Tag: McCarthy

How the White House sees its debt ceiling standoff with McCarthy

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The endgame is still hard to see, weeks or even months away depending on how quickly the nation approaches default. But the political battle entered a new phase this week when McCarthy finally put forth a legislative proposal in his speech Monday, laying out the spending cuts Republicans wanted in exchange for a one-year debt ceiling increase — and giving the White House officials something specific to attack.
And attack they have. Biden’s speech Wednesday at a Maryland union hall served as a summation of his team’s theory of the case. And White House aides have made it clear they’re eager to continue talking about this, whether through emails from the press shop, Cabinet officials describing the specific impacts of proposed cuts or at the briefing room podium.
On Friday, press secretary Karine Jean-Pierre called McCarthy’s proposal a “ransom note” and emphasized a new VA analysis on the impact of proposed GOP cuts on veterans healthcare. The president’s economic agenda, the White House believes, is popular. Repealing laws that have helped the middle class and created jobs, cutting taxes for corporations and the rich, and risking default are not.
Republicans, Biden asserted Wednesday, “say they’re going to default unless I agree to all these wacko notions they have. Default. It would be worse than totally irresponsible.”
He reminded McCarthy of the GOP’s hypocrisy — they had no problem raising the debt ceiling three times during the Trump presidency — and of Ronald Reagan and Donald Trump’s own comments decrying debt limit brinkmanship as reckless. Biden also urged the speaker to “take default off the table, and let’s have a real, serious, detailed conversation about how to grow the economy, lower costs and reduce the deficit.”
According to two people familiar with the administration’s strategy, it’s not clear to anyone inside the White House if McCarthy has the votes from his own caucus to pass his bill, and it may not yet be clear to the speaker himself, who has what one person familiar with the White House’s thinking termed a “principal-agent problem.”
The bill would be dead on arrival in a Democrat-controlled Senate. But the White House is signaling clearly to GOP moderates in the House: Vote to cut popular programs, including Social Security and Medicare, at your own risk.
“If they pass this, we are going to hang it around their moderates’ necks,” said one person familiar with the administration’s thinking.

Chad Gilmartin, a McCarthy spokesperson, said “the White House is clearly having trouble defending President Biden’s reckless spending and irresponsible refusal to negotiate with Speaker McCarthy on the debt limit.”
He added: “It’s no surprise that the administration now has to fall back on crazy accusations against the only plan in Congress that would avoid default.”
But Biden, his aides say, learned from the Obama administration’s 2011 standoff with Republicans that it’s imperative not to allow the debt ceiling to become part of negotiations. But with McCarthy’s tenuous speakership constantly hanging by a thread, and dependent in large part on his ability to placate his most extreme members, the White House knows that talking him off the ledge on risking default — giving up what he sees as his main point of leverage — won’t be easy.
And as much as White House officials like the politics of the negotiations’ current phase, they know they, too, will face pressure to negotiate the closer they get to D-Day.
The window for scoring points, in fact, could be quite short as the danger of default grows. Goldman Sachs economists this week said that, due to weaker than expected tax season revenues, the U.S. could hit the debt ceiling in early June, earlier than expected. Within the administration, there are some differences in the level of alarm, as senior officials focused on economic matters have privately expressed more concern about the serious possibility of default than others whose purview is politics, according to one senior administration official, who spoke on the condition of anonymity to speak freely.
Already, some Democrats are urging Biden to engage with McCarthy sooner rather than later. But at this point, Biden would be unlikely to say anything different to the speaker in private than what he’s said publicly — he’s open to a bipartisan deal on spending but only after lawmakers authorize a clean debt ceiling increase. That said, Jean-Pierre Friday wouldn’t go as far as to say that Biden would only meet with McCarthy after he puts forth a clean debt ceiling hike.
And there’s doubt inside the West Wing about whether McCarthy is ready for a meeting. Some aides believe it will take mounting pressure from the business community for the speaker to relent and that, given the difficult politics within his own caucus, he may not be able to back down. In such a scenario, the White House hopes that the House might at the very least swallow a Senate-passed bill to avoid default, if some Republicans are willing to use a discharge petition to get such a bill to the floor.
But some in the administration are less confident about that scenario coming to fruition than the White House is at the moment about the current contours of the debate. Senate Republican Leader “Mitch McConnell as the backstop is scary,” the senior administration official said.

