The Archive

IN THIS EDITION

Yes. The Senate will change the GOP reconciliation bill

GOP tax, Medicaid markups go all night

Huizenga staffs up ahead of potential Senate bid

House Dems seethe over Trump impeachment move

ICYMI: McClain on Medicaid and Michigan

THE TOP

Yes. The Senate will change the GOP reconciliation bill

Happy Wednesday morning.

Here’s something Speaker Mike Johnson should be worried about: Senate Republicans are gearing up to change the House’s reconciliation package.

The big questions are by how much, and can House Republicans live with those changes?

Johnson hopes to have the House GOP reconciliation package on the floor next week. If Johnson and his leadership team can pass it, then Senate Republicans will have several weeks to debate and revise the package to pass it before the debt limit needs to be raised in mid-July.

This is a hugely complex legislative vehicle that will directly impact nearly every American – plus the political outlook for President Donald Trump and the GOP-controlled Congress.

There’s widespread agreement that changes on issues ranging from tax credits to health care provisions will be necessary to satisfy different factions within the Senate GOP Conference, as well as the Byrd Rule.

But you should expect changes.

“We are, both the House and the Senate, trying to stay as close as we can on policies,” Senate Finance Committee Chair Mike Crapo (R-Idaho) said. “That being said, the House is going to have a different work product than we end up with here.”

That’s an unappealing prospect for many House Republican moderates wary of voting for controversial provisions that may be dramatically different once the Senate has its say.

Conservatives won’t like it either, especially if Senate Republicans balk at the hundreds of billions of dollars in spending cuts to Medicaid and other social safety net programs House Republicans are proposing.

“The goal is to make sure we do the best job possible so the things they might want to deal with are as limited as possible,” said House Majority Whip Tom Emmer, who huddled with Senate Republican whips on Tuesday.

Emmer added: “We’re gonna pass this bill and send it to them. When it gets to them, it’s their job to do what they need to do to that bill and get it back to us as soon as possible.”

Tax: GOP tax writers worked closely to tweak the 2017 tax cuts in an attempt to make the current policy baseline work in the Senate.

Republicans plan to use the accounting tactic to make the tax provisions permanent without needing big offsets down the line under reconciliation rules. Those adjustments — many of which grant some extra tax cuts — are in the Ways and Means Committee bill.

But beyond that, the Senate will still have a lot to work through, including revenue raisers in the package. There are GOP senators uneasy about the net $515 billion of clean energy tax credit repeals included in the House package.

“We’re gonna have a little bit of a different view, so we’ll wait to see what they come out with,” Sen. Shelley Moore Capito (R-W.Va.) said about the House’s clean energy provisions.

Senate Republicans also aren’t thrilled with a SALT cap above $10,000, which has to be included for Johnson to push this bill through the House.

GOP senators will push to make key business tax breaks for R&D, interest expenses and buying short-term assets like machinery permanent. House Republican tax writers would love permanence, but that’ll raise the bill’s cost. Ways and Means had to stick to an under $4 trillion price tag to please House deficit hawks, but the Senate could blow past it.

Ag: Senate Agriculture Committee Chair John Boozman (R-Ark.) said he’s coordinated with his House counterparts to include risk management tools in the farm bill section of the reconciliation package.

But there are larger problems ahead, as Boozman has raised concerns that some of the other House provisions won’t survive the Byrd Rule, including a partial rewrite of the farm bill.

“We’re going to wait and see what they mark up,” Boozman said.

House Agriculture Committee Chair GT Thompson (R-Pa.) told reporters on Tuesday that he’s held discussions with Boozman over this issue.

“We’ve worked with him, we’ve worked with the parliamentarians. Ultimately, the Senate will have the final say. But we’ve really done our due diligence to try to avoid any type of conflict with that Senate rule,” Thompson said.

Medicaid: Some of the most controversial House GOP policy moves – especially Medicaid cuts – are winning Senate converts, although Republican senators aren’t committing to backing the reconciliation package yet.

“I think it’s getting better,” said Sen. Jim Justice (R-W.Va.). Justice and Capito were among several red-state Republican senators concerned about House GOP proposals to alter how the federal government reimburses states for Medicaid recipients or impose per capita caps. These senators have lots of Medicaid recipients among their constituents too.

