The Archive

IN THIS EDITION

Inside the closed House Republican leadership retreat in Miami

James Biden heads to the Hill

Shaheen, Tillis to unveil resolution condemning Hungary

Capital One merger is one big test for the Capitol

Hogan leads Maryland race in eye-opening GOP poll

THE TOP

Inside the closed House Republican leadership retreat in Miami

Happy Wednesday morning.

The House Republican leadership has been holed up at the luxury waterside Mandarin Oriental in Miami for its annual Elected Leadership Committee retreat. This session followed an NRCC donor event at the Ritz-Carlton in Key Biscayne, Fla., over the weekend.

The ELC, as it’s known in the Capitol, is designed to be the kitchen cabinet for the top House Republican — in this case Speaker Mike Johnson — and the leadership. This year, Johnson invited committee chairs and representatives from different factions within the GOP conference to attend as well.

We spent the day reporting on the closed-door retreat Tuesday. And a few moments stuck out to us.

1) Government spending. Congress is facing two funding deadlines during the next 16 days — March 1 and March 8. Johnson demanded the twin spending cliffs as a way to ensure that House hardline conservatives weren’t forced to swallow a massive omnibus bill.

At this point, the House and Senate haven’t passed any FY2024 spending bills, although appropriators in both chambers are scrambling to come up with multiple packages before the deadlines.

Rep. Tom Cole (R-Okla.), the chair of the House Rules Committee and a leading contender to become the next Appropriations Committee chair, said during the retreat that he expects leadership to back any negotiated spending deal and that appropriators alone can’t be relied upon to drag the bill across the finish line.

As we’ve reported, the House Freedom Caucus is pressing Johnson and GOP appropriators not to give in to Democrats and the Senate over policy riders on the spending bills. They want Johnson to risk a shutdown if necessary.

Johnson didn’t weigh in either way on this topic in Miami. But it does get to an issue facing House Republicans — what will Johnson do on government funding? Johnson effectively has three options: a short-term funding bill, which Johnson has been skeptical of; a yearlong CR that would cut spending by 1% beginning April 1; or the bipartisan compromise package, which is expected to emerge in the coming days.

The Four Corners — the top House and Senate appropriators in both parties — are still trying to get a deal on FY24 spending. The question to think about now is how will Johnson move a spending deal? Will he move it in two packages? Three packages? Johnson needs something that will carry votes and only has a limited number of legislative vehicles that will attract support.

2) Johnson’s leadership. On several occasions during the retreat, lawmakers told Johnson that they’re hoping he becomes a more vocal leader. Johnson’s style is hard to pin down. He’s not very eager to take specific positions and push the conference to follow him. For example, after the Senate passed a $95 billion foreign aid funding bill, Johnson said it wasn’t a priority for him given the looming government funding deadlines.

At the ELC retreat, Rep. Bob Good (R-Va.), the chair of the House Freedom Caucus, said Johnson should be more of a leader and not a neutral referee.

Ways and Means Committee Chair Jason Smith (R-Mo.) wondered aloud why Johnson was spending so much time at the retreat talking about Ukraine aid when there’s a government shutdown just days away.

This gets back to an adage we hear a lot in the House Republican Conference — despite how often people pine for member-driven leadership, Republicans truly want to be led. Then they can complain about what direction they’re being led in.

3) Ukraine. Rep. French Hill (R-Ark.) and House Judiciary Committee Chair Jim Jordan (R-Ohio) had a heated back-and-forth over the future of aid to Ukraine. Hill, a member of the House Intelligence Committee, is in favor of additional U.S. funding for Ukraine. At the retreat, Hill said Congress has to help the Ukrainians defeat Russian President Vladimir Putin’s invasion, which is about to enter its third year.

Jordan is a prominent Ukraine skeptic. Jordan — echoing the position of many GOP conservatives — asked what the desired outcome was in continuing to pour billions of dollars into the conflict. Hill countered that Putin can’t continue his land-grabbing campaign without a U.S. response. This clash represents the two poles in the House Republican Conference when it comes to sending more money to Kyiv.

4) Good dumps on McCarthy. In a moment that surprised many at the retreat, Good told the room that the country was better off without Kevin McCarthy as speaker. Good said he’d vote to remove him from the post again. Of course, the House has had quite a lot of drama since GOP hardliners — backed by Democrats — voted to oust McCarthy from the speakership. But Good has publicly and privately shown no remorse.

General takeaway: To a person, nearly every attendee we spoke to — and we spoke to a lot of them — said that Johnson didn’t present a vision, but rather lectured his colleagues. One source compared his performance to a political science professor.