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( With inputs from : www.politico.com )

April 22, 2023
McCarthy builds a kitchen Cabinet ahead of debt showdown — without his No. 2, Scalise

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Most House Republicans insist publicly that they’re paying no attention to the simmering mistrust between McCarthy and Scalise. But privately, many are watching the duo’s dynamic strain under the stress of the debt-limit fight. That’s true even as McCarthy mends fences with the budget chief he’d previously sidelined, Scalise ally Rep. Jodey Arrington (R-Texas).
GOP lawmakers and senior aides say McCarthy and Scalise are friendly in private, and that Scalise is happy at No. 2, where he’s focused on policy priorities like energy and education. Yet it’s no secret that Scalise, once seen as waiting in the wings if McCarthy stumbled, is now competing for the speaker’s ear with other confidants on several issues.
The resulting tension is starting to simmer just as McCarthy, like his predecessors John Boehner and Paul Ryan, faces the ultimate test of House Republican loyalty — a debt standoff. And it shows that the rift that opened between McCarthy and some senior Republicans during his grueling bid for the job hasn’t faded in the months since.
“People say there’s goldfish memory: 30 seconds, and everything’s forgotten,” said Rep. Dan Bishop (R-N.C.), one of the 20 conservative holdouts who delayed McCarthy’s ascension to speaker. “But I’m not sure that’s always true.”
It’s not uncommon for legislative leaders to lean on an unofficial circle of friendly colleagues. But any sign of daylight within McCarthy’s leadership team was bound to draw scrutiny after what he endured to secure the speakership — and his narrow margin for error to keep it.
McCarthy’s relationship with Scalise isn’t the only one taxed by the debt drama. As he moved closer to releasing a bill designed to unite his members, the speaker put distance between himself and Arrington. Allies of McCarthy had seen Arrington as speaking out of turn about the conference’s approach to the high-stakes debt-limit talks.
But since then, McCarthy has quietly worked to repair ties with Arrington — even putting the Budget Committee chair’s name on the GOP’s opening bid in the debt talks — in what members saw as an effort to show unity to the rank and file.
Arrington said in an interview that McCarthy called him hours before releasing the House GOP’s debt plan and asked if he would add his name as lead sponsor.

“I said, ‘If I can help the conference succeed in this endeavor, which I think is critical for our country’s future, I’m in’,” the Texan recalled.
Still, some members are keeping a close eye on McCarthy and Scalise as the House hurtles toward a likely vote next week on the speaker’s debt plan. The two meet one-on-one at least weekly, but suspicion about a rift between them flared again heading into January’s speakership race, as McCarthy worked fiercely to win over his skeptics, while behind closed doors his allies fumed that Scalise wasn’t boosting him enough.
“Steve could have said the simple thing in the press and refused to do so,” one House Republican allied with McCarthy said, insisting on anonymity to speak freely about Scalise’s handling of the speakership fight. “I think there’s a level of distrust between the two members that exists, sure. But the staffs are working well together and that’s all it really needs for this [debt ceiling] thing.”
Scalise made several public statements supporting McCarthy for speaker in the runup to the balloting and nominated the Californian on the floor. And Scalise allies are defending his efforts on steering other high-profile GOP measures to passage in recent weeks, including a marquee energy bill and a “parents’ bill of rights.”
Rep. Andrew Garbarino (R-N.Y.), a member of the elected leadership team, said Scalise was instrumental in smoothing over hiccups on the parents’ bill as language in the text threatened to trigger a damaging jailbreak: “It went from a dead bill to something we were able to fix in 30 to 45 minutes.”
In the first months of the new majority, however, McCarthy became increasingly reliant on his own sounding boards, like McHenry, Hill, Graves and others. They serve as McCarthy’s shadow Cabinet of sorts, offering perhaps the most precious commodity in Washington: loyalty.
Graves and McHenry, in particular, seem to be involved in most of the GOP’s tactical decisions these days. Graves is running point on McCarthy’s debt conversations across the conference, after helping to shepherd a major energy bill and internal talks about earmark rules. McHenry has been pulled in on multiple issues that range beyond his financial expertise.
Their fellow House Republicans note that McCarthy’s unelected lieutenants, in addition to being viewed as strong on policy, are also not as threatening as Scalise because they’re not seen as angling for his job.
“It’s natural for folks to fall back with people they trust, and people who aren’t afraid to tell them ‘that’s a bad idea,’” Rep. Dave Joyce (R-Ohio) said.
It’s a practice that past speakers have also engaged in, as former Rep. Rodney Davis (R-Ill.) pointed out.
“Having close friends be trusted advisers outside of elected leadership is not uncommon,” said Davis, a close McCarthy ally. “Boehner had members like Tom Latham and Dave Joyce, among others. Paul Ryan had Jim Sensenbrenner and Sean Duffy, too. Kevin is doing the same thing with trusted folks that were essential in helping him win the speaker’s gavel.”
But that practice has a way of chafing the members left on the outskirts of the conversation — such as those elected to leadership or committee chair positions. In Scalise’s case, he took pains to project alignment with McCarthy in the run-up to November’s midterms that became harder to maintain after the House GOP’s hopes of a commanding victory faded to a narrow, four-seat majority.
That small margin of control, of course, made it much harder for McCarthy to win the speakership earlier this year. Throughout the 15 ballots he needed to win, McCarthy allies argue Scalise should’ve had more of a hands-on approach, rather than a hands off, which triggered old suspicions that the Louisianan was lying in wait for his opening to rise, feelings of which have percolated throughout the duo’s first 100 days in charge of the House.
Allies in both camps note that the majority leader is keeping his head down and focused on policy — including putting out fires in another fraught intraparty debate: immigration policy. The Louisianan has helped broker conversations between holdouts like Rep. Tony Gonzales (R-Texas) and his Lone Star State rival, GOP Rep. Chip Roy. But a New York Times report earlier this month that highlighted his frayed relationship with McCarthy only made things worse.
“It was a little weird. I don’t think that was one of the best moments, but there have been many good moments,” Bishop acknowledged.
Rep. Don Bacon (R-Neb.), a purple-district incumbent and McCarthy ally, said he called the speaker’s office to raise concerns about the “undermining” that he perceived in the Times report. Bacon added that he’s “seen no evidence” of bad blood between the “very collegial” speaker and majority leader.
In a potential win for McCarthy, some of his biggest skeptics during the speakership skirmish appear to be tuning out what’s happening at the top. About a half-dozen members of the House Freedom Caucus interviewed for this story largely shrugged off the leadership drama as separate from their world — though some were displeased and defensive about the sidelining of Arrington, a fellow conservative albeit not a member of the group.
The Freedom Caucus’ bigger focus right now is eking all the wins they can get from the debt deal, which leadership needs the right flank on board for as much as possible.
Arrington, for his part, appears back in the fray on the debt talks. He attended a closed-door meeting Thursday afternoon as a cross-section of the conference demanded changes to the leadership-crafted measure’s proposed Medicaid work requirements, while shrugging off any questions about discord.
Rep. Steve Womack (R-Ark.), one of the conference’s more respected senior members, observed that Boehner once likened the speakership, during tough internal battles to corralling “jumping frogs in the wheelbarrow.”
“Keeping all the jumping frogs together, at some snapshot in time when we’re voting, is going to be the test of leadership,” Womack said.
Jennifer Scholtes, Jordain Carney and Caitlin Emma contributed to this report.
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( With inputs from : www.politico.com )

