The Archive

IN THIS EDITION

Spending text could be delayed until Thursday

Senate conservatives get their first shot to shape the post-McConnell era

Airlines, card companies resist Durbin’s calls to testify

Attendance issues at influence peddling hearing

McHenry talks Johnson, government funding and digital payments

THE TOP

Spending text could be delayed until Thursday

Happy Wednesday morning.

Well, here we are again. It’s Wednesday. The federal government (partially) shuts down at midnight on Friday. And text for the six-bill minibus still hasn’t been released yet. We’re now hearing we may not see text of the package until Thursday.

Party leaders, appropriators and the White House very much want text out today. Yet the 118th Congress has shown that deadlines are just dreams waiting to be crushed. So don’t assume anything.

This final FY2024 spending package includes the Defense, Homeland Security, Labor-HHS, Legislative Branch, Financial Services-General Government and State-Foreign Operations bills. That’s roughly three-quarters of all federal discretionary spending.

Homeland Security was the big problem, of course. As we told you in the Tuesday AM edition, Speaker Mike Johnson’s office and senior White House officials spent two days negotiating on that bill. What was once going to be a full-year continuing resolution with “anomalies” became a regular appropriations bill. Several billion dollars in new spending on enforcement measures was added, with both sides claiming wins. As we scooped Tuesday, leadership added 12,000 visas for Afghans who helped the U.S. in Afghanistan.

The House will move first on the massive FY2024 spending package. Johnson and his top lieutenants want to hold votes on this bill on Friday, just hours before the midnight shutdown deadline. That’s a tight timeline. But Congress is on the brink of a two-week recess, so there’s a strong bipartisan desire to get it done. Jet fumes and all that. Plus, Republicans and Democrats fear they will have attendance issues if a vote slips to Saturday.

“We’ve got the agreement reached. Hopefully the text will be filed by the morning,” House Majority Leader Steve Scalise said. “The objective is to have it voted on before the end of the deadline [March 22]. So obviously we’re looking at Friday. No final decision has been made, but that’s what we’re looking at.”

In order to get that Friday vote, Johnson really needs text to come out today. The problem is some sources involved in the talks see that goal slipping away. Heading into the week, Johnson’s leadership team simply didn’t think that the speaker would be able to waive the 72-hour review period for legislation — especially on a package that totals more than $1 trillion and touches on immigration, defense and social safety-net policy.

But in Johnson’s Daily Management Meeting Tuesday afternoon, there was consensus that the GOP leadership could collapse that timeframe without much hassle. Then in the Elected Leadership Committee meeting — a much larger group — Johnson said he’d like to hold a vote Friday or Saturday.

Going into the ELC session, conservatives were suggesting that Johnson needed to adhere to the three-day review period. But afterward, RSC Chair Kevin Hern (R-Okla.) admitted that the review period won’t make much difference for a bipartisan bill being considered under suspension. “The 72-hour rule is not going to change anybody from a ‘no’ to a ‘yes’ or a ‘yes’ to a ‘no,’’’ Hern said.

There’s a House Republican Conference meeting this morning. Johnson will sell the yet-to-be-released deal to the rank and file and get a true sense of how much he can speed up passage of the minibus package. Johnson also met with the House Freedom Caucus Tuesday evening with the same goal.

Johnson is certainly getting more comfortable with the realities of the speakership. You need to get a deal, stick to it and get it through the chamber. House Financial Services Committee Chair Patrick McHenry (R-N.C.), speaking at a Punchbowl News event Tuesday, said Johnson is “improving week over week” as speaker. “He’s landed deals,” McHenry said.

“Do not fear the deal,” McHenry added. “You have to go land those legislative priorities in order to show power and to exercise power. … He has now landed his second big deal as speaker.”

The Senate: Majority Leader Chuck Schumer said Tuesday he’ll put the funding package on the floor immediately once it’s received from the House. Without a time agreement, it could take several days for this to pass.

Already, GOP aides say at least a dozen amendment votes have been requested — many of which center on immigration and border security. Republican leaders are trying to get this sorted out on the front end to minimize the last-minute haggling.

