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The reconciliation meeting that will dominate this week

Who we’re watching

Cruz leads the way on Mexican water dispute

What we’re watching

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The reconciliation meeting that will dominate this week

Happy Monday morning. The House and Senate are back today. President Donald Trump is at the White House.

News: The first big moment of this week will come Tuesday. That’s when Speaker Mike Johnson, Senate Majority Leader John Thune and House and Senate Republican committee chairs will meet to begin hammering out how to meld their very different budget resolutions for reconciliation. At stake — the fate of Trump’s legislative agenda.

You don’t need us to fully review how different the two budget resolutions are, but as a reminder, the House’s resolution includes a minimum of $1.5 trillion in spending cuts and $4.5 trillion for tax cuts. The Senate’s “skinny” budget resolution includes $325 billion in new military and border security spending plus energy policy changes.

Johnson and his House Republican leadership team have been adamant that they believe their resolution should win out because of the razor-tight GOP margin of control in their chamber. Yet, the Senate isn’t going to agree to $880 billion in Medicaid cuts or other massive reductions in federal spending that the House has approved.

House and Senate Republican leaders want to pass a compromise budget resolution before the Easter break. The plan, as of now, is for the Senate to consider the legislation on the floor first.

But in order for that to happen before the scheduled two-week recess, the Senate would need to vote on the compromise budget resolution next week. During a Fox News interview on Sunday, Sen. John Hoeven (R-N.D.), suggested that the Senate could indeed have a compromise budget resolution on the floor as soon as next week.

Meanwhile, staff-level work on the tax components was “virtually nonstop” over the recess, per a Senate aide. Remember, GOP congressional leaders and the White House also have to hammer out a compromise on the non-tax details. For example, the Senate’s defense number is $50 billion higher than the House’s.

One of the other main topics of conversation expected in the Johnson-Thune-chair meeting is Congress’s next big fight: the debt limit.

Johnson would like to keep the debt limit increase as part of the reconciliation package. But Senate Republicans are skeptical of that. For his part, Trump would like the borrowing cap lifted as soon as possible and doesn’t care how.

Johnson is still under the assumption that he can get the final reconciliation package passed through both chambers and to Trump’s desk before Memorial Day. We’re skeptical of this timeline, as is pretty much everyone else in town. The “X date” for the debt limit hasn’t been set yet, although that would be close. Problems at the IRS are a potential issue too.

But let’s play out another scenario. What if Congress lumped together the debt limit and disaster aid, something that lawmakers and aides have been talking about for some time? It would take the hugely controversial provision out of the reconciliation package and lump it in with tens of billions of dollars in aid for California and other disaster-stricken areas.

The political dynamics here are somewhat favorable for Republicans, although it wouldn’t be easy for GOP leaders. They could put a divided Democratic Party in a jam again while making reconciliation easier. Most importantly, it could reach the floor long before a reconciliation package is completed.

Look at what Democrats are going through at this moment. House Democrats are up in arms against Senate Minority Leader Chuck Schumer for helping the GOP-run Congress avoid a government shutdown. Schumer spent the recess on an “I’m-not-resigning-as-leader” tour while promoting his new book on anti-semitism. A huge chunk of the Democratic Party has major reservations about Schumer’s strategic decision-making. A debt limit-disaster aid fight could push the Democratic Party’s fissures back to the surface again.

We don’t want to minimize the seriousness of the debt-limit issue. Republicans have to pass a debt-limit increase in order to enact their agenda, including extending the 2017 Trump tax rates. Voting for such an increase has been anathema to most hardline conservatives throughout their careers, but they supported it under heavy pressure from Trump as part of the House GOP budget resolution. That proposal included a $4 trillion increase in the borrowing limit.

In order to add the debt-limit provision to a disaster aid bill – which Democrats would be upset about – Johnson would first have to pass a rule. Then the House could consider the measure. If passed, it could put Schumer in an uncomfortable spot. The New York Democrat knows raising the debt limit is among the most serious issues Congress faces. Yet he would be under pressure to force Republicans to go with it alone, meaning using reconciliation to pass it themselves.

But for this week, Johnson’s goal is to keep the focus completely on reconciliation and party unity in order to have a chance of getting the reconciliation package over the finish line at some point this spring or summer.

The GOP leadership doesn’t want to spend necessary time on any other issue.

But this week, they have to deal with two situations.