— Jake Sherman and John Bresnahan

James Biden heads to the Hill

Today is a big day for the House impeachment inquiry into President Joe Biden.

The Oversight and Judiciary panels will hear from James Biden, the president’s brother, in a private deposition on the Hill.

Republican investigators see James Biden as critical to the impeachment inquiry. During his career, the president’s younger brother entered into a wide range of business deals that the GOP argues only went through because he was related to Joe Biden.

The impeachment inquiry has looked into James Biden’s former associates in recent months. But the vast majority of these figures have said Joe Biden had nothing to do with these financial deals.

The James Biden deposition and next week’s Hunter Biden interview come at a precarious time for the Republican-led inquiry. Last week, the impeachment push was dealt a major blow when an FBI informant who alleged a Biden bribery plot was indicted for making it all up.

While Republicans have insisted that the now-disproven Ukraine bribery allegation wasn’t the main focus of the impeachment inquiry, that’s a stretch. In reality, it formed a major part of the probe.

Remember: The inquiry is searching for any official acts in Biden took that were improperly impacted by his family’s business interests. To date, the probe has uncovered no conclusive evidence of impeachable offenses.

An interesting point to keep in mind today: It’s unlikely that James Biden will throw his brother under the bus and give Republicans any major revelations. So expect the GOP to try to discredit James Biden, catch him saying contradictory things or accuse him of stonewalling.

— Max Cohen

WASHINGTON X THE WORLD

Shaheen, Tillis to unveil resolution condemning Hungary

Just days after they were snubbed by Hungary’s leaders during a visit to Budapest, Sens. Jeanne Shaheen (D-N.H.) and Thom Tillis (R-N.C.) are set to unveil a Senate resolution condemning the NATO ally on a variety of fronts.

The new measure, set to drop next week, lashes Hungary for democratic backsliding, its months-long delay in approving Sweden’s accession to NATO and Prime Minister Viktor Orbán’s closeness with Russia and China, according to the resolution text we obtained.

It also notes that Hungary had pledged it wouldn’t be the last NATO member to sign off on Sweden’s membership in the military alliance, which it has now become. And the resolution accuses the country of “jeopardizing transatlantic security at a key moment for peace and stability in Europe.”

Shaheen, Tillis and Sen. Chris Murphy (D-Conn.) traveled to Budapest on Sunday after the Munich Security Conference. Orbán, as well as his ministers and members of his party in the country’s parliament, refused to meet with the senators.

Europe’s problem child: Orbán’s nationalist government has been hailed as a model by former President Donald Trump and his allies. But it has come under increasing scrutiny from the West, with Orbán maintaining relations with Vladimir Putin and seeking to water down some of the European Union’s sanctions on Russia after the invasion of Ukraine.

The United States and other Western nations have been openly critical of Hungary in recent months because of its 18-month delay in ratifying Sweden’s NATO accession, which Shaheen and Tillis have argued undermines the alliance. Orbán has also come under fire for trying to suppress independent media and crack down on dissent.

The resolution chided Hungary for instituting “a law purportedly designed to protect the sovereignty of Hungary, but which actually serves as a tool to silence Hungarians who disagree with the current ruling party” in December.

This is a reference to a law passed in Hungary that the State Department said implements “draconian tools that can be used to intimidate and punish” critics of the Orbán government.

Back on the Hill: Shaheen and Tillis chair the Senate’s NATO Observer Group and have been calling on Hungary to swiftly approve Sweden’s membership. They’ve said Hungary’s delay could “irrevocably” damage its relationship with the United States and with NATO. Hungary could finally be moving toward ratification as soon as next week, according to reports on Tuesday.

Frustrations with Hungary have reached a boiling point in Congress. Senate Foreign Relations Committee Chair Ben Cardin (D-Md.) suggested earlier this month that the country may be deserving of human-rights sanctions, which would be an unprecedented action against a fellow NATO member.

— Andrew Desiderio

Capital One merger is one big test for the Capitol

A proposed merger between two giants of the credit card world comes at a tense moment for Washington and Wall Street, making it one of the country’s most politically charged bank mergers in years.

Capital One Financial announced over the weekend it had secured an agreement to purchase Discover Financial Services in a $35.3 billion deal.

Lawmakers are just beginning to weigh in on the deal. Sen. Elizabeth Warren (D-Mass.) wrote on X that the merger should be blocked, arguing the transaction “threatens our financial stability, reduces competition, and would increase fees and credit costs for American families.” Senate Banking Committee Chair Sherrod Brown (D-Ohio) warned regulators away from a “rubber-stamped merger.”

The deal isn’t significant simply for the size of the would-be bank, which could eclipse JPMorgan Chase as the country’s biggest card lender by market share.

