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updated 9/12/2010 11:33:06 AM ET 2010-09-12T15:33:06

Congress returns this week with embattled Democrats torn between trying to show they have the economic answers and fearing the further wrath of voters over new government programs.

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It appears the fears will win out.

The inbox is overflowing as lawmakers end their summer recess and undertake four weeks of writing and trying to pass bills before leaving town ahead of the Nov. 2 election: Bush-era tax cuts are set to expire at year's end; annual spending bills await action; and President Barack Obama has just come out with a new plan to stimulate the economy through tax credits, breaks for business investment and public works projects.

But progress on any of those before the election is doubtful.

Majority Democrats are returning to Washington after a month of listening to voters angry over government spending. Republicans are dead-set against White House initiatives.

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"It will be difficult to get a very broad agenda through," said House Majority Leader Steny Hoyer.

Some issues probably will fall back into a lame-duck session after the election. Even then, Republicans won't be raring to cooperate, particularly if they regain control of the House or Senate.

Democrats insist they'll act before the end of the year to extend the middle-class tax cuts pushed through by President George W. Bush. And if Congress does nothing? Then a family in the $50,000-$75,000 income range would face an extra $1,126 in taxes next year.

Obama and most Democrats want the extensions to apply only to individuals with annual incomes of less than $200,000, or joint filers earning less than $250,000. Continuing those tax cuts would add $3.1 trillion to the national debt over the next decade. The debt would rise by an additional $700 billion if tax cuts for the richest people are also extended.

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But some Democrats say that with the economy in bad shape, the time's not right to end tax breaks for the wealthy. Republicans, headed by House Minority Leader John Boehner of Ohio, are demanding a two-year freeze on all tax rates.

"If the only option I have is to vote for those at 250 and below, of course I'm going to do that. But I'm going to do everything I can to fight to make sure that we extend the current tax rates for all Americans," Boehner told CBS' "Face the Nation" in an interview broadcast Sunday.

Sen. Jack Reed, a Rhode Island Democrat, says he expects the Senate to get into "serious debate" on the Bush tax cuts, but he would not speculate on the chances for an agreement. House Democratic leaders say they prefer to see what the Senate does before tackling the issue.

Congress hasn't sent the president any of the 12 annual spending bills it must consider to pay for government programs when the new budget year starts on Oct. 1. With lawmakers leery of voting for spending increases, prospects for much action on these bills are slim. Congress instead will have to vote to keep agencies funded at current levels to avoid a shutdown.

Story: Boehner backs tax cuts limited to middle class

Among others on the may-not-happen list are a bill to authorize defense programs for 2011 and a bill requiring greater disclosure of corporate and union spending on campaign ads.

Senate Republicans have balked at the defense bill because the House added a provision to end the ban on gays serving openly in the military. Republican aides said it would require three or four weeks of debate time if that provision remains.

The campaign spending bill is in response to a Supreme Court ruling lifting restrictions on election ad spending. Advocates of the measure, which requires greater identification of those financing ads, had hoped it could be passed before the November elections. But in July, the Senate fell three votes short of overcoming Republican legislative maneuvers to delay a vote.

That doesn't mean it will be a do-nothing Congress for the next month.

The Senate's first order of business is a bill creating a $30 billion government fund to encourage lending to small businesses and provide about $12 billion in small business tax breaks. Democrats should have the votes, and it could pass in the week the Senate returns.

Also on tap, to the dismay of Democrats, are House ethics committee trials of two prominent Democrats, Reps. Charles Rangel of New York and Maxine Waters of California, for alleged ethics violations. One or both of those trials could begin before the fall election.

The Senate planned to open a trial Monday on the impeachment of U.S. District Court Judge G. Thomas Porteous Jr. The House in March approved four impeachment articles charging the Louisiana judge with taking payoffs and lying under oath.

It's the first impeachment trial since the one held for former President Bill Clinton in 1999. The Senate acquitted Clinton. If Porteous is found guilty, he would become the eighth federal judge in U.S. history to be impeached and convicted.

Other issues with a chance of progress:

  • The Senate is close to passing food safety legislation giving the Food and Drug Administration greater power to order recalls and to increase inspections of food facilities. The House has passed a similar bill.
  • The House could take up a $4.5 billion Senate-passed child nutrition bill, promoted by first lady Michelle Obama, that would create healthier standards for food served in schools.
  • The Senate could act on a rules change, pushed by some of its newer members, to end the custom where a single senator can secretly block a bill or a nomination.
  • The Senate Foreign Relations Committee plans to vote on a new arms treaty with Russia. A two-thirds vote by the full Senate is needed for ratification. Also possible, although less likely, is consideration of a long-stalled free trade agreement with South Korea.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Video: Obama not connecting with Americans on economy?

