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November 16, 2022
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PRESENTED BY
THE TOP
Happy Wednesday morning.
This morning we’re going to continue to focus on internal deliberations among House and Senate Republicans about their leadership for next Congress.
Senate Republicans are scheduled to vote this morning on who’ll be their leader for the 118th Congress. We’ll save you the suspense. Sen. Mitch McConnell of Kentucky will win.
Yet McConnell is facing something he’s never dealt with previously during his 16-year run as Senate GOP leader — a challenger.
Sen. Rick Scott of Florida, the NRSC chair, is running against McConnell for minority leader. Scott is likely to get between six and 10 votes, according to Republican senators we spoke with on Tuesday. One GOP senator suggested Scott could garner 12 votes. No matter what, it won’t be anywhere near enough to threaten McConnell’s grip on the conference, yet it shows just how much unrest there is among Senate Republicans after the party’s dismal showing on Election Day.
There will also be a group of Senate Republicans calling for a delay in the leadership elections until after the Dec. 6 runoff in Georgia’s Senate race. Joining Scott in this effort – seen as an anti-McConnell move – are Sens. Ted Cruz (R-Texas), Marco Rubio (R-Fla.) and Lindsey Graham (R-S.C.), among others. This effort will fail as well.
Former President Donald Trump’s announcement on Tuesday night that he’s making another bid for the White House in 2024 – his third since mid-2015 – adds another level of complexity to the internal Senate GOP fight.
It was Trump-endorsed Senate candidates that lost in Pennsylvania and Arizona, and may still lose in Georgia. Scott’s unwillingness to have the NRSC intervene in primaries against any of these Trumpian candidates – despite concerns from McConnell about their viability – led to sharp disagreements between the two men. The McConnell-allied Senate Leadership Fund and NRSC clashed throughout the cycle on tactics and spending. And Trump’s continued attacks on McConnell further split the party, with GOP candidates being asked repeatedly over whether they’d support the Kentucky Republican for leader next year if elected.
The Republican leadership elections will kick off this morning at 9:30 a.m. in the Old Senate Chamber and will take several hours to play out. GOP incumbents eligible to serve in the next Congress will be allowed to vote. This means Sen. Lisa Murkowski (R-Alaska) can take part, but not her Republican challenger Kelly Tshibaka. Republican candidate Herschel Walker is also allowed to vote, although he’s not expected to be present. Reps. Markwayne Mullin (R-Okla.) and Ted Budd (R-N.C.) get to vote following their Senate victories, as do Sens.-elect Katie Britt (Ala.), Eric Schmitt (Mo.), and J.D. Vance (Ohio). Budd and Mullin have declined to answer any questions about the McConnell-Scott dispute, and the views of the other three aren’t clear.
Sen. John Barrasso (Wyo.), the Republican Conference chair, will oversee the proceedings.
Sen. Ron Johnson (R-Wis.) is expected to nominate Scott, GOP aides said. It wasn’t clear who’ll nominate McConnell, although the Kentucky Republican said repeatedly that he’s going into the contest with more than enough support to win.
“I want to repeat again, I have the votes. I will be elected,” McConnell said on Tuesday. “The only issue is whether we do it sooner or later. And I think we’ll probably have another discussion about that tomorrow.”
In public and private, McConnell and Scott have blamed the other in large part for the Nov. 8 debacle. McConnell has also criticized the Trump wing of the party, pointing out that false claims over the 2020 elections being stolen – and the violence that occurred during the Jan. 6 insurrection – alienated the very voters that Republicans needed.
Here’s McConnell:
During Tuesday’s closed-door meeting, Senate Minority Whip John Thune bashed Scott for pushing his own policy agenda, which was seized on by President Joe Biden and Democrats, despite being rejected by party leaders.
Sens. Thom Tillis (R-N.C.) and Marsha Blackburn (R-Tenn.) have called for a review of how the NRSC operated during this cycle. It’s not an audit of the campaign committee, but GOP senators want to explore decision-making process and procedures inside the organization, said several Republicans.
For his part, Scott criticized McConnell’s willingness to compromise with Democrats on infrastructure, gun control, the debt limit and spending bills during this Congress. Scott also complained that Republicans lack an agenda to inspire the American public.
Scott told his colleagues in a letter circulated on Tuesday that it was time for “bold change.”
The fracas with Scott comes as the 80-year-old McConnell is on the verge of breaking the late Sen. Mike Mansfield’s (D-Mont.) record for the longest-serving party leader in Senate history. McConnell will reach that milestone in January. McConnell is acutely aware of this record – and his place in Senate history. Yet McConnell and his allies hoped he would be doing it as majority leader, especially with a very favorable Senate map heading into this cycle.
As for Scott, his own future is less clear. Scott’s only been in the Senate for four years, and he often talks about how the chamber’s rigid traditions and customs impede the ability to make real changes. Scott constantly mentions his record as a business executive and Florida governor.
Scott is seen as having presidential ambitions, which was viewed as one of the reasons he refused to intervene in Senate primaries – an unwillingness to offend the Trump base.
