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Monday, October 31, 2011

Exclusive: Democrats seek up to $3 trillion in budget savings (Reuters)

WASHINGTON (Reuters) – Democrats are proposing $2.5 trillion to $3 trillion in measures to reduce the budget deficit, including revenue increases and significant cuts to Medicare, congressional aides told Reuters.

The plan was unveiled on Tuesday at a closed-door meeting of a special 12-member congressional panel, the so-called "super committee" that is tasked with finding at least $1.2 trillion in deficit reduction over 10 years.

It was the first formal proposal by Democrats on the committee and is aimed at galvanizing talks that are quickly running up against a November 23 deadline.

The congressional aides did not say why Democrats were proposing such a big deal, but Democratic congressional leaders have repeatedly called on the committee to go beyond its mandate to fix the country's fiscal mess.

According to congressional sources, the plan includes a roughly equal mix of spending cuts and revenue increases; between $200 billion and $300 billion in new economic stimulus spending that would be paid for with lower interest payments from reducing deficits; and around $400 billion in Medicare savings, with half coming in benefit cuts and the other half in cuts to healthcare providers.

While sources portrayed the proposal as a Democratic plan, they also noted that at least one Democrat on the super committee, Representative James Clyburn, had reservations about the move to cut Medicare spending.

One of the congressional sources said Republicans on the committee did not react favorably to the Democratic plan.

Republicans have long been opposed to more economic stimulus spending and increasing revenues in deficit-reduction efforts.

(Editing by Sandra Maler)


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Dems invoke the ‘Kennedy Card’ to defend Obamacare in wake of failing CLASS Act (Daily Caller)

House Democrats worked to tug on the heartstrings Wednesday, playing to the “Kennedy card” several times while defending Obamacare in a congressional hearing. Sen. Ted Kennedy, who passed away in 2009, called socialized medicine “the cause of my life.”

The House Energy and Commerce Subcommittee on Health, and the Subcommittee on Oversight and Investigations, were holding a joint hearing on the failures of Obamacare’s Community Living Assistance Services and Supports Act, or CLASS Act.

The CLASS Act was supposed to be the part of Obamacare that provided a public “long-term care” option. It was also supposed to be financially self-sustaining. Conservative allegations that the CLASS Act was not financially self-sustaining were confirmed a little over a week ago when President Obama’s Health and Human Service Secretary Kathleen Sebelius announced that the administration will not be implementing the CLASS Act because it is not financially solvent and, Sebelius said, it has no “viable path forward.”

Republicans view the CLASS Act’s failure as a major victory in the fight against Obamacare — and point to it as a “gimmick” used to make the president’s signature legislation look less expensive.

As the CLASS Act, and Obamacare in its entirety, came under fire yet again in Wednesday’s hearing, Democrats turned to the “Kennedy card” as one of their most frequent defenses.

Former Rhode Island Democratic Rep. Patrick Kennedy even came back to Congress to defend the CLASS Act, a “key priority” of his father — former Massachusetts Democratic Sen. Ted Kennedy. Patrick Kennedy testified as part of special hearing panel that included Louisiana Republican Rep. Charles Boustany, Montana Republican Rep. Denny Rehberg and Florida Democratic Rep. Ted Deutch. The other panel that testified before the subcommittee consisted of two senior Obama administration officials, who were present to defend the CLASS Act.

Texas Democratic Rep. Gene Green offered glowing remarks for the late senator’s son, and thanked Patrick Kennedy for Ted Kennedy’s work in Congress. “I want to particularly welcome our former colleague Patrick Kennedy. Patrick, we worked together on lots of mental health issues over the years and I want to thank you for your service to the American people, and particularly to your district in Rhode Island,” Green said before defending Obamacare. “But, also I want to thank you for the service of your father. Without your father’s work in the Senate, I don’t have enough fingers and toes to list the issues that would not be in the law today, including the CLASS Act. [I want] just to generally thank you for the service of your family — I think all of us thank you for that.”

Illinois Democratic Rep. Jan Schakowsky cited Patrick Kennedy in her comments, too. “As former Representative Kennedy said, repealing the CLASS Act doesn’t mean that the widespread financial, physical and emotional suffering of older and disabled Americans goes away,” Schakowsky said as she questioned an Obama administration Health and Human Services official.

