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PRESENTED BY
THE TOP
One week until shutdown. What’s going on?
Happy Friday morning.
At Punchbowl News, we take pride in our ability to follow the twists and turns of legislative debates. No matter how illogical everything seems, we find a way to keep track of the ups and downs. It’s what we do.
But this current government funding debate is setting a new standard for inanity.
Let’s take stock of where things stand. We recommend a cup of coffee while you read this. Maybe throw in a drop of something stronger.
Speaker Mike Johnson cut a deal with Senate Majority Leader Chuck Schumer to fund spending for FY2024 basically at Fiscal Responsibility Act levels. There were $16 billion of additional cuts and rescissions that Democrats threw in to allow Johnson to claim some wins.
Johnson sent out a letter Sunday saying he had “secured hard-fought concessions.” He took to the House Republican Conference to sell the deal. Johnson went on Fox News to say Republicans have to be responsible and govern.
But by Thursday, Johnson was holed up in his office with hardline House Republicans who were imploring the speaker to abandon the spending deal. Johnson said after the meeting that he made “no commitment” to walk away from his agreement with Schumer.
Yet the conservative GOP lawmakers leaving the meeting said Johnson was at least interested in hearing alternatives to his deal with Schumer, which led to an angry pushback from Democrats. So whether he actually made the commitment or not, Republicans thought Johnson was open to it. This also blew open a rift with the GOP moderates who want to stick with the spending agreement.
In that meeting, Johnson also said his personal preference was to pass a clean year-long CR — which would also represent walking away from the deal — but he lacked the votes to get it across the finish line.
Republican members of the House Armed Services Committee, led by Chair Mike Rogers (R-Ala.), marched into Johnson’s office to tell him they’d kill any yearlong CR because it freezes defense spending.
Here’s Rogers:
“I communicated to the speaker and I can assure you the yearlong CR is not a viable option. No Democrat would vote for it because of the catastrophic non-defense spending, and I would make sure that enough defense hawks didn’t vote for it that it has no path forward.”
Meanwhile, Schumer filed cloture Thursday on a legislative vehicle that will become a short-term CR. We hear the CR will last until March 1 or March 15.
Johnson hasn’t made his decision as to what he wants, according to Johnson aides and sources in all the other leadership offices. We checked with his office and they said several dates are under consideration. But House Republicans are already getting jammed by the Senate, which will move Tuesday to begin the process of passing the CR.
We understand the dilemma that Johnson is in here. As of a few months ago, he was a rank-and-file House Republican. Now he’s in the middle of a legislative debate against veteran pols with a conference that’s bitterly divided following the ouster of former Speaker Kevin McCarthy and the bloody battle to replace him.
But the lack of guidance about next steps is grating on everyone in the House and increasingly in the Senate.
Here’s Senate Minority Whip John Thune on Johnson:
“It’s not like you have somebody you’ve worked through a lot of these types of battles in the past [with]… He’s got to manage an incredibly divided caucus and I assume at some point they’re going to have to get it done in a bipartisan way. Because I don’t think there are people over there, on our side of the aisle, who will vote for anything.”
By Saturday evening or so, Schumer has to make a decision on the length of the stopgap measure. Remember, Johnson hasn’t even definitively said he’d take up the CR.
Johnson keeps saying that he’ll fight the Senate to win Republican policy priorities. One Democrat put it to us this way: If Johnson can pass the funding bills on his own, he can fight for GOP policy riders. Otherwise, he should give up.
— Jake Sherman, John Bresnahan and Andrew Desiderio
PRESENTED BY THE NATIONAL RETAIL FEDERATION
The retail industry’s policy agenda is focused on the economy, jobs, innovation and consumer value. As the nation’s largest private-sector employer, retail is profoundly affected by decisions made in Washington that impact retailers’ ability to do business and serve their customers. But the impact is bigger than just retail. These issues are vital to the overall economic competitiveness and growth of the United States, making the actions taken by Congress and federal agencies even more critical.
