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April 21, 2023
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PRESENTED BY
THE TOP
Happy Friday morning.
Let’s be honest for a second. House Republican leaders feel good about passing their $4.5 trillion debt-limit package next week, the biggest moment of this Congress for the GOP majority. But many of them also thought Kevin McCarthy would win the speaker’s gavel on the first ballot back in January. So we’re going to step back and analyze what’s happening with House Republicans heading into this critical period.
News: Party leaders began whipping the GOP debt-limit package Thursday. The readout we got from several key House Republican sources is that the whip count went well overall, but there are a large number of “undecided” lawmakers.
This stands to reason. Lifting the debt limit has been a politically dicey vote for years, especially for Republicans. And this package would do just that by $1.5 trillion or until the end of March 2024, whichever comes first.
But GOP leaders feel as if they have a good chance of passing this measure because most Republicans have supported all of the spending-cut provisions in the past. Still, House Majority Whip Tom Emmer and his deputy Rep. Guy Reschenthaler (R-Pa.) have their work cut out for them because, again, no Republicans like raising the debt limit.
McCarthy’s leadership team isn’t interested in changing the text of the Limit, Save and Grow Act, so the bill is what it is, at this point. Based on our conversations, it seems likely that the legislation will come up for a vote Wednesday or Thursday of next week — as long as the whip count continues to move in the right direction. The leadership will push to hold the vote as soon as possible.
We wanted to use this opportunity to unveil the “Punchbowl News 4” — the four groups to watch on the vote next week. This is based on our reporting from inside the leadership from last night.
Rep. Andy Biggs (R-Ariz.): Biggs, a key player in the far right faction of the conference, is getting a lot of attention. Biggs has privately praised the bill to some members, but he’s still undecided, according to sources close to the leadership. The concern is that if Biggs votes no, fellow Arizona Rep. Eli Crane and Montana Rep. Matt Rosendale could join him — and possibly others. This would be a serious problem for the GOP leadership.
Moderates: This is a no-brainer. There are a host of Republicans representing districts that President Joe Biden won in 2020, especially in New York and Pennsylvania. These members may be hesitant to change work requirements for social programs while also slashing spending by tens of billions of dollars.
Yet as you’ll see below, we asked Rep. Brian Fitzpatrick (R-Pa.), a leading House moderate, about this very issue. While Fitzpatrick is uncomfortable with portions of the bill, he seemed open to voting for it, if only to kick off the broader debt limit negotiations between McCarthy and Biden. Passing this package gets McCarthy at that table.
Midwesterners: This group is less of a concern for the leadership, but there are a few Midwestern Republicans anxious about gutting some of the manufacturing provisions from the Inflation Reduction Act. Furthermore, there are concerns about reducing ethanol subsidies. The GOP leadership is making the argument that every Republican voted against the IRA, so they should have no problem with voting to eliminate those provisions now.
Defense hawks: There are pro-military Republicans worried about the tight budget caps called for in the GOP bill. Leadership is arguing that they’ll work out any issues on the Pentagon budget during the appropriations process. This is a hurdle McCarthy will have to overcome. Of course, many of the hawks are close to the leadership, so we don’t expect they’ll cross the speaker here.
Votes on a package like this are exceedingly difficult for the leadership. One vocal no vote can quickly morph into a flood of opposition. The whip team will be working the phone lines hard all weekend to try to solidify support. It’s a huge test for Emmer.
Here’s something to have on your radar: Read this from Reuters regarding the “X date” for a debt default deadline:
House GOP leaders expect to have a better sense of the true deadline by sometime next week. There has been no meaningful contact between McCarthy and Treasury Department officials of late, meaning Republicans don’t have any special insight on timing.
Also: Biden is running for president again and could announce next week. Here’s the coverage: WaPo, NYT and CNN.
The president is heading up to Camp David this weekend to discuss the issue with his family and inner circle, with the public rollout of a campaign video possible by as early as Tuesday.
Biden has made clear for months that he wants to run again, as has First Lady Jill Biden. How this debt limit fight plays out, however, will have a huge impact on his standing heading into the reelection campaign.
– Jake Sherman and John Bresnahan
THE SENATE
Senate Dems grapple with GOP veto power on Judiciary
Senate Democrats have no idea when Sen. Dianne Feinstein (D-Calif.) will return to Washington. In the meantime, the Judiciary Committee is functioning as a 50-50 panel — which means Republicans have a veto over Democrats’ judicial nominees.
Nominations are pretty much the only thing Democrats can unilaterally control in a divided Congress, with the most important being judicial confirmations. They’ve processed nominees for district and circuit courts at a record pace under President Joe Biden. So Feinstein’s absence has a huge impact on a high-profile issue.
But Thursday was a reminder that, despite Democrats’ concerns about their lack of a working majority on the panel with Feinstein out, they’re still able to advance judicial picks. With bipartisan support, the committee approved seven judicial nominees. Others, including Michael Delaney, a controversial appeals court nominee who might not even have unified Democratic support, were put on hold in the face of solid GOP opposition.
“We just moved another handful of judges today, so the work continues,” Sen. Alex Padilla (D-Calif.) said.
But Democrats are frustrated. And they’re worried that their historic pace could soon slow.