First, Rep. Anna Paulina Luna’s (R-Fla.) resolution to formalize remote voting for new mothers and fathers has reached the requisite signatures to get a vote on the floor. Johnson is vehemently opposed to this measure.

Second, the GOP leadership is going to try to avoid having Rep. Brandon Gill’s (R-Texas) resolution to impeach U.S. District Judge James Boasberg come up for a vote. Boasberg ruled against Trump’s deportation of Venezuelans.

The House GOP leadership plans two moves to show they are taking on what they call judicial activism.

– They will put Rep. Darrell Issa’s (R-Calif.) bill on the floor to forbid district judges from issuing nationwide injunctions. This bill is unlikely to come to the floor this week since the House has a shortened schedule due to the late Rep. Raul Grijalva’s (D-Ariz.) funeral.

– The House Judiciary Committee will announce hearings on Boasberg and will try to bring him in to testify. It will be difficult to drag a sitting judge in front of a House committee to testify.

— Jake Sherman, John Bresnahan and Andrew Desiderio

Tomorrow at 8:30 a.m. ET: Punchbowl News Founder and CEO Anna Palmer will interview Rep. Nicole Malliotakis (R-N.Y.) about news of the day and tax policy. There’s still time to RSVP!

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Who we’re watching

There’s a lot on tap for this week, as we outlined above. But there are a few more storylines that could get a lot of attention in the coming days, too.

Durbin retirement watch. Any day now, Senate Minority Whip Dick Durbin could announce whether he’ll run for reelection next year.

There’s no doubt that the seat will remain in Democratic hands after 2026, regardless of Durbin’s ultimate decision. But if Durbin announces he won’t seek a sixth Senate term, it would set off a succession battle with major implications not only for Illinois Democrats, but also for Senate Democratic leadership.

Last week, Durbin said at an event in his home state that he’d be announcing his intentions “soon.”

The 80-year-old Durbin has served as the Senate Democratic whip for the last two decades. He was first elected to the Senate in 1996, having served in the House for seven terms prior.

Several Democrats in the state have expressed interest in running for Durbin’s seat if he chooses to retire.

Illinois Lt. Gov. Juliana Stratton has reportedly indicated privately that she’d have the backing of Gov. JB Pritzker. This would give Stratton a major advantage, especially considering Pritzker’s personal wealth. Rep. Raja Krishnamoorthi (D-Ill.) has long been interested in succeeding Durbin, too.

There’s also the question of who would replace Durbin as the No. 2 Senate Democrat. As we wrote last week, Sen. Brian Schatz (D-Hawaii) is considered to be a leading contender.

Rep. Brandon Gill (R-Texas). The freshman lawmaker has 16 co-sponsors on his resolution to impeach U.S. District Judge James Boasberg, who ruled against President Donald Trump’s order to deport Venezuelans under the 1789 Alien Enemies Act. The House Republican leadership team doesn’t think that Boasberg has done anything that rises to the level of impeachment.

But Gill has a bunch of Republicans who will be tough to convince.

Worldwide threats hearings. The Senate and House Intelligence committees will hold their annual “worldwide threats” hearings this week. It’s the highest-profile public event each year for the usually secretive panels.

It’s also the first time Trump’s top intelligence officials will testify together. Director of National Intelligence Tulsi Gabbard and CIA Director John Ratcliffe appeared before the Senate Intelligence Committee separately earlier this year for their confirmation hearings. FBI Director Kash Patel had his confirmation hearing before the Judiciary Committee.

The Senate Intelligence Committee’s worldwide threats hearing is scheduled for Tuesday. The House’s hearing will take place on Wednesday.

In addition to Gabbard, Ratcliffe and Patel, the committees will also hear from NSA Director Gen. Timothy Haugh and DIA Director Lt. Gen. Jeffrey Kruse.

The D.C. budget issue. You may remember that the CR that Congress passed before the recess included language that gave the D.C. government flexibility to spend its money as it sees fit. The Senate passed a fix that averted the District having to go back to FY2024 spending levels. The House will only take up the Senate’s fix if Trump makes a public case that it’s needed. Trump will meet with the House Republicans’ women’s caucus at the White House on Wednesday.

— Jake Sherman and Andrew Desiderio

WASHINGTON X THE WORLD

Cruz leads the way on Mexican water dispute

Sen. Ted Cruz (R-Texas) is leaning into a bubbling foreign policy dispute, accusing the Mexican government of violating a 1944 treaty requiring water shipments to U.S. farmers.