  1. Transcript of: Obama not connecting with Americans on economy?

    MR. GREGORY: Let's talk a little bit more about the midterms and, and, and the economic power of this recession. Dee Dee Myers , I take you back to 1993 and the documentary " The War Room ." This was James Carville -- while we have that, first we'll show you this, which is seven out of 10 Americans know somebody who his currently out of work in this recession. This is the, the poll that the National Journal , Ron Brownstein 's group, has worked on. But this was " The War Room ," and this was that famous message from James Carville back then.

    MR. JAMES CARVILLE: Stay focused. Talk about things that matter to people, you know? It's the economy , stupid.

    MR. GREGORY: "It's the economy , stupid." Here we are again.

    MS. MYERS: Right.

    MR. GREGORY: And yet people's connection to the recession, people who've been laid off, is the president connecting on this issue?

    MS. MYERS: I, I think he's trying to. But I, I think the results sort of speak for themselves. He's having trouble connecting on, on it. He's having trouble making people believe that he's done enough. And he, he starts every conversation by saying, "Look, we've done a lot, but we haven't gotten where we need to be, and we need to keep working." And people are frustrated. You know, one of the things Clinton -- in 1994 we had a terrible midterm, lost both houses of Congress . And the economy was improving, and yet people were still feeling...

    MR. GREGORY: Right. And that's a key point here...

    MS. MYERS: ...vulnerable.

    MR. GREGORY: ...because part of the problem in ' 94 -- you've talked about it, Ron -- the chaos theory. Democrats couldn't get anything done. Mike Murphy ...

    MS. MYERS: Yeah.

    MR. GREGORY: ... Democrats have gotten a whole lot done, right?

    MS. MYERS: Well...

    MR. GREGORY: Financial reform, healthcare reform , a big stimulus. I mean, this is a point I was, I was asking David Axelrod about. There is a lack of confidence now after they've seen what the president has done...

    MR. MURPHY: Mm-hmm. Mm-hmm.

    MR. GREGORY: ...in things getting better.

    MR. MURPHY: Well, yeah. I think they've gotten a lot of things done, they haven't gotten a lot of results that the American people have been -- think have been effective. So what happened when the president ran as a centrist and then became kind of a more doctrinaire, you know, liberal, particularly with the House Democratic definition of that, he's lost the country. He's lost the independents, he's lost some of the working class , you know, white voters he had. People now think that, after two years of almost complete power in Washington -- I mean, he's had more power than many presidents have had because he's had all the houses, he's had a tremendous mandate, he hasn't delivered. People are feeling more pain, and so they want a change, and so the data's pretty clear that there's going to be a change. Now, we don't know the scope, but...

    MR. GREGORY: And, Ron Brownstein , here's a sense of history. We'll put it up on the screen. Midterm history for first-term presidents, it's mostly pretty bleak...

    MR. BROWNSTEIN: Yes.

    MR. GREGORY: ...for a president in power, as we see it revealed here. A lot of losses across the board in our recent history; 2002 the exception after 9/11. What's happening here?

    MR. BROWNSTEIN: Pretty wide distribution there. Well, I think the first thing I learned this morning is an absolute rule of politics when you rule -- from your interview with David Axelrod , which is if you're at 9.6 percent unemployment and it's not going down, there's not a good answer to any question. And, in fact, people are -- we're looking at over 60 percent of the country saying we're on the wrong track. What's really changed in the last few months is not people's report of their own current circumstances, what's really changed is their level of optimism about the future. And you, you talked about the NBC / Wall Street Journal poll and our Heartland Moderate poll down from 55 percent saying the economy 's going to get better over the next year. Seventy percent were saying that in the spring. That is the real cloud hanging over Democrats , and it could be very bad. I would say quickly, though, there are two distinct strains of disenchantment that are emerging here. There is an ideological backlash going on in around 40, 40-something percent, low 40 percent of the electorate. Beyond that, Obama has a problem with performance and result. And that is affecting, as Mike said, even groups that were into the core of his coalition in 2008 and are not necessarily drawn toward these Republican solutions. So if they have any hope of avoiding full-scale disaster in November, which seems to be diminishing, it may -- it really is in trying to make this more of a choice than a referendum, which is difficult to do in a midterm election .

    MR. GREGORY: Reza , healthcare reform . I brought this up with Axelrod as well. They have not won the argument there. You can look at the polling. John Podhoretz wrote this in The New York Times -- the New York Post , rather, on Friday, which I thought was interesting. "The [ Health Care ] bill united the GOP in opposition, gave a party in sore need of a defining issue its marching orders for the next several years. And even before its passage, it landed a Republican in Teddy Kennedy 's Senate seat whose central campaign promise was doing what he could to prevent it from happening." I mean, this was a signature achievement. Really tough if you're a president and Democrats who can't run on that achievement in the midterms.

