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Happy Thursday morning.
So now what?
That’s the question bouncing around Washington after Speaker Kevin McCarthy and House GOP leaders muscled their debt-limit bill — the Limit, Save, Grow Act — through the chamber on Wednesday.
This was an important step by McCarthy and his leadership team. Does it end the debt-limit debate? No, of course not. But it’s the end of the beginning, to borrow a famous phrase. We have some thoughts on how this could all unfold during the next few weeks.
No. 1: McCarthy played the only hand he had, which was to move a debt-limit bill. Doing nothing and engaging in a war of words with the White House and Senate Democrats wouldn’t have worked. If McCarthy waited around, a clean debt-limit bill would’ve eventually come to the House amid a burgeoning default crisis, and his speakership would be over.
McCarthy also secured an extremely useful talking point. No matter how right-leaning and unrealistic the 320-page package is, House Republicans are the only ones to have passed legislation to lift the nation’s borrowing cap. McCarthy plans now to sit, pat and slam Senate Majority Leader Chuck Schumer for doing nothing and President Joe Biden for refusing to negotiate.
“Now, the president can no longer put this economy in jeopardy. We have lifted the debt limit, we have done our job, we are the only body that passed anything,” McCarthy said after the vote.
McCarthy received calls from a number of Senate Republicans on Wednesday night congratulating him on passing the bill. It’s clear that there isn’t support in the Senate GOP Conference for a clean debt-limit measure, not right now anyway. The White House won’t be able to try bypassing McCarthy by cutting a deal with Senate Republicans.
No. 2: This was a win for McCarthy, and he made some crucial decisions along the way. Late on Tuesday night, as the House Rules Committee was locked in a marathon markup of the legislation, McCarthy agreed to alter the debt-limit package to mollify conservatives and Midwestern Republicans while he was laying in his bed. The Iowa delegation was under pressure from GOP Gov. Kim Reynolds, who was concerned about ethanol-related provisions. And a handful of House GOP hardliners wanted to implement tougher work requirements more quickly.
Beyond McCarthy, others in the House GOP leadership played key roles here as well. House Majority Leader Steve Scalise met with undecided lawmakers and was helpful in flipping them. Majority Whip Tom Emmer and his deputy Rep. Guy Reschenthaler (R-Pa.) ran an effective whip operation that was able to hold together a tenuous coalition. Rep. Garret Graves (R-La.) was deputized by McCarthy to help assemble the GOP package.
No. 3: House Republicans can’t pass more than a few FY 2024 spending bills at the levels called for in this package — if they can pass any. It’s not clear that the Senate can pass any spending bills, despite the bipartisan talk coming out of the Senate Appropriations Committee. The fight over the debt limit is the only real game in town.
No. 4: The next chapter will be much more difficult. McCarthy truly wants spending caps, permitting reform and work requirements in an ultimate debt-limit deal. That’s going to be very tricky if the California Republican ever gets into a real negotiation with Biden and Schumer. Did House GOP leaders raise the bar too high by passing this package? Only time will tell.
No. 5: Goldman Sachs said Wednesday that the default deadline for the U.S. government will come in July, not in June as some had feared. Treasury Secretary Janet Yellen has only stated that the Treasury can fund government operations through “early June.” CBO has been predicting the “X date” would occur sometime between July and September.
No. 6: McCarthy feels as if he and House Republicans are being constantly underestimated — and it’s clearly nagging at him.
Check out what McCarthy said late Wednesday at his news conference:
“You raised the question whether I could even become speaker. We went 15 rounds. Became speaker. Then you raised the question could we even pass [a bill to strip funding from the 87,000 IRS agents] We did it. …
“Then you said could we stand up for the American public [and what] we said in the Commitment to America … would we pass the Parents Bill of Rights. We passed that. … When we passed the bill to end the pandemic so we could get back to work again. You said why even do it, the Senate is not going to take it up. The president said he’s going to veto it. It’s law today.
“So every question you continue to raise, you guys have been wrong. You’ve underestimated us.”
The House is out of session next week, while the Senate is in. McCarthy heads off to Israel on a bipartisan codel. Shortly after McCarthy returns, Biden will head to Australia and Japan. Time is short.