April 21, 2023
House Dems worry Biden ‘can’t keep waiting’ on McCarthy debt meet

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“They’ve got to do it soon,” Rep. Debbie Dingell (D-Mich.), a close White House ally, said of a Biden-McCarthy sitdown, adding that while she believes there will ultimately be a clean debt-ceiling increase, the administration “can’t keep waiting.”
Democratic lawmakers have already pressed that point in private, according to two people close to the discussions, urging the White House to lay out plans to meet with McCarthy for fear that public opinion would turn against the party. And swing-seat lawmakers stressed there’s no harm in starting a conversation, even as they all oppose McCarthy’s opening bid.
“I don’t think there’s any harm in the two of them sitting down to talk,” said first-term Rep. Greg Landsman (D-Ohio). “The idea that we’re even coming this close to a potential default is insane.”
Over in the Senate, centrist Joe Manchin (D-W.Va.) has been pushing Biden for weeks to restart talks. Manchin said in a statement Thursday he didn’t fully agree with McCarthy’s proposal but slammed Biden’s refusal to meet with the Republican leader as a “deficiency of leadership.”
Rank-and-file House Democrats aren’t going that far.
“This is not a serious piece of legislation,” said Rep. Jared Moskowitz (D-Fla.). “That being said, I am happy we are talking about the debt ceiling, because I think it’s very critical to talk, and so do I think the speaker of the House and the president should sit down and talk about the debt ceiling? Of course they should.”
Democratic leaders aren’t budging, yet. They remain in lockstep with the White House’s position that talks can’t begin until House Republicans release their own budget and fully divorce the conversation about debt from spending. Biden and McCarthy last met on the debt ceiling at the White House in early February, and while both characterized it as a promising start, the meeting didn’t produce any breakthroughs. Democratic leaders believe they should maintain maximum pressure on Republicans rather than strengthen McCarthy’s hand heading into a difficult vote for the GOP conference.
House Minority Leader Hakeem Jeffries told reporters Thursday he didn’t expect any Democrats to support McCarthy’s offer and reiterated that they could talk with Republicans once they produced a budget. “I don’t know whether reasonable people would conclude that we should be negotiating against ourselves. That’s not a logical place to be,” he said.

