Everyone wants a clean CR; some just have different timelines” for action, King said.

But King said ultimately Republicans were going to agree to a clean CR.

“It would probably make it easier if we can show that we defeated Obamacare, even if we didn’t,” King said.

Another moderate Republican, Rep. Mike Simpson of Idaho, summed up the current state of play.

“The real problem is we may have gotten ourselves in a position where we can’t budge on a clean CR and they can’t budge on Obamacare,” Simpson said. “I don’t think closing down the government is a good strategy for us.”

But it does seem to have caught the attention of Democrats and the nation. On Wednesday, Boehner headed to a meeting with the president and other congressional leaders, and lawmakers on both sides were hoping they could begin to forge an agreement.

If those talks don’t bear fruit, centrists could decide to try to hijack the floor. One way to get a clean CR would be by voting down a motion to order the previous question. If GOP centrists joined Democrats to vote down the previous question, Democrats could get control of the floor for an hour and might be able to offer a clean CR.

But when would a group of moderates actually employ that strategy?

“That’s the question,” Grimm said. “I think everyone is trying to give leadership at least the opportunity to have the conversation with the other side.”

Asked when he thought the group of moderate Republicans would start voting to do that, King wasn’t sure.

“I think they should do it now,” he said. “Believe it or not, people don’t always listen to me.”

King said that was precisely what lawmakers in his office were discussing — “when they should do it, how it should be done, what process we should follow.”

He said there were many lawmakers who support a clean CR. He cautioned, however, that many of them may never be in a position to vote for it “because of their districts, they’re afraid, they’re concerned about a primary.”

“One thing I admire about the Ted Cruz Republicans, they don’t care what anyone thinks about them, they just go ahead and do it. I think that’s what we have to start doing,” King said. “So to that extent I’m a Cruz Republican.”

But until centrists start acting with more abandon, Boehner is likely to stick with the current plan — even if they have the numbers right now to force a vote on a clean CR.

It’s no secret that King and Rep. Charlie Dent of Pennsylvania have been leading a contingent of moderates, and as of Wednesday afternoon, there were at least 18 Republicans who had publicly stated they would vote for a clean CR. The list includes King, Dent, Grimm, Simpson, Devin Nunes of California, C.W. Bill Young of Florida, Erik Paulsen of Minnesota, Frank A. LoBiondo of New Jersey, Leonard Lance of New Jersey, Jon Runyan of New Jersey, Lou Barletta of Pennsylvania, Jim Gerlach of Pennsylvania, Michael G. Fitzpatrick of Pennsylvania, Patrick Meehan of Pennsylvania, Frank R. Wolf of Virginia, J. Randy Forbes of Virginia, Rob Wittman of Virginia and Scott Rigell of Virginia.

If they all stick together, the bloc could make Boehner’s life difficult. But Boehner is worried about another group.

Many speculate that Boehner would face a conservative mutiny if he simply brought up a clean CR to be passed by Democrats and a small number of moderate Republicans.

Boehner needs at least 116 Republicans to vote for a CR. That’s half of the Republican Conference’s 232 members, and if Boehner had 116 Republicans to vote for a clean CR, the conservative mutiny would have to stand up to the majority of Republicans in the conference.

But there aren’t 116 Republicans supporting a clean CR — at least not yet and not publicly.

And the moderate group is still waiting to see if Boehner can pull out a deal with Senate Majority Leader Harry Reid and President Barack Obama.

“I think there’s going to be another solution found,” Grimm said.“I know that Speaker Boehner understands the gravity of this situation.”

But ultimately, King said the moderates were going to have fight it out with the far right.

“First of all, I don’t know who they could elect besides John [Boehner]. And sooner or later, we’re going to have to face up to these guys,” King said.

On Wednesday, Speaker John A. Boehner, R-Ohio, held meetings with groups of “pragmatist” lawmakers — as Michael G. Grimm, R-N.Y., described them — who want to pass a policy-rider-free continuing resolution and end the government shutdown as soon as possible.

Grimm said the group was “spitballing some ideas” on how to pass a CR that would fund the entire government, but he indicated that any plan would probably require a number of centrists to join Democrats in voting down a routine procedural motion in an attempt to seize control of the debate and the House floor.

Grimm also expressed support for wrapping negotiations over the debt limit, sequester and the CR into one.

“I do feel we’re moving in the right direction, but for me, it can’t be fast enough,” Grimm said.

It isn’t fast enough for Rep. Peter T. King of New York, who was one of the most vocal House Republicans criticizing the party’s strategy as the government headed to a shutdown.

King wasn’t invited to any of Boehner’s moderate meetings Wednesday, so he held his own.

King said he met in his office with roughly 10 members who support a clean CR, and they discussed “what the strategy would be.”

“Everyone wants a clean CR; some just have different timelines” for action, King said.

But King said ultimately Republicans were going to agree to a clean CR.

“It would probably make it easier if we can show that we defeated Obamacare, even if we didn’t,” King said.

Another moderate Republican, Rep. Mike Simpson of Idaho, summed up the current state of play.