In an interview, Cruz advocated for his legislation placing sanctions on Mexico — including cutting U.S. aid by 15% — if the country continued to fail in its agreement to transport water to struggling south Texas farmers.

“South Texas farmers are removing thousands and thousands of acres from production,” Cruz told us. “Farm workers are losing their jobs.”

The issue has significantly escalated recently, resulting in the State Department’s announcement last week that it was withholding U.S. shipments of water to Mexico for the first time. Agriculture Secretary Brooke Rollins is stepping in too, having traveled to the Rio Grande Valley last week to announce $280 million in block grant funding for Texas state officials to distribute to local farmers.

Cruz applauded Rollins’ efforts but insisted that “the real answer is not relief checks. The real answer is to get our damn water.”

At the heart of the matter is a 1944 treaty between the United States and Mexico, that requires Mexico to provide south Texas with 350,000 acre-feet of water per year over a five-year cycle. Per Cruz, the Mexican government “is badly in arrears” and “currently owes south Texas 1.3 million acre feet of water.”

In Cruz’s view, Mexican non-compliance with the treaty was allowed to flourish during the Biden administration “because Democrats simply didn’t give a damn about the south Texas farmers whose farms were going out of business.” But the Trump administration’s tough posture toward Mexico — ranging from tariffs to anti-fentanyl efforts to immigration — is welcome news to Republicans like Cruz.

“[Mexican] President Sheinbaum both respects and fears President Trump,” Cruz said. “I have every confidence Mexico is going to meet its treaty obligation, because if they do not, the Trump administration is going to utilize the leverage they have to force them to do so.”

Mum on Cornyn: At the end of our interview, we took the opportunity to get Cruz’s thoughts on a separate Texas issue: The burgeoning primary threat Sen. John Cornyn (R-Texas) faces from Texas Attorney General Ken Paxton. Cruz wouldn’t answer whether he would stay out of the primary or get involved in some capacity, telling us he wanted to focus on the water dispute.

— Max Cohen

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What we’re watching

Monday: The House Rules Committee will meet to prepare several bills for floor consideration.

Tuesday: The House Agriculture Committee will host a hearing on the CFTC at 50 years old. The House Financial Services Committee will hold a hearing on expanding access to capital across America with several witnesses, including Steve Case.

U.S. Capitol Police Chief J. Thomas Manger will testify in front of the House Appropriations Committee about the security of the Capitol complex.

The House Ways and Means Committee will hold a hearing on America’s trade negotiation priorities.

The Senate Finance Committee will hold a hearing on Frank Bisignano’s nomination to be commissioner of the Social Security Administration. The Senate Intelligence Committee will have its worldwide threats hearing.

Wednesday: The House Appropriations Committee will host NTSB Chair Jennifer Homendy for an NTSB oversight hearing. The House Financial Services Committee will hold a hearing on a “new era for the CFPB.”

The House Oversight and Government Reform Committee will host the heads of NPR and PBS for a hearing entitled “Anti-American Airwaves: Holding the heads of NPR and PBS Accountable.” NPR President and CEO Katherine Maher and PBS President and CEO Paula Kerger are slated to appear.

The Senate Armed Services Committee will hold a hearing on the status of the military service academies with the superintendents of West Point, the Naval Academy and the Air Force Academy.

Thursday: The Senate Commerce Committee will hold a hearing about the DCA mid-air collision. Homendy, Acting FAA Administrator Chris Rocheleau and Brigadier Gen. Matthew Braman, the director of Army Aviation, will testify.

– Jake Sherman

… AND THERE’S MORE

The Campaign. Conservative Fighter PAC is up on the air with an ad aimed at boosting Randy Fine, the Republican running to replace National Security Adviser Michael Waltz in Florida. Fine is running against Democrat Josh Weil. House Republicans and the Trump political operation have gotten nervous about this seat, which President Donald Trump and Waltz won by 30 points in 2024.

https://www.youtube.com/watch?v=sWEbOtDSSig

Weil is running a spot that calls Fine a “violent, corrupt politician,” links him to steep cuts in Medicaid and says that he believes Social Security is a “Ponzi scheme.” The end of the ad labels Fine as “unhinged and un-American.”

Downtown Download. Ballard Partners has signed Atlas Air to lobby on trade and tariffs and Netflix to lobby on “[l]egislative and regulatory issues related to the media industry.”

Job moves. Mark Bednar, a former aide to former Speaker Kevin McCarty, has joined Monument Advocacy as principal of government relations and public affairs.

– Jake Sherman

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