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The dueling budget chairs: How Arrington and Graham are playing their hands

Thune takes a victory lap on Trump nominees

MTG prepares for fight in first DOGE hearing

The Vault: The bank lobby is being awfully quiet about CFPB

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The dueling budget chairs: How Arrington and Graham are playing their hands

Happy Wednesday morning.

New: The House Budget Committee is expected to release its budget resolution today. Yes, we’ve heard this before.

But if Rep. Jodey Arrington (R-Texas), the committee’s chair, wants to hold a markup Thursday, members are going to want to see the text of the resolution today.

What we’ve heard is that Arrington’s budget resolution will call for $4.5 trillion to spend on tax cuts. That’s less than President Donald Trump wants for an extension of the 2017 tax law plus new tax cuts on tipped wages, overtime pay and more — unless offsets can bridge that gap. But that could get difficult quickly.

The resolution will also call for $1.5 trillion in spending cuts, a compromise between the $500 billion to $700 billion that Speaker Mike Johnson originally called for and the $2 trillion hardline Republicans wanted.

There will be a $300 billion increase in mandatory spending, which is likely the increase in border security and defense funding.

The House GOP resolution also assumes 2.8% economic growth, a healthy projection that predicts the economy will boom under Trump.

The big picture. As we’ve reported over the last few days, at this point, the entire reconciliation process is a contest between House and Senate Republicans over whose process wins out. The Senate wants to give Trump a quick win by enacting a more narrow border-energy-defense spending package now and worry about extending the tax rates later. The House wants to do everything in one “big, beautiful bill” due to the super-tight margin of GOP control.

So today is a big day with the House expected to release its text and the Senate beginning to markup its “skinny” resolution.

Both Johnson and Senate Budget Committee Chair Lindsey Graham (R-S.C.), a very close Trump ally, feel their diametrically different strategies are best for the president.

The speed with which Graham is moving stands in stark contrast to the bumpy road House Republicans are traveling. Johnson promised a budget resolution would be released and marked up last week. Today is Wednesday, and the House GOP budget plan still isn’t out yet with members slated to leave town for a week-long recess beginning Thursday. We understand this is a difficult, hugely complex process. Johnson also faces an unforgiving margin that complicates every move.

It’s not news that the House and Senate are very different bodies with different incentive structures, political dynamics and, perhaps most importantly, margins.

But it’s worth spending a moment digging into just why the House Republican leadership hasn’t been able to strongarm Arrington to release a proposal.

Where we are. Over the last few days, Arrington has been at loggerheads with House Republican leadership and Ways and Means Committee Chair Jason Smith (R-Mo.) over some very basic elements of the Trump agenda.

Smith has argued that he needs more than $4.7 trillion to deliver everything Republicans want — including Trump’s new tax cut priorities — on top of extending expiring elements of the GOP’s 2017 tax law. Arrington doesn’t want to go that high. Prodded by hardline conservatives, Arrington has also been pushing for steeper budget cuts.

The Senate dynamics. Put yourself in the shoes of Graham and Senate Majority Leader John Thune. The two have been in Congress for a combined 56 years. Their view is that Trump needs a quick win, which is why their two-bill approach makes plenty of sense. It also doesn’t take a genius to look at the dysfunction of the House Republican Conference and realize that things can go sideways very quickly. Which is why the Senate may want to take the lead.

House view. One thing that’s befuddled us in this process is why the House GOP seemingly cannot bend Arrington to its will. Arrington is the chair of the Budget Committee and serves under Johnson. Yet the Texas Republican seems to be in the driver’s seat.

But this ignores a few key dynamics.

1.) The House Budget Committee is a rightward-leaning panel with a lot of deficit hawks and Freedom Caucus types. GOP Reps. Ralph Norman (S.C.), Tom McClintock (Calif.), Lloyd Smucker (Pa.) and Chip Roy (Texas) all have seats on the committee. Arrington needs a budget resolution that can get through the panel.

2.) For the last few years, Arrington has been promoting “Reverse the Curse,” his budget plan. This plan would’ve balanced the budget and created a $130 billion surplus by 2033. So how can Arrington now say that $1 trillion or $2 trillion in cuts is a fiscally responsible plan?