– Jake Sherman and John Bresnahan
Reminder: Join Punchbowl News Founder and CEO Anna Palmer and Managing Editor Heather Caygle on Tuesday, May 9 at 8:30 a.m. ET for Women Challenging Washington. The event will feature conversations with Sens. Joni Ernst (R-Iowa) and Jeanne Shaheen (D-N.H.), and Reps. Stephanie Bice (R-Okla.), Lisa Blunt Rochester (D-Del.) and Mikie Sherrill (D-N.J.). The interviews will focus on their bipartisan policy work and disrupting partisan culture on Capitol Hill.
The event will also feature great networking opportunities and headshots available to all attendees on a first-come, first-served basis. RSVP and be sure to share the event with your mentor/mentee or friend across the aisle.
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How can parents help teens manage the time they spend on Instagram?
Once Supervision is set up, parents can use daily time limits to manage the amount of time their teen spends on Instagram every day.
As a result, teens can be more intentional about the time they spend online.
Manchin on warpath against Dems as Justice enters race
Sen. Joe Manchin (D-W.Va.) is on a tear against his own party as a new and formidable challenger prepares to enter the West Virginia Senate race — GOP Gov. Jim Justice.
Justice is expected to officially jump into the race later Thursday. Sens. Shelley Moore Capito (R-W.Va.) and Lindsey Graham (R-S.C.) are scheduled to be on hand for Justice’s announcement.
Manchin hasn’t officially declared whether he’ll run for reelection in 2024, but lately he’s been acting more and more like a candidate.
In public statements and floor votes, Manchin is consistently breaking with his party and President Joe Biden, using language one would expect to hear from a Republican. This week, Manchin even threatened to vote to repeal the Inflation Reduction Act, a law he helped craft. Manchin has been infuriated by the Biden administration’s implementation of the legislation, arguing federal agencies are ignoring clear congressional intent.
In a brief interview, Manchin insisted to us that his posture has nothing to do with the 2024 race.
“I’ve been involved in state politics for a long time. I lost one race in 1996. I made a vow that I’ll never lose another race. And I won’t,” a defiant Manchin declared.
Manchin’s fellow Democrats have been careful not to criticize him directly. For the most part, Democrats want to give Manchin some latitude to distance himself from the party, recognizing that that helps him in West Virginia — a state Donald Trump won by nearly 40 points in 2020.
Lately, though, Manchin has taken it to a whole new level. He’s joined Republicans on nearly every disapproval resolution they’ve brought up for a vote, most recently on blocking EPA emissions standards for heavy-duty trucks Wednesday. Manchin was the deciding vote that led to passage of that measure.
For months now, Manchin has slammed the Biden administration over its implementation of the IRA’s energy-related provisions. Manchin dialed up the rhetorical attacks when he appeared on Sean Hannity’s Fox News show Monday and said he’d vote to repeal the IRA entirely if the administration doesn’t reverse course. Manchin now seems primed to oppose Biden’s nominee for Labor secretary, Julie Su. On top of that, Manchin is deviating from Democrats’ message on the debt limit, calling for Biden to negotiate with Republicans.
Despite all of this, Manchin — chair of the Energy and Natural Resources Committee — regularly attends the weekly Democratic leadership meeting and has, for years, swatted away questions about potentially switching parties.
We asked Senate Majority Leader Chuck Schumer whether he’s comfortable with Manchin’s posture lately. Schumer’s response: “Look, the bottom line is our caucus is overwhelmingly for the Inflation Reduction Act.”
This is true. But Manchin isn’t alone in his view that the IRA isn’t being properly implemented. Sen. John Hickenlooper (D-Colo.) said Manchin made “commitments” as part of the legislation that have since “obviously unraveled.”
More from Hickenlooper:
“We’re not getting transmission lines, we’re not getting natural gas or hydrogen pipelines, any of that stuff. And now he feels that some of the things that he put in place to protect American jobs aren’t being administered to fulfill that requirement…
“My experience with Joe Manchin is, when he has an issue, he’s pretty direct and straightforward about it. He’s not manufacturing stuff. This is something he has a genuine concern for.”
Another red-state Democrat up for reelection in 2024 said Manchin has a point, but questioned his threat to repeal the entire law.
Here’s Sen. Jon Tester (D-Mont.):
“That means repealing the prescription drug stuff, repealing the stuff on insulin… Are there things the White House could be doing differently on implementation? Of course. But I don’t know that you’d want to repeal the whole thing.”