But the meteoric rise of Florida GOP Gov. Ron DeSantis, coupled with Trump’s continued efforts to get back into the White House, complicate the picture for Scott, as well as other Republican senators eyeing the White House.
Happening today: The Senate will vote at 3:15 p.m. on a cloture motion for the Respect for Marriage Act. This bill would codify the right to same-sex marriage into federal law. GOP and Democratic sponsors of a revised version of the bill – Sens. Tammy Baldwin (D-Wis.), Susan Collins (R-Maine), Kyrsten Sinema (D-Ariz.) and Thom Tillis (R-N.C.) – believe they have the 60 votes needed to overcome a GOP filibuster.
– John Bresnahan
TODAY: Join us at Hawk ‘N’ Dove or on the livestream at 9 a.m. ET for our conversation with Sen. Mark Warner (D-Va.) about the impact of 5G on energy. It’s the last event in our series, “5G’s Climate Impact,” that explores the wide ranging use of 5G technology, especially when it comes to climate change. RSVP here!
THE QUEST FOR 218
McCarthy’s next step
House Minority Leader Kevin McCarthy had a good day Tuesday. House GOP lawmakers picked the California Republican to be their nominee for speaker of the House. He garnered the votes of 86% of the House Republican Conference, 188-31, easily beating back a challenge from Rep. Andy Biggs (R-Ariz.).
Does McCarthy have the 218 votes he needs to be speaker? Not a chance – and he won’t until December or even early January.
The next step in McCarthy’s quest to be speaker will come at 1 p.m., when House Republicans vote on a host of changes to the party’s rules meant to curb the power of the leadership.
Here’s the list of changes that conservatives are seeking to party rules. Remember – these are party rules subject to a GOP-only vote today. Each one of these will succeed or fail on their own. House Republicans will consider the first 12 proposals today. We’re going to review some of the big ones here.
| → | Rep. Andrew Clyde (R-Ga.) is proposing a rule that the leadership can probably accept. This rule would mandate that the Capitol could only be closed in “extraordinary circumstances.” Notably, the rule change says that “Guidance from the Attending Physician, or House Officers, should inform but not necessitate action by the Speaker.” |
This is fallout from the Capitol being largely shut down due to the Covid-19 pandemic. It doesn’t force McCarthy’s hand in any way.
| → | Rep. Lauren Boebert (R-Colo.) is trying to ban members of the Steering Committee – the panel that chooses Republican committee assignments – from serving on the NRCC executive committee. Sure, why not? McCarthy controls the NRCC anyway and incoming NRCC Chair Richard Hudson is a close ally. This is effectively toothless, so we can’t imagine much opposition. |
| → | Rep. Gary Palmer (R-Ala.) wants to prohibit bills costing more than $250 million from being considered on the suspension calendar, a fast-track process for approving legislation that requires two-third majority. We can’t imagine leadership will care about this either. If a bill is more than $250 million, they’ll just push it to be considered under a rule. |
| → | Rep. Ralph Norman (R-S.C.) wants to ensure every Republican member can participate in conference meetings. The rule calls for new structures to be put in place to allow everyone to speak. The Republican leadership will not support this because it would make meetings too long. |
| → | Rep. Scott Perry (R-Pa.) wants to allow more staffers into closed party meetings. No chance leadership will support this, as it will make these meetings more widely attended and that’s not what they want. |
| → | Rep. Tom McClintock (R-Calif.) wants to ban earmarks on annual spending bills. Leadership won’t weigh in here. Earmarks are growing in popularity among Republicans, but there remains a pretty deep ideological divide on the issue. |
| → | Perry is trying to have committees elect their own chairs. Leadership is firmly against this and we expect them to work to kill it. |
| → | Rep. Dan Bishop (R-N.C.) is aiming to create a rule whereby 25 Republicans could stop the consideration of any bill. Leadership is strongly opposed and will work to kill this one too. |
| → | Rep. Bob Good (R-Va.) wants to prevent the leadership from bringing up any bill if three-fourths of the appropriations bills aren’t passed by Aug. 1. Leadership will take a pass here too. The House cannot tie itself to the Senate’s schedule. Furthermore, who knows if the House will be able to pass any appropriations bill next year. |
| → | Norman is advocating that Steering Committee members should “not allow for any Regional Representative to represent more than seven Members.” This would blow up the committee. Leadership will oppose. |
| → | Rep. Mike Turner (R-Ohio) wants to add language on the motion to vacate, the process by which the House can remove the speaker. The language Turner is seeking to insert is this: “It is the position of the Republican Conference that the privilege under House Rule IX Clause 2(a)(3) should only be available with the agreement of the Republican Conference so as to not allow Democrats to choose the Speaker.” |
Leadership strongly supports this one for obvious reasons.
McCarthy wants very badly to be speaker so he’s going to be open to all sorts of rule changes. If you’re a Republican right now who wants something, this is the time to push McCarthy for it. If you’re trying to make a point or be a pain in the neck to the leadership, your rule change will probably be defeated by a conference that mostly lines up with McCarthy.