As it is, House Republicans are making less-sweeping FMAP revisions while imposing new work requirements and eligibility checks. But health care changes in the reconciliation bill will still result in 8.6 million Americans losing health insurance.

Sen. Mike Rounds (R-S.D.) summed up the fluid nature of the final package by noting that making the Trump tax cuts permanent and extending the debt limit are the only two must-pass provisions.

“Other than that, everything else is up for discussion for the most part,” Rounds said.

Also: Johnson met with the SALT Caucus Tuesday evening. They’re inching closer to finding a deal but it hasn’t happened yet. The group discussed different expiration dates for a higher cap – an earlier expiration date would lower the cost. The two sides broke up last night with the understanding that they would run numbers to figure out the costs and reconvene and hopefully notch a deal today.

One of the options under consideration was a $40,000 cap for individuals and an $80,000 cap for couples. This would be very pricey and would be a big win for SALTers.

– John Bresnahan, Max Cohen, Andrew Desiderio, Laura Weiss, Jake Sherman and Brendan Pedersen

RECONCILIATION

GOP tax, Medicaid markups go all night

While you were sleeping, key House committees were sparring over Republicans’ plans for taxes and Medicaid spending cuts in reconciliation — and they’re still going roughly 15 hours in.

The House GOP is pushing to wrap up markups for pieces of the package containing President Donald Trump’s legislative agenda. Their goal is to get the full reconciliation bill to the floor next week.

Here’s your recap from inside the committee rooms where it’s all going down.

Medicaid. The House Energy and Commerce Committee is only a few hours into its health portion of the markup. Members are just getting started on this critical piece of the reconciliation puzzle.

There have been only a couple of amendment votes during the consideration of the health title. House Democrats are hammering Republicans over the potential loss of health insurance for millions of Americans.

Republicans keep fighting back, asserting that it’s only those who shouldn’t be eligible in the first place who would lose coverage. So far, this debate has included spats over CBO scores and committee rules.

And this battle is going to keep going. And going. And going. The handful of amendments that Democrats have already filed all hit on the potential benefits and losses.

Buckle up for a long Wednesday in Rayburn.

Taxes. The temperature has dropped to freezing but Democrats are still going on amendments in 1100 Longworth. Republicans are batting them all down.

Ways and Means Committee Democrats unveiled a series of amendments overnight to block tax cuts for high-income Americans — escalating gradually from a $400,000 cut-off up to barring benefits for billionaires. This is a huge chunk of the Democratic Party’s political messaging about the GOP’s tax agenda.

Ways and Means Democrats also used amendments to press Republicans on topics like Trump’s tariffs, clean energy tax credit repeals and expanding the child tax credit.

The big sticking point for the Republicans’ tax package, SALT, created a stir in the hearing and privately.

Rep. Nicole Malliotakis (R-N.Y.) left the Ways and Means’ markup to join a meeting of SALT holdouts with Speaker Mike Johnson — only to be asked to leave, as we scooped. There’s been tension between Ways and Means and the blue-state SALT crew amid the impasse.

Tech. Energy and Commerce approved its communications title earlier this morning.

The measure includes new spectrum for auction. It would also impose a decade-long moratorium on states’ artificial intelligence laws. The preemption is tucked in a provision that gives $500 million to the Commerce Department to revamp old information technology systems with AI.

But there’s already opposition from some senators to the spectrum language and doubts over whether the AI moratorium will comply with the chamber’s rules.

During a back-and-forth after the midnight hour, the E&C Committee’s counsel acknowledged the AI moratorium is a “policy change,” in response to queries from Democratic Reps. Alexandria Ocasio-Cortez (N.Y.) and Lizzie Fletcher (Texas).

This doesn’t bode well for the parliamentarian battle in the Senate. Democrats will use it to argue against the provision’s compliance with the Byrd Rule. Under Senate rules, provisions in reconciliation have to deal with spending and revenue.

Rep. Jay Obernolte (R-Calif.) tried to “clear up” the issue. Obernotle said the moratorium is a “necessary term and condition” for the Commerce Department to fulfill the spending direction.

