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Happy Wednesday morning.
There are 108 days until government funding runs out. And the way things are looking right now, Congress is in for an incredibly difficult appropriations season with a government shutdown possible this fall.
The evidence for a high-stakes showdown abounds. At the urging of House conservatives, Speaker Kevin McCarthy is allowing GOP appropriators to write spending bills at FY2022 levels, which is far below the levels set out in the Fiscal Responsibility Act. This will put the House on a collision course with the Democrat-controlled Senate and the White House, who want to stick to the budget caps laid out in the debt-limit deal.
“We are going to be responsible in the Senate and do the agreement that we agreed to,” Senate Appropriations Committee Chair Patty Murray (D-Wash.) told us of the House drama.
So what will happen come Sept. 30? The declaration from House Republicans makes it much more difficult for the two chambers to come together and avoid a government shutdown or a continuing resolution.
What’s more, a 1% budget cut goes into effect on Jan. 1, 2024, unless Congress passes all 12 appropriations bills. So the fourth quarter of 2023 could get quite dicey on the government-funding front.
“[In September], we’re going to have a dilemma on our hands,” Rep. Steve Womack (R-Ark.), an appropriations cardinal, told us. “And the governing majority … doesn’t need to be toying around with shutting down government. At the end of the fiscal year, we’ve got work to do and we ought to get it done.”
Furthermore, McCarthy heard from House conservatives Tuesday afternoon in a closed-door meeting that they want to cut funding for the Justice Department and the FBI’s new headquarters, proposed for either Maryland or Virginia. While this is far from a unified position within the House GOP, it once again puts the chamber at odds with the Biden administration and the Senate.
On top of that, funding the government will require compromise — a very dirty word these days in House GOP circles. That’s exactly what happened with the debt-limit agreement, and hardline conservatives just ground the House to a halt for a week to vent about the deal.
“The path to get appropriations bills done is to put together the same coalition that passed the debt ceiling,” said Sen. Chris Murphy (D-Conn.), a senior Appropriations member. “I understand the House has to do a dance, they’ve got to be able to operate on a week-to-week basis. But in the end, the House Freedom Caucus has never voted for appropriations bills and will never vote for appropriations bills.”
Of course, Murphy’s suggestion — that Republicans pair with Democrats — is at the heart of the House Freedom Caucus’s gripes with McCarthy.
For now, Senate Republicans are projecting optimism. Sen. Susan Collins of Maine, the top Republican on the Appropriations Committee, said “things will be worked out,” while Senate Minority Leader Mitch McConnell said it’s “not totally uncommon” for each chamber to draft different bills.
But there’s a potential gap of more than $100 billion between the two chambers’ starting points. Plus, McConnell and other top Republicans are already pushing to go beyond the defense spending cap of $886 billion, which will be a major point of contention in the fall.
House Appropriations Committee Chair Kay Granger (R-Texas) has already said she’ll mark up FY2024 spending bills at FY2022 levels, an olive branch to conservatives who were griping about the debt-limit deal.
Yet even some of Granger’s own cardinals aren’t yet ready to throw their weight behind the plan, with several already acknowledging it’s a futile effort given the Senate’s posture.
“The senators are going to do their job and eventually we’re going to be in a conference,” said Rep. Dave Joyce (R-Ohio), the Homeland Security cardinal. “We just have to be realistic, but the numbers that are going to come back here probably aren’t going to be at those total ‘22 levels.”
Yet for the most part, however, GOP appropriators are falling in line behind Granger.
“The goal is to get the bills passed,” Rep. Robert Aderholt (R-Ala.), chair of the Labor-HHS subcommittee, told us. “And I think that’s what her goal is, and that’s what the speaker’s goal is. And we have to do whatever we need to do to accommodate those.”
Some House Republicans are openly questioning whether they’ll have any leverage with the other side of the Capitol, where there’s broad bipartisan support for adhering to the budget caps, setting aside contentious riders and writing a Pentagon supplemental for Ukraine.
