Whether we like it or not, fiscal issues will be paramount in this lame duck session at the end of this year because the stop-gap spending bill, called a continuing resolution (CR), funded the federal government only until December 11, 2014, and because several significant tax provisions affecting a large number of Americans must be either extended or allowed to expire by December 31.

Let’s deal with appropriations first.

Budget experts tell us that congressional leaders have three options for funding the federal government post-December 11, 2014:

1. An omnibus spending bill that combines the 12 annual spending bills (regular FY 2015 appropriations bills) into a single package that funds the government for the rest of the fiscal year
2. Another stop-gap spending bill or CR that funds the government at 2014 levels through some portion of the fiscal year (e.g. until March 31 or June 1 in 2015) or for the full fiscal year
3.  A hybrid package in which some of the 12 spending bills are regular appropriations bills, with funding and program adjustments, and others are stop-gap bills that fund various agencies at 2014 levels and don’t alter policies or programs. In recent years this option has been used several times.

Congress has not passed any of its 12 annual spending bills for FY 2015 even though the fiscal year began on October 1. The House has approved seven of the 12 bills for FY 2015 and the House Appropriations Committee has approved another four. The full Senate has not passed any spending bills, but there are reports that the Senate Appropriations Committee has approved eight spending bills and assembled drafts of the other four bills. This state of affairs is not unusual in that the federal government has not enjoyed a real budget on time since 1997!

A New York Times article on November 6 stated that the majority of Republicans want to find a way to finance the government through next September and take “those sticky spending issues off the table” – in other words, start the new 114th Congress with a clean slate rather than refighting old issues. Other Republicans, mostly very conservative, want a CR to extend only until the new Congress begins its legislative session so that the Republican-dominated House and Senate can use their greater leverage to shape the budget according to more conservative thinking.

It is anyone’s guess at this point whether incoming Republican leaders of the House and Senate will decide on a fresh start or use a CR to set the stage for a broader debate early in 2015 on government spending across the board.

What we do know is that there are some very influential people behind the congressional push for an omnibus bill. For example, House Appropriations Committee Chair Harold Rogers (R-KY) agrees with his Senate counterpart, Chairwoman Barbara Mikulski (D-MD), that it would be best to pass an omnibus bill in the lame duck session so that the new Congress does not have to deal with leftover issues.

Chances are also better thanks to the Murray-Ryan agreement of December 2013 (following the government shutdown), setting defense and non-defense spending issues through FY 2015. One of the major problems with another CR, says the Coalition on Human Needs (CHN), is that “agencies and their programs are hurt since it severely limits their ability to adjust their spending and activities to respond to changing realities.”

After the Senate passed the CR in mid-September, Senator Mikulski said that the goal of the CR “is to lay the groundwork for an omnibus funding bill in December that will include all 12 appropriations bills.” Both Senator Mikulski and Representative Rogers have said that the two chambers are not that far apart on an omnibus package and they would much prefer drafting and passing a FY 2015 omnibus spending bill rather than passing another CR that merely funds the government for a few months. Their respective staffs have been working on the various appropriations bills for several weeks and the principals (Mikulski and Rogers) are discussing the status of their work with the congressional leadership.

As recently as November 13, according to CQ Roll Call, Representative Rogers maintained that Republican leaders would help him press the case for an omnibus bill at their weekly caucus meeting. Majority Leader Kevin McCarthy of California agreed to support the measure as well as other leaders of the House. Rogers believes that passing an omnibus bill to which agreement with the Senate is obtained, not only would prove to a skeptical public that Congress could overcome the “gridlock syndrome,” but also achieve several conservative priorities by including some of their long-sought provisions in the bills – such as rolling back financial regulatory reform and EPA regulations. There had been threats to derail the omnibus should the president issue his executive order on immigration, which, of course, he did. We don’t know at this point if they will make do on their threats.

While Rogers and Mikulski are significant players, the final decision is still in the hands of congressional leaders, the president, and a Democratic Senate, who may not agree with the priorities of Representative Rogers.

Whether the result is an omnibus funding bill, a CR or a hybrid, the appropriations will end up as a $1 trillion-plus spending bill including roughly $550 billion defense spending, with nearly $60 billion for the Overseas Contingency Operations (OCO). This would be a behemoth bill, no matter what shape it takes.

An October 29 article in The Hill states that government often grows during lame duck sessions and cites as past examples gas tax hikes, congressional pay increases, free-standing debt limit hikes, and industry bailouts. The author claims that “elected officials are more susceptible to the demands of special interests when they face no future elections,” and urges that Congress break from the past this year and try to limit the harm.

Whether Congress will adhere to the Ryan-Murray budget deal remains to be seen since discretionary spending is already $19 billion higher than that deal anticipated, and the OCO budget keeps growing. Key questions are whether Congress will provide supplemental funding for Ebola and for fighting the Islamic State militants. One issue that should be considered in the request for supplemental funding for the Pentagon is that the current CR left the military with excess resources because the CR continued war spending at FY 2014 levels, and some recent needs have diminished due to drawdowns of military personnel from Afghanistan.

The largest appropriations bill is for defense. Leaders of the House and Senate Armed Services committees have been negotiating their differences. Their decisions will affect spending on the Air Force A-10 Warthog aircraft, Navy cruisers and Army National Guard attack aviation. Both the House and Senate bills reject the administration’s proposal to retire the Warthog (saving $4.2 billion over the next five years), but take different approaches to paying for the planes to stay in service. There are also contentious debates about whether half the Navy’s fleet of cruisers should be taken out of service for modernization as the Navy has recommended, and whether the Army National Guard Apache helicopters should be moved to active duty as part of an overdue restructuring that the administration says will save money. Ultimately, the plan is for a military authorization bill to move through Congress during the lame duck session and be passed regardless of the fate of other appropriation bills.

In addition to the appropriations bills, a significant section of fiscal issues facing the lame duck Congress is taxation. Rather than comprehensive tax reform, Congress will be considering extending certain tax provisions (thus, the appellation “tax extenders”) that expired on January 1, 2014 and will reinstitute some or all of them retroactively. The Senate Finance Committee, under Democratic leadership, and the House Ways and Means Committee under GOP control, support very different approaches to tax extenders bills.

The Senate Finance Committee supports an $85 billion two-year (this past year and next year) extension of more than 50 tax provisions; whereas the Ways and Means panel wants to permanently extend and expand certain tax provisions related to investment, research and small businesses, at a 10-year cost of more than $500 billion. Most observers, including several congressional staffers close to the negotiations, believe a two-year extension package is more likely during the lame duck session.

Some groups, such as the National Women’s Law Center (NWLC), think that Congress should reject the renewal of any costly corporate tax breaks (tax extenders) or pay for them by closing other corporate loopholes so that corporations are paying their fair share of taxes. Antipoverty groups such as NETWORK agree, but also feel that any move to make permanent any aspect of the tax extenders calls for the permanent expansion and extension of the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC), on the basis of reciprocity. Both credits have always enjoyed bipartisan support.

The two major fiscal issues we have discussed, appropriations and taxation, must ensure that all individuals and families within our country are able to live in security and dignity; that every person is valued; and that Congress will serve the common good, especially by robustly funding support for poor and vulnerable people and reducing reliance on tools of violent conflict.