THE SENATE
Inside McConnell’s supplemental play
President Joe Biden’s decision to launch airstrikes against Iran-backed Houthi militants in Yemen on Thursday could serve to accelerate Senate Minority Leader Mitch McConnell’s urgent push for a national-security funding bill — though steep challenges remain.
McConnell leads a far more isolationist conference than he once did. Several rank-and-file Senate Republicans are skeptical of foreign entanglements in the wake of the Afghanistan and Iraq wars and will push back.
And then there’s former President Donald Trump. He’s repeatedly flirted with pulling the United States out of NATO, something once unthinkable for any American leader.
Simply put, McConnell’s worldview isn’t as popular within his conference as it once was. As a result, it’s a lot harder for him to sell it.
And as House Republicans descend further into chaos and fears mount over Speaker Mike Johnson’s willingness to accept a bipartisan border deal, McConnell is looking to raise the stakes even higher.
In public and private, McConnell has been lobbying for Biden’s behemoth national security supplemental request for Ukraine, Israel and the Indo-Pacific region by reminding anyone who’ll listen that “the world is literally at war.”
The strikes Thursday on the Houthis, who have attacked shipping channels in the Red Sea, may lend new urgency to McConnell’s push.
Yet it’s unlikely to change the fundamental dilemma facing McConnell: How do you persuade a group of Republicans that opposes a comprehensive foreign-aid package and wants no part of a bipartisan border deal with Democrats?
Of course, there’s no deal yet on the border and immigration provisions that’ll be necessary to win GOP support for the legislation, which includes funding for longtime McConnell priorities like Ukraine.
Behind the scenes: We first reported that the Kentucky Republican told GOP senators during a closed-door meeting Thursday that this is Congress’ best opportunity to do something meaningful about the border, and they shouldn’t squander it. McConnell also said it was highly unlikely that they could strike a border deal with Democrats if Trump returns to the White House. His message was clear: We need to take the deal — now.
At separate party lunches this week, McConnell also highlighted the myriad national-security crises that would be addressed in the package — Russia’s war in Ukraine, terrorist attacks on Israel, China’s aggressive posture toward Taiwan, and now, Houthi attacks on ships in the Red Sea. Ahead of Thursday’s airstrikes on Houthi targets in Yemen, McConnell had urged the Biden administration to ramp up its “grossly insufficient” deterrence efforts against Iran in the region.
McConnell said on the floor this week that he “honestly can’t think of a more shortsighted strategic gamble” than pulling back from these conflicts and failing to pass a supplemental funding package.
What happens next will tell us a lot about the direction of the Republican Party — and which faction has the most influence.
— Andrew Desiderio
HOUSE DEMS
House Dems sounding alarm on border crisis
House Democrats know the border crisis is a political liability for them. Now, some members are blaming their own party for it.
Democrats from border states are demanding the Biden administration do more to stem the influx of illegal migrants coming into the country, even if that means enacting tougher policies that not everyone in the party supports.
“The administration has taken too long to take serious action on some important border reforms,” Rep. Gabe Vasquez (D-N.M.) said. “It’s, of course, going to be a dominant issue in the election coming up.”
Republicans have focused their narrative around the migrant crisis at the U.S.-Mexico border, accusing President Joe Biden and Democrats of being soft on border security and taking little action to mitigate the flood of migrants coming into U.S. cities.
House Republicans have taken numerous trips to the border to witness firsthand what they say is the Biden administration’s disastrous policies. Conservative Republicans have blocked U.S. aid to Ukraine as well, arguing that the White House needs to secure U.S. borders first before pouring more money into its embattled ally. Speaker Mike Johnson also spoke to Biden by phone this week, encouraging him to use executive authority to take action on the border.
On top of that, the Homeland Security Committee officially launched its impeachment proceedings into DHS Secretary Alejandro Mayorkas this week. The committee and Mayorkas’ aides clashed Thursday over Homeland Security Committee Chair Mark Green’s (R-Tenn.) invitation for the secretary to testify next week.
Mayorkas will be meeting with a delegation of Mexican officials while Green is holding the hearing. But Mayorkas is ready to appear at another date under the proper circumstances, aides said. Mayorkas has testified before Congress 27 times, more than any other Cabinet official.