3.) Arrington also seems to be taking advantage of the “bottom-up” approach that Johnson trumpets. The speaker is facilitating a process that Arrington is leading. For better or worse, that empowers the budget chair.

The House GOP leadership was somewhat blindsided by Arrington’s proclamation in a closed party meeting that he’d mark up a budget Thursday. But for now, the GOP leadership is rolling with the plan. And they’re plenty willing to have the budget resolution laid out for a week with the House out of session before a floor vote.

Will this resolution pass the Budget Committee? Maybe. But the leadership does feel confident that this will eventually pass the House.

Also: Trump nominated Gary Andres, the Republican staff director of the House Budget Committee, to be assistant secretary of health and human services. Andres has also been the staff director on the Ways and Means and Energy and Commerce committees.

— Jake Sherman

Tomorrow’s the day! Join us for a summit on tax policy in the new administration. Hear from Rep. Kevin Hern (R-Okla.), Danielle Rolfes of KPMG and an expert panel of top policy leaders. Don’t miss the chance to connect with industry pros during the networking session. RSVP now — it’s not too late!

NOMS, NOMS, NOMS

Thune takes a victory lap on Trump nominees

As Senate Republicans prepare to confirm former Rep. Tulsi Gabbard (Hawaii) as director of national intelligence today, Senate Majority Leader John Thune — less than six weeks into his new job — can feel the culmination of a dedicated strategy to convince his rank-and-file senators to back some of President Donald Trump’s most controversial nominees.

Senate Republicans are aiming to confirm both Gabbard and HHS nominee Robert F. Kennedy Jr. this week. This would be a dramatic turnaround from just a few weeks ago, when one or both of the nominees, facing a tidal wave of bad press and Democratic attacks, looked like they could go down.

In fact, other than former Rep. Matt Gaetz (R-Fla.), who had years worth of scandals and personal attacks on GOP senators to overcome, Trump and Senate Republicans haven’t lost out on a nominee.

Trump’s picks are also being confirmed at a faster rate than former President Joe Biden’s Cabinet, which Thune and other top Senate Republicans repeatedly tout.

In an interview on Tuesday, Thune told us that this is all according to plan.

“With respect to Tulsi, RFK, [Pete] Hegseth, Kash Patel — they’re obviously all folks that sort of went into the process with concerns about whether or not they were going to have a path forward,” Thune said. “But I could see in each one of those how they would get there and so far, it’s kind of worked out that way.”

Thune also credited the White House with being proactive in responding to GOP senators’ concerns. He praised Vice President JD Vance for being an “honest broker” and a key link to the White House during the process, as well as White House Chief of Staff Susie Wiles, Deputy Chief of Staff Stephen Miller and James Braid, director of the White House legislative affairs office. Trump also reached out to Republican senators on several occasions.

“[Vance] did a nice job of just getting them information they needed, responding to the questions they had, in a way that certainly wasn’t high pressure,” Thune said.

For the 64-year-old Thune, this whole episode has been a huge challenge. Taking over for longtime GOP leader, Sen. Mitch McConnell (R-Ky.), Thune faced heavy pressure from Trump and his allies to move quickly. And Senate Democrats have been increasingly unwilling to cut time agreements to speed up the process, especially on high-profile nominations. Thune has been forced to move forward with late-night and weekend votes on several occasions.

“You just take it a day at a time,” Thune said. “You try to figure out how can we win the day, how can we get through the meetings, the hearing process, take it one step at a time, and just ensure — as we said from the beginning — that there was a fair process.”

On Gabbard: After a rocky start to her meetings with GOP senators, Gabbard issued a statement walking back her previous criticism of FISA Section 702. Some GOP senators weren’t convinced that Gabbard really had shifted her stance, so this was a critical move.

And during Gabbard’s hearing in front of the Senate Intelligence Committee, several Republicans were shocked that the nominee couldn’t bring herself to unequivocally condemn NSA leaker Edward Snowden.

But again, Gabbard reached out to her detractors and eventually won over Sens. Susan Collins (R-Maine) and Todd Young (R-Ind.) to advance out of committee. Vance and Sen. Tom Cotton (Ark.), the Intelligence Committee chair and number three Senate Republican, worked behind the scenes, as well.