Biden allies are also salivating over the political contrast they believe the GOP’s debt plan creates, allowing Democrats to position themselves as the bulwark against proposals that would roll back clean energy tax credits and impose work requirements on Medicaid beneficiaries.
“Ask House Republicans: Do they support Speaker McCarthy’s plan to kill manufacturing jobs in their home districts?” read the headline of a White House memo Thursday detailing more than a half-dozen Republican members whose districts are benefiting from manufacturing projects supported by the Inflation Reduction Act’s tax credits.
In a speech Wednesday, Biden rejected McCarthy’s proposal as full of “wacko notions” and reiterated his demand for a clean debt ceiling increase.
Yet while he’s maintained for months that he wants McCarthy to put out a budget before meeting with him again, officials have refrained from saying definitively whether the GOP passing its debt-limit bill would shift that calculus.
“If you do another meeting, there’ll be an expectation of negotiations,” one adviser close to the White House, granted anonymity to speak candidly, said of the dilemma facing Biden and his top aides. “The White House would have to be able to structure the lead up to the meetings to say, we’re happy to talk to him but we’re not negotiating. … And then the question becomes: ‘What’s the meeting for?’”
A bipartisan group of lawmakers from the Problem Solvers Caucus endorsed a separate debt framework Wednesday to hike the debt limit without drastic spending cuts. They’re billing it as a potential path to a compromise.
“Probably everyone’s rooting for the speaker and the president to come to a deal,” said Rep. Scott Peters (D-Calif.), a member of the bipartisan group. He said he wasn’t going to dictate what the president and speaker should do, but added: “I think more discussion or exploration about where people are, what would work, is helpful — and that’s why we did what we did.”
Democratic leaders haven’t openly embraced the bipartisan bid, though Jeffries said Thursday he saw it as proof that there are several dozen Republican lawmakers “who disagree with the extreme Republican proposal.”
Still, others projected optimism that a sitdown between Biden and McCarthy could produce a bipartisan breakthrough.
“They’re both Irish-American. They ought to have a nice dinner, and they ought to get to work and get it done for the sake of the country,” said Rep. Marcy Kaptur (D-Ohio), who represents a district former President Donald Trump won in 2020.
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( With inputs from : www.politico.com )

April 20, 2023
Gaetz, Boebert and Biggs raised big bucks off their opposition to McCarthy

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Rep. Lauren Boebert (R-Colo), who spent several thousand dollars on Facebook ads in January that touted the Speaker fight as having “fundamentally changed the direction of our country,” reported more than $760,000 in first-quarter receipts. That included just shy of $270,000 from small-dollar donors and $95,000 through a joint fundraising committee. The speaker fight produced several days of above-average fundraising for Boebert in January, although her top fundraising days came later in the quarter.
It’s not rare for each party’s more incendiary members to also be their most prolific fundraisers. In the age of grassroots giving, appeals to the base can generate big bucks. Less common, however, is for lawmakers to organize those appeals around direct challenges to their own party’s leadership.
The effort to capitalize on the Speaker race was not without cost, both reputational and financial. The trio burned through cash at a higher rate than most candidates in the first quarter, a POLITICO analysis found.
The Gaetz campaign spent more than $490,000 over the course of the quarter, including more than $100,000 on fundraising expenses, according to his filing. He still had more than $700,000 left in the bank due to cash left over from his 2022 campaign. In response to questions from POLITICO about the link between the Speaker battle and fundraising, Gaetz defended his fight against McCarthy’s ascension, saying that he started “firing back” after “shadow groups” peppered his district with calls asking him to support the California Republican.
Biggs’ campaign spent $168,000 over the period, including $53,000 on list rentals — a common fundraising expense — as well as $38,000 on direct mail and $14,000 on fundraising consulting.
Boebert’s campaign also spent more than $500,000 over the quarter, with direct mail, digital advertising and fundraising consulting as her biggest expenses. The Colorado Republican, who won reelection in 2022 by fewer than 600 votes, was one of the few lawmakers who opposed McCarthy’s ascension who faces a potentially competitive election in 2024. Boebert was outraised in the first quarter by Democratic challenger Adam Frisch. She did not address questions from POLITICO about whether the Speaker fight drove fundraising but said in a statement that there was “no doubt Democrats will raise more and spend more to try and steal” her seat.
While McCarthy was ultimately elected to the speakership on the 15th ballot, the fundraising successes of those lawmakers who opposed him along the way, underscore just how tenuous his hold on the majority actually is. The insight into fundraising comes as the House GOP faces new internal conflict with a high-stakes standoff over the debt ceiling approaching, where McCarthy once again will need to keep nearly all of the members of his caucus in line.
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( With inputs from : www.politico.com )

April 18, 2023
George Santos left out of McCarthy fundraising group to help NY GOP candidates

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Rep. George Santos (R-N.Y.) is a notable omission from Protect the House New York 2024, a joint fundraising committee formed to corral money for vulnerable House Republicans in the state. | Bryan Anselm for POLITICO
Rep. George Santos (R-N.Y.) may be running for reelection but the embattled congressman, under fire for fabricating portions of his resume, isn’t likely to get much fundraising help from his party, a new fundraising vehicle indicates.
Santos’ seat is one of Democrats’ top targets in next year’s elections, but the freshman lawmaker is a notable omission from Protect the House New York 2024, a joint fundraising committee formed to corral money for vulnerable House Republicans in the state.
The committee includes both House Speaker Kevin McCarthy and his leadership PAC, as well as the NRCC, the House Republicans’ campaign arm, and the New York State Republicans’ federal PAC. It will raise money for frontline New York Reps. Mike Lawler, Brandon Williams, Marc Molinaro, Anthony D’Esposito, Andrew Garbarino, Nick LaLota, according to organization paperwork filed Monday with the FEC.
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( With inputs from : www.politico.com )

April 18, 2023
McCarthy muscles toward vote on debt plan that ‘doesn’t even exist’

