Scenarios: Obama to score few wins in Congress

WASHINGTON (Reuters) - The U.S. Congress is headed toward giving President Barack Obama a landmark crackdown on Wall Street and confirmation of a second Supreme Court nominee.

But Obama, who also notched up healthcare reform earlier this year, is unlikely to score many other big victories on Capitol Hill before voters decide in the November election whether to keep his fellow Democrats in control of Congress.

With lawmakers facing an angry electorate, it is tough to find much common ground on such hot-button issues as immigration, energy and deficit reduction.

Here is a look at what issues Congress faces:

FINANCIAL REFORM

A landmark overhaul of financial industry rules is very close to being approved in the Senate and then sent to Obama to be signed into law. But the Democrats do not yet have all the votes needed for approval. The death in June of 92-year-old Democratic Senator Robert Byrd complicated efforts to pass the bill. The Democrats are looking for support from moderate Republican Senators like Charles Grassley, Olympia Snowe and Scott Brown to help them muster the needed 60 votes in the 100-member Senate. Brown said on Monday, "I expect to support the bill when it comes up for a vote."

"At this point, I don't know who will provide the 60 votes, but we fully expect to get there," a Democratic aide said.

Ethan Siegal of the Washington Exchange, a private firm that tracks Washington for investors, said: "Bottom line: The (bill) will pass the Senate and become law."

SUPREME COURT

U.S. Supreme Court nominee Elena Kagan won bipartisan praise at her Senate confirmation hearing that ended with members of both parties predicting she will be confirmed.

Regardless, expect all but a few of the Senate's 41 Republicans to line up against the former Harvard law school dean and Clinton White House lawyer. Many already have, including Senate Republican leader Mitch McConnell.

Kagan seems certain to be confirmed by a smaller margin than Obama's first Supreme Court nominee, Sonia Sotomayor. She was approved by the Senate last year, 68-31. She would replace retired Justice John Paul Stevens, who had been the court's leading liberal. Kagan is not expected to change the ideological balance of the sharply divided court, which has a conservative majority.

IMMIGRATION

Obama recently delivered a major address on the need for U.S. immigration reform -- despite little, if any, chance Congress will pass such legislation this year.

Obama has been under pressure to keep a 2008 campaign vow to revamp the U.S. immigration system, but has been unable to muster needed bipartisan cooperation on Capitol Hill.

ENERGY/ENVIRONMENT

A sprawling bill could be before the full Senate late this month.

Details are still being worked on, but the measure may encourage the use of more alternative energy, reduce carbon dioxide emissions blamed for global warming and tighten offshore oil drilling practices in the wake of BP's Gulf of Mexico oil spill.

It is still unclear is how far the global-warming part of the bill will go. There is speculation it might force electric power utilities to begin reducing their carbon emissions in 2013 and leave other parts of the economy -- such as factories -- for later. The difficulty will be finding the 60 votes needed to pass a bill with such mandatory pollution reductions.

DEFICIT REDUCTION

With polls showing mounting voter anger about the $13 trillion federal debt, members of Congress sound increasingly interested in finally doing something about it.

Yet lawmakers are likely to put off any serious effort until at least after Obama's deficit-cutting commission issues its recommendations in December.

Options -- none of which would be very popular in an election year -- include raising taxes, cutting spending or most likely a combination of both.

CAMPAIGN FINANCE

Like many legislative efforts the past two years, the Democratic-led House approved a campaign finance reform bill last month largely along party lines.

The White House-backed measure now faces an uphill climb in the Senate where Republicans voice confidence that they will stop it with still another procedural roadblock.

Critics argue the measure would violate freedom of speech.

But proponents hope to win Senate passage, noting polls show broad public support for the bill's central aim: unprecedented disclosure of campaign financing.

JOBLESS BENEFITS

Senate Democrats expect to pass legislation to extend jobless benefits to the long-term unemployed once a successor is appointed and sworn in to replace the late Senator Robert Byrd.

Byrd's death on June 28 left fellow Democrats a vote short of breaking a Republican-led filibuster against the measure.

A replacement for Byrd is expected to join the Senate shortly after lawmakers return on Monday from a weeklong recess.

The House passed such legislation last month but it was stopped in the Senate amid complaints its $34 billion price tag would add to the record federal deficit.

JOB CREATION

Democrats know their own jobs are very much on the line in the November election unless they can reduce the near double-digit U.S. unemployment rate.

Consequently, they have passed a number of bills designed to create jobs. But these measures have all been relatively small ones.

Senate Republicans have blocked efforts to pass sweeping and costly jobs legislation, complaining that would swell the federal deficit.

Senate Democrats are guardedly hopeful, however, that they will be able to win passage of a bill to create a $30 billion fund aimed at encouraging community banks to lend to small businesses with the aim of boosting economic growth and job creation.

TAXES

The Senate is likely to try to pass a stalled jobs bill that would extend a package of popular business and individual tax breaks. The bill, which has been blocked by Senate Republicans, also includes a provision that would raise taxes on private investment fund managers.

The House could consider legislation temporarily extending popular middle class tax breaks that are part of the expiring tax cuts signed into law by President George W. Bush. Those tax cuts expire at the end of this year. House Democrats, keeping in line with Obama's pledge not to raise middle class taxes, plan at least a one year extension of tax breaks for families making less than $250,000. The package would also provide a two-year fix to ensure that millions of middle income earners are not hit with alternative minimum tax, which originally was meant for only the wealthiest people.

ARMS TREATY

Obama negotiated a new arms reduction treaty with Russia and Senate Foreign Relations Committee Chairman John Kerry has been trying for months to set the stage for a needed two-thirds Senate majority vote to ratify it.

Kerry aims to have his committee vote on the pact before the start of an August recess. "The expectation is that the treaty will be ratified (by the full Senate), but timing is unclear," a party aide said, adding it could happen before or after the November election.

(Additional reporting by Richard Cowan and Donna Smith; Editing by Alistair Bell and Frances Kerry)