Right before accusing Republicans of turning the now-failed CLASS Act into a “political football,” Florida Democratic Rep. Kathy Castor invoked Kennedy rhetoric: “I’m going to borrow Patrick Kennedy’s language of a ‘Demographic Tsunami,’” Castor said, referring to issues she thinks exist in the long-term healthcare industry.

Florida Democratic Rep. Ted Deutch cited Ted Kennedy’s “dream” in his comments to the committee. Deutch isn’t a member of the Energy and Commerce committee, but appeared with Patrick Kennedy, Rehberg and Boustany on the opening special panel. “Senator Kennedy eloquently captured how our long-term care system is failing the American people when he said, ‘too often, they have to give up the American Dream — the dignity of a job, a home, and a family — so they can qualify for Medicaid, the only program that will support them,’” Deutch said in prepared testimony.

Even Patrick Kennedy played the Kennedy card. In his testimony, he cited his father’s work on the CLASS Act and how his father was deathly ill while working on finishing the legislation. “Our family was very fortunate,” Patrick Kennedy said in his prepared testimony. “We had the resources to provide my father with any long-term services and supports that he needed as he approached the end of his life — but he knew that most working families are not as fortunate. The inclusion of the long-term care infrastructure (CLASS) in health care reform was a signature issue for my father.”

“Even before he became ill, my father saw a need for an alternative solution, realizing that for persons with disabilities and older Americans, long-term services and supports are their primary unmet care need, and that while 45 million Americans lack medical insurance, 200 million adult Americans lack any insurance protection against the costs of these services,” Patrick Kennedy added.

Republican Rehberg, in his testimony, said the Democrats’ testimonies were political spin. Rehberg, who is the chairman of the House Appropriations Committee’s Subcommittee on Labor, Health and Human Services, hit the Democrats for hiding the damage caused by the CLASS Act underneath political games.

“Once we stripped away the political spin, brushed off budget gimmicks and cut through the bureaucratic jungle, we saw a foundation pillar [the CLASS Act] of the president’s healthcare law for what it really was: truly a Ponzi scheme that apparently was included in the bill solely to help the bill appear deficit-neutral,” Rehberg said.

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Democratic Plan to Cut $3 Trillion Doesn't Mention Defense (The Atlantic Wire)

Earlier today, Democrats leaked a $3 trillion deficit-reduction package to the Los Angeles Times, The New York Times, Dow Jones and Reuters but in each case, one major government expense was not mentioned: defense spending. The outline of the plan, independently reported by each outlet, calls for savings though "cuts to federal entitlement programs and Medicare coupled with at least $1 trillion in new taxes." It's not clear why the Pentagon, which is on the hook for a $600 billion haircut if a deal between Democrats and Republicans isn't reached, is left out of the Democratic proposal. (Thus far, reports say the bulk of the savings will come from about $400 billion in Medicare savings and revenues from tax increases.) What is clear, however, is the aggressiveness in which military contractors are lobbying members of the Super Committee. Last week, K Street firms filed lobbying reports for the third quarter requiring them to list details such as who they represent and if they're specifically lobbying the Super Committee or "Joint Select Committee on Deficit Reduction," as it's officially called. The filing doesn't breakdown lobbyists by industry but we found a number of corporations that have significant defense contracts among the list of registered lobbyist clients:

Related: Debt Deal Could Slash Hundreds of Billions From Pentagon Budget

Northrop Grumman Corporation: $50,000General Dynamics: $50,000ITT Corporation: $480,000Honeywell International: $10,000Associated General Contractors of America: $130,000Accenture: $40,000IBM: $1,090,000INTELSAT: $10,000Now, it's highly unlikely that the Democrats would propose a deficit plan without any defense cuts. (The conventional wisdom in Washington is that defense cuts will be around $100 billion if a deal can be brokered.) But central to any rumored outlines has been at least a rough number of where defense cuts will come from. Today's plan gives us none. Liberals such as The Nation's George Zornick are already complaining that the Democrats' deal is a "major capitulation" that cuts too much from Medicare. But if defense cuts aren't a major factor in this $3 trillion grand bargain, that would likely produce leftward angst as well.

