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November 13, 2023
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PRESENTED BY
THE TOP
Happy Monday morning.
Government funding runs out after Nov. 17. The chances of a shutdown are low, but this week will be full of drama between the two parties and two chambers — plus the White House — over how to deal with this situation. Even keeping the lights on has proven to be tedious work in the 118th Congress, one of the key reasons Moody’s moved on Friday to downgrade its outlook on the U.S. government’s credit rating.
After weeks of conversations about changing the way Washington works, Speaker Mike Johnson will seek to pass a complex “clean” stopgap funding bill Tuesday that maintains the status quo. The House Rules Committee will meet this afternoon to take up the 32-page bill.
The Rules hearing will be watched closely, especially how a trio of hardline conservatives on the panel vote. Rep. Chip Roy (R-Texas), one of those members, has already said he’s opposed to Johnson’s proposal. If successful in Rules, Johnson and GOP leaders will have to pass the rule on the floor, another major challenge. The full House is expected to vote on the measure Tuesday.
Overall, Johnson’s proposal is basically the same approach that former Speaker Kevin McCarthy was booted for — a clean CR at current funding levels. And he’ll need Democrats to help pass it. But that’s the strategy Johnson decided on following extensive meetings with Republicans from across his conference.
The scheme Johnson proposed is this — the House will seek to extend government funding until Jan. 19 for four spending bills: Agriculture, Energy and Water, Military Construction-VA and Transportation-HUD.
Funding for the rest of the federal government — the eight remaining bills — will be extended until Feb. 2.
What’s notable is what has been left out of this package: money for Israel, Ukraine, Taiwan and any extension of FISA surveillance authority. So, there will still be a year-end and first-quarter 2024 legislative crunch.
House GOP leaders also want to hold floor votes this week on the Labor-HHS and Commerce-Justice-Science funding bills — two of the most controversial annual spending measures — as well as the Transportation-HUD package, which was pulled from consideration last week.
Johnson said on Sunday he “will not allow end-of-year megabus spending packages to continue under my leadership.”
Some hardline conservatives have already come out against Johnson’s CR plan in addition to Roy, including Rep. Marjorie Taylor Greene (R-Ga.). Senior Democrats and the White House are bashing it, too.
We’ll note, however, that House Democratic leaders haven’t formally said they’ll recommend a vote against it. Remember: If more Democrats end up voting for this bill than Republicans, Johnson is in trouble.
What we’ve heard from Democrats is this — it could’ve been worse. And they don’t see Johnson’s move as picking a fight with Democrats as he did with the Israel aid bill, when the speaker attached a poison-pill spending cut that he knew would be a non-starter.
To be sure, Democrats don’t like the “laddered CR” approach, as Rep. Rosa DeLauro (Conn.), top Democrat on the House Appropriations Committee, noted. Democrats also don’t like that it doesn’t include Ukraine or Israel funding. Every day that Ukraine money doesn’t get passed makes it less likely that country will get additional U.S. aid. More on this below.
Yet there’s no obvious poison pill in the proposal, either. Democratic leaders’ initial reaction wasn’t to take a whack at it. In fact, a Senate Democratic leadership aide said it was “a good thing” that the House’s CR plan doesn’t include spending cuts, and that the Pentagon spending portion is grouped in with the second tranche of bills. Plus, the “ladder” only has two funding deadlines just weeks apart.
Put simply, nobody wants a shutdown, especially right before Thanksgiving. So the Senate is waiting to see if the House can pass Johnson’s proposal.
The Senate is scheduled to hold a procedural vote this evening on the legislative vehicle for its own CR proposal. It’s unclear whether Republicans will provide the necessary votes for this without some sort of clarity on what it will look like.
The supplemental: It’s nearly certain that the multi-billion dollar national security supplemental package requested by President Joe Biden won’t get through the Senate before the Nov. 17 deadline. That means punting on the measure until after Thanksgiving.
The delay stems from Senate Republicans’ demand for stringent border provisions as a condition for advancing a foreign-aid package that includes funding for Ukraine.
The bipartisan group leading the border talks worked through the weekend, we’re told, and is nearing a decision on whether there’s enough of a consensus to attach proposed policy changes to the supplemental.
Money news: The Congressional Leadership Fund and American Action Network — the House GOP leadership-linked outside groups — have brought in $16 million in the 10 days since Johnson started raising money.
This is a big haul and a sign of early support that should help alleviate the concerns that the Louisiana Republican will be a poor fundraiser — especially among front-line Republicans who are most vulnerable. Furthermore, it highlights the durability of the political apparatus that McCarthy built.