The White House also pushed back on claims of not being aggressive enough with several examples of times they deported undocumented migrants but declined to provide a statement.
Rep. Seth Magaziner (D-R.I.), who visited the border last year, said his party must do better to recognize the problems at the border.
“I’d say to my fellow Democrats ‘Don’t deny the fact that there are challenges,’” Magaziner told us.
Rep. Vicente Gonzalez (D-Texas), whose district borders Mexico, went even further, calling for harsher tactics to mitigate the flow of migrants.
“We need to raise [the] credible fear standard” for asylum claims, Gonzalez said. “We need to enforce immigration laws on the border. We need to start removing people. We need to send a clear message to the world that if you show up to our border, just give us a laundry list of answers to our agents that you can’t come in. It’s time.”
Rep. Henry Cuellar (Texas), one of the most vocal Democrats on border security, said the issue is “absolutely” going to dominate his party in November. Cuellar, who represents a border district, has been targeted by left-wing primary challengers over his moderate stances on issues, including border security and immigration.
“I’ve been saying this for years,” Cuellar told us. “We need to make some policy changes. We need to do some funding.”
Broader Context: White House officials and Mayorkas have been working for more than a month to reach a border deal with a bipartisan Senate group in order to help reduce unlawful border crossings. Concerned Democrats assert that the Biden administration should’ve engaged sooner, while prominent Hispanic leaders in Congress are warning Biden not to give into harsher GOP-backed changes on asylum and parole.
U.S. Customs and Border Protection reported more than 300,000 migrant encounters in December, reaching the highest level of encounters ever recorded.
— Mica Soellner
Weekday mornings, The Daily Punch brings you inside Capitol Hill, the White House, and Washington.
PRESENTED BY THE NATIONAL RETAIL FEDERATION
Credit card swipe fees are most retailers’ highest operating cost after labor, driving up consumer prices by more than $1,000 a year for the average household.
2024
Manchin sounds like a presidential candidate but he isn’t one yet
Sen. Joe Manchin (D-W.Va.) is in New Hampshire today speaking at public gatherings in Manchester and Derry, something we usually only see presidential candidates doing.
These events are being hosted by Americans Together, a nonprofit group founded by the senator’s daughter, ex-drug industry executive Heather Manchin. The group is seeking to raise up to $100 million to promote centrist candidates.
The 76-year-old Manchin — who has been in the Senate since 2010 — isn’t running for president, at least not now. Manchin says he wants to rein in the power of the major parties while promoting “common sense candidates” who can get things done in Washington.
Here are some excerpts from Manchin’s remarks later today:
“There is no home base for common sense candidates. We want to help these candidates win their primaries and their general elections so they can lead by example without fear of punishment. There are also so many barriers that make it hard for common sense candidates to have any chance to win. We want to reduce those barriers and create fairer and more competitive elections….
“We are focused on changing that. We will support independent redistricting commission to end the reckless gerrymandering that protects the party in power. And we will support changes that encourage candidates to appeal to a broader base of voters to win the nomination or election.”
Manchin will push for open primaries and ranked-choice voting, which he says “can help shift power from small groups at the extremes to the common sense majority.”
Democrats in particular are concerned about Manchin, former Maryland GOP Gov. Larry Hogan and the centrist group No Labels, which is considering offering a “unity ticket” in 2024. Democratic strategists fear any independent bid for the White House could siphon off more support from President Joe Biden than former President Donald Trump.
Our friend Maggie Haberman at the New York Times reported earlier this week that a new super PAC has been formed to boost a No Labels presidential candidate.
The AP then reported that Hogan had formally stepped down from the No Labels board last month, a sign of a possible White House campaign.
And now Joe Manchin is in New Hampshire talking about “common sense candidates.”
All this should make Democrats and the Biden-Harris campaign extremely happy, we’re sure.
— John Bresnahan
THE CAMPAIGN
Hudson says Republicans need to fight back on abortion messaging
NRCC Chair Richard Hudson has a message for GOP House candidates running in tough seats: “You need to tell the voters your position” on abortion.