Related: Obama Administration Message on 9/11: It's 'Not Just About Us'

*Did we miss any defense contractors in our buletted list? View the entire list of registered third quarter lobbyists below, courtesy the Sunlight Foundation:

Related: Pentagon Looking Safe from the Super Committee's Cuts


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Competing fiscal plans blocked in divided Senate (Reuters)

WASHINGTON (Reuters) – Senate Republicans and Democrats rejected each other's economic stimulus bills on Thursday, underscoring their inability to craft a bipartisan solution on job creation before next year's elections.

All 47 Senate Republicans, joined by two of President Barack Obama's fellow Democrats and one independent, stopped a key piece of Obama's $447 billion economic stimulus plan.

The $35 billion proposal would raise taxes on millionaires to create or protect 400,000 jobs for teachers, firefighters, police officers and other first responders. In a 50-50 vote, its backers fell short of the needed 60 votes in the 100-member chamber to clear a Republican-led procedural roadblock.

"For the second time in two weeks, every single Republican in the United States Senate has chosen to obstruct a bill that would create jobs and get our economy going again. That's unacceptable," Obama said in a statement vowing to continue pushing for passage of the plan "piece by piece."

Democrats fired back by blocking a Republican bid to repeal a 3 percent withholding tax on business set to take effect on January 1, 2013. The 57-43 vote was also short of the needed 60 to stop a procedural roadblock by Democrats. Ten Democrats crossed party lines to vote in favor of the measure.

Democrats control the Senate, 53-47.

Both sides accused the other of jockeying for position in advance of the 2012 presidential elections that seems certain to feature the economy as the top issue.

"Protecting millionaires and defeating President Obama are more important to my Republican colleagues than creating jobs and getting our economy back on track," charged Senate Democratic Leader Harry Reid.

"The American people want us to do something about the jobs crisis," said Senate Republican leader Mitch McConnell. "What Republicans have been saying is that raising taxes on business owners isn't the way to do it."

WASHINGTON GRIDLOCK

Obama's approval rating is only about 41 percent largely because of his inability to bolster the economy. But Congress is even more unpopular: its approval rating is about 12 percent after budget battles pushed the government to the brink of a shutdown and an unprecedented default.

With the U.S. jobless rate stuck above 9 percent for five straight months, a recent Wall Street Journal-NBC poll showed that voters back Obama's bill by a two-to-one margin.

Obama spent three days this week campaigning in North Carolina and Virginia, key states in his reelection bid, to promote his jobs bill and crank up pressure on Republicans.

The president's strategy is to force Republicans to accept his proposals or be painted as obstructing economic recovery.

Republicans counter that Obama's plan are laden with wasteful spending and job-killing tax hikes on millionaires.

McConnell argued that the Republican bill to repeal a pending 3 percent withholding tax on business mirrored a provision that Obama included in his own jobs bill.

Democrats disagreed, noting that Obama's proposal would have delayed implementation of the tax, not repealed it.

In issuing a veto threat shortly before the Senate vote, the White House also pointed out that the Republican measure, unlike Obama's proposal, called for $30 billion in spending cuts to cover lost tax revenue.

Obama's overall $447 billion bill seeks to create jobs with a mixture of stimulus spending and tax cuts for the middle class and small businesses. It would be financed by a 5.6 percent surtax on millionaires.

McConnell rejected Democratic charges that his party is trying to hurt the economy to damage Obama's reelection bid.

"If Republicans wanted the economy to fail, we'd all line right up behind the president's economic policies, rather than opposing them," McConnell said.

(Reporting by Thomas Ferraro; editing by Anthony Boadle)


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Deficit-cutting panel looking at benefits, taxes (AP)

By DAVID ESPO and ANDREW TAYLOR, Associated Press David Espo And Andrew Taylor, Associated Press – Thu Oct 27, 5:55 pm ET

WASHINGTON – Rival deficit-cutting plans advanced by Republicans and Democrats on Congress' secretive supercommittee would both mean smaller-than-expected cost of living benefit increases for veterans and federal retirees as well as Social Security recipients and bump up taxes for some individuals and families, according to officials familiar with the recommendations.

In all, the changes would reduce deficits by an estimated $200 billion over a decade, a fraction of the committee's minimum goal of $1.2 trillion in savings.

A final decision by the panel on legislation to reduce deficits is still a few weeks off, and given the political difficulties involved, there is no certainty that the six Republicans and six Democrats will be able to agree.