But passing the minibus on Friday or Saturday will require a unanimous-consent agreement — meaning those who want amendment votes must first agree to speed things up. The GOP amendments would be quickly rejected, and senators would move to final passage.

“I’m certainly willing to try to convince our conference to agree to time limits so we can get out of here,” Sen. Ron Johnson (R-Wis.), who has submitted several amendments, told us. “There’s no reason to let these things go to the very end [and] threaten a shutdown.”

Of course, any one senator can drag out this process. But senators are staring down a two-week recess filled with home-state travel and CODELs, so there’s little interest in delaying the inevitable. And recesses have a funny way of speeding things up. A little “Senate magic” can go a long way.

Also today: We scooped last night that Israeli Prime Minister Benjamin Netanyahu will address Senate Republicans via video during their lunch today. This is especially interesting given Schumer’s comments last week calling for new elections.

— Jake Sherman, Andrew Desiderio and John Bresnahan

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THE SENATE

Senate conservatives get their first shot to shape the post-McConnell era

Republican senators who tried to oust Mitch McConnell will soon have their first chance to shape the battle to replace him as their party’s leader.

GOP senators are scheduled to meet behind closed doors at 3:30 p.m. in an effort by conservatives to ensure that McConnell’s successor breaks from the Kentucky Republican’s leadership style.

Sen. Ron Johnson (R-Wis.), who led the push for the meeting today, told us he expects it to be just the first step in a months-long process.

“I’ve not been satisfied with the governing model, which has been pretty much what one person says it is,” said Johnson, a vocal McConnell critic. “To the extent we have a strategy, it’s what’s in that one person’s head. [He] doesn’t share it with the rest of us until it’s too late to change course. That’s got to change.”

Johnson said the GOP Conference has been “grotesquely dysfunctional” as of late and wants the leadership candidates to “be engaged in developing” a mission statement for the conference. Johnson and other conservatives bash McConnell for being willing to cut deals with Democrats that only require a handful of GOP votes for passage. And they want the eventual GOP leader to focus on countering Democrats’ policy efforts, rather than helping advance them.

That’s an unmistakable message to those running for GOP leader. So far, there are just two declared candidates — Senate Minority Whip John Thune and Sen. John Cornyn (R-Texas). Others could jump into the race at some point, including Sens. Rick Scott (R-Fla.) and Steve Daines (R-Mont.).

Senators also told us they expect potential changes to the conference’s rules to come up at today’s session, such as term limits for the party leader and the ability of senators to offer amendments. All of the candidates for various leadership positions have emphasized the need to democratize the GOP Conference — in other words, spread the power and influence around.

Thune and Cornyn said they plan to simply listen during Wednesday’s meeting. Neither seemed exactly sure about what could be brought up.

“I don’t really know,” Thune told us. “I assume we’ll talk a little bit about the process. We have some folks interested in a mission statement of some sort. So we’ll see where it goes. I think it… sounds fairly open-ended at this point.”

— Andrew Desiderio

Airlines, card companies resist Durbin’s calls to testify

We’re going to talk about interest rates in a second. But let’s talk about credit cards first.

News here: Senate Judiciary Committee Chair Dick Durbin (D-Ill.) said Tuesday night he’s facing “resistance” from major players in the credit card market after calling on the CEOs of United Airlines, American Airlines, Mastercard and Visa to testify.

Back in February, Durbin announced that he wanted CEOs of those four companies to testify in an April hearing on “credit card competition,” with a deadline to respond set for March 4. Banks are strongly opposed to Durbin’s Credit Card Competition Act, and they’ve gotten a nice lift from the airline industry in this fight.

We asked Durbin Tuesday evening whether he’d heard back from the airlines about his request. Durbin told a group of reporters he’d experienced “resistance from them to bring their CEOs in.”

“CEOs are too busy, they say,” Durbin added. Durbin also confirmed the companies had offered other executives to testify. When we asked whether that’d be acceptable, he replied: “No.”

Representatives for United and American declined to comment.

Staff familiar with the hearing’s planning say that Mastercard and Visa have presented similar resistance to Durbin. Spokespersons for both companies declined to comment about the hearing on the record.