Sen. Sherrod Brown of Ohio, another in-cycle red-state Democrat, said this of Manchin’s recent statements: “I don’t think a lot about Sen. Manchin, so I don’t make much of it either way… I do what I need to do.”
Brown, a vocal progressive, is handling his race in a much different way. For the most part, Brown hasn’t been voting with Republicans on blocking specific Biden administration policies, nor has he been in the mix to oppose presidential nominees, some of whom have been forced to withdraw due to opposition from moderate Democrats. However, Brown did announce on Wednesday that he’d be joining GOP senators to overturn the administration’s suspension of solar tariffs.
Graham, who is expected to join Justice at his campaign launch today, said Manchin got played by the Biden administration and Senate Democratic leadership on the IRA.
“I like Joe a lot,” Graham told us. “But he should’ve gotten whatever he was going to get up front.”
— Andrew Desiderio
Inside a new FAA reauthorization flight: Washington Reagan flights
Delta Air Lines is backing a new coalition aimed at altering the perimeter requirements at Washington Reagan Airport as part of the FAA reauthorization.
Warning: This news is not just for airline nuts but is actually interesting for all D.C. residents, so stick with us.
Washington Reagan, the airport closest to downtown Washington, has been subject to perimeter restrictions for the better part of 60 years. This rule was, in essence, created to protect long-haul airline traffic at Dulles Airport, which is a hub for United Airlines.
Over time, the federal government has peeled back the 1,250-mile perimeter requirement, allowing exceptions so airlines could fly to far-off locales such as Phoenix, Los Angeles, San Francisco, Seattle, Salt Lake City, Las Vegas, Denver, San Juan, Austin and Portland, Ore.
But the Capital Access Alliance, backed by Delta, is arguing that the rule is outdated and is pushing Congress to add more long-haul domestic flights to Reagan.
Part of their argument is that the feds no longer need to protect Dulles since the population of Northern Virginia has tripled since the rule was put in place.
The coalition has enlisted the Boston Consulting Group to draw up a study backing the addition of more long-haul slots that would benefit all airlines equally. BCG recommends between 20 and 25 additional long-haul domestic slots to Reagan National.
The coalition makes the argument that San Antonio — the nation’s seventh-largest city — and San Diego, the nation’s eighth largest city, have no direct flights from DCA.
Let’s zoom out for a second: Altering the perimeter requirement would probably allow Delta to add another flight to LAX, Salt Lake City and a flight to Seattle — all Delta hubs. Delta flies its 757 with an enhanced first class product to LAX, which is far superior to American’s offerings to Los Angeles. American considers DCA a hub.
The coalition’s San Antonio and San Diego arguments are definitely valid. Delta has been expanding a bit at Reagan — they will begin service to Miami, Orlando and Nashville this fall — and they could try to own a few routes that are underserved from Reagan. United flies non-stop to San Antonio and San Diego from Dulles.
We will be following this fight very closely. We imagine American and United will have something to say about this proposal, considering they are the predominant airlines at DCA and Dulles, respectively.
The FAA reauthorization will be up this year so this will come to a head pretty soon.
Also worth noting: Delta has Jeff Miller, Speaker Kevin McCarthy’s close friend, as a lobbyist.
– Jake Sherman
Senators unveil their take on weed banking
It’s been a long time coming, but the Senate is finally ready to talk about how it wants to fix the business of cannabis banking.
Sens. Jeff Merkley (D-Ore.) and Steve Daines (R-Mont.) unveiled the Secure and Fair Enforcement Banking Act of 2023 Wednesday night, which would clear regulated banks to work with state-legal cannabis companies. Reps. Dave Joyce (R-Ohio) and Earl Blumenauer (D-Ore.) introduced a House companion.
Read the 38-page bill’s text here.
Remember the history here: The House has passed some form of cannabis banking reform seven times since 2019 by significantly bipartisan margins. The Senate has always been the chief obstacle to final passage, as we wrote during the lame duck late last year. But pushing through cannabis legislation has been a priority for Majority Leader Chuck Schumer.
So, this draft represents a significant change of fortunes for the cannabis industry. A bipartisan group of almost 40 senators is co-sponsoring the bill. Republican backers include Sens. Cynthia Lummis (Wyo.), Bill Cassidy (La.), Lisa Murkowski (Alaska), Dan Sullivan (Alaska), Kevin Cramer (N.D.) and Rand Paul (Ky.). That’s not quite enough to get past the filibuster, but it’s a good start.