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House Republicans’ internal frustrations go beyond their long-stalled debt limit talks with President Joe Biden. The conference is near its breaking point over a contentious border bill that has exposed divisions between hardline conservatives and politically vulnerable purple-district members. Then there are the simmering tensions that no GOP lawmaker wants to talk about — the evident disconnect between the speaker and his budget chief, as well as chatter over the elevation of a new McCarthy lieutenant with a vast portfolio.
House Budget Committee Chair Jodey Arrington (R-Texas), who appeared to diverge from McCarthy last month on the GOP’s plans for its fiscal blueprint, said as he entered Tuesday’s morning meeting that “I hope we’re focused on our mission.” Arrington added pointedly: “We don’t need distractions. We need to unify.”
And he got his wish that McCarthy not bring up any behind-the-scenes drama before the rest of their colleagues. Talk of McCarthy-Arrington discord did not come up at the private conference meeting, according to six lawmakers in the room.
Instead, Republicans focused on presenting a unified front on the debt limit as they prepare for a new, more urgent phase of their political jostling with the Biden White House. The fact that no internal rifts got rehashed on Tuesday morning is a positive sign for McCarthy, who has almost no room for error on his debt plan given his four-vote majority.
Rep. Tom Cole (R-Okla.), a close McCarthy ally, dryly summed up the meeting’s tone: “It’s a chorus of unity and sunshine.”
Inside the room, according to one attendee, McCarthy ticked through a brief slideshow laying out the basic principles of his fiscal plan — which includes a passel of deregulatory and energy provisions as well as steep federal spending cuts in exchange for a one-year lift to the nation’s debt ceiling.
One major part of Tuesday’s private GOP conversation centered on whether leaders should try to pay down the national debt by repealing elements of Democrats’ marquee tax, climate and health care measure passed last year, including funding for new IRS enforcement and green tax incentives.
Many GOP lawmakers have demanded party leaders make those moves, though some aides and budget experts say it’s unclear whether they would yield any real savings. McCarthy addressed that topic by laying out pros and cons in his slides, per the meeting attendee who spoke on condition of anonymity.

Some of McCarthy’s closest advisers projected confidence that they would have enough support in a conference. Financial Services Committee Chair Patrick McHenry (R-N.C.), a confidant of the California Republican, simply said “yes” to reporters who asked if the speaker would get a majority.
Other Republicans, however, are preparing for the prospect that McCarthy’s plan fails to get enough traction within the conference.
At least one member, first-term swing-district Rep. Mike Lawler (R-N.Y.), raised the idea of a separate discharge petition as a Plan B approach if the threat of an economically disastrous debt default began to loom over members.
As he left Tuesday’s meeting, though, Lawler insisted that he backs McCarthy’s plan: “The speaker has put forth a plan and I support it.”
Rep. Matt Gaetz (R-Fla.), one of McCarthy’s harshest critics in the past, said leadership doesn’t yet have the votes because members haven’t seen the full plan on paper.
“We still have to resolve major questions like the dollar amount, and the duration, and the policy concessions we are seeking from the Senate. So it couldn’t possibly have 218 votes, because it doesn’t even exist,” Gaetz said, adding that he won’t “prognosticate the end-zone dance before we draw the game plan.”
Those flashing yellow lights haven’t stopped McCarthy allies from bullishly predicting that a bill could be ready for a floor vote next week. Republicans close to leadership privately said text could be released as soon as Wednesday or Thursday — with some expecting the House to put off its next recess until passage of a debt plan that stands no chance of becoming law.
Yet in order to write that bill, GOP lawmakers still have to settle crucial questions like whether to lift the ceiling by a specific dollar amount and when the fight might come up again next year.
“Some had a few little tweaks they’d like to see to it. But I think, in general, everyone is supportive of it,” Rep. Blaine Luetkemeyer (R-Mo.) said, adding that “everyone’s got good ideas. They are all supportive of the general idea and program that the speaker laid out.”
Meanwhile, an immigration fight is about to compete with the debt for the House GOP’s attention.
Republicans will formally kick off work on border security, with the Judiciary Committee slated to vote on an immigration package Wednesday and the Homeland Security panel set to follow with its own bill next week. But months after leadership initially vowed action within the first few weeks of the year, there are few signs that the GOP is any closer to a bill that can pass the House.
Rep. Tony Gonzales (R-Texas), who discussed the issue alongside the GOP-helmed Congressional Hispanic Conference earlier Tuesday, warned that the Judiciary Committee proposal isn’t ready for “prime time.” Gonzales, who’s taken a public stand against conservatives pushing for a strident border bill, pledged not to be sidelined by his party’s right flank.
“In this Congress, five votes is 100,” Gonzales said, referring to the ease with which only a handful of Republicans can derail a bill on the floor, given the party’s slim majority.
And even as House Republicans publicly brushed off reports of contention within their upper ranks, some leaders are hearing hush-hush questions about McCarthy’s confidence in his own team.
Some rank-and-file members, reading reports of internal strife, started asking leadership “‘This is terrible, is this true?’” said one senior House Republican, who requested anonymity to speak frankly.
“It’s not true,” this senior Republican added.
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( With inputs from : www.politico.com )

April 18, 2023
Kevin McCarthy will make his first foreign trip as speaker to Israel, where he will address the Knesset.

