WASHINGTON (MNI) - When Congress passed a two-year budget agreement late last year, negotiated by Senate Budget Committee Chairman Patty Murray and House Budget Committee Chairman Paul Ryan, it was widely seen as an indication that lawmakers wanted to take a little time off from their seemingly endless fiscal confrontations.
With mid-term elections looming in November of 2014, budget deficits declining, and scant hope for actual progress on entitlement or tax reform, Congress decided a ceasefire was in order.
But if budget battles have been put on hold this year, Congress continues to debate the size, scope and role of the federal government in more indirect ways.
Lawmakers are now battling over two issues that relate to the role of the federal government: the Export-Import Bank and the Highway Trust Fund.
Bob Bixby, executive director of the Concord Coalition, said this indirect battle involving the Export-Import Bank and the Highway Trust Fund is not surprising.
"Fiscal issues and issues pertaining to the size and scope of the federal government never go away--even when the parties reach a budget truce and decide to dispense with direct fiscal warfare," Bixby said.
"When the budget front is quiet, these battles about government often take place in different places," Bixby said.
The Export-Import Bank was created in 1934 by an executive order and became an independent federal agency in 1945. It provides direct loans, loan guarantees, working capital guarantees and export credit insurance.
It was reauthorized by the Senate and House in 2012, clearing the House by a decisive 330 to 93 vote. The reauthorization bill was negotiated by House Majority Leader Eric Cantor and House Minority Whip Steny Hoyer. All 183 House Democrats supported the measure as did 147 Republicans.
The Ex-Im Bank's reauthorization expires September 30 and a fierce battle has broken out over whether it should be renewed. That battle is taking place almost exclusively within the Republican Party.
House Financial Services Committee Chairman Jeb Hensarling came out aggressively against renewing the Export-Import Bank in a May speech at the Heritage Foundation and continues to push hard to kill or, at a minimum, fundamentally overhaul, the agency. Adopting a populist stance, he has called it an egregious form of corporate welfare.
The House Financial Services Committee held a hearing on the Export-Import Bank this week and the title of the hearing signaled Hensarling's views: "The Export-Import Bank: Corporate Necessity or Corporate Welfare?" Most of the witnesses were staunch foes of the agency.
In his opening remarks, Hensarling assailed Ex-Im as little more than a tool of "some of the largest, richest, most politically-connected corporations in the world - like Boeing, General Electric, Bechtel and Caterpillar."
"Ex-Im may not just be guilty of cronyism: it may be guilty of corruption as well. Now I will admit that Republicans may disagree on whether Ex-Im should be reformed or allowed to expire ... but we are united in believing we cannot reauthorize the status quo," Hensarling said.
However, Hensarling is being firmly opposed by two stalwarts of the American business community and historic supporters of the GOP: the U.S. Chamber of Commerce and the National Association of Manufacturers.
The U.S. Chamber and NAM have created a coalition of more than 800 companies and associations to advocate for renewal of the Export-Import Bank, saying in a press release that last year it "supported $37 billion in exports that in turn sustained more than 200,000 American jobs at 3,400 companies."
In a letter to Congress, the coalition said "failure to reauthorize Ex-Im would amount to unilateral disarmament in the face of other governments' far more aggressive export credit programs, which have provided their own exporters with an estimated $1 trillion in financing support in recent years."
House Speaker John Boehner, who has supported the Export-Import Bank in the past, told reporters this week that he is trying to broker a consensus within the GOP on the future of the agency.
"My job is to work with our members to get to a place where the members are comfortable. Some people believe that we shouldn't have it at all, others believe that we should reauthorize it with significant reforms. We're going to work our way through this," he said.
Even as the battle over the Export-Import Bank rages, the financial woes of the Highway Trust Fund have moved to the forefront of the congressional agenda.
According to the Congressional Budget Office, in 2013 in the United States governments at various levels spent $156 billion to build, operate, and maintain highways and $60 billion on mass transit systems. The federal government paid about one-quarter of the spending for highway and mass transit programs.
For several decades, the federal Highway Trust Fund's balances were stable or growing but in recent years spending for highways and transit has exceeded the amounts credited to the trust fund from taxes collected on gas, diesel fuel, and other transportation-related products and activities.
Since 2008, Congress has supported the transfer of $54 billion from Treasury's general fund to the Highway Trust Fund.
The CBO has confirmed that another financial crunch time has arrived, with the highway and transit accounts headed toward zero at the end of the fiscal year on September 30 and set to dip to dangerously low levels later this summer.
In a recent report, the CBO outlined three options for Congress to bolster the Highway Trust Fund: reduce spending on highways and transit; increase revenues; or shift general funds into the Highway Trust Fund.
Senate Finance Committee Chairman Ron Wyden proposed this week a $9 billion "patch" which would keep highway and transit programs operating regularly through the rest of the year while working for a longer-term solution.
Wyden's initial proposal would have paid for this fix by instituting a higher tax on commercial trucks and requiring people who inherit IRA's and other retirement plans to take taxable distributions over five years.
Under strong opposition from Republicans on his panel, Wyden is rewriting his proposal. Sen. Orrin Hatch, the ranking Republican on the Finance Committee, said Republicans want any patch paid for, at least in considerable part, by spending cuts.
Wyden and Hatch are in talks with House Ways and Means Committee Chairman Dave Camp to come up with a short-term plan that lawmakers hope to consider next month.
Democratic senator Chris Murphy and Republican senator Bob Corker have offered a longer-term plan to increase the federal gas tax to shore up the Highway Trust Fund, but they also include a package of tax cuts to make their plan more politically acceptable.
The Murphy-Corker plan would increase the federal gasoline and diesel taxes by six cents in each of the next two years for a total of 12 cents. They would also index the gas tax to inflation, using the Consumer Price Index. Finally, to offset the revenue raised from increasing the gas tax to pay for roads and transportation projects, they propose "net tax relief" for American families and businesses.
Bixby of the Concord Coalition said the Murphy-Corker plan is "pretty straightforward and honest," but he fears that its overall effect would be to increase budget deficits rather than reduce them.
"Raising the gas tax to pay for highway and transit programs makes sense and is the honest thing to do. I just wish they hadn't thrown in a bunch of unspecified tax breaks to make it more politically palatable," Bixby said.