Crucially, Discover owns a discrete payment network, one that’s much smaller than the massive networks run by Mastercard and Visa, to be clear. But that system, coupled with the combined loan balances of the two institutions, will make Capital One a much heftier competitor in this business.

That shakeup is going to attract a lot of regulatory attention from bank regulators and antitrust officials at the Justice Department. The Biden administration has generally tried to signal a more aggressive posture toward mergers in general, but left-leaning lawmakers have urged the White House to do more.

We’ve written elsewhere about Capital One’s unique lobbying footprint in Washington. The Virginia-based, $478-billion-asset institution spent more than $2.5 million lobbying the Hill in 2023 — far more than most banks of its size.

Much of the bank’s lobbying revolves around credit card policy and legislation — particularly the Credit Card Competition Act from Sens. Dick Durbin (D-Ill.) and Roger Marshall (R-Kan.). The banking industry is staunchly opposed to that bill.

But Capital One signaled broader ambitions last year. A lobbying disclosure filed by 1607 Strategies reported part of the firm’s work would center on “issues related to competition policy and antitrust laws.”

Of note: One lobbyist listed on that disclosure — Travis Johnson, managing principal at 1607 Strategies — touts a “strong working relationship with current Speaker Mike Johnson” after serving as chief of staff for former Sen. David Vitter (R-La.), per the firm’s website.

— Brendan Pedersen

THE CAMPAIGN

Hogan leads Maryland race in eye-opening GOP poll

News: Former Maryland Gov. Larry Hogan is leading both of his potential Democratic Senate challengers by double digits, according to GOP polling provided to the NRSC.

Hogan leads Rep. David Trone (D-Md.) 49%-33% and outruns Prince George’s County Executive Angela Alsobrooks 52%-29%, according to the poll conducted by longtime Hogan pollsters Ragnar Research Partners.

We make it a habit not to run many internal polls, but we felt compelled to include this. These are eye-popping numbers, and it shows the challenges Democrats face in a very blue state with Hogan.

But it’s time for some caveats.

We don’t really believe Hogan is leading by that wide of a margin over Trone and Alsobrooks in Maryland. Yes, Hogan is a largely popular former two-term governor. But remember – 2024 is a presidential year and former President Donald Trump is back on the ballot. President Joe Biden beat Trump by 33 points in Maryland.

The months of attacks on Hogan’s record haven’t begun. Abortion will be a top campaign issue, which could be a problem for the Republican. And a federal election is far different than a statewide race. All cycle, Hogan will be tied to unpopular national Republicans including Senate Minority Leader Mitch McConnell.

All that being said, it’s fair to say that Democrats have a problem in the Old Line State. Trone has unlimited resources and is spending heavily on television but isn’t breaking through. Alsobrooks has locked up almost every major statewide endorsement yet is widely unknown across the state.

Hogan, on the other hand, enjoys almost universal name identification and left office with high approval ratings.

Even if this is just a very early snapshot of the race, it appears that Democrats may have to divert some resources to Maryland. Consider that the party is defending vulnerable incumbents in Montana, Ohio, Pennsylvania, Nevada and Wisconsin, plus an open seat in Michigan. And there’s the mess that’s Arizona. Maryland, plainly, wasn’t supposed to be even remotely in play.

Florida Senate news: A new memo from former Rep. Debbie Mucarsel-Powell’s (D-Fla.) campaign hits incumbent Sen. Rick Scott (R-Fla.) over his controversial Social Security and Medicare reform. The memo marks the two-year anniversary of Scott’s “12 Point Plan to Rescue America,” which was pilloried by Democrats and criticized by Republicans like McConnell.

Also: Eric Hovde officially launched his bid for Senate against Sen. Tammy Baldwin (D-Wis.). The wealthy businessman has a new ad out where he says, “Everything is going in the wrong direction.” Hovde doesn’t mention Baldwin in his ad.

Democrats are already painting Hovde as extreme and out-of-touch.

One more: Defend American Jobs PAC has put $2.1 million in broadcast and cable ads boosting Rep. Jim Banks (R-Ind.) bid for Senate. The spot is running in Indianapolis, South Bend and Ft. Wayne. Banks is the frontrunner for the Senate seat being vacated by Sen. Mike Braun (R-Ind.).

Defend American Jobs PAC is being funded by a whole host of private equity and tech companies and executives. Both Ripple Labs and Coinbase, crypto companies, donated $1.5 million to the super PAC. Ben Horowitz and Marc Andreessen, the founders of Andreessen Horowitz, donated $750,000 each. And Fairshake, another super PAC funded by Silicon Valley titans, gave $150,000.

— Max Cohen and John Bresnahan

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