Concession on offshore energy drilling clears path for quiet exit for senators

Two parties that started September headed for a bitter clash that could have shut down the government are now preparing for a quiet departure as each tries to shift into campaign mode.

Democrats have given in to GOP demands to lift a decades-old ban on expanding offshore drilling, paving the way for must-pass legislation to keep the government running after Oct. 1.

{mosads}Several senior Republicans say that concession makes it highly unlikely that the GOP will block the measure — and effectively shut down the government — even if the legislation includes other provisions the conference opposes.

Meanwhile, Senate GOP and Democratic leaders have brokered a major deal to extend business tax breaks, patch the alternative minimum tax and renew dozens of expiring energy provisions — a bill each side said was necessary to complete before Election Day.

A big Senate debate expected this week over Iraq and President Bush’s troop surge never panned out, with enough Republicans siding with Democrats to advance a massive defense policy bill and choke off a long list of amendments.

And in another sign that Democrats don’t plan to wage a big fight, Senate Majority Leader Harry Reid (D-Nev.) said Wednesday that he won’t combine a stimulus package that the GOP opposes with a stop-gap spending bill.

Even though the partisan rhetoric has sharpened, the movement on legislation has been jolted by election-year realties and fear among lawmakers of appearing insensitive to the worsening economic situation.

“We’re coming together on a whole bunch of things here,” said Sen. Mel Martinez (R-Fla.). “I think maybe there’s a moment where we’re seeing the situation is grave enough that we’ve got to be grownups.”

By conceding to the GOP demands over oil drilling, Democrats are seeking to blunt the campaign slogan that they are standing in the way of lower gas prices.

In the meantime, Democrats have seized on the Wall Street crisis to launch a coordinated broadside connecting the blame with presidential candidate Sen. John McCain (Ariz.) and the Republican Party.

{mospagebreak}Republicans have spent little time in the Senate this week pushing back on the Democrats’ attacks, and are instead continuing their calls to lower the price at the pump, which they call the root of the nation’s economic anxieties.

“We’ll see in a few weeks” if it’s a risky strategy, acknowledged Sen. Lamar Alexander (Tenn.), chairman of the Senate Republican Conference, which is in charge of the conference’s messaging.

“Our strategy since July has been that the high cost of gasoline and other energy prices along with housing is drawing the economy down,” Alexander said.

{mosads}But some have cautioned against shying away from the financial markets.

“I think Republicans needed to get more engaged in that debate,” chief Senate Republican Deputy Whip John Thune (S.D.) said of the economy. “[Democrats] are going to the floor everyday and just whacking away.”

Reid has spared little time slamming McCain’s long-standing support for deregulatory policies that he cites as a main reason for the collapse of Wall Street giants.

By contrast, Senate Minority Leader Mitch McConnell (R-Ky.) has remained mostly mum, avoiding reporters’ questions and making few public statements about the turmoil.

An aide said that McConnell is not interested in turning the nation’s economic woes into a political football.

While Democrats are collectively calling for greater regulation of the financial markets, the GOP’s position is far from uniform, with some seeking a larger federal role and others wanting to allow the crisis to work itself out without government intervention.

Plus, the congressional Republicans are in a tricky position, with a Republican in the White House being accused of mismanaging the economy and a presidential candidate who is sending out mixed messages while also criticizing Washington for poor regulations.

“Here’s a guy who’s been part of the deregulation crowd since he’s come to Washington,” said Sen. Robert Mendenez (D-N.J.), criticizing McCain’s position.

For now, congressional Republicans are sitting on the sidelines and trying to re-engage in an energy debate they appear poised to win.

“I think we won the battle [on drilling] and now everybody’s trying to out-drill each other,” said Sen. Johnny Isakson (R-Ga.).

Reid and House Speaker Nancy Pelosi (D-Calif.) may still irk the GOP if they push forward a continuing resolution with provisions they oppose or set a longer timeframe than the White House wants.

The Senate GOP also may push back on Reid for his plans to bring up a package of bills being blocked by Sen. Tom Coburn (R-Okla.), or if he tries to advance a measure aimed at overturning a Supreme Court decision on gender-pay discrimination.

Those measures, however, could be rejected on simple procedural votes, leaving Congress with only the must-pass continuing resolution to approve as they plan to leave Capitol Hill next week.