— Laura Weiss, Samantha Handler and Diego Areas Munhoz

DEPT. OF BIG MOVES

Huizenga staffs up ahead of potential Senate bid

Scoop: Rep. Bill Huizenga (R-Mich.) has hired a top consulting firm that made Trump campaign ads as he inches closer to a Senate run.

Huizenga signed BrabenderCox to work for him in 2026 as he weighs a bid for retiring Democratic Sen. Gary Peters’ (Mich.) seat, according to two people familiar with the decision.

Huizenga’s team has had discussions with Kyle Robertson, a senior strategist at the firm and a former aide to both former Vice President Mike Pence and former Rep. Greg Pence (R-Ind.), about working on the race, according to one of those people.

Robertson has a long history with the Pence family, recently serving as former Rep. Greg Pence’s (R-Ind.) chief of staff. He also managed the successful gubernatorial campaigns of Mike Pence in Indiana and Rick Snyder in Michigan.

Senate GOP leaders have urged Huizenga to remain in the House. They’ve lined up behind former Rep. Mike Rogers (R-Mich) in a bid to clear the field and avoid a bruising primary in Michigan. Rogers, who lost a 2024 Senate bid to Democrat Elissa Slotkin (Mich.), brought on former Trump campaign manager Chris LaCivita as a senior adviser.

But President Donald Trump hasn’t offered an endorsement in the race, and Huizenga hasn’t been moved by entreaties for him to rule out a run. We reported last month that Huizenga spoke to Trump just before the president traveled to Michigan for a rally that some believed would include an endorsement of Rogers.

– Ally Mutnick and Brendan Pedersen

THE MINORITY

House Dems seethe over Trump impeachment move

Two top Democratic leaders rebuked Rep. Shri Thanedar (D-Mich.) over his decision to seek a vote on impeaching President Donald Trump during a pivotal legislative week.

House Minority Leader Hakeem Jeffries and Minority Whip Katherine Clark spoke with Thanedar on Tuesday, according to multiple people familiar with the outreach.

Thanedar angered Democrats across the caucus because of the timing of his move — in the midst of the reconciliation markups full of hot-button issues like Medicaid and tax. Plus there’s the fact that such a vote could be politically toxic for battleground Democrats who need to court Trump voters.

“It’s completely unhelpful,” said Rep. Susie Lee (D-Nev.), the battleground members’ representative in House leadership. “I think it’s crazy.”

“As someone who voted to impeach Donald Trump twice, he should be impeached, but we don’t have the votes to do it,” added Rep. Veronica Escobar (D-Texas).

Privately, Democrats have accused Thanedar of tacking left because he recently landed a primary challenger, Michigan state Rep. Donavan McKinney.

Rep. Rashida Tlaib (D-Mich.) has already endorsed McKinney while offering blistering criticism of Thanedar’s performance as a two-term lawmaker.

For his part, Thanedar acknowledged that his colleagues had expressed concerns to him over his decision to push an impeachment vote against Trump right now. But Thanedar said he wasn’t backing down.

“The timing is always right to do the right thing,” Thanedar said.

– John Bresnahan, Ally Mutnick and Mica Soellner

PUNCHBOWL NEWS EVENTS

ICYMI: McClain on Medicaid and Michigan

House GOP Conference Chair Lisa McClain sat down with us Tuesday for a newsy conversation on the future of small businesses, the reconciliation process and the Michigan Senate race. McClain joined us as part of The Summit: Investing in Small Business.

McClain pushed back on Democrats’ political ads accusing Republicans of trying to cut Medicaid in their reconciliation package.

“We’ve been clear,” McClain said. “We’re not cutting Medicaid for people who need it. I wish we would run that ad, but that ad is not going to sell.”

On the Michigan Senate race, McClain commended both former Rep. Mike Rogers (R-Mich.) and potential candidate Rep. Bill Huizenga (R-Mich.), though she said she wants to keep Huizenga in the House. Rogers ran last year but narrowly lost to Democratic Sen. Elissa Slotkin.

McClain, however, emphasized the importance of the midterms next year as Republicans seek to hold their razor-thin majority in the House.

“The midterms are extremely crucial, because if we can [win] the midterms – which I’m optimistic we can – we can take this reconciliation bite. We can take another reconciliation bite,” McClain said.

Check out more of our conversation here.

– Mica Soellner

MOMENTS

CLIPS