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The speech will be just the second in history by a U.S. House speaker.

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( With inputs from : www.politico.com )

April 18, 2023
McCarthy seeks to reassure Wall Street on stalled debt talks

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Rebuffed by President Joe Biden since February on that point, McCarthy and his team are now attempting to demonstrate their seriousness by drafting their own debt limit proposal — one that includes a half-dozen attempts to slash federal spending or loosen regulations in a bid to boost the economy.
“We are seeing in real time the effects of reckless government spending, record inflation and the hardship it causes,” McCarthy said inside the colonnaded walls of the New York Stock Exchange on a gloomy morning as a smattering of progressive protestors chanted out front. “Rising interest rates, supply chain shortages, instability in the banking system and uncertainty across the board.”
The speaker on Monday repeatedly blamed Biden and Democrats for driving higher inflation through excess spending, reiterating that any hike in the debt limit should be offset by significant spending cuts. He said Republicans would pass their own bill within weeks but offered no further details on which cuts his conference wants to see.
Some early drafts of those plans have been shared with GOP members in recent days, but party leaders stress that nothing is final until the entire conference can weigh in.
McCarthy vowed that in the next few weeks, “the House will vote on a bill to lift the debt ceiling into next year, save taxpayers trillions of dollars, make us less dependent on China, and curb high inflation — all without touching Social Security or Medicare.”
The bill is almost certain to include some of the GOP’s recently-passed energy priorities, including a new way to streamline the permitting process, as first reported by POLITICO.
Much of the discussion over what that bill will look like is expected to kick off this week, with Congress returning from a holiday recess to a sense of rising anxiety in both parties over the debt standoff. Even so, McCarthy sought to reassure the markets during his speech, saying defaulting on the nation’s existing debt “is not an option.”
“I have full confidence that if we limit our federal spending, if we save taxpayers money, if we grow the economy, we will end our dependence on China, we will curb inflation, and we will protect Medicare and Social Security so America will be stronger,” McCarthy said — repeatedly invoking former President Ronald Reagan, a favorite among many Wall Street traders.

The California Republican ripped Biden for doing “nothing” on the federal debt and annual deficits, saying that as a senator, Biden “voted for spending reforms attached to debt limit increases four times.”
Democrats have dismissed McCarthy’s initial proposal — which includes steep spending cuts, stricter work requirements for social programs and a new deregulatory push — as going nowhere in a divided government. They argue that Republicans should cleanly lift the borrowing limit and avoid risky negotiations with potentially dire consequences for the global economy.
“Speaker McCarthy continues to bumble our country towards a catastrophic default, which would cause the economy to crash, cause monumental job loss and drastically raise costs to the American people. He went all the way to Wall Street and gave us no more detail,” Senate Majority Leader Chuck Schumer told reporters after the speech.
Schumer said he would be willing to meet with McCarthy after the Republicans decide on a specific package of spending cute. He also stressed that while he would be willing to discuss future spending levels, he wouldn’t entertain tying that conversation to the debt limit.
“No more facts, no new information at all. I’ll be blunt. If Speaker McCarthy continues in this direction, we are headed to default,” Schumer said. And as for McCarthy’s push for a one-year debt ceiling increase — which would punt the issue until the heat of the 2024 campaign season — Schumer called it a “terrible idea.”
Wall Street traders and executives continue to believe that House Republicans and the White House will eventually cut a deal ahead of a deadline sometime this summer, avoiding a default. Republicans and Democrats clashed over the debt limit through much of former President Barack Obama’s tenure, including the first downgrade of U.S. debt by ratings agency Standard & Poor’s in 2011. (That crisis led to 10 years of spending austerity, known as budget caps, that only just ended.)
Still, the path to a deal remains unclear. McCarthy on Monday said that a “no-strings-attached debt limit increase cannot pass” — which happens to be exactly what Democrats have unwaveringly demanded.
But even a GOP-only measure may not be easy to pass in the House. Republicans can only lose four votes on the floor, meaning that virtually all of McCarthy’s conference must line up behind a package that stands no chance of becoming law in its current form.
Already, that opening offer on the debt limit is running into some potential political pitfalls — including an expiration date that would tee up another high-stakes fiscal fight just months before the 2024 presidential election.
McCarthy “again failed to clearly outline what House Republicans are proposing and will vote on, even as he referenced a vague, extreme MAGA wish list,” White House spokesperson Andrew Bates said, accusing the GOP of increasing costs for families and taking “food assistance and health care away from millions of Americans” with their emerging proposal.
“A speech isn’t a plan, but it did showcase House Republicans’ priorities,” Bates said.
Burgess Everett contributed to this report. Ferris reported from Washington.
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( With inputs from : www.politico.com )

