The biggest news this week in Congress was the passage and signing of the FISA bill [3], which expanded the president's surveillance powers (to more closely fit the Bush administration's existing practices) and granted retroactive legal immunity to telecom companies for breaking federal privacy laws when allowing the administration to illegally tap domestic phone lines without a warrant. The Senate also passed a housing legislation package [4] on Friday and Congress gave final passage to a bill preventing a cut in payments to doctors in the Medicare program (at the expense of federally subsidized corporate Medicare programs).

The just-passed FISA Amendments Act of 2008 [3] codified changes to the 1978 Foreign Intelligence Surveillance Act [5] - which created a special court to govern electronic intelligence gathering in the U.S. - previously made by the now-expired Protect America Act [6]. The Protect America Act essentially served as a placeholder while Congress debated an expansion of the president's surveillance powers, which President Bush said were needed to protect against terrorism. Both that bill and the FISA Amendments Act remove the need for a warrant when surveillance of foreign targets might include eavesdropping on Americans, as long as the government claims it is urgent and necessary. Both bills also clarified that the FISA framework is the exclusive method under which the government can conduct national security-related eavesdropping, contrary to earlier Bush administration claims that the president's war powers might exempt it from oversight.

The bill had been stalled in the Senate, largely over a presidential demand that telecom companies be granted legal immunity for participating in an earlier program that bypassed FISA's warrant requirements. (Though what the companies did and the scope of the program is not fully known, this is the specific immunity granted by the bill.) While enough Senate Democrats had joined with the Republicans earlier this year to advance an earlier version of the bill (the RESTORE Act) [7], House Democrats refused to accept the bill.

That changed last month when House Democratic leaders cut a deal with President Bush to grant the immunity as long as his administration admitted that they had requested the surveillance (something already revealed in Congressional testimony). The bill then sailed through the House but ran up against a filibuster threat from civil libertarian members of the Senate. Presidential candidates Barack Obama [8] (D-Ill.) and John McCain [9] (R-Ariz.) expressed supported for the basic terms of the bill, though Obama said he would work to strip the immunity provisions from the bill but would not, as he had earlier promised, support a filibuster to remove the provisions. Eventually enough Democrats sided with their Republican colleagues to defeat three amendments offered to modify the immunity provision, and the final bill passed by an overwhelming margin, showing the GOP can still divide Democrats on national security issues. President Bush signed the bill into law on Thursday.

In other action on the Senate floor, the body passed a bill preserving Medicare payment levels to physicians [10], who were facing a 10.6% cut in reimbursements through the program. Originally, the cuts were supposed to be small (about 1 percent) and spread out over many years as a deficit reduction tool. However, Congress has always waived the decrease, and the cumulative effect was a large cut scheduled this year. The new bill patches the hole by shifting $9.9 billion from bonus payments to corporate-operated Medicare plans known as Medicare Advantage.

Sen. Edward Kennedy [11] (D-Mass.), despite having spent the last six weeks recovering from brain surgery to remove brain cancer tumors, cast the deciding vote to approve the bill (though several senators changed their votes once passage was inevitable). President Bush has threatened to veto the bill, but it was passed by veto-proof margins in both chambers, so it will likely become law.

Finally, the Senate approved a long-awaited bill to address the housing and mortgage crisis [4] once Nevada Republican Sen. John Ensign [12]'s efforts to attach a series of renewable energy tax breaks to the package were rebuffed. The bill's main provisions include a program to offer a federal guarantee on risky mortgages to lenders if they fix escalating interest rates and cut the loan amount to the current value of the home. The House, however, plans on rewriting significant portions of the bill and President Bush has vowed to veto the measure, so final passage is far from certain.