For your planning purposes: Rep.-elect Gabe Amo (D-R.I.) will be sworn in tonight, bringing House Democrats back up to 213 members. There are currently 221 House Republicans. Utah’s 2nd District will hold a special election on Nov. 21.
— John Bresnahan, Andrew Desiderio and Jake Sherman
Don’t miss: Reps. Shontel Brown (D-Ohio) and Nikema Williams (D-Ga.) will join us on Tuesday evening for a conversation about disparities impacting Black women. The discussion will focus on health, finance and education. The program will be followed by a cocktail reception with drinks and light bites. RSVP!
WASHINGTON X THE WORLD
Biden’s high-stakes meeting with Xi comes amid global turmoil
President Joe Biden will meet with Chinese President Xi Jinping Wednesday on the sidelines of the Asia-Pacific Economic Cooperation (APEC) Summit in San Francisco, the first face-to-face interaction between the leaders of the world’s leading economic powers in more than a year.
Biden and Xi — who is spending four days in the United States during this trip — are looking to manage rising economic and military tensions between the two superpowers even as the world suddenly looks far more unstable.
The war between Israel and Hamas is growing in scale and intensity following Hamas’ Oct. 7 terror attacks. The winter fighting season could lead to a significant recalibration in Ukraine’s efforts to fight off the Russian invasion. China’s growing aggression against Taiwan and in the South China Sea has pushed the Biden administration to seek new alliances throughout the region.
Congress currently has no path to approving new aid for Israel, Ukraine or Taiwan, certainly a good thing in the eyes of Xi. And Biden will surely emphasize to Xi, as Senate Majority Leader Chuck Schumer did, that Beijing shouldn’t take steps that help Russia or Iran.
Senior Biden administration officials have been huddling with some of their Chinese counterparts during the period leading up to Wednesday’s session, including Treasury Secretary Janet Yellen.
The White House also wants to restart high-level military contacts between the United States and China. These were cut off after former Speaker Nancy Pelosi visited Taiwan in August 2022. Those tensions were further inflamed after a Chinese high-altitude spy balloon was shot down off the South Carolina coast in February.
“Well, this has been a priority for President Biden,” National Security Adviser Jake Sullivan said on CBS’ “Face The Nation.” “He believes that having military-to-military communication is necessary to manage competition responsibly, and to ensure that competition does not turn into conflict.”
Xi will push back against U.S. efforts to restrict high-tech transfers to China and other economic restrictions.
The Coverage
AP: “What they want: Biden and Xi are looking for clarity in an increasingly difficult relationship,” by Aamer Madhani and Didi Tang
CNN: “Six years on from cake at Mar-a-Lago, China’s Xi returns to a much warier US,” by Nectar Gan
Bloomberg: “China Weighs Ending Freeze on Boeing With 737 Max Deal in US,” by Julie Johnsson, Siddharth Vikram Philip, and Jenny Leonard
— Andrew Desiderio and John Bresnahan
Will the House impeach Mayorkas?
The House will have to deal with — somehow — an effort to impeach Homeland Security Secretary Alejandro Mayorkas this week.
You’ll recall Rep. Marjorie Taylor Greene (R-Ga.) filed a privileged resolution to impeach Mayorkas before the House left Thursday. This means GOP leaders have two legislative days, or until Tuesday, to bring the resolution up for a vote.
It’s unclear what the GOP leadership plans to do here. An earlier effort to impeach President Joe Biden in June was dealt with by referring the resolution to committee. House GOP leaders could move to do the same with the Mayorkas resolution. This is probably an easier vote for Republicans, even the most vulnerable GOP lawmakers.
But we’ve already seen House Majority Whip Tom Emmer, the No. 3 Republican and the most moderate lawmaker in the leadership, come out in support of Mayorkas’ impeachment. This shows what kind of appeal the proposal could have for many Republicans.
However, the language of MTG’s resolution is inflammatory, to say the least. That could make it easier for lawmakers to vote no or even skip the vote. The resolution refers repeatedly to “invasion” and “illegals,” offensive and potentially dangerous rhetoric.
Greene claims that Mayorkas “has violated his oath to uphold this constitutional duty by allowing the invasion of approximately 10,000,000 illegals across our borders.”
More from the resolution:
We checked in with Democrats over the weekend, and they’ll try to first table the resolution, according to multiple sources. Only a handful of Republicans would need to vote with all Democrats to effectively kill the resolution using that maneuver.
Of course, if the House does vote on impeaching Mayorkas, it would be doing so without a vote by the Homeland Security Committee, where Chair Mark Green (R-Tenn.) is conducting his own probe into Mayorkas.
And it would come during a week that Congress is struggling to keep the federal government open, not to mention while House Republicans’ separate impeachment inquiry into Biden seems to be sputtering.
