With two weeks until two key measures expire, Congress appears poised to do what it does best – absolutely nothing.

At issue are the doubling of the student loan interest rate, and the surface transportation bill. Democrats and the White House seized on the student loan issue, getting Republicans to agree on the basic principle of averting a doubling of the interest rate on federal loans, from 3.4% to 6.8%. But despite the relatively low cost – about $6 billion to avert it for a year – the two sides have not reached consensus on how to offset it (the question should actually be whether to offset it at all). Harry Reid offered a plan last week that would change how employer’s private pension contributions are calculated, resulting in lower business tax deductions. Reid would also increase premiums for pension insurance from the Pension Benefit Guaranty Corp.

The sticking point is that these offsets are already part of the Senate’s surface transportation bill, which passed with 74 votes. They would take in much more than $6 billion, and could cover the make-up offsets in the highway bill as well (most of the highway bill is funded through the federal gas tax). But Reid said that, if the highway bill dies, then a portion of the offsets should be used on the student loan interest rate bill.

Sadly, it looks like that transportation bill is dead, despite the conference committee put together to negotiate inter-party differences.

Advocates for a new federal transportation bill think even bumping negotiations up to Senate Majority Leader Harry Reid (D-Nev.) and House Speaker John Boehner (R-Ohio) may not be enough to save the measure from this year’s legislative scrapheap [...]

“I think the bill’s dead,” a transportation industry source said to The Hill on Friday. “I don’t think they can fix what they have in front of them. Kicking it up to the leadership probably gives it a chance…but every time they get to the five-yard line, they move the goal posts back.”

Without some mechanism in place by June 30, the government would no longer be able to collect the federal gas tax, and work on any federally funded construction and infrastructure projects would have to stop. The House has passed a 90-day extension that the Senate could take up, but that would hardly give enough certainty to start new projects in what is typically a process that requires long lead times.

House Speaker John Boehner has said he won’t look at anything on student loans until the Senate passes something, and per Reid’s funding proposal that cannot happen until there’s clarity on the transportation bill. So it looks like we’ll go down to the wire again.