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April 20, 2023
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THE TOP
Happy Thursday morning.
Speaker Kevin McCarthy’s debt-limit strategy relies on two basic assumptions.
No. 1: He’ll be able to pass the House GOP’s new 320-page bill next week with Republican votes only.
No. 2: Senate Republicans will back McCarthy up and reject Senate Majority Leader Chuck Schumer’s bid to pass any clean debt-limit hike, forcing President Joe Biden and Senate Democrats to the negotiating table.
As of now, even the GOP senators most prone to deal-making say they’ll oppose a clean debt-limit bill — a positive development for McCarthy in this saga. Senate Minority Leader Mitch McConnell has made it very clear that this is McCarthy’s fight and he will back up the speaker as needed.
We canvassed moderate Senate Republicans over the last few days and found just one who seemed even remotely open to voting for a clean debt-limit hike at some point in the future. Of course, it’s still early, and this issue will only get more complicated if the threat of a debt default draws closer over the next two months.
Yet the reticence from Senate GOP moderates highlights what has become a broader effort to preserve McCarthy’s leverage, to the extent he has any.
We asked McCarthy what made him confident that Senate Republicans wouldn’t undermine him at the end of the day.
That Senate Republicans are sticking by McCarthy’s side is important, especially as the possibility of a default grows. With 51 Senate Democrats, it would take just nine GOP senators to cross the aisle and support a clean debt-limit increase. That would put McCarthy in an uncomfortable and potentially embarrassing spot.
Sen. Thom Tillis (R-N.C.) was the only GOP senator we spoke with who envisioned a scenario in which enough Republicans would back a clean debt-limit hike to reach 60 votes. But, Tillis noted, “it would be dead on arrival in the House.” (So is McCarthy’s bill in the Senate, of course.)
Tillis also cautioned that, “under the current circumstances,” he wouldn’t vote for a clean debt-limit hike. Tillis wants to see a bipartisan deal.
However, the North Carolina Republican is someone to watch if this stalemate drags into the summer and the choice is between a clean debt-limit hike or a default.
Other deal-making Republicans weren’t as willing to entertain the possibility of a clean debt-limit increase. They’re looking to boost McCarthy’s negotiating position as he works to secure 218 votes for his opening salvo.
“I don’t see it right now,” Sen. Todd Young (R-Ind.) said of a clean debt-limit hike. “We should all assume that we’re going to be implementing some spending cuts in conjunction with raising the debt limit. And I think Speaker McCarthy’s leverage will increase if they’re able to pass out of the House, per his plan, some spending-cut proposals bundled with a debt-limit increase.”
Sen. Susan Collins (R-Maine) said she’s confident that there’ll be a bipartisan deal at some point, especially now that McCarthy has been more specific about his plan. “So that takes away the last excuse for the administration, which should sit down and negotiate,” Collins added.
“Right now everything is pointing to the fact that we’re going to get a negotiated settlement on it. I don’t want to do anything that would jeopardize the House trying to get their team put together on it,” said Sen. Mike Rounds (R-S.D.). “I’m going to keep my powder dry at this point until we get something from the House.”
“I support the effort that Speaker McCarthy is undertaking,” said Sen. Mitt Romney (R-Utah). “Assuming he’s able to get a proposal on the table, I think that puts enormous pressure on the White House to finally negotiate. And that’s what standing between us and getting the deal done.”
That’s some remarkable support from a group of Senate Republicans who were on the receiving end of McCarthy’s threats last year to ignore any legislation they proposed due after the group backed the omnibus spending bill. But it isn’t a risk-free strategy.
McCarthy and the House GOP leadership are planning to take this legislation to the House Rules Committee on Tuesday, with a floor vote sometime Wednesday or later. Republicans can only lose four votes in the House, giving the leadership very little room for maneuver.
