September 7th, 2010, Washington, DC–From ALG News’ Capitol Hill Correspondent Derek Baker:

In the Senate, with a week left of the long congressional recess, Majority Leader read is starting to talk more about his plans when they’re back in session. The Hill quoted Reid as saying, “When we return to the Senate this fall, Democrats’ first order of business will be to pass bipartisan legislation that helps small businesses create jobs.” Reid went on to attack Republicans for blocking “common-sense solutions, instead betting against American workers and against our economic recovery.”

Florida Republican Senate nominee Marco Rubio released a statement recently that Gov. Charlie Christ has changed his position on ObamaCare six times. Rubio is running against now-independent Crist and Democrat Kendrick Meek for the seat held by Sen. Martinez. The statement read in part, “Charlie Crist has six different positions on ObamaCare because he doesn’t actually care about healthcare, he only cares about getting himself elected… We all know Kendrick Meek is a liberal who strongly supports ObamaCare. But Charlie Crists’s political opportunism puts him in a league of his own. After changing his mind six times, I’m still not sure what he believes because he will likely change it again tomorrow.” A Miami Herald article out today takes great pains to point out that Crist has really only changed his position four times instead of six.

Bottom Line: Though a number of issues will come to the floor in this next session, there is virtually no possibility that any will have a measurable impact on the economy – at least not a positive one. Republicans welcome tax breaks for small businesses, but the question always turns on what else is in the package that will harm businesses and private-sector employment. With the “small business” bill up first, Republicans have little cause to cooperate, perhaps giving Democrats what they really want: a fresh reason to blame Republicans for the ailing economy.

In the House, Politico’s Richard Cohen published an article today entitled “How the House would be won” handicapping some 75 House seats in play “that feature varying degrees of difficulty.” The article lists an additional 13 seats “on the bubble,” and divides the seats into three groups: “must-wins, majority makers, and landslide,” underscoring what will happen if seats in those categories are won by Republicans.

Responding to Obama’s call for billions in infrastructure spending, GOP Leader Boehner said it’s more failed stimulus spending. Boehner stated, “As the American people, facing near double-digit unemployment, mark Labor Day by asking, where are the jobs, the White House has chosen to double-down on more of the same failed ‘stimulus’ spending. If we’ve learned anything from the past 18 months, it’s that we can’t spend our way to prosperity.”

Bottom Line: With expectations already high for Republicans and increasing every day, it is vital for the GOP to at least win those seats in the “must-wins” category to save face after all that’s been said. Any seats they gain in the “landslide” category is just gravy, since Dems will be so demoralized by losing the House that the margin will not really matter in the short run.

Though moderate Republicans are usually quite receptive to infrastructure spending projects, Obama’s call for increased spending here is a test for Boehner and those more squishy Republicans. Will they hold the line on increased spending and essentially higher taxes on the oil and gas industry, or will they jump at the chance to steer money toward their districts for road and rail projects?

At the other end of the Avenue, Obama yesterday called on Congress to approve a second stimulus worth $50 billion for infrastructure projects such as road, railway, and runway improvement. He announced the six-year infrastructure improvement plan during a Labor Day trip to Wisconsin at an AFL-CIO event. Obama proposes to pay for the package by increasing taxes on the oil and gas industry. Though no legislation exists yet to implement the plan, Obama pledged it “will cut waste and bureaucracy” by consolidating over 100 differed federal transportation programs. In the same speech, Obama once again blamed Republicans for the current economic woes, stating “These are the folks whose policies helped devastate our middle class and drive our economy into a ditch. And now they’re asking you for the keys back.”

Meanwhile, Obama’s former director of OMB has recommended that Congress extend the expiring Bush tax cuts for another two years, then let them all expire. Orszag made the case in a NYT op-ed yesterday, stating “In the face of the dueling deficits, the best approach is a compromise: extend the tax cuts for two years and then end them altogether. Ideally only the middle-class tax cuts would be continued for now. Getting a deal through Congress, though, may require keeping the high-income tax cuts too. And that would still be worth it.”

Bottom Line: Obama’s call for massive infrastructure spending is not his October surprise. This will do virtually nothing to quell the criticism of his job on the economy, so expect the federal mortgage pay-down idea to come back, or perhaps another similarly populist, socialist, expensive program to be proposed in the coming weeks by a desperate president.

P.S. – Check out America Speaking Out and share your thoughts on how we can return to a limited, constitutional government.

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