Republicans will argue they have been making the case that Mayorkas is responsible for the crisis conditions at the U.S.-Mexico border through a series of hearings and reports for months. This has largely taken place under Green’s aegis at the Homeland Security panel.
Green has repeatedly cited Mayorkas “dereliction of duty” at the border, kicking off what was supposed to be a five-phase probe to build support for the impeachment effort. Democrats have dismissed the GOP push, saying Republicans are just desperate to impeach someone — anyone — in the Biden administration.
Of course, the House impeachment effort, even if successful, would fail to win a two-thirds majority in the Democratic-controlled Senate.
No Cabinet official has been impeached since Secretary of War William Belknap in 1876. Belknap was acquitted.
— Heather Caygle and John Bresnahan
PRESENTED BY CHEVRON
At Chevron, we’re producing renewable fuels to help reduce the lifecycle carbon intensity of the transportation industry.
Odds of crypto reform are getting worse, top Democrats say
Key Democrats in both the House and Senate say the Republican-led effort to reform the legal landscape around digital assets and stablecoins is facing longer odds than ever.
Start with this: Rep. Jim Himes (D-Conn.) told us that the House’s approach to crypto would likely need to change in order to become law. We’re once again talking about how much oversight the Federal Reserve should have over digital assets.
“The House bill — for it to pass, I think would probably need to go further, especially with respect to the Federal Reserve’s ability to step in when a state regulator has dropped the ball,” Himes said in an interview.
It’s a notable statement from Himes. He was one of five Democrats to help advance committee legislation in July that would effectively limit the Federal Reserve’s oversight of state-chartered stablecoin companies.
Himes is one of the longest-serving lawmakers in the Democratic quintet that backed the effort, which included Reps. Greg Meeks (N.Y.), Ritchie Torres (N.Y.), Wiley Nickel (N.C.) and Josh Gottheimer (N.J.).
More from Himes:
We’ve written before about the Fed-shaped hole inside House Republicans’ approach to stablecoin regulation. While supportive lawmakers say the bill creates a “federal floor” for state-level stablecoin companies, the Federal Reserve isn’t thrilled about having limited supervision over what it views as a form of private money.
Any changes empowering the Fed would be directed at getting more buy-in from Democrats, particularly in the Senate. At this point, we don’t expect Republicans — led by House Financial Services Chair Patrick McHenry (R-N.C.) and Rep. French Hill (R-Ark.) — to trip over themselves to make these tweaks anytime soon.
This brings us to the Senate: Senate Banking Committee Chair Sherrod Brown (D-Ohio) dumped cold water on the idea that his chamber would take up the House’s leading crypto legislation.
Multiple lawmakers have floated the potential for horse trading between Brown and McHenry’s respective committees. Brown’s got banker accountability legislation and cannabis reform that McHenry doesn’t really care for. McHenry’s crypto ideas have not been met with enthusiasm by Brown.
But what Brown told us in a recent interview is the clearest sign yet that House crypto reform might already be DOA in the Senate.
“We’re not going to pass an industry bill, and that’s what the House has,” Brown said. “I’m certainly willing to talk and negotiate. I’m not going to start with a bill written by the industry.”
That doesn’t sound like fertile ground for crypto reform. But Laura Peavey, a spokesperson for McHenry, said that the “bipartisan legislation passed out of our committee provides strong consumer protections and builds off the effective framework set by the state of New York.”
House Republicans are still holding out for potential negotiations in the Senate.
“Productive conversations continue with House and Senate Democrats, and the administration, to get this bipartisan legislation across the finish line,” Peavey said, adding that it was “time for the White House to meaningfully come to the table” of crypto bill negotiations.
— Brendan Pedersen
Correction: The original version of this story identified Rep. Jim Himes (D-Conn.) as the most senior Democrat to vote to advance the House Financial Services Committee’s stablecoin bill in July. We forgot about Rep. Greg Meeks (D-N.Y.), who also supported the package and has served in the House since 1998. The original version also said Rep. Brittany Pettersen (D-Colo.) voted in favor stablecoin reform. She did not, and we regret that error.
THE TALLY
News: Lucia Báez-Geller, the Democrat running to unseat Rep. Maria Elvira Salazar (R-Fla.), is receiving the endorsements of former Democratic Florida Reps. Debbie Mucarsel-Powell and Donna Shalala.
Shalala held the seat for one term before losing to Salazar in 2020. Mucarsel-Powell also represented a neighboring Miami district for one term and is now running for Senate this cycle.
Báez-Geller is looking to turn around Democratic losses in South Florida. An educator and the daughter of Cuban and Colombian immigrants, Democrats are hopeful she can be competitive in a district where President Joe Biden won 49.9% of the vote.
— Max Cohen
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