“I would like for our conference to look a little bit beyond the end of our nose right now and say, ‘OK, we got [the Fiscal Responsibility Act], decent deal, raised the debt ceiling for two years,” Womack said. “Let’s go do our work. Let’s get it done to the agreed-upon numbers, and then come back and re-huddle.’”
One more thing: The House will begin to consider today a resolution to censure Rep. Adam Schiff (D-Calif.). Rep. Anna Paulina Luna (R-Fla.), a freshman, has offered the resolution.
The Luna resolution will get called up at the end of an afternoon vote series today — around 3:45 p.m. House Democrats will offer a motion to table. Republican leaders believe that there’s a good chance enough GOP lawmakers vote with Democrats to do that.
— Andrew Desiderio, Jake Sherman and Max Cohen
Tomorrow: Join us at 9 a.m. ET for a conversation with Rep. John Joyce (R-Pa.) on healthcare innovation and the future of cancer research. Heather Caygle will discuss the impacts of the Inflation Reduction Act on the two research areas with Joyce. RSVP now.
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BEHIND THE SCENES
Tuberville rejects possible off-ramp as his military blockade grows
News: The Senate Armed Services Committee reported out dozens of new senior-level military promotions to the floor on Tuesday, bringing the total number of general and flag officers stalled by Sen. Tommy Tuberville (R-Ala.) to more than 250.
Just this week, Tuberville made clear that he’s no closer to lifting his unprecedented blockade. This comes even as Senate Republicans grow increasingly worried about the consequences of preventing these officers from assuming their posts around the world.
On Monday evening, Tuberville and Sen. Joni Ernst (R-Iowa) talked on the Senate floor about her bill that would effectively reverse the Pentagon’s abortion policy that the Alabama Republican is protesting by holding up unanimous approval of military promotions.
According to multiple people familiar with their conversation, Tuberville told Ernst that he won’t accept a deal in which her bill gets a vote as part of the annual defense authorization process in exchange for lifting his holds.
Tuberville, sources said, reiterated that while backing Ernst’s bill, he’ll only relent if the Pentagon drops the policy or the Senate passes legislation from Sen. Jeanne Shaheen (D-N.H.) that codifies the abortion policy.
Neither is likely to happen. The Pentagon won’t be comfortable with setting the precedent that a senator can use military promotions as leverage, while Shaheen’s bill almost certainly lacks 60 votes in the Senate. It wouldn’t get through the House either.
Tuberville and Ernst, we’re told, talked strategy as Senate GOP leaders are trying desperately to find a way to mollify Tuberville while ending his blockade.
Kelsi Daniell, Ernst’s spokesperson, said the senator “is laser focused on getting her bill to block the Pentagon’s ongoing war on the unborn across the finish line.”
Democratic leaders see Senate Minority Leader Mitch McConnell as key to ending the standoff. McConnell has said publicly that he opposes Tuberville’s tactics. Tuberville, however, insists that McConnell hasn’t yet pushed him to back off.
— Andrew Desiderio
Dems growing more confident Bidenomics could win in 2024
There’s one definitive thing we can say about the Biden economy in 2023 — the numbers are good, and the polling is bad.
Inflation has been on a steady downward march for 11-straight months. The unemployment rate has been at or below 4% since January 2022. Prices at the pump have fallen, the costs of some foods are dropping and low-income workers are seeing unprecedented wage growth — even after accounting for inflation.
But you wouldn’t know that from public polling. President Joe Biden’s job approval has been anchored between the high 30s and low 40s since early 2022. Again and again, the state of the economy has been respondents’ top concern.
We won’t downplay the bad stuff. Inflation is still too high. Economic growth last quarter was sluggish, and tax receipts are coming in at a far lower clip than budget analysts expected. There are signs U.S. consumers are pulling back on spending. Several large regional banks have failed since March, which makes everyone nervous.