Still, there’s a couple of things we should note. This is a “skinny” version of cannabis banking reform that’s focused primarily on bank regulators, prohibiting the government from dinging banks just for working with weed businesses.
Last year, we talked about the potential for a “SAFE-plus” package that would include broader cannabis reforms, including a bill to help states expunge the records of non-violent cannabis offenders and another to remove restrictions on gun ownership for cannabis users.
Those bills — the HOPE and GRAM Acts, respectively — didn’t make the cut here. Daines and Merkley said in a joint statement that there’d be “an opportunity” to add those bills into the SAFE package through regular order.
That might be a problem if they’re already struggling to secure 60 votes. For starters, the SAFE Banking Act will need to make its way to the floor through the Senate Banking Committee. Sen. Sherrod Brown (D-Ohio), who chairs the committee, isn’t a co-sponsor of SAFE at this point.
Brown has been ambivalent about cannabis reform that’s narrowly focused on helping banks. Brown only came around to the idea last year when lawmakers started discussing expungements and other consumer-focused reforms, like making it easier for cannabis employees to qualify for mortgages.
And then there’s the GOP-run House. House Financial Services Committee Chair Patrick McHenry (R-N.C.) is ambivalent-to-negative on cannabis banking. McHenry has said in the past he won’t get in the way if his colleagues want to get it done, however.
All together, we see a path for this legislation to become law, though it’s far from assured. Plus, it’ll be one weird trip if it doesn’t have support from Congress’s top financial services lawmakers.
– Brendan Pedersen
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News: Democratic fundraising platform ActBlue processed $218 million in donations during the first quarter of 2023, sparked by a liberal grassroots response to a wave of gun violence and former President Donald Trump’s indictment.
ActBlue reported the Q1 figure was 25% higher than the same period four years ago, when Democratic presidential primary candidates were soliciting donations in earnest to remain competitive in a sprawling field.
The average Q1 contribution size was $36.75, ActBlue said. The platform added they received donations from a total of 1.4 million unique donors.
A blog post said the first quarter numbers showed “small-dollar donors’ sustained engagement and investment in the campaigns, organizations, and issues they support” ahead of a crucial 2024 cycle for Democrats.
ActBlue was in the news earlier this month as the organization announced it was reducing its staff by 17%, citing a strategic “restructuring.”
In other fundraising news: Organized labor leaders hosted a fundraiser for House Minority Leader Hakeem Jeffries on Wednesday evening at the Machinist Union Capitol Hill townhouse. The event, where House Assistant Democratic Leader Jim Clyburn also spoke, raised money for Jeffries’ campaign fund.
The major labor leaders in attendance were AFT President Randi Weingarten, Machinists Union International President Robert Martinez Jr., AFSCME President Lee Saunders and AFL-CIO Secretary-Treasurer Fred Redmond.
— Max Cohen
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8:30 a.m.: First quarter 2023 GDP will be released by the Commerce Department’s BEA.
9 a.m.: President Joe Biden will get his daily intelligence briefing.
9:45 a.m.: Speaker Kevin McCarthy will hold a photo opportunity with South Korean President Yoon Suk Yeol.
11 a.m.: President Yoon will address a joint meeting of Congress.
12:15 p.m.: Biden will participate in Take Your Child to Work Day.
1:45 p.m.: Karine Jean-Pierre will brief.
2:15 p.m.: House Majority Leader Steve Scalise, House Judiciary Committee Chair Jim Jordan and other House Republicans will release their border bill.
6:45 p.m.: Biden will participate in a campaign call.
“‘You’ve underestimated us’: How McCarthy’s horse-trading stopped a GOP revolt in debt fight,” by Manu Raju, Melanie Zanona and Lauren Fox
“On Eve of Trial, Discovery of Carlson Texts Set Off Crisis Atop Fox,” by Jim Rutenberg, Jeremy W. Peters and Mike Schmidt
“Despite outrage from some, Congress reluctant to act on Supreme Court ethics,” by Robert Barnes, Ann E. Marimow and Liz Goodwin
“How McCarthy mollified the right on his debt plan — for now,” by Sarah Ferris, Olivia Beavers and Burgess Everett
Editorial photos provided by Getty Images.
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How can families create positive Instagram experiences together?
Family Center supervision tools allow parents to view who their teen follows and who follows them, manage daily time limits and be notified when their teen shares reported accounts, once Supervision is set up.
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