A few House Republicans have indicated they are uncomfortable with the bill. For example, Rep. George Santos’ (R-N.Y.) team is saying publicly he’ll vote no. We imagine House GOP leaders will remind Santos that they didn’t call for his expulsion in the midst of an ethics scandal. And Rep. Nancy Mace (R-S.C.) is also currently “leaning no,” but she expressed doubt about the rules package before eventually voting yes.
McCarthy and his top lieutenants will spend the next week meeting with as many rank-and-file members as possible, looking to nail down their support.
— Andrew Desiderio, Jake Sherman and John Bresnahan
TODAY: There’s still time to RSVP for our conversation at 9 a.m. ET with House Problem Solvers Caucus Co-Chairs Brian Fitzpatrick (R-Pa.) and Josh Gottheimer (D-N.J.). They’re sharing their insights on challenges facing small business owners. This conversation is the first in a three-part series, Small Business, America’s Future.
NOMINATION FIGHT
Su goes before HELP panel today with Labor post at stake
The Senate HELP Committee will take up the nomination of Julie Su for Labor secretary today. But whether the Senate will confirm Su is far from clear at this point.
No Senate Republicans will back Su, while at least three moderates who previously voted for her to be confirmed as deputy secretary in July 2021 — Democratic Sens. Jon Tester of Montana and Joe Manchin of West Virginia, along with Sen. Kyrsten Sinema (I-Ariz.) — now are declining to say whether they’ll do so again. And with Sen. Dianne Feinstein (D-Calif.) out for an indeterminate period, Senate Majority Leader Chuck Schumer and the White House can’t lose any votes.
Tester is meeting with Su today, while Manchin and Sinema declined to comment on Wednesday.
We spoke to AFL-CIO President Liz Shuler on Wednesday about Su and what it would mean for the labor movement to have the former California official confirmed as secretary. Labor unions and business groups are sharply divided over Su’s nomination.
“We could not have someone more prepared to hit the ground running on day one than Julie Su. This has been her life’s work,” Shuler said, pointing to Su’s long tenure as California labor commissioner and legal work on behalf of Asian American groups. “She has spent every day thinking about how to improve the lives of workers for decades.”
More Shuler:
As for Senate Democrats who are wavering on Su, Shuler added, “Nothing has changed except she’s more experienced now.”
HELP Committee Chair Bernie Sanders (I-Vt.) told us that GOP opposition to Su’s nomination “has nothing to do with Julie Su.”
Opposition to Su centers around the tens of billions of dollars in fraudulent claims allegedly paid out while she oversaw California’s unemployment insurance program during the Covid-19 pandemic. As much as $30 billion was improperly distributed under Su’s watch. That controversy almost derailed her nomination for deputy secretary of Labor in 2021. Su was confirmed on a 50-47 margin with three Republicans missing the vote.
“[Su] demonstrated an unusual capacity for incompetence in managing the unemployment system in California,” said Sen. Mitt Romney (R-Utah), who serves on the HELP Committee. “And her statements on other matters are out of the mainstream.“
– John Bresnahan
WASHINGTON X THE WORLD
The Democrats going with Jeffries to Israel and Ghana
House Minority Leader Hakeem Jeffries is heading abroad tonight on his first trip as the chamber’s top Democrat. He’ll go to Israel and Ghana.
We got our hands on the list of Democrats who will be traveling with Jeffries.