But Biden, and the rest of the Democratic Party by extension, should be doing better than they’re doing in the polls. That’s why partly we expect the party to go on the economic offensive as the 2024 campaign kicks off in earnest.
Right now, it’s a pretty good economy, stupid, and Democrats think they can own it.
Start with this: House Democrats will be presented with messaging data from the Center for American Progress during today’s whip meeting that strongly suggests the current economy is a winning issue for the party to run on in the upcoming election.
House Minority Leader Hakeem Jeffries told us he wasn’t too stressed about the current polling, saying Biden “will receive a tremendous amount of credit” for economic wins come 2024.
“The issues that the American people focus on on a day-to-day basis aren’t always the same issues that people in terms of inside-the-Beltway media focus on,” Jeffries said. “But at the end of the day, it’s all of our responsibilities to communicate directly with the American people about the work that we’ve done.”
Democrats also argue that Republicans have dug themselves into a hole with an overwhelming focus on inflation — a foothold that continues to shrink — and have left themselves exposed by whipsawing from spending cuts to tax cuts as a legislative focus.
“Congressional Republicans are doubling down on tax welfare for rich special interests while moving to cut Medicare and Social Security, a vision Americans rejected” in the 2022 midterms, said White House spokesperson Andrew Bates.
Democrats are well aware of their accomplishments under Biden. The bipartisan infrastructure law, CHIPS bill and Inflation Reduction Act all represent huge investments in the U.S. economy.
But these are also the kind of laws that take time to be felt among voters, particularly when it comes to stuff like building bridges.
“I get the White House is frustrated. I feel some of the frustration as well,” said Sen. Mark Warner (D-Va.) “But on the infrastructure stuff, you can’t turn it all over on a dime.”
We should also note that improving economic numbers isn’t everything. Inflation at 4% is a lot better than inflation at 9%, but 4% is still double what Americans have been used to in recent years.
“Regardless of what the numbers or stats are, you fill in what you live everyday. Lived experience is everything,” Rep. Nikema Williams (D-Ga.) said.
Rep. Pramila Jayapal (D-Wash.) argued some of inflation’s main drivers today — housing and childcare — still haven’t been directly addressed by Congress. “Had we passed Build Back Better, that would have done a lot for those two particular costs,” Jayapal said.
Several Democrats we spoke to this week said they expect the voters to get the message as the election ramps up. “This is an issue that just hasn’t ripened fully,” Sen. Elizabeth Warren (D-Mass.) said, adding that Biden would have plenty of reforms to tout “when we get into full campaign mode.”
But progressives are also critical of the Federal Reserve’s approach to interest rates and inflation. We’ve talked about big-picture fears that too-fast rate hikes could tip the economy into a recession or worse.
A scoop from tax-land: Sen. Sherrod Brown (D-Ohio) will introduce a new bill today to permanently expand the Earned Income Tax Credit and reestablish the Child Tax Credit. He’s joined by Sens. Michael Bennet (D-Colo.), Cory Booker (D-N.J.), Raphael Warnock (D-Ga.), Ron Wyden (D-Ore.) and Dick Durbin (D-Ill.). You can read the text of the Working Families Tax Relief Act here.
This is a separate effort from a similar bill introduced in the House last week by Reps. Rosa DeLauro (D-Conn.), Suzan DelBene (D-Wash.) and Ritchie Torres (D-N.Y.), which reintroduced the CTC without expanding the EITC.
— Brendan Pedersen and John Bresnahan
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The Coca-Cola Company, Keurig Dr Pepper and PepsiCo are offering more choices with less sugar. Today, nearly 60% of beverages sold have zero sugar. BalanceUS.org
House GOP targets Mayorkas again as impeachment push heats up
The House Homeland Security Committee will hold a hearing today to examine what Republicans describe as Homeland Security Secretary Alejandro Mayorkas’ dereliction of duty on the U.S.-Mexico border. It’s the second hearing in a week that House Republicans have held about the border as they seek to build a case for impeaching Mayorkas.