The two sides exchanged initial offers earlier this week, and each side swiftly found fault with the others' proposal in the privacy of the committee's rooms as well as in public.

House Speaker John Boehner, R-Ohio, noting published reports that Democrats are seeking $3 trillion in higher taxes, said, "This is the same number that was in the president's budget, the same number that — that they — I don't know that they found any Democrats in the House and Senate to vote for."

"I don't think it's a reasonable number," he said. Boehner also chided Democrats for recommending $50 billion in savings from Medicaid over the next decade, well below what Republicans are seeking.

"Let's understand over the next 10 years, we're going to spend $10 trillion on Medicaid. I just think there's a lot more room there to help find common ground," he said.

At the same time, Boehner emphasized, "I am committed to getting to an outcome" that clears the committee and Congress. The speaker negotiated privately with President Barack Obama over the summer in deficit-reduction talks that failed to produce an agreement.

At a news conference of her own, House Democratic leader Nancy Pelosi of California said she wanted a compromise that was "big, bold and balanced," a phrase that Democrats use to convey an insistence on higher tax revenue.

She pointedly declined to embrace what Democrats had presented to the supercommittee. She called it "Sen. Baucus' package," a reference to the Montana Democrat and chairman of the Senate Finance Committee. That ran directly counter to his aides' statements earlier in the week that he was speaking for a majority of Democrats on the panel — and tacit confirmation that at least two of the party's members had not signed on as supporters.

Ironically, while the Republican and Democratic panel members remain far apart, one of the relatively few items in common was a potentially controversial recommendation to change the calculation for annual cost-of-living increases in federal programs as well as the yearly adjustments in income tax brackets.

According to the nonpartisan Congressional Budget Office, the recommended change "produces lower estimates of inflation than the traditional" measurement of the Consumer Price Index. Since December 2000 the difference on average has amounted to 0.3 percentage points, according to the agency.

A decision to base annual cost of living increases on the new calculation would lower Social Security costs by $108 billion over a decade, and the impact on benefits for federal civilian and military pension programs and veterans' benefits would save an additional $23 billion, according to calculations made in February 2010.

Congressional experts said the list of federal programs that would be affected is extensive, and included Medicare, Medicaid, food stamps and more, but the absence of a written description by either side in the deficit negotiations makes a complete listing impossible.

Officials in both parties said their plans would affect income tax brackets, which currently are adjusted annually to make sure that inflation alone does not expose more earnings to taxation.

By slowing the rate of the adjustment, more income would be taxed than is currently forecast, a change that Congress' Joint Tax Committee recently estimated would produce $59.6 billion in revenue to the Treasury over a decade.

Just as changes to Social Security and benefit programs are politically problematic for Democrats, tax increases are difficult for Republicans.

Americans for Tax Reform, an organization led by anti-tax advocate Grover Norquist, earlier this year said slowing the pace at which tax brackets are adjusted for inflation "would most certainly be a tax hike."

There was one caveat, though.

"This idea can of course be part of a discussion of comprehensive and revenue-neutral tax reform, but stand-alone it is a tax hike."

Both Republicans and Democrats included tax reform in their presentations inside the supercommittee, and the issue has great political appeal.

But the two sides differ dramatically on the details. Democrats called for tax reform that would generate an additional $1 trillion in revenue over a decade, while Republicans said they envisioned no increase.


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Both Romney and Obama Want to Make 2012 a Sequel to 2004 (The Atlantic Wire)

Mitt Romney wants to be the John Kerry of this year's Iowa caucuses, while President Obama wants to be the George W. Bush of the general election. Like Romney, Kerry was an early frontrunner later overshadowed by flashier candidates; his case that he was the more electable candidate led to back-to-back wins in Iowa and New Hampshire, essentially endeding the Democratic primary in 2004. But while Romney surely hopes the 2004 similarities end there, Obama hopes that's where they begin. The New York Times' Richard W. Stevenson reports that Obama's reelection team has studied how to do what George W. Bush did to Kerry in 2004 -- take bad news (then Iraq; this time, the economy) and turn it to his advantage, while portraying his opponent as a flip-flopper with no convictions.