In the 2022 cycle, Democrats spent heavily to define Republicans as extreme on abortion rights following the reversal of Roe v. Wade. That strategy is largely credited with blunting the predicted “red wave” and delivering a smaller-than-expected Republican House majority.
Hudson, who’s helming the House GOP campaign arm for the first cycle, thinks Republicans need to be more aggressive in combating Democratic abortion attacks.
“[Candidates] need to articulate their position to the voters, because the voters think the Republican position is like, ‘We’ll throw you in jail if you get an abortion,’” Hudson said.
More:
“We could have done a better job handling [abortion] last cycle, where the Democrats spent hundreds of millions of dollars on that topic and we pretty much just treated it like a hot stove and didn’t touch it.”
It’s a frank acknowledgment from the House GOP campaign leader that the party has been outmaneuvered on abortion messaging. After the Dobbs decision in 2022, the GOP message was muddled between calling for state restrictions versus new federal action curtailing abortion.
Hudson added he wasn’t instructing candidates what their stance on abortion should be but claimed that any GOP stance was closer to voters than what Democrats believed.
“Republicans don’t have a policy problem. We have a branding problem,” Hudson said. “We need to point out that the Democrat position is abortion for any reason, up until the moment of birth, paid for by taxpayers. That’s extreme.”
Democrats contest this framing and argue they are simply seeking to codify Roe into law. The party message is that decisions on abortions are best left to women and their doctors, not politicians.
Heading into the 2024 election, Hudson argued the issues most important to voters — the economy, crime and immigration — favored Republicans.
“If you’re losing on every issue that the voters care about, and you have no ideas on how to fix it, I would also want to change the subject to something else,” Hudson said of Democrats.
Overall picture: Hudson predicted House Republicans would grow their majority in 2024. Hudson cited President Joe Biden’s unpopularity, voter dissatisfaction with the state of the country and the border, key Democratic retirements in tough seats and GOP recruitment as reasons for his optimism.
Hudson also said the NRCC has identified 37 pickup opportunities in seats currently represented by Democrats.
ICYMI: Hudson opened up on his lack of confidence in J.R. Majewski in a critical Ohio swing seat, as we reported in our PM edition.
— Max Cohen
PRESENTED BY THE NATIONAL RETAIL FEDERATION
Tell Congress to pass the Credit Card Competition Act.
MOMENTS
ALL TIMES EASTERN
9 a.m.
President Joe Biden will get his daily intelligence briefing.
10 a.m.
Biden will depart the White House for Joint Base Andrews. From there, he will travel to Allentown, Pa., arriving at 1:15 p.m. Principal Deputy Press Secretary Olivia Dalton and NSC spokesperson John Kirby will gaggle aboard Air Force One.
1:50 p.m.
Biden will visit several small businesses in the Allentown area.
4:25 p.m.
Biden will depart Allentown en route to the White House, arriving at 5:35 p.m.
CLIPS
Bloomberg
“European Shipping Stocks Rise After US, UK Airstrikes on Houthis”
– Farah Elbahrawy
Politico
“Inside Biden’s decision to strike the Houthis”
– Lara Seligman and Lauren Egan
PRESENTED BY THE NATIONAL RETAIL FEDERATION
Every time a credit card is swiped, a Wall Street bank profits off businesses and consumers. That’s because two companies control 80% of the current market, setting the fees charged by all banks that issue their cards, along with the terms for usage — forcing merchants to foot the bill. That means businesses have no choice but to pay non-negotiable fees or incorporate the high swipe fees into the prices consumers pay. Big banks are working to raise credit card swipe fees, which will only make it more challenging for businesses — especially small businesses — to expand, hire new employees and lower prices. It’s time for Congress to act. Tell Congress to support the bipartisan Credit Card Competition Act, which will require at least two competing processing networks enabled on each credit card. These reforms have the potential to save American businesses and consumers an estimated $15 billion per year.
Editorial photos provided by Getty Images. Political ads courtesy of AdImpact.
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