April 17, 2023
McCarthy prepares his opening debt-limit bid — and it’s full of potential pitfalls

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The party’s list of potential demands — which includes an across-the-board cut to discretionary spending and stricter work requirements on programs like food stamps — is likely to change as House Republicans hash out a formal bill over the coming weeks. One big flashpoint: They’re proposing to raise the debt limit for just one year, triggering another battle over the federal purse in the middle of the 2024 presidential primaries.
The Republican lawmaker close to the talks, who spoke candidly on condition of anonymity, called leadership’s forthcoming proposal “just an opening salvo” and said there’s no specific whip count of support underway yet.
But McCarthy and members of his leadership team are hard at work behind the scenes. That includes two months of rank-and-file “listening sessions” with House Majority Whip Tom Emmer (R-Minn.) — six to 10 members at a time — and broader talks led by McCarthy and Rep. Garret Graves (R-La.) among various factions within the conference, designed to solicit ideas.
“Certainly leadership wouldn’t put this on paper … without having spoken to a number of people,” Republican Study Committee Chair Kevin Hern (R-Okla.) said, estimating that he had been in no less than 10 of those meetings in the last few months.
“This is a culmination of all the conversations from leadership, from speaker from majority leader from the whip, talking to so many people over the last … 85 days about what they’d like to see in a debt limit deal. And that’s why you’re seeing this,” he added.
The stakes couldn’t be higher for McCarthy. The California Republican must avoid a misstep that would weaken his speakership — which any single frustrated member could force a vote to terminate. And unlike other GOP agenda items, which satisfy the party base despite their slim chances of becoming law, any debt-ceiling moves are bound to draw internal criticism while possibly exacting economic consequences.
McCarthy is slated to deliver a speech Monday at the New York Stock Exchange that’s expected to focus on the debt limit. The flurry of new activity comes as the nation’s borrowing power to pay its bills is set to run out as soon as this summer.
Privately, Democrats close to party leadership said the entire GOP list is a nonstarter. President Joe Biden’s party continues to insist it will accept nothing other than a clean debt limit lift.

In addition, McCarthy will have to contend with several cooks in his own financial kitchen. No less than four factions within his conference are already floating their own ideas as they try to shape McCarthy’s initial bid.
The more centrist Main Street Caucus, in a letter to McCarthy on Thursday, reiterated its support for the California Republican, while outlining its own debt priorities. Those include clawing back unspent coronavirus relief cash, reversing Biden’s student loan relief moves and forming a commission that would propose ways to shore up Medicare and Social Security without cutting benefits.
“This letter outlines those proposals that have garnered the most support from our caucus, and we have every confidence they can secure 218 votes in the U.S. House of Representatives,” Main Street Chair Dusty Johnson (R-S.D.) and Vice Chair Stephanie Bice (R-Okla.) wrote. Some of their ideas are also included in GOP leadership’s draft proposal.
The bipartisan Problem Solvers Caucus has also presented its own ideas to members in Zoom meetings over the recess.
Meanwhile, Hern has not only put out a debt “playbook” for the Republican Study Committee, but is now pushing for a specific timeline. He added that while leadership had to be wary of “deal killers,” Republicans are well-positioned to be able to hold a vote by the end of this month.
To bolster his push to hold a debt vote quickly, Hern is delaying the release of his group’s balanced budget proposal, which he had previously vowed would be out by April 15, until May.
The Republican Study Committee moves are in addition to those by the ultra-conservative House Freedom Caucus, which sparked grumbles from across the conference when it publicly outlined its thinking on the debt ceiling — though its chair, Rep. Scott Perry (R-Pa.), stressed that the group wasn’t making “demands.”
Republicans involved in the talks said their members understand the need to coalesce behind a single debt measure. Their goal: Convince Democrats that they’re serious about slashing spending.
“We need to get to 218 votes, get it passed with the most conservative 218 votes in the conference and get it sent to the Senate — and then let the president and the Democrats in the Senate tell the American people why they didn’t want to change the direction of the spending that’s caused the inflation that we’re seeing today,” Hern said.
The GOP’s list, which is widely circulating on K Street, does not include not everything that will go into the debt limit bill, according to a half dozen people close to Republican leadership.
While the party hasn’t formally decided how much in across-the-board spending cuts to support, Republicans are clear that they plan to pare back large chunks of discretionary spending to fiscal year 2022 levels. The GOP’s proposal includes a 1 percent uptick each year after that, though some Republicans have called for more stringent spending cuts.
Others in the GOP conference are agitating for caps on defense spending, too, creating another likely conflict with colleagues who don’t want to trim the Pentagon.
What’s not included in the emerging GOP proposal: A conservative push to claw back $80 billion for tax enforcement that was included in Democrats’ tax, climate and health bill last year. Also left out are border policies pushed by Rep. Chip Roy (R-Texas) and others on the right.
Caitlin Emma, Meredith Lee Hill and Olivia Beavers contributed.
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( With inputs from : www.politico.com )

April 14, 2023
Freedom Caucus and progressives lock arms — and that could be bad news for McCarthy

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This alignment could create headaches for McCarthy, because he can only lose four members of his own party during any given floor vote in the closely divided House. And while the Senate has already passed its own bipartisan reversal of the Iraq war authorizations, most of the House GOP is not yet bought in on that issue, and there’s no consensus in the party about cutting Pentagon funding.

