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May 9, 2025
Presented by UL Standards & Engagement
The bipartisan Setting Consumer Standards for Lithium-Ion Batteries Act will keep uncertified batteries off the market and out of homes — reducing the fire risk and preserving consumer access. It passed the House by an overwhelming majority. Now it’s the Senate’s turn to make a smart decision to protect Americans.
PRESENTED BY
THE TOP
‘Stay tuned’: The half-baked Republican reconciliation plan
Happy Friday morning.
It’s the end of a hugely important week in Hill Republicans’ quest to craft a massive reconciliation package. Next week, a trio of House panels will mark up the most important pieces of President Donald Trump’s domestic agenda — cuts to social safety net programs and an extension of the 2017 Trump tax cuts.
But here’s what’s striking to us: So much about this reconciliation package is still undecided even though the GOP leadership says they’ve been working on it for more than six months. Let’s get into it.
1) The SALT divide: House Republican leaders are nowhere close to notching a deal on raising the SALT deduction cap. The House Ways and Means Committee has discussed a bunch of options, including a new $30,000 cap, up from the current $10,000 limit.
But four key New York Republicans – Reps. Elise Stefanik, Andrew Garbarino, Nick LaLota and Mike Lawler – nixed that option in a statement Thursday night. The SALT Caucus co-chairs also said they have no deal and blasted the entire negotiation. Blue-state Republicans say they’re nowhere close to an agreement with GOP leaders over the issue.
Speaker Mike Johnson sent a text to a group of New York Republicans noting that he wasn’t part of the $30,000 offer and expressed displeasure that the blue staters issued a public rebuke:
This isn’t an idle back and forth between members. It’s a critical part of the tax package with an impact running into the hundreds of billions of dollars.
Ways and Means can mark up a bill without a deal that satisfies all of the SALT holdouts. But that would almost certainly lead to a showdown before the House vote, potentially forcing Johnson to fix the bill in the House Rules Committee or on the floor with a manager’s amendment.
2) The Trump factor: We scooped Thursday that Trump told Johnson in a private call that he wanted a new top tax rate. Trump is seeking a new 39.6% tax bracket for individuals earning more than $2.5 million annually and married couples earning more than $5 million per year.
A new tax bracket for ultra-wealthy Americans would be a seismic shift for the Ways and Means Committee. Johnson has been opposed to raising individual tax rates, even for the very rich. But Trump’s push could scramble the dynamics for House Republicans heading into next week’s markup.
House Ways and Means Committee Chair Jason Smith (R-Mo.) will meet with Trump today. Politico broke this news Thursday.
Trump also asked Johnson to consider closing the carried interest loophole. This is a massively divisive issue on Capitol Hill and GOP leaders in both chambers are cool to the idea.
And Trump suggested to Johnson that Congress should create savings accounts for newborns. House Republican leadership isn’t entirely clear what Trump wants to do here but some have suggested that Trump is referring to this program.
3) Medicaid woes: House GOP leadership still hasn’t decided on the size and scope of Medicaid cuts. To be honest, Republicans have been all over the place on this.
Johnson took FMAP changes off the table Thursday, but then he said per capita caps for Medicaid recipients were still on the table. Senate Republican leaders have criticized the House GOP for being too cautious over cutting Medicaid and other social safety net programs.
4) Pension problems: House Majority Leader Steve Scalise told us Thursday that the leadership is talking about nixing changes to the federal pension program. The House Oversight Committee planned to drastically change the pension formula.
On Capitol Hill, the GOP proposed basing the pension on an employee’s top five years of pay instead of the top three years. They also forced employees to pay a higher percentage, 4.4% of their salary into the Federal Employees Retirement System.
Scalise said there’s been “a lot of internal conversation about a couple of items like that.”
5) Ag unknowns: House Agriculture Republicans are planning to include a $60 billion “skinny” farm bill in their reconciliation section, as we reported last week. The traditional five-year farm bill failed to move through Congress last year, and this is the GOP’s way of getting crucial provisions done without negotiating with Democrats.