Back to central banking: The Federal Open Market Committee announces its next interest rate move this afternoon.

We know we say this a lot, but the news conference today with Fed Chair Jay Powell will be a big one for economy watchers.

Price hikes for the American consumer have been slowing for months from the inflationary highs of 2022. But progress against inflation has become bumpier in recent weeks, with consumer price data coming in hotter than expected and shelter costs remaining stubbornly high.

More importantly, core inflationary dynamics have been changing in 2024. Inflation for physical goods has come down as supply chains have unsnarled over the last two years. But services inflation — better known as the prices folks charge for skilled labor — has proven to be stickier.

Powell told reporters in January that the Fed would need to see more progress against services inflation. “It’s a reasonable assumption that, over time, goods inflation will flatten out — probably approximate zero,” Powell said. “That would mean the services sectors would have to contribute more.”

Washington and Wall Street are acutely interested in when the Federal Reserve will start to cut interest rates — which Fed officials have said they’d like to do this year.

So exactly how Powell addresses these concerns today is going to shape how we think about inflation and the broader economy for the next several months. That’ll have big implications for the upcoming presidential election.

— Brendan Pedersen

Attendance issues at influence peddling hearing

House Oversight Committee Chair James Comer’s (R-Ky.) hearing today on alleged influence peddling by President Joe Biden’s family is facing an attendance problem.

The person at the heart of the hearing, Joe Biden’s son Hunter Biden, isn’t showing up. Devon Archer, Hunter Biden’s former business associate who shed light on then-vice president Joe Biden’s involvement in phone calls with Hunter’s partners, won’t be attending either.

That leaves Tony Bobulinski — who clashed heavily with Democratic investigators — and Jason Galanis — who’s appearing virtually from federal prison — as the GOP witnesses.

Obviously, this isn’t ideal for Comer, who has faced growing questions from Republican colleagues over where the impeachment inquiry into Joe Biden is heading. Today’s hearing was billed by Comer as a chance to publicly grill Hunter Biden on discrepancies between his testimony and what his former business partners told investigators.

First in Punchbowl News: A new memo from Oversight Democrats takes aim at Bobulinski and Galanis, arguing their testimony lacks any evidence of wrongdoing on the part of Joe Biden.

“Republicans are attempting to erase exculpatory testimony from nearly 20 witnesses, instead depending on two discredited witnesses with significant ties to Donald Trump and his allies — and even they cannot provide evidence of wrongdoing,” the memo states.

How we got here: Hunter Biden’s lawyer, Abbe Lowell, turned down the invitation to the public hearing. Lowell said his client would consider taking part only if Comer also probed the business deals of former President Donald Trump’s family members. So Hunter Biden won’t be coming. Archer’s lawyer wrote to Oversight GOP staff on Monday that his client wasn’t given a proper heads-up about the hearing and won’t be testifying as a result.

Asked about the fact that two of his witnesses aren’t coming, Comer told us to worry about “the timeline” — a reference to our item last week about House Republicans flailing on impeachment.

“I’m taking a break from Punchbowl,” Comer said. “I’m looking at you like the comics section in the paper.”

Democrats are inviting Lev Parnas, a former Rudy Giuliani associate who has urged Comer to drop his impeachment inquiry.

It’s safe to say that we can expect some fireworks from the proceedings today. Comer has previously said he doesn’t view public hearings as the best venue due to the start-stop nature of the questioning. Left unsaid is that firebrands on both sides of the aisle sit on the Oversight panel and will use their five minutes to try to go viral.

— Max Cohen

PUNCHBOWL NEWS EVENTS

McHenry talks Johnson, government funding and digital payments

Did you miss our half-day summit on the digital payments economy Tuesday?

The event featured a conversation with House Financial Services Committee Chair Patrick McHenry (R-N.C.), who discussed his views on Speaker Mike Johnson’s leadership, government funding, stablecoin legislation, fintech and more.

You can watch the full conversation here.

— Elvina Nawaguna

THE CAMPAIGN

— Max Cohen

MOMENTS

CLIPS