“Sometimes the political spectrum is more of a circle than a line. At some point, you might have sometimes-differing motives or different ranges, but you end up [at] the same conclusion, and that’s okay,” said Chip Roy.
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Jose Luis Magana/ AP Photo
So if McCarthy’s right flank teams up with liberals in earnest — after nearly costing the California Republican the speakership — it could chip at his hold over his slim majority. It remains to be seen whether a concrete break with the speaker will materialize, but lawmakers on both sides of the aisle are paying attention to the dynamic.
As Rep. Jamaal Bowman (D-N.Y.) put it: “Sometimes you have interesting bedfellows in Washington.”
The best-case scenario outcome for McCarthy, who’s been noncommittal on a quick floor vote to repeal Iraq war powers, is House Foreign Affairs Committee Chair Michael McCaul’s (R-Texas) proposal to replace those war authorizations as well as a third authorization passed after the Sept. 11 attacks. That approach would likely be a no-go for liberals who are currently on the same page as many conservatives.
Ending Iraq war powers “should come to the floor as soon as possible,” said Rep. Barbara Lee (D-Calif.), a former Progressive Caucus co-chair who’s spearheaded a decades-long push on the matter. “And our Republican colleagues are also working to try to ensure that this comes to the floor as soon as possible. It’s way past time to get this done.”
Rebelling against leadership is hardly a new mode for Lee, who endured harsh criticism during the George W. Bush administration as the sole House lawmaker to vote against the post-Sept. 11 authorization. And other members of the Freedom and Progressive Caucuses are gadflies in their own right; Roy, for one, regularly upends the GOP conference’s plans.
“It’s a question of institutional power,” said Rep. Tom Cole (R-Okla.), the House Rules Committee chair whom Lee cited as one of her top Republican allies on repealing war authorizations. “And I think there’s a sense around here, on both the left and the right, that we’ve abdicated too much of that — and not just in recent Congresses, but honestly probably going back decades.”

Ending Iraq war powers “should come to the floor as soon as possible,” said Barbara Lee.
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J. Scott Applewhite/AP Photo
President Joe Biden has promised to sign the Senate-passed pair of war authorization repeals if they reach his desk.

It’s not just the war powers effort that’s bringing together the House’s opposing factions. They’ve also united to push for pumping the brakes on a potential ban of TikTok, airing fears of government overreach while more establishment colleagues share national security worries.
In addition, Progressive Caucus chief Rep. Pramila Jayapal (D-Wash.) and Freedom Caucus member Rep. Warren Davidson (R-Ohio) are jointly raising concerns about government surveillance laws ahead of a reauthorization deadline at the end of the year.
The left and right frequently align “on issues of war, civil liberties and privacy,” Jayapal said. “We do have things that we see eye to eye on, and I think we’re always going to look for those opportunities.”
It’s not clear yet how the war powers repeal might come to the House floor, whether as a stand-alone or attached to another must-pass vehicle. But Roy said that if it’s not brought up before the end of the year’s annual defense policy bill, he “can promise” it would “become an issue” during debate on that plan.
“We’re gonna have to deal with that at some point. And so this will be just another step along the way. I’ve been happy to work with Congresswoman Lee towards that end,” Roy said.
While McCaul may be able to find a war powers compromise that would satisfy a majority of House Republicans — according to longstanding conference tradition, the speaker needs majority-GOP support in order to bring legislation to the floor — the party probably can’t count on many Democratic votes for that plan.
Right now, liberals are pushing solely for a full repeal of the 2002 and 1991 Iraq authorizations.
“There’s nothing to replace it with,” said Lee. “That argument and strategy is muddying the water.”
Meanwhile, McCaul’s Democratic counterpart atop the Foreign Affairs panel is looking to help break the logjam on post-Sept. 11 war powers. Rep. Gregory Meeks (D-N.Y.) signaled an interest in introducing his own replacement for that measure. But Meeks aligned with progressives on the Senate-passed measures repealing the 2002 and 1991 war powers authorizations, calling for a “straight repeal.”
If all else fails in the war powers debate, there’s always the wonky procedural gambit known as a discharge petition — which allows a majority of House members from either party to band together and force a bill onto the floor, regardless of leadership’s wishes.
Some liberals, like Rep. Ro Khanna (D-Calif.), have indicated they’re open to that option. But other progressive leaders have said that’s off the table for now, concerned it could blow up the fragile bipartisan consensus on war powers.
“The discharge petition is not the way to get bipartisan support,” Lee said. “We have the votes. So this should come to the floor as soon as possible.”
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( With inputs from : www.politico.com )

April 6, 2023