“This will be the beginning of that process,” Rep. Marjorie Taylor Greene (R-Ga.), a member of the panel, told us when asked about the hearing.
Greene filed a resolution last week to investigate “whether sufficient grounds exist” to impeach Mayorkas. Greene wants today’s hearing to convince the broader GOP conference to support her efforts.
The hearing follows a similar one held by a House Judiciary subcommittee last week that featured two of the same witnesses testifying today.
House Homeland Security Committee Chair Mark Green (R-Tenn.) told us he still plans to hand over a “five phase accountability plan” on Mayorkas to the Judiciary Committee, which has jurisdiction over impeachment.
The plan would focus on what Republicans say are five areas Mayorkas has failed in his job. GOP lawmakers plan to highlight the financial and human cost of the southern border crisis, as well as the laws they claim the secretary has broken. Green said the hearing today will complement that by “digging into the failures” of DHS.
“I’ve already seen enough that I think he needs to be fired. 100%,” Green said. “I can’t imagine that Joe Biden, our commander-in-chief, is aware of all these failures because if he was, he would have fired this guy weeks ago.”
While Green didn’t explicitly use the “I-word,” others on his committee aren’t shying away from it.
Rep. Carlos Gimenez (R-Fla.) told us the hearing is a step toward building more concrete support for Mayorkas’ possible impeachment.
“I’m an immigrant. I am pro-legal immigration,” said Gimenez, who was born in Cuba. “I am not in favor of illegal immigration. Every country has a right to defend their borders and I don’t think [Mayorkas] is doing a good job.”
The Homeland Security panel’s hearing will feature former Acting DHS Secretary Chad Wolf and Joseph Edlow, former acting director of the U.S. Citizenship and Immigration Services. Wolf and Edlow — who were both appointed by former President Donald Trump — testified before the Judiciary subcommittee last week.
Rodney Scott, a former Border Patrol chief and visiting fellow at the Texas Public Policy Foundation, will also testify at today’s hearing.
We previously reported that vulnerable House Republicans, a handful of whom sit on the Homeland Security Committee, have signaled support for impeaching Mayorkas. But the main push is still coming from the hardline conservative wing of the Republican Conference.
Democrats argue the GOP’s border hearings are public fishing expeditions to help their impeachment agenda rather than actual congressional oversight.
“Obviously, this is a narrative they think they can pull off,” Rep. Bennie Thompson (D-Miss.), the Homeland Security Committee’s ranking member, told us. “I don’t think they have very good witnesses, but it’s their choice.”
DHS data shows daily migrant encounters at the U.S.-Mexico border have decreased by 70% since May 11 when Title 42 pandemic restrictions expired.
— Mica Soellner
PUNCHBOWL NEWS EVENTS
Missed our conversation yesterday on digital equity with Rep. Steny Hoyer (D-Md.) and fireside chat with Broderick Johnson, EVP, public policy & EVP, digital equity at Comcast? Follow the link below to watch the full video here:
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9:30 a.m.: House Homeland Security Committee Chair Mark Green (R-Tenn.), Reps. Clay Higgins (R-La.), August Pfluger (R-Texas) and Laurel Lee (R-Fla.) will announce an investigation into Homeland Security Secretary Alejandro Mayorkas.
11 a.m.: President Joe Biden and Vice President Kamala Harris will get their daily intelligence briefing.
1:45 p.m.: Karine Jean-Pierre will brief.
2 p.m.: Federal Open Market Committee announcement on interest rates.
3 p.m.: RSC Chair Kevin Hern and members of the caucus will unveil their FY2024 budget plan.
7:15 p.m.: Biden will leave the White House for The Anthem, where he will speak at the League of Conservation Voters annual dinner.
Editorial photos provided by Getty Images. Political ads courtesy of AdImpact.
PRESENTED BY AMERICAN BEVERAGE ASSOCIATION
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