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Sunday, October 30, 2011

Obama adviser says president best for middle-class (AP)

WASHINGTON – A presidential campaign adviser says that Barack Obama can tap into the frustrations typified by the Occupy Wall Street movement better than any Republican rival in 2012.

Former White House press secretary Robert Gibbs tells NBC's "Today" show Obama "is out there fighting for the middle class."

Gibbs says "we're seeing now a lot of anxiety and frustration" across the country because of income disparity.

Asked if this economic unrest will mostly likely benefit Obama in next year's election, Gibbs said Obama has a better record than the GOP in defending the middle class. Gibbs also said that "every one" of the Republican presidential candidates want to roll back Wall Street regulation.

He said the lack of sufficient rules to govern Wall Street is what "got us into this mess."


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Gary Hart for President in 2012? (ContributorNetwork)

COMMENTARY | The left's disappointment with President Barack Obama has been touched upon many times before. However the sticking point has always been finding someone with a high enough profile to challenge him in the Democratic primaries.

A group calling itself "Run Gary Hart" thinks it has found that man. His name is Gary Hart, the former senator from Colorado, campaign manager for George McGovern and twice candidate for president.

Leaving aside whether the former senator and star of the "monkey business" sex scandal is even willing to have another go at it, Hart makes for an interesting man of the white horse. He has intellectual pretensions going back to the 1984 campaign when he was called an "Atari Democrat" for his propensity to offer high tech babble as part of his campaign spiel. In 1987, during his second attempt, Hart was caught up in a what would now be considered a tame sex scandal involving an attractive young lady named Donna Rice and a yacht called "Monkey Business."

Since 1987, Hart has practiced law, written extensively, and has gotten a doctorate at Oxford. He was mentioned for a cabinet post in a potential John Kerry presidency. He currently has a professorship at the University of Colorado at Denver.

Hart had started his political career as a great young hope, brimming with a boatload of new but unspecified ideas. However, now in his 70s, Hart would have to approach a revival of his political career as a venerable sage.

While Hart's political approach is still decidedly left, combining a skepticism about the war on terror with a desire to have an energy policy to wean the United States off foreign oil, one wonders what he appeal would be for those disaffected liberals looking for an alternative to Obama.

It is possible that Hart has been out of the public eye for so long that he would qualify as a fresh face. An entire generation has grown up not knowing who Hart is. Were he to decide to challenge Obama, he might get a following, combining young people looking for a savior, to aging supporters from his previous campaigns who pine for what might have been.

Sources: Run Gary Hart

Gary Hart Biography, Answers.Com


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Top Dems oppose detention policy in defense bill (AP)

WASHINGTON – Top Democrats on the Senate Judiciary and Intelligence committees are opposing provisions in a sweeping defense bill that would require military custody of terrorist suspects and limit the government's authority to transfer detainees.

In a letter to Senate Majority Leader Harry Reid, D-Nev., the lawmakers — Judiciary Chairman Patrick Leahy and Intelligence Chairwoman Dianne Feinstein — said the provisions would undercut U.S. counterterrorism efforts and urged him to remove the sections from the bill. The Obama administration also opposes the provisions.

"Professionals in the intelligence community and law enforcement need the flexibility to use all tools to effectively interrogate, incarcerate and bring terrorists to justice," Leahy and Feinstein wrote Oct. 21 along with 11 other Democratic senators.

The issue has exposed divisions within the Senate and the Democratic Party.

The Senate Armed Services Committee approved the $683 billion defense bill in June that would authorize spending on military personnel, weapons systems and wars in Iraq and Afghanistan in the fiscal year that began Oct. 1. The panel, led by Sen. Carl Levin, D-Mich., approved the provision on military custody on a 25-1 vote.

But the administration's opposition and Reid's concerns have delayed Senate consideration of the legislation with about 10 weeks remaining in the session.

The provision in the bill would require military custody of a suspect determined to be a member of al-Qaida or its affiliate and involved in the planning or an attack on the United States. The administration argues that such a step would hamper efforts by the FBI or other law enforcement to elicit intelligence from terror suspects, and Reid has said "limitations on that flexibility, or on the availability of critical counterterrorism tools, would significantly threaten our national security."

Levin has argued that the provision included a national security waiver that the administration could exercise to bypass the requirement.