Still, it’s unclear how much of the farm bill House Republicans can ultimately enact. Senators have warned that many of these proposals will run afoul of the Byrd Rule, which dictates what can happen in the Senate via reconciliation.
The major question remaining for the House Agriculture panel, though, is how their SNAP cost-sharing plan will score. The committee is waiting on final CBO scores on their proposal to shift around 10% of SNAP costs onto the states. That’s a plan that GOP moderates like but may not score high enough to reach the $230 billion in cuts the panel is required to produce under its reconciliation instructions.
– Jake Sherman, Laura Weiss and Samantha Handler
Join us Tuesday, May 13 at 9 a.m. ET for The Summit: Investing in Small Businesses. We’ll hear from House GOP Conference Chair Lisa McClain, Verizon CEO Hans Vestberg, Joe Montana and a panel of experts on communications technology and small business. Save your seat now.
BIPARTISANSHIP
Bipartisan group eyes stock-trading ban
A bipartisan group of House members with competing bills to ban congressional stock trading are privately working together to craft a consensus bill that could have broad appeal across Congress.
Reps. Seth Magaziner (D-R.I.), Chip Roy (R-Texas), Alexandria Ocasio-Cortez (D-N.Y.), Pramila Jayapal (D-Wash.), Joe Morelle (D-N.Y.), Tim Burchett (R-Tenn.) and Brian Fitzpatrick (R-Pa.) have been engaged in informal talks to find common ground on proposals barring lawmakers from trading stocks.
The group has held two private meetings so far, including on Wednesday night, when multiple members involved said progress was made. The lawmakers are aiming to either craft one new bill or heavily amend an existing bill to appease everyone involved in the discussions.
“We’re going to need to move something this year,” Roy told us. “It’s long past time. We’ve had legislation now for a few years, and we’ve been patient.”
Lawmakers in the group generally agree that the ban should extend to lawmakers’ spouses and dependents.
But the main issue they are trying to resolve is how to penalize members who don’t abide by the ban. Past proposals have ranged from hefty fines to Justice Department referrals, all of which drew opposition.
The group is also trying to figure out how to handle members who come into Congress owning stocks.
Momentum growing: President Donald Trump and several high-ranking lawmakers have signaled their support for a stock-trading ban.
Trump told Time Magazine that he would “absolutely” sign legislation that banned lawmakers from trading stocks.
House Minority Leader Hakeem Jeffries has long supported a ban on congressional stock trading, reiterating his support at a Thursday news conference.
“I strongly support the effort to get this done,” Jeffries said.
Democratic Caucus Chair Pete Aguilar also mentioned the issue on local radio this week. Aguilar cited a contentious Natural Resources Committee hearing this week where Democrats criticized Chair Bruce Westerman (R-Ark.) for disclosing that he purchased company stocks from industries the panel oversees.
“Those types of things just are absolutely detrimental in having trust in Congress,” Aguilar told KQED. “I do think it is something we need to dig into a little bit more and support.”
But House GOP leaders, bogged down in the midst of the reconciliation process, haven’t focused on this issue at all, according to Republican leadership aides.
To be frank, it may be difficult for Congress to act on this while Trump is president. Trump’s family has made hundreds of millions of dollars from cryptocurrency deals since he returned to office. Democrats have attacked this as a major conflict of interest.
– Mica Soellner and John Bresnahan
WASHINGTON X THE WORLD
Congressional Hispanic Caucus heads to Mexico
Exclusive: Leaders of the Congressional Hispanic Caucus are in Monterrey, Mexico, today to protest against the Trump administration’s immigration and border policies.
CHC Chair Adriano Espaillat (D-N.Y.), CHC Whip Sylvia Garcia (D-Texas) and Rep. Joaquin Castro (D-Texas) will attend meetings with nonprofit organizations, local officials and the U.S. consulate.
The Democrats specifically want to raise awareness about two Mexican nationals deported from the United States along with their children, who are U.S. citizens.
House Democrats have drawn outsized attention for their international travel aimed at highlighting President Donald Trump’s hardline immigration agenda. Democrats have accused Trump of foregoing due process in his efforts to deport undocumented immigrants living in the U.S.