“The real problem is we may have gotten ourselves in a position where we can’t budge on a clean CR and they can’t budge on Obamacare,” Simpson said. “I don’t think closing down the government is a good strategy for us.”

But it does seem to have caught the attention of Democrats and the nation. On Wednesday, Boehner headed to a meeting with the president and other congressional leaders, and lawmakers on both sides were hoping they could begin to forge an agreement.

If those talks don’t bear fruit, centrists could decide to try to hijack the floor. One way to get a clean CR would be by voting down a motion to order the previous question. If GOP centrists joined Democrats to vote down the previous question, Democrats could get control of the floor for an hour and might be able to offer a clean CR.

But when would a group of moderates actually employ that strategy?

“That’s the question,” Grimm said. “I think everyone is trying to give leadership at least the opportunity to have the conversation with the other side.”

Asked when he thought the group of moderate Republicans would start voting to do that, King wasn’t sure.

“I think they should do it now,” he said. “Believe it or not, people don’t always listen to me.”

King said that was precisely what lawmakers in his office were discussing — “when they should do it, how it should be done, what process we should follow.”

He said there were many lawmakers who support a clean CR. He cautioned, however, that many of them may never be in a position to vote for it “because of their districts, they’re afraid, they’re concerned about a primary.”

“One thing I admire about the Ted Cruz Republicans, they don’t care what anyone thinks about them, they just go ahead and do it. I think that’s what we have to start doing,” King said. “So to that extent I’m a Cruz Republican.”

But until centrists start acting with more abandon, Boehner is likely to stick with the current plan — even if they have the numbers right now to force a vote on a clean CR.

It’s no secret that King and Rep. Charlie Dent of Pennsylvania have been leading a contingent of moderates, and as of Wednesday afternoon, there were at least 18 Republicans who had publicly stated they would vote for a clean CR. The list includes King, Dent, Grimm, Simpson, Devin Nunes of California, C.W. Bill Young of Florida, Erik Paulsen of Minnesota, Frank A. LoBiondo of New Jersey, Leonard Lance of New Jersey, Jon Runyan of New Jersey, Lou Barletta of Pennsylvania, Jim Gerlach of Pennsylvania, Michael G. Fitzpatrick of Pennsylvania, Patrick Meehan of Pennsylvania, Frank R. Wolf of Virginia, J. Randy Forbes of Virginia, Rob Wittman of Virginia and Scott Rigell of Virginia.

If they all stick together, the bloc could make Boehner’s life difficult. But Boehner is worried about another group.

Many speculate that Boehner would face a conservative mutiny if he simply brought up a clean CR to be passed by Democrats and a small number of moderate Republicans.

Boehner needs at least 116 Republicans to vote for a CR. That’s half of the Republican Conference’s 232 members, and if Boehner had 116 Republicans to vote for a clean CR, the conservative mutiny would have to stand up to the majority of Republicans in the conference.

But there aren’t 116 Republicans supporting a clean CR — at least not yet and not publicly.

And the moderate group is still waiting to see if Boehner can pull out a deal with Senate Majority Leader Harry Reid and President Barack Obama.

“I think there’s going to be another solution found,” Grimm said.“I know that Speaker Boehner understands the gravity of this situation.”

But ultimately, King said the moderates were going to have fight it out with the far right.

“First of all, I don’t know who they could elect besides John [Boehner]. And sooner or later, we’re going to have to face up to these guys,” King said.

Speaker John A. Boehner told reporters early Tuesday morning that Republicans want to keep the government open but want “basic fairness” for the American people under Obamacare.

The House agreed to the motion to conference in a 228-199 vote with seven Democrats joining most Republicans in support of the tactic. Nine Republicans rejected the resolution.

The motion to conference would ask the Senate to agree to the House’s last offer — which included a one-year delay of Obamacare’s individual mandate and a provision eliminating health benefits for members of Congress and their staff — and attempt to move the House and Senate to negotiate sizable differences on the CR.

But the proposal is going nowhere, according to Senate Majority Leader Harry Reid.

The Nevada Republican said Monday night, “We will not go to conference with a gun to our head.”

While the proposal does little to bring the government out of a shutdown, it does end the House’s game of legislative ping pong.

On Monday night, the Senate rejected the House’s third offer on the CR within an hour of House passage. Earlier in the day, the Senate tabled the House’s Saturday offer within 25 minutes of the opening gavel.

Meanwhile, House Republicans are banking on Americans blaming the Senate and the White House for refusing to negotiate.

But while Republicans followed that rhetoric into a government shutdown, Democrats took their own talking points to the House floor early Tuesday morning.

“This stunt tonight doesn’t end one thing to end the government shutdown,” said the Appropriations Committee’s ranking Democrat, Nita M. Lowey of New York. “We should call it what it is: a last-ditch attempt to not be blamed for a government shutdown.”

“It’s a fig leaf,” said Budget ranking Democrat Chris Van Hollen of Maryland. “It’s not going to give them any political cover.”

In response, House Financial Services Chairman Jeb Hensarling of Texas, delivered what has become a familiar set of Republican talking points.