This isn't the first time Congress has tried to limit the administration on the detainee issue. Last year's defense bill barred the transfer of detainees at the naval prison at Guantanamo Bay, Cuba, to the United States. The omnibus spending bill that President Barack Obama and Congress approved in April also prevented the transfer of detainees from Guantanamo to the U.S., prohibited the construction or modification of facilities in the United States to house detainees and required the defense secretary to notify Congress before transferring a terror suspect to a foreign country.

Congressional Republicans and some Democrats want to keep the facility at Guantanamo open despite Obama's efforts, which have proven unsuccessful, to close the prison. Lawmakers also favor trying suspects in military commissions instead of federal courts.

Separately, Rep. Howard "Buck" McKeon, R-Calif., chairman of the House Armed Services Committee, sent a letter to Obama expressing frustration with the administration's unwillingness to discuss the House-passed defense bill's provisions on terror suspects. The House bill, approved this past summer, includes different provisions limiting the administration's authority on handling detainees that the White House opposes.

"The administration has shown a willingness to undertake nothing short of extraordinary action regarding targeting terrorists overseas," McKeon wrote in an Oct. 20 letter. "Yet is has shown none of this resolve when it comes to detaining our enemies instead."

McKeon argued that the administration has "foreclosed options that are critical to our national security."

The House and Senate versions of the defense bills need to be reconciled and cleared by Congress for the president. In doubt is Congress' four-decade record of completing defense bills and sending them to the president.


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House Democrats say GOP wants too many days off (AP)

WASHINGTON – The House will be in session less than one out of every three days next year, a slight decline from past years. House Republicans say they are running the place more efficiently and lawmakers need the time to be with constituents in an election year. Democrats say that's too few days on the job during an economic crisis.

The announcement of the 2012 schedule even led to a Twitter battle between the press offices of House Majority Leader Eric Cantor, R-Va., and the No. 2 Democrat, Steny Hoyer of Maryland, over how Congress is being run.

"As with this year, the goal of next year's calendar is to create certainty and productivity in the legislative process, protect committee time and afford members the opportunity to gain valuable input from their constituents at home," Cantor said in a letter to colleagues as he released the calendar scheduling 109 legislative days in 2012.

Under the tentative calendar, the House would have only six voting days in January. There would be three working days in August, when Congress usually takes off, and the House would be off from Oct. 5 until a week after Election Day on Nov. 6. The last scheduled session of the year would be on Dec. 14.

In 2008, the last presidential election year when Democrats controlled the House, the House met for 119 days.

"The American people deserve better," House Democratic leader Nancy Pelosi of California said at a news conference, referring to congressional inaction on creating jobs and the House's six-day schedule in January. "We have work to do."

Hoyer said the House has had only 111 days of legislative business this year and the floor schedule "has prevented the House from getting anything done to create jobs."

Republicans responded at a news conference where they highlighted what they called the "forgotten 15," bills that the House has passed and Republicans say will lead to job growth but which the Democratic-controlled Senate has ignored.

The 15 bills focus on promoting development of domestic energy and reducing or eliminating regulations imposed by the Environmental Protection Agency and other federal agencies.

Differences over the schedule and who's to blame for lack of productivity played out on Twitter. Cantor's office derided the "fake outrage" of Hoyer and Pelosi and claimed that the House will be in session more days than it was under Democratic control.

Hoyer's office shot back, "You mean days like today when last votes started before 11 a.m. and we jetted out of town for the week?"

House Republicans, when they gained the majority in January, put into effect several changes to make the chamber operate more smoothly. They reduced the number of votes on minor legislation such as naming post offices, cut back on morning votes so committee hearings would not be interrupted, and reduced late-night sessions. Cantor said the House has taken 800 roll call votes through Oct. 14 this year, compared to 565 last year.

The Library of Congress says the House has met 139 times through Wednesday. That includes several dozen "pro forma" sessions that last a few minutes and where no business is conducted. This year such sessions have been convened to prevent President Barack Obama from making federal appointments when Congress is away.

The number hasn't varied much in recent years, with legislative sessions generally going down in election years. According to the Library of Congress, the House met 127 times in 2010, 159 times in 2009, 119 times in 2008 and 164 times in 2007.

The Senate has met 136 times so far this year and convened 157 times last year, including pro forma sessions.


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