From a trade agreement at the heart of President Donald Trump's legislative agenda to more incremental pieces of legislation, activity on Capitol Hill could grind to a halt because of the congressional impeachment inquiry opened into the president's conduct last month.
That would ensure that an already historically unproductive Congress becomes the least effective in at least 46 years. More than three-quarters of the way through its first year, the 116th Congress has witnessed the passage of just 65 bills, compared with an average of 417 for each of the past 10 two-year Congresses. If the pace picks up and it reached 200 bills, it would still be the smallest number passed since at least the 93rd Congress between 1973 and 1974, which passed 772 bills.
The numbers look even worse if we count just substantive legislation, defined by the Pew Research Center as a change in Federal Law or the authorization to spend taxpayer dollars, as opposed to ceremonial bills that rename public buildings, commemorate special days and so on. S&P Global Market Intelligence analysis of the 65 bills passed by the 116th Congress shows 54 of those bills have been substantive, according to Pew's criteria.
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The lack of progress does not mean Congressional representatives haven't been busy. Some 8,420 bills have been introduced during the 116th Congress thus far, compared with 13,556 total during the 115th Congress and 12,063 during the 114th. However, with a Democratic House of Representatives and Republican Senate, very little has actually hit the statute books, while lawmakers have been tied up reaching agreements on government spending caps and funding the government.
"We want to guard against saying Congress is doing nothing," Sarah Binder, a senior fellow in governance studies at the Brookings Institution, said in an interview. "To some extent, more is being done than meets the eye, but on the big ticket items, there's really been very little visible progress so far."
That could mean even the least controversial pieces of legislation are unlikely to make it to the president's desk, according to Ed Mills, public policy analyst for Raymond James. The impeachment inquiry, which the Trump administration has said it will not cooperate with, will only make things worse. Trump said in May that he would not do business with the Democrats unless investigations into his administration stopped, adding at the time that the White House was "doing tremendous work without them."
"You have to start with the premise that we're in the middle of an impeachment inquiry, so if legislating is not dead, it's mostly dead," Mills said in an interview earlier this month. "Is that an opportunity for a lesser-known bill to pass? Maybe, but it's hard to get overly optimistic [of legislation] passing in this type of political environment we are in."
The biggest casualties in terms of legislation that would affect the world of business and finance are likely to be a money laundering bill called the Illicit Cash Act; USMCA, the trade deal replacing NAFTA; as well as numerous bills aimed at energy and healthcare, including a measure to curb drug pricing.
Anti-money laundering overhaul
A bill to update current anti-money laundering rules and require shell companies to disclose their owners has been introduced by a bipartisan pair of senators on Capitol Hill.
The ILLICIT CASH Act, introduced by Sens. Mark Warner, D-Va., and Tom Cotton, R-Ark. last month, would also mandate inter-government data sharing of potential instances of money laundering and other illicit financial activity.
The bill has received support from the Institute of International Bankers and the Bank Policy Institute, a Washington, D.C.-based trade group. It could potentially be tacked on to legislation designed to provide a safe harbor for financial services companies to offer services to the cannabis industry, which passed the House in September.
Despite this support, the lack of immediate need for this legislation to pass could jeopardize its prospects, according to Mills.
"The chances of this bill going into law were better than they were a week or a month ago," he said. "But there isn't an urgent need in Congress to get this done."
Path forward on USMCA
Passing the United States-Mexico-Canada Agreement, or USMCA, has been a top legislative priority for the Trump White House, as the president has previously threatened to unilaterally withdraw from the North American Free Trade Agreement, or NAFTA, if the USMCA were not approved by lawmakers.
The U.S. Chamber of Commerce has called for Congress to pass the USMCA by the end of November, while House Speaker Nancy Pelosi, D-Calif., told reporters earlier this month "the quiet you hear is progress" as far as congressional negotiations with the White House are concerned.
House Democrats have largely been pushing for stricter enforcement on Mexican labor laws as a prerequisite for USMCA support, along with environmental protections and provisions that could affect the cost of prescription drugs. These gaps would have been difficult to bridge even without the current impeachment inquiry, according to Simon Lester, associate director of the Herbert A. Stiefel Center for Trade Policy Studies at the Cato Institute in Washington, D.C.
"My very rough estimate is still only about a 30% chance of happening because there are some different views here, and it's hard to reconcile them," Lester said in an interview. "The quiet and the positive talk suggests to me that people are working in good faith, and this might happen, but without evidence of progress…it's very hard to say how things are actually progressing."
In the House of Representatives, it is unlikely Pelosi will want to move forward with a USMCA vote unless a sizable number of Democrats will vote to pass it, according to Todd Tucker, a fellow at the Roosevelt Institute.
Pelosi drew the ire of House Democrats by voting on a free-trade agreement with Peru brokered by former President George W. Bush in 2007. While the agreement was approved by a 285-132 vote, 116 Democrats opposed the agreement, the Los Angeles Times reported at the time. Former Rep. Phil Hare, D-Ill., called the pact "another one-sided, so-called free-trade agreement," according to the Times.
Tucker said Pelosi would want to avoid a repeat of that situation when it comes to a USMCA vote.
"[The vote] was extremely divisive for the caucus, and in a way, it really hasn't healed since," Tucker said in an interview. "Now it's a very rare Democrat that's a trade cheerleader these days."
Energy policy and agency vacancies
The House and Senate energy committees have both backed companion measures to bolster cybersecurity and support development of advanced nuclear reactors, among other areas of consensus. But momentum on broader energy legislation has been weak and looks to be even more so as impeachment proceedings frustrate bipartisan cooperation.
Impeachment proceedings could further disrupt already slow progress on energy and climate legislation. So far this Congress, the Democrat-controlled House has prioritized energy and climate bills that have mostly hit a wall in the GOP-majority Senate, including a House-passed measure to keep the U.S. in the Paris Agreement on climate change as the president works to withdraw from the global pact.
"You're never quite sure what the political climate is going to be like when the timing is right to move something, and so I'm going to be nimble and preserve my options," Senate Energy and Natural Resources Committee Chairman Lisa Murkowski, R-Alaska, said Sept. 25 regarding the potential for a broad energy bill.
The Senate could also face a bumpy confirmation process for FERC nominee James Danly. Senate Democrats are angry that the Trump administration announced its intent to nominate Danly, a Republican, without also putting forward a Democratic pick for the commission. Democratic leaders have not announced plans to place a hold on Danly's nomination without a Democratic pairing, but Senate Minority Leader Chuck Schumer, D-N.Y., has reportedly threatened to prevent legislation from the Senate energy committee from getting floor votes unless the Trump administration nominates a Democrat for FERC.
Drug pricing and the ACA
Both President Trump and Speaker Pelosi have expressed interest in working on a bill to give the federal government the power to negotiate prices for expensive prescription drugs, but Trump later tweeted Pelosi was "incapable" of working on that bill and the USMCA. Trump later suggested during a speech in Florida that prescription drug companies might be working with Pelosi to move the impeachment inquiry forward.
The White House must also contend with a court case in the U.S Court of Appeals for the 5th Circuit that will decide whether to uphold a December 2018 ruling declaring the entire Affordable Care Act unconstitutional. A group of Republican state attorneys general and governors successfully argued that when Congress repealed the act's individual mandate in the 2017 tax law, it rendered the entire law unconstitutional.
The White House is planning to ask the court to delay its ruling until after the 2020 presidential election, as no viable replacement plan currently exists, according to reporting from The Washington Post.