Congressional tax committees have set to work and are looking into how tax policy can be used to help victims of the recent disaster, both immediately and in the long run. Chairman of the Senate Finance Committee Charles Grassley (R-IA) told reporters in a morning news conference that his committee would be looking into relief efforts associated with past natural disasters in order to determine which policies have been effective. Then, they will look into applying similar policies to help those affected by Katrina.

Meanwhile, in the House the Chairman of the Ways and Means Committee, Bill Thomas (R-CA), is apparently exploring a three-phase approach addressing the initial humanitarian concerns, followed by infrastructure concerns, and finally long-term reconstruction. The first measure, which could move as early as September 8, deals with getting money to individuals through TANF (Temporary Assistance for Needy Families). The measure would remove a lot of red tape and provide immediate assistance for a number of families.

Also, it is pretty clear that any sort of work on Social Security legislation is off the table now that Congressional leaders have their hands full dealing with the disaster. Sen. Olympia Snowe (R-ME) told BNA News Services that "Major issues are overtaking a number of issues like Social Security. It's hard to foresee a legislative agenda addressing the long-term issues associated with Social Security this fall." Grassley made similar comments, telling reporters that his top priority this fall will be disaster-related measures, the Roberts nomination, budget reconciliation legislation and appropriation bills, and then Social Security.

Congress is more likely to act on pension reform than social security reform this year, according to today's BNA:

"Congress ultimately may fail to find accord on Social Security reforms and instead pass more targeted pension reform legislation when it returns from its summer recess, sources who follow the issue told BNA Aug. 31."

Michael Tanner, director of the Cato Institute's Project on Social Security Choice, told BNA Aug. 31 that Congress is likely to pass a pension bill, even if it fails to muster support for Social Security changes. "You could get a decent pension bill regardless of what happens with Social Security," Tanner said.

Jason Furman, a senior fellow with the Center on Budget and Policy Priorities, rarely agrees with Tanner, a proponent of Social Security payroll tax-financed individual investment accounts. But Furman also said he expected Congress to act on pensions. "Something on the defined benefit [pension plan] side has to happen," Furman told BNA Aug. 31.

Furman said he anticipated that Congress would feel compelled to pass provisions aimed at strengthening the funding of defined benefit pension plans and measures aimed at bolstering the federal pension insurer, the Pension Benefit Guaranty Corporation.

"On Social Security, it is extremely unlikely that anything will be enacted by Congress. What the Republicans are trying to do is retreat from this issue," Furman said.