| → | Rep. Greg Meeks (N.Y.), the top Democrat on the House Foreign Affairs Committee. |
| → | Rep. Debbie Wasserman Schultz (Fla.), the ranking Democrat on the MilConVA appropriations subcommittee. |
| → | Rep. Yvette Clarke (N.Y.), a close Jeffries ally who also represents Brooklyn. |
| → | Rep. Joe Neguse (Colo.), a member of Jeffries’ leadership team. |
| → | Rep. Steven Horsford (Nev.), chair of the Congressional Black Caucus. |
| → | Rep. Nanette Barragán (Calif.), chair of the Congressional Hispanic Caucus. |
| → | Rep. Josh Gottheimer (N.J.), co-chair of the Problem Solvers Caucus. |
| → | Rep. Sara Jacobs (Calif.), the top Democrat on the Africa subcommittee on Foreign Affairs. |
| → | Rep. Dean Phillips (Minn.), who sits on the Middle East subcommittee on Foreign Affairs. |
| → | Rep. Lizzie Fletcher (Texas), an ally of the Democratic leadership. |
| → | Del. Stacey Plaskett (Virgin Islands), a member of the House Intelligence Committee. |
– Jake Sherman
PRESENTED BY HCA HEALTHCARE
In 2022, HCA Healthcare provided an estimated cost of $3.5B for the delivery of charity care, uninsured discounts and other uncompensated care.
AFGHANISTAN OVERSIGHT
Blinken doesn’t comply with subpoena for dissent cable, offers briefing instead
Secretary of State Antony Blinken has not complied with House Foreign Affairs Committee Chair Michael McCaul’s (R-Texas) subpoena for a Kabul Embassy dissent cable, setting the stage for a potential legal battle with Republicans over access to the document.
McCaul requested an in-camera review of the cable — written by U.S. officials critical of the Biden administration’s plan to withdraw all American combat troops from Afghanistan in 2021 — as part of the panel’s oversight of the chaotic pullout.
Yet even after McCaul offered to view the document with the names of signatories redacted, the State Department declined to comply by the Wednesday 6 p.m. deadline.
The State Department did reach out to the Foreign Affairs Committee on Wednesday to arrange a briefing “about the concerns raised and the challenges identified by Embassy Kabul,” according to State Department Principal Deputy Spokesperson Vedant Patel.
“We continue to believe that our offers can satisfactorily provide the Committee with the information it needs to conduct its oversight function while still protecting the dissent channel,” Patel added.
That offer, however, wasn’t near enough for House Republicans. It’s also worth noting that the State Department wouldn’t give Democrats access to the document either when they were running the chamber.
McCaul wrote to Blinken on April 5 and made clear that a briefing alone “does not constitute compliance with the subpoena or a suitable accommodation in response to it.”
For what it’s worth, McCaul’s approach on trying to obtain access to dissent cable may curry favor in any legal fight.
McCaul initially set a subpoena deadline of April 4 to receive the document. But the Texas Republican later attempted to accommodate Blinken’s concerns that granting lawmakers access to the private dissent cable would discourage the signatories from being candid in future internal communications. McCaul also pushed back the deadline another two weeks.
McCaul told us on Tuesday that while litigation “wasn’t the path we really wanted to go down,” the committee’s legal counsel was prepared to take action.
“It makes you wonder what’s in [the cable], right?” McCaul said. “They’re nervous about it.”
— Max Cohen
DOWNTOWN DOWNLOAD
Tesla hires a new lobbyist and McCarthy’s friend signs new clients
There have been a bunch of interesting moves in the lobbying space in the last day or so.
No. 1: Tesla, Elon Musk’s gigantic car company, has signed Pioneer Public Affairs to lobby on “federal fleet electrification, implementation of Inflation Reduction Act tax incentives and battery supply chain security.”
No. 2: Jeff Miller, Speaker Kevin McCarthy’s close friend and top adviser, has signed a bunch of new clients. Haim Chera, a real estate figure in New York, has hired Miller Strategies to lobby on “[i]ssues as they relate to healthcare legislation.” Haim is the son of Stanley Chera, the late real estate magnate in New York who died of Covid-19. The elder Chera was a friend of former President Donald Trump.
Miller has also signed Ubicquia Inc., a Florida-based infrastructure company; US Trinity Energy Services, a pipeline construction company; and Puerto Verde Holdings.
No. 3: The Major League Baseball Players Association has hired Green Mountain Strategies to lobby on “[l]abor laws and regulations affecting the terms and conditions of employment for professional baseball players.”
– Jake Sherman
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