“The president will negotiate with Iranians and negotiate with Syria,” Hensarling said. “But won’t negotiate with Americans if they happen to be Republicans.”

As debate wrapped up, Democrats and Republicans demonstrated just how far apart they are on the CR, applauding members of their own party and jeering members of the other.

Meanwhile, Reid’s staff was considering leaking emails between his chief of staff and the speaker’s chief of staff in an attempt to reveal the private musings of the GOP leader on the Republicans’ push to eliminate health care benefits for lawmakers and their staff.

If that partisanship is any indication of the future of the CR, the government could be shut down for quite a while longer.

With the Senate set to act next, and the House readying a response, the two chambers are engaged in a game of political hot potato, with both trying not to be considering the last version of a continuing resolution when the deadline hits.

But with a partial shutdown—the first since 1996—slated for midnight, many are pessimistic. Asked on CBS's Face the Nation if he thinks a shutdown will occur, the Senate's No. 2 Democrat, Dick Durbin of Illinois, said, "I'm afraid I do."

"The House position, which is basically the same one they sent us the last time, is going to be rejected again," Durbin said. "And we are going to face the prospect of the government shutting down."

What happens next, according to Senate Democratic aides, is that the Senate will take up the continuing resolution passed by the House early Sunday morning, but will strip out what Democratic leaders view as toxic provisions that would affect the Affordable Care Act.

The House's bill delays the implementation of Obamacare for a year and repeals a medical-device tax that funds portions of the ACA. A separate resolution passed by the House calls for paying the military in the event of a shutdown.

House Republicans are hoping that Democratic senators from conservative states will join with those who oppose the medical-device tax to pressure Majority Leader Harry Reid, D-Nev., for a vote on those provisions.

But Reid's next move is anything but a mystery. Saying that the House's action Sunday was "pointless," Reid intends to strip the controversial provisions (whether the Senate will vote on the military funding is still unclear) with a motion to table, which requires a simple majority, according to a Senate Democratic leadership aide. Reid will then send the same bill that passed the chamber on Friday back to the House, the aide said.

After the Senate acts, the House is likely to have only hours to address the Senate version of the "clean" funding bill, a fact that Speaker John Boehner, R-Ohio, railed against in a statement Sunday. "If the Senate stalls until Monday afternoon … it would be an act of breathtaking arrogance by the Senate Democratic leadership," he said. "They will be deliberately bringing the nation to the brink of a government shutdown."

But House Republican leaders said Sunday that they were also mulling options on how to proceed in a way that might be acceptable to enough conservative members of their conference as they race against the midnight deadline.

"We have other options for the Senate to look at," said House Majority Whip Kevin McCarthy, R-Calif. He would not outline those, or say whether a "clean" funding bill was an option.

One option being considered, House GOP members say, is to revise the CR to include language by Sen. David Vitter, R-La., that would prevent members of Congress and their staffers from receiving exemptions from key Obamacare measures.

But Reid has shot down any provisions that would affect Obamacare.

Indeed, the Senate Democrats' position has opened them up to blistering attacks from Republicans, including Sen. Ted Cruz of Texas, who paint Reid and President Obama as unbending. With House Republicans arguing they've acted to prevent a shutdown, they say it's up to Reid to capitulate.

"Let's be clear what the Senate has done," Cruz said on NBC's Meet the Press. "So far Majority Leader Harry Reid has essentially told the House of Representatives and the American people, go jump in a lake. He said, 'I'm not willing to compromise. I'm not willing to even talk.' "

Cruz, who has helped set in motion the latest congressional action against Obamacare, did not lay out his plans on Sunday.

Senate Democrats are betting that the public will blame the GOP for a shutdown, and a contingent of Senate Republicans agree. The thinking is that Cruz has set the GOP on a crash course because Obama has threatened to veto any legislation that repeals or delays the Affordable Care Act.

Asked about the criticism from other Republicans, Cruz was unfazed. "I'm just trying to fight for 26 million Texans and the American people," he said.

The federal government has shut down 17 times since 1976, according to an NBC tally. The last time was for 21 days in late 1995 and early 1996, when House Speaker Newt Gingrich and President Clinton clashed over spending. That shutdown left a deep political scar, with Clinton's approval rating skyrocketing after the shutdown and Republicans shouldering much of the blame.

In a persistent GOP line on several Sunday talk shows, House Republicans said the showdown has resulted from a president who has refused to negotiate over Obamacare.

"People are panicked in this country over higher premiums, lack of access. This law is having a negative effect," House Republican Conference Chairwoman Cathy McMorris Rodgers, R-Wash., said on CNN's State of the Union.

She said the standoff will end "with us coming to the table and negotiating. But … Republicans do not want to shut down the government."

However, House Budget Committee ranking member Chris Van Hollen, D-Md., said on Face the Nation that the Republican effort to delay the law "is a way to prevent millions of Americans from signing up for more affordable health care."

As he put it, "What you see in the House is that Speaker Boehner has essentially handed the gavel over to Senator Cruz."