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Freedom Caucus comes out against NDAA

The House Freedom Caucus has come out against the annual defense policy bill, citing Speaker Mike Johnson’s decision to extend a high-profile intelligence surveillance program as part of the package.

In a statement, the hard-right conservative group said they are prepared to vote against the bill and “use all available leverage” to kill it.

“Any reauthorization of the Foreign Intelligence Surveillance Act (FISA) must be considered only with significant reforms and as a standalone measure,” the statement read. “Under no circumstances should an extension be attached to ‘must pass’ legislation such as the National Defense Authorization Act (NDAA).”

The NDAA conference report will be taken up by the Senate next week, where it’s expected to pass easily. There are problems in the House, though. The measure is likely to come up under suspension, meaning it needs 290 votes to pass. That’s not guaranteed to happen at this point.

At the same time, senior officials from the DOJ, CIA, NSA and ODNI were on Capitol Hill today to brief House Democratic staff on their concerns about the FISA debate.

A source who attended the meeting said administration officials warned that the House Judiciary Committee’s FISA reform bill “would be catastrophic” to national security and that “a vote on the Judiciary bill is a vote to end the 702 program.”

However, that bill – led by Rep. Andy Biggs (R-Ariz.) – passed the Judiciary Committee on a huge 35-2 bipartisan margin. Both Reps. Jim Jordan (R-Ohio) and Jerry Nadler (D-N.Y.), chair and ranking member on Judiciary, co-sponsored the legislation.

But national security officials prefer a competing FISA bill that advanced out of the Intelligence Committee. The Judiciary Committee’s bill includes a search-warrant requirement for any review of communications from U.S. persons caught up in an intelligence investigation involving foreign nationals operating overseas. The Intelligence Committee proposal doesn’t have that requirement.

In a “Dear Colleague” letter on Thursday, Johnson said he wants to bring the Judiciary and Intelligence panels’ FISA bills to the floor next week under a special rule that allows members to vote for their preferred legislation. Johnson hasn’t said which bill will get voted upon first, however.

If House Intelligence Committee Chair Mike Turner’s (R-Ohio) bill gets more votes than the Judiciary Committee’s overhaul bill, that will spell trouble for the efforts to tweak surveillance laws.

It will also matter for any floor vote on NDAA.

– Mica Soellner, Jake Sherman and John Bresnahan

The U.S. labor market just won’t quit

It’s a beat: The American economy added 199,000 jobs in November, bucking economists’ expectations and pulling the U.S. unemployment rate back to 3.7%.

The Bureau of Labor Statistics report is the latest sign that any recession in the United States is just going to have to wait. Worker earnings also beat expectations with hourly rates growing by 0.4% between October and November or 4% over the previous 12 months.

That’s a lot! And more importantly, those wage gains have continued to outpace inflation since the summer, though we should note we don’t have November inflation data quite yet.

Of course, what Wall Street mostly cares about these days is when the Federal Reserve might cut interest rates. Prior to this report, a growing chunk of the financial sector had penciled in cuts as soon as the second quarter of 2024.

But a hot economy makes that less likely. Federal Reserve Chair Jay Powell has said over and over again in recent weeks that it’s “premature” to talk about rate cuts.

Market futures slipped on the news, but the broader stock market hasn’t moved much this morning. Bond yields climbed up a bit.

Still, the White House will – and should – celebrate this beat. The Council of Economic Advisers noted on X that the U.S. unemployment rate has sat below 4% for 22 straight months.

Is that enough for voters to come around to the Biden administration’s economic agenda? Only time will tell.

– Brendan Pedersen

THE LEADERSHIP

The CPI-House Republican alliance

This is an interesting development.

The House Republican Conference invited Capitol Hill staffers to a briefing with the Conservative Partnership Institute in the Capitol. CPI, as you’ll remember, is the organization run by former Rep. Mark Meadows (R-N.C.) and former Sen. Jim DeMint (R-S.C.).

Here’s the invite:

The fact that CPI is briefing House Republican staffers on the invitation of the House Republican Conference shows a high degree of influence for the Meadows-and-DeMint run group. Meadows has been indicted in Fulton County, Ga., for allegedly improperly aiding former President Donald Trump’s efforts to overturn the 2020 election.

– Jake Sherman

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