– Jake Sherman
LEADER LOOK
What to know about Senate Banking’s next top Republican
With Democrats’ control of the Senate assured in the next Congress, Sen. Sherrod Brown (D-Ohio) is again expected to chair the Senate Banking Committee. But a new top Republican could significantly shift the panel’s dynamics in 2023.
Sen. Tim Scott (R-S.C.) is in line to become the ranking member on Senate Banking next year, succeeding the retiring Sen. Pat Toomey (R-Pa.).
Of course, there’s only so much Republicans can do in the minority. And if the Georgia runoff between Sen. Raphael Warnock (D) and Republican Herschel Walker next month nets Democrats their 51st seat, it will become even harder for the GOP to block President Joe Biden’s financial nominees.
Still, observers say it’ll be easier – though not exactly easy – for Brown and Scott to work together on areas of agreement. Toomey’s relationship with Brown has been rocky over the last two years. Brown and Scott are on friendlier terms.
| → | Policy priorities: Scott has served in the Senate since 2013. But he’s had less time to establish a detailed financial services portfolio and construct an army of alumni on K Street compared to previous ranking Republicans on Banking. And we’re told Scott is a relatively blank slate in some key policy areas – among them, crypto. |
Scott does have clearer priorities across a number of issues that you can read about in his “Opportunity Agenda.” Some highlights include a bill he introduced with Sen. Catherine Cortez Masto (D-Nev.) in 2018 to simplify the process of opening a bank account. And there’s another bill he authored with Sen. Mark Warner (D-Va.) to update the credit scoring models used by government-sponsored housing lenders.
| → | Downtown download: Saat Alety, a partner at Federal Hall Policy Advisors, will be an important person in Scott’s orbit. Alety served as one of Scott’s senior financial services advisers and as a subcommittee staff director focused on housing and transportation. |
Scott is also tied to Bradley Knox, senior vice president and counsel, federal relations at the insurance giant Aflac. Scott himself has 15 years of experience in the insurance industry with Allstate. We expect insurance policy to be a major focus for Scott, particularly reforming the National Flood Insurance Program.
Other lobbyists to watch include Amy Best Weiss, vice president and head of U.S. government affairs at American Express, and King Mueller, a partner at Mindset and former deputy assistant secretary at the Treasury Department.
| → | Money watch: We want to highlight some of Scott’s top allies on fundraising – an activity the South Carolinian is rather good at. One is Larry Ellison, CEO of the tech giant Oracle. Ellison pumped $20 million dollars into the pro-Scott super PAC Opportunity Matters Fund in the 2022 cycle. |
Another big donor is Ben Navarro, the billionaire CEO of Sherman Financial Group. He donated $2.5 million to the Opportunity Matters Fund in 2022. Navarro even got a shoutout towards the end of Scott’s victory speech on Tuesday night.
A related super PAC, Opportunity Matters Fund Action, is being advised by consultant Jennifer DeCasper, Scott’s former chief of staff and one of his closest D.C. advisers.
One last thing: 2024 looms large for Scott, who has said this upcoming term as senator will be his last. Serving in a top post on the Senate Banking Committee is a lot of work. So is being part of the Finance, HELP, Small Business and Aging committees, his other assignments. Running for president or being on a presidential ticket is time-consuming as well, and there’s only 24 hours in a day. We’ll leave it at that.
– Brendan Pedersen
PRESENTED BY CHEVRON
Learn how we’re working to develop non-food grade peanuts to create lower carbon intensity fuel, and bring farming back to drier areas in Texas.
LEADERSHIP WATCH
New: Sara Jacobs to run for ‘Five terms or less’ representative
Rep. Sara Jacobs (D-Calif.) is running for the “Five terms or less” position in House Democratic leadership. Jacobs, a prolific fundraiser who’s seen as a rising star in the caucus, had been seen as a potential contender to lead the Democratic Congressional Campaign Committee.
This is the 33-year-old Jacobs’ attempt to break into the leadership and get a seat at the decision-making table.
Jacobs will face off against Rep. Lizzie Fletcher (D-Texas) for the Caucus Leadership Representative role, which is reserved for a House Democrat who has served under five terms in the body. Members of the Classes of 2014, 2016, 2018, 2020 and 2022 elect the representative.
Here’s a portion from Jacobs’ letter emphasizing her experience within the DCCC:
Check out the full letter here.
Jacobs was elected to her San Diego-area seat in 2020, while Fletcher came to the House in 2018 when she flipped a red Houston-area seat. Jacobs has already made a name for herself as a fundraising juggernaut.
— Max Cohen
THE CAMPAIGN
| → | Goldman Sachs is starting a campaign to push Congress to re-authorize the Small Business Administration. Goldman is doing this under its 10,000 Small Business Voices initiative. The SBA hasn’t been reauthorized since 2000. The push will include this TV ad and includes a letter signed by 3,000 small businesses. Goldman Sachs has sponsored Punchbowl News events. |
– Jake Sherman
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