With Pete Hegseth, Sen. Thom Tillis (R-N.C.) spoke repeatedly with the now-defense secretary in the critical days leading up to that floor vote. Vance ended up casting the deciding vote for Hegseth’s nomination.

What’s next: The Senate will consider Brooke Rollins for agriculture secretary, Howard Lutnick for commerce secretary and former Sen. Kelly Loeffler (R-Ga.) for small business administrator. Thune said he’ll keep pressing for quick action on these nominees, including potentially staying in over the weekend if Senate Democrats continue to drag out the process.

— John Bresnahan and Max Cohen

DOGE WATCH

MTG prepares for fight in first DOGE hearing

Four years after being completely stripped of her committee assignments, Rep. Marjorie Taylor Greene (R-Ga.) is spearheading one of the most high-profile subcommittees in Congress.

The Georgia Republican, who chairs the House Oversight Committee’s DOGE subcommittee, argues Elon Musk’s idea for the Department of Government Efficiency is the top interest of not only Republicans in Washington but everyday Americans.

“This has become the number one topic across the country,” Greene told us. “It is the hottest topic and people are so engaged with us.”

Greene’s panel will hold its first hearing today, focusing on improper payments made by the federal government.

Greene, who met with Musk at the White House earlier this week, said today’s hearing should be a topic that’s “easy to be bipartisan” on and is timely ahead of when people begin filing taxes.

Hill Democrats have a dramatically different view of DOGE after its efforts to dismantle federal agencies, including USAID and the Consumer Financial Protection Bureau, so bipartisanship will be hard to achieve.

Greene said she’ll unveil an action plan in the days ahead with a series of legislative proposals to curtail government waste. She said the Republican Party’s full control of Washington gives it a chance to get results.

“We’re really tired of having hearings where it’s a bunch of talking and information comes out and nothing changes,” Greene said. “This is going to be a different opportunity that we have.”

Legislator or bomb thrower? Greene’s holding of the gavel is a remarkable turn of events from when she arrived in Congress four years ago. And it is emblematic of how much the GOP has come to fully embrace President Donald Trump’s MAGA movement and its most ardent promoters.

But leading a high-profile subcommittee is also a test for Greene. Her congressional career has been marked by controversial comments and policy stances. Democrats stripped her of committee assignments in 2021, arguing she had made threatening and bigoted remarks and was unfit to serve.

Greene said there’s been a shift in Washington since she arrived in 2021. Greene said her Republican colleagues are starting to come around to her way of seeing things.

“I came into Congress being vocally against everything happening here, and I’ve been proven right,” she said. “I wouldn’t say that I’ve changed. I would say it’s the House that’s changed and they figured out I am a person who takes [this] seriously because the people do and so does President Trump.”

Dems’ view: We recently wrote that moderate Democrats who were initially interested in making DOGE a bipartisan cause have soured on the effort.

“Over the last three weeks, we’ve seen how Donald Trump and Elon Musk have systemically dismantled our federal agencies and acted lawlessly,” said Rep. Melanie Stansbury (D-N.M.), the subcommittee’s ranking member.

Rep. Robert Garcia (D-Calif.), who sits on the panel, told us he wants Democrats to match Greene’s bombastic energy when it comes to pushing back on DOGE.

“We can’t go in and expect [Greene] to act proper and have decorum,” he said. “That’s not going to work. She doesn’t work that way.”

Also: The AFL-CIO will submit written testimony for today’s hearing condemning Musk’s DOGE efforts and raising concerns about his potential access to private information. Here’s the full statement.

— Mica Soellner

BIPARTISAN WATCH

News: Reps. Robin Kelly (D-Ill.), Young Kim (R-Calif.), Kim Schrier (D-Wash.) and Dan Meuser (R-Pa.) are introducing the House companion bill of the Rural Obstetrics Readiness Act. We scooped last week that Sens. Katie Britt (R-Ala.) and Maggie Hassan (D-N.H.) were introducing the Senate version.

Downtown download: Esther Kahng, long-time chief counsel on the House Financial Services Committee to Ranking Member Maxine Waters (D-Calif.), is leaving the panel for Zest AI, a fintech company focused on underwriting. Kahng will serve as head of public policy and chief of staff.

— Max Cohen and Brendan Pedersen

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