The Archive

IN THIS EDITION

House to vote on Johnson funding plan

The Vault: The rate cut you’ve been waiting for

Senate Intel panel to grill tech execs on election interference

Andy Harris will be next HFC chair

House GOP ready to back anti-sanctuary cities funding bill

THE TOP

House to vote on Johnson funding plan

Happy Wednesday morning.

Are you having major déjà vu? We are.

The House is set to vote today on a short-term funding bill that won’t pass. GOP lawmakers are grumbling about messaging, strategy and yearning to get back home to run for reelection. And Speaker Mike Johnson is being publicly and privately cagey about his next move, frustrating the entire House Republican Conference, which is looking for guidance about the leadership’s plans.

In fact, the GOP leadership is even in the dark at most times as to what Johnson is thinking and planning.

Johnson is putting a bill on the floor that his entire leadership team — Majority Leader Steve Scalise of Louisiana and Tom Emmer of Minnesota — knows is going to fail. One House Republican lawmaker entered a meeting of GOP whips Tuesday and told us that he was “going to see how well they’re polishing this turd.”

In theory, the impending failure of the six-month stopgap funding bill coupled with the SAVE Act will lead House Republicans toward accepting a clean CR. Johnson can then tell hardline conservatives that he has no other option.

“It’ll fail, then we’ll go back and do something that’s to the end of the year clean,” said Rep. Mark Amodei (R-Nev.), a senior House appropriator. “That’s just reality. We’ve been through this drill enough times to know that nobody’s come up with a silver bullet to put somebody in a chokehold ‘till they scream, ‘Uncle.’”

Remember when you watch the vote today that Johnson foisted this plan on the House Republican Conference. He could’ve pushed through a clean stopgap funding bill (with Democratic votes), closed up shop and passed messaging bills for the rest of the month. Johnson is choosing failure.

What’s next: Senate leaders tell us they hope the collapse of the House effort will prompt a Four Corners discussion on a bipartisan CR that can pass both chambers.

Appropriators will also need to incorporate anomalies and extenders — many of which aren’t in the House bill — and potentially reach an agreement on a Secret Service funding patch. Disaster relief is also on the table.

“The appropriators have not been asked [yet] to get together to start working,” Sen. Susan Collins (Maine), the top GOP appropriator, told us. “But time is growing very short.”

Given those time constraints, it’s unclear whether Congress can address Secret Service funding in the CR, especially amid bipartisan outrage over the agency’s handling of lawmakers’ requests.

Sen. Chris Murphy (D-Conn.), who wants to see new money for the embattled agency included in the CR, said the Secret Service may have to get “creative” with its suggestions — and fast.

“Right now the urgency is to get us from now until the inauguration,” Murphy added.

The current discussions revolve around expanding overtime pay, allowing partnerships with other federal agencies and funding for new technology. There could also be a provision that permits the Secret Service to spend existing funds more quickly.

What’s certain is that the eventual CR won’t last for six months. Senate leaders are eyeing Dec. 13 as the end date, with Dec. 20 as a backup.

Task force news: The House’s bipartisan task force investigating the assassination attempts against former President Donald Trump will be briefed by the Secret Service this afternoon on the latest incident Sunday at Trump’s Florida golf course. There’s also some discussion about visiting the site in West Palm Beach, Fla., but nothing has been finalized yet.

This morning’s fun: The House Republican Conference will be at the Capitol Hill Club today. What a time for House Republicans to be talking about politics, as Democrats continue to pummel them in fundraising — despite Johnson’s much-touted 198-city fundraising tour.

What Republicans will hear this morning:

– This is interesting: Former Speaker Kevin McCarthy will give out $4 million from Protect the House, his joint fundraising committee, during a visit to the Hill today. This will include $1.2 million to vulnerable rank-and-file House Republicans and $1.7 