“There’s certainly some level of frustration, not blaming Sen. Feinstein because health issues are what they are,” Sen. Richard Blumenthal (D-Conn.) said. “But we’re working hard to find a workaround. And maybe we’ll be successful. But certainly all of us wish we were at full strength.”
Senate Democratic leaders have said all week that they hope and expect Feinstein to return “soon.” But, Blumenthal added, “‘soon’ is in the eye of the beholder.” It remains to be seen whether Feinstein will face additional pressure to resign. If she’s unable to travel back to the East Coast within the next few months, Democrats’ judicial confirmations will undoubtedly dry up.
Republicans — who this week blocked a Democratic request to temporarily replace Feinstein on the committee — are content with the status quo.
“Their goal has been to jam through, on a party-line vote, all their most controversial nominees,” Sen. Josh Hawley (R-Mo.) said. “And they obviously can’t do that at the moment.”
The Judiciary Committee’s work in other areas has been impacted as well. Judiciary Committee Chair Dick Durbin (D-Ill.) invited Chief Justice John Roberts to testify on May 2 about the Supreme Court’s ethics code in the wake of Justice Clarence Thomas’ alleged ethics violations.
Asked about a possible subpoena for Roberts, a frustrated Durbin threw up his hands and said, “I don’t have a majority.”
Of course, a majority vote in the Judiciary Committee would be required to issue a subpoena, and Republicans would almost certainly oppose such a move, giving them full veto authority.
“If we were engaged in an objective discussion about the appropriate standard for judicial ethics, that would be perfectly appropriate,” Sen. Ted Cruz (R-Texas) said. “I don’t believe the Democrats have any interest in an objective or fair discussion.”
In the meantime, Democrats can’t advance judicial nominees that lack GOP support, unless they take laborious and time-consuming procedural votes.
“I’m trying to calculate Sen. Feinstein’s return,” Durbin told us. “And I don’t know when that will be.”
— Andrew Desiderio and John Bresnahan
OVERSIGHT WATCH
Raskin says Oversight Republicans may be violating Bank Secrecy Act
At the outset of the week, Republicans on the House Oversight and Accountability Committee went on a media blitz claiming they unearthed major revelations about President Joe Biden’s family during a search of secret financial records.
But Rep. Jamie Raskin (D-Md.), the panel’s top Democrat, is crying foul. Raskin argues that the Republican messaging violates laws that regulate the treatment of “suspicious activity reports.”
“SARs are governed under the Bank Secrecy Act. It is punishable by substantial financial penalties and crime to reveal anything about a SARs report,” Raskin told us. “[Republicans] should be very careful because the law treats the content of these reports with scrupulous confidentiality.”
Raskin also sent a letter to Chair James Comer (R-Ky.) this week articulating these concerns. But Comer is unbothered by Raskin’s protestations.
“Another day, another letter from Ranking Member Raskin playing defense attorney for the Bidens,” Comer said. “We have every intention to respect the Bank Secrecy Act and hope Ranking Member Raskin will as well instead of leaking memos to the press disclosing information about suspicious activity reports.”
Oversight Republicans, led by Comer, personally reviewed hundreds of suspicious activity reports related to Biden family members and their business dealings at the Treasury Department Monday. Following that review, Comer said the committee was now investigating six more Biden family members that weren’t previously on the panel’s radar.
“It’s a violation of the law even to refer to the identity of someone who’s mentioned in the SARS report,” Raskin added. “So I just hope that they are attentive to the rule of law in proceeding with respect to those reports.”
The Bank Secrecy Act prohibits federal government employees with knowledge of SARs from revealing “any information that would reveal that the transaction has been reported, other than as necessary to fulfill the official duties of such officer or employee.”
More context on SARs: The reports are filed by banks and are often related to money laundering concerns. The vast majority of SARs don’t lead to any law enforcement inquiry.
Comer engaged in a protracted fight with Treasury in order to gain access to the documents. The Biden administration claimed in February that they had to consult with law enforcement partners before allowing lawmakers to view the reports. But Comer won his fight when Treasury announced on March 14 that he could scrutinize the documents in-camera.
— Max Cohen
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PUNCHBOWL NEWS EVENTS
Missed our conversation with Problem Solvers Caucus Co-Chairs Brian Fitzpatrick (R-Pa.) and Josh Gottheimer (D-N.J.)? Check it out below.
THE CAMPAIGN
It’s mid-April, so we’re getting a bunch of campaign finance filings covering the first quarter of 2023. Let’s run down some of the results so far for the big campaign committees.
DNC: $8.1 million raised, $9.7 million spent, $28.6 million on hand.
RNC: $9.1 million raised, $7.5 million spent, $13.3 million on hand.
DCCC: $16.9 million raised, $11.6 million spent, $26.6 million on hand.
NRCC: $14.6 million raised, $9.6 million spent, $24 million on hand.
DSCC: $9.4 million raised, $7.8 million spent, $9.5 million on hand.
NRSC: $7.8 million raised, $8.1 million spent, $8 million on hand.
— Jake Sherman
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Presented by Apollo Global Management
One size rarely fits all. That’s why Apollo provides custom capital solutions designed to help companies achieve their ambitious business goals. Think Credit New