As the United States Congress goes into recess, we thought we would take a look back on what has been a grueling legislative year thus far.

The year began with closing debates on health care reform, and the March 20th passage of the historic Affordable Care Act, with barely a majority in the House and just enough votes to avoid a filibuster in the Senate.  The highly contentious bill had to go through reconciliation in the Senate for certain House amendments to be included.  No sooner than the bill passed did we see its opponents take up arms and vow to take their fight to the courthouse with nearly two dozen mostly right-leaning states filing lawsuits that aim to repeal the bill.  The ultimate impact of the health care legislation is yet to be recognized, as most of its key provisions will not be enacted until 2014.  And between now and then, one can anticipate a great deal of lobbying as state legislatures work to implement key requirements related to Medicaid, Medicare, and Insurance Exchanges.

With healthcare reform enacted, the Democrats next charge was financial reform, a major part of the party platform during the 2008 presidential candidate.  In spite of what appeared to be a commitment from both parties to reform a financial system that almost brought the world’s economy to a halt during the latter part of 2008, both sides could not reach an agreement on reform and you even had the Democrats face a hard time reaching a consensus within their party.  The financial reform bill that was passed in July will now have to stand up to other tests as financial industry groups and lobbyists work to mitigate the regulatory impact of the legislation to preserve the industry’s ability to maintain profitability.

Coinciding with financial reform, was a growing bipartisan effort to draft a comprehensive energy and environmental bill in the Senate, an effort that all but seemed to come to a halt when national attention shifted to immigration in response to passage of Arizona’s now infamous Senate Bill 1070.  Then April 20, 2010 marked an unprecedented oil drilling disaster, as the Transocean drilling rig operated by British Petroleum in the Gulf of Mexico exploded.   The whole world watched for nearly 100 days until BP was finally able to successfully execute a “top-kill” procedure, which temporarily cause the oil gushing to stop.  The final verdict on this catastrophe might not be reached for years to come.  Declining support for the war in Iraq and Afghanistan, ethics trial of key House Democrats, the fight to lift the Cuban trade embargo, further debate on the Disclose Act, and a potential Supreme Court case on California’s Proposition 8 should suffice in keeping us occupied in the mean time.

Congress heads into this year with a lot of work left to be done.  Furthermore, we have yet to see how the year’s events will impact the outcome of the 2010 fall elections.  Earlier in the year, it appeared that Republicans were going to hang their hope of reclaiming congressional seats on the public debate on healthcare, while Democrats hopes relied on painting Republicans as “the party of NO”.  However, as the events of the year have unfolded it is unclear what the strategy on either side will end up being.  Republicans have gone from hoping for gains in the House, to believing they have an opportunity to reclaim both chambers of Congress.  On the other side of the table are the Democrats who believe passage of financial reform and the debate on immigration might be just the right combination to help energize their base and keep them in power for at least two more years (It, however, did not help that the President’s Press Secretary Robert Gibbs appeared on Meet The Press and proclaimed that Democrats were at risk of losing both the House and Senate).  Mainstream Republicans have struggled this year as we have watched experienced legislators like Utah’s Senator Bob Bennett lose his party primary, and veterans like John McCain have to run to the hard right to retain their seats.  Then there are the fights in Colorado and Florida where the Tea Party effect might have been just the poison pill that diminishes any chance of Republicans being reelected to the Governor and US Senate seats in those states respectively.

Upon Congress’ return from recess, they will be faced with decisions on what do regarding immigration, a comprehensive energy policy, an uncertain economic climate, above nine percent unemployment, mounting resentment on the Afghanistan war, and continually rising debt.   All said, this year’s fall elections bear no resemblance to the historic 2008 fall elections, however, with so much on the table your guess is just as good as mine on what the outcome is going to be.

Yesterday June 16, 2010, the Obama administration announced that BP had agreed to its request for a $20 billion escrow account to be setup to aid victims of the oil spill.  The fund that’s set up will be run by Kenneth Feinberg the lawyer and mediator who ran the fund for victims of September 11.

This is welcome news considering the fact that there has been significant uncertainty about the future of BP.  Its stock market value has been cut in half since the initial onset of the spill, and it was rumored earlier this week that a certain bank had warned its employees not to issue debt contracts to BP that extend beyond a year.   Then you take into consideration that FEMA the federal government’s disaster recovery arm has yet to recover from the barrage of floods, hurricanes, tornadoes, and fires that have depleted its funds over the past five years.

It goes without saying that the federal government needs BP just about as much as BP needs the government right now.  The agreement by BP to the demands of the Obama administration should not come as a surprise to anyone paying close attention to what is at stake.  However, by being readily agreeable to the President’s request, BP effectively killed multiple birds with one stone.  In order for BP to survive they were already going to have to pay for the damages from this tragedy.  So by acquiescing to the  the administration’s demand, BP was able to cast itself as compassionate, while at the same time enabling the administration to show some stealth and build some political capital in the process.

Despite the staggering sum being set aside, some have speculated this amount would be insufficient to cover the long-term costs this disaster is bound to run. To offer some comparison, BP had gross earnings of $246 billion in 2009 with net profits being $17 billion.  So in actuality, BP is putting up all of last years profit and some change as a show of goodwill to the administration and the American public.  It is safe to conclude that we need BP to be alive and well in order to not only preserve 23,000 jobs, but also to ensure that our nation recovers from this catastrophe.