Sen. Chris Van Hollen (D-Md.) went to El Salvador seeking the release and return of Salvadoran immigrant Kilmar Abrego Garcia. Abrego Garcia, who’s married to a U.S. citizen, was improperly deported from Maryland and sent to the infamous CECOT prison.
Four House Democrats also went to El Salvador following Van Hollen’s trip to meet with officials at the U.S. embassy there and to highlight Abrego Garcia’s case.
Espaillat was among the first House Democrats to say he was seeking a trip to El Salvador with the CHC, but those travel plans never materialized.
Meanwhile, the White House and Republicans have relentlessly criticized Democrats over their defense of Abrego Garcia and their trips on his behalf. Top Trump administration officials, including DHS Secretary Kristi Noem on Thursday, have said repeatedly that even if Abrego Garcia returns to the United States, he will immediately be deported again.
Republicans have argued that Democrats are prioritizing undocumented immigrants over Americans, including those impacted by crimes committed by migrants.
– Mica Soellner
Tech: Cotton wants to track advanced chips
Sen. Tom Cotton (R-Ark.) wants exporters of the most advanced semiconductors to tell the U.S. government if they find out the chips are off-course or being tampered with.
Cotton, the Senate’s No. 3 Republican and chair of the Intelligence Committee, is introducing a bill today on the issue. It’s part of an effort to keep advanced chips produced by Nvidia and other cutting-edge manufacturers out of the hands of China and other adversaries.
The measure is coming just days after President Donald Trump’s administration announced it will revamp its approach to limiting exports of certain state-of-the-art chips.
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Although Cotton is introducing the bill alone, a bipartisan House version is also in the works, according to a Hill aide.
“With these enhanced security measures, we can continue to expand access to U.S. technology without compromising our national security,” Cotton said in a statement on his Chip Security Act.
The core of the bill is a location verification mechanism. The exporter has to alert the Commerce Department upon receiving “credible information” that the chips ended up in a place that’s not listed in export licenses.
Companies also have to notify the government if the chips were diverted or were subject to tampering.
The requirements would kick in six months after enactment. These would apply to similar chips (and products containing those chips) as the Biden-era rule that the Commerce Department is throwing out.
Cotton’s bill and the rule both attempt to deal with China’s history of obtaining advanced chips through other nations or via rerouted shipments.
The so-called AI diffusion rule sorted countries into tiers based on their security posture for chips, with varying restrictions on exports in each tier. Nvidia, in particular, has argued the rule crippled efforts to boost the U.S. AI industry and would drive other nations to buy from Chinese competitors.
Commerce Secretary Howard Lutnick told CNBC Thursday that the department plans to implement a new rule. That regulation may condition exports of AI semiconductors on the chips being used in data centers operated by “trusted” American businesses, Lutnick said.
The Trump administration is also weighing capping exports of AI chips at 50%, with the other half of advanced semiconductors sold domestically, Lutnick added.
In addition to location verification, Cotton’s bill would require a study alongside the Pentagon of further semiconductor security measures. It would direct the federal government to recommend new ideas annually for three years to keep ahead of the tech.
— Ben Brody and Diego Areas Munhoz
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… AND THERE’S MORE
Taxes. The National Federation of Independent Business is launching new ads pressing Congress to make the 20% deduction for pass-through businesses permanent. The group is spending over $1 million on the ad campaign through at least the August recess.
“If Congress doesn’t do their job, it could literally mean closing our doors,” a small business owner says in one spot.
The pass-through deduction is a huge priority for Republicans, so NFIB is likely to get its wish in the tax bill.
Downtown Download. Former Rep. Al Lawson (D-Fla.) is now lobbying. He signed on Florida A&M University.
— Laura Weiss and Jake Sherman
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Presented by UL Standards & Engagement
E-bike fires are happening across the country, costing lives and forcing families out of their homes. The Senate can help stop these fires and protect Americans. The bipartisan Setting Consumer Standards for Lithium-Ion Batteries Act will keep uncertified batteries off the market, reducing the risk.