    MR. ASLAN: They didn't win the, the, the argument over health care , they didn't win the argument over financial reform, and obviously, the president wants to make this election about either moving forward or moving backward. But, as Ron was saying, most people feel like we're, we're actually standing perfectly still. So they don't see either backwards, forward as the two options. And, you know, there's not a lot of room here for the Democrats to, to think about this.

    MR. GREGORY: Well, so, Dee Dee , eight weeks, what can the president do to save the House ?

    MS. MYERS: Well, I think he can -- first of all, he's going to have to contribute to the Democratic effort to target pretty carefully. And it's a, it's a brutal and ugly time in, in the party when you have to triage. I think he can raise money , which he's already done quite effectively. And I think he can campaign in a few select districts, but, you know, that isn't the silver bullet. He isn't going to be able to save the House by campaigning for various members, although he can save, if they target carefully, they can save a few members. They can spend a little more money to help save more. And he can focus on the economy , as we've seen him do more aggressively, particularly this week.

    MR. GREGORY: But -- Mark -- Mike , you said on this program last year, you described the Republican Party as Russia 1919 . I don't forget these quotes. You said...

    MR. MURPHY: I said a lot of warlords were running around. Yeah.

    MR. GREGORY: Yeah. Yeah. Yeah. Twenty warlords of the Republican Party are running around...

    MR. MURPHY: Yeah.

    MR. GREGORY: ...and nobody is really in charge.

    MR. MURPHY: Yeah.

    MR. GREGORY: Is that still the case, or do you think Republicans have united in a way that can really return them to power and have them be effective?

    MR. MURPHY: Well, they don't need to unite to return to power because President Obama has become a great savior. If he'd stayed in the center, he could have put us back for a long time. Instead, he went hard left. Now there's been a reaction to his policies across the board and they're going to lose. Now, I've been telling Republicans to brag a little less and organize a little more. Let's not get the expectations out of control. But every poll now is historic, and I think the only thing the president can do is build a time machine and go back in time to save an outcome that I don't know how bad it'll be for the Democrats , but people are mad. They don't believe this administration has delivered, nor their allies in Congress . They want a change. It's going to be a different Washington .

    MR. GREGORY: I, I want to look at one specific race that, of course, you have a connection to, that's out in California . We all have California connections. I'm an L.A. native. We can go around the table, we all have a California connection. The governor's race in California , Mike Murphy , you're working with Meg Whitman , the Republican, former head of eBay. And here's the poll, it's a tight race. She's ahead 2 percentage points over Attorney General Jerry Brown , a former governor, of course. This is, Ron Brownstein , a tight race in a state in a lot of economic trouble.

    MR. BROWNSTEIN: Right, absolutely it is, and has, and has been the biggest blue state in the country, overwhelming margin for President Obama .

    MR. GREGORY: Yeah.

    MR. BROWNSTEIN: I believe he won by more than Lyndon Johnson did in 1964 . But, look, it is easier for a Republican to win at the statewide level than it is at the federal level because some of these polarizing social issues and wedge issues like abortion and gun control that could trip up Carly Fiorina , at the state level, aren't -- at the federal level , aren't is relevant in state elections . And Meg Whitman also has steered a more centrist course on them. On the other hand , she has spent a lot of money this summer and not put away Jerry Brown . I'd say -- you have to say she's the favorite, but the fact that he is hanging around where he is with all the negatives that he carries shows that he is, he is really in this.

    MR. GREGORY: What's your view of the race, Mike ?

    MR. MURPHY: I think Meg 's going to win because she fits California well. I mean, look, the election...

    MR. ASLAN:

    MR. MURPHY: The election is not -- yeah, no, I, she...

    MR. ASLAN:

    MR. MURPHY: It's a jobs program, and she's contributed to it. People know she knows how to create jobs. That's the number one issue. And they know she's from the Silicon Valley world of delivering results, which is what we need in Sacramento . Jerry Brown is a time machine to failure.

    MR. ASLAN: My question, Mike , is, why does Meg what to be governor of California ? Why would anyone want to be governor of California ?

    MR. MURPHY: Because...

    MS. MYERS: Let alone spend 140 million of their own money to get it.

    MR. MURPHY: Yeah, but the money is about getting -- California is so expensive, $3 million a week for television, it's about getting a message out against the entrenched public employee unions.

    MR. GREGORY: OK.

    MR. MURPHY: I'm mean, I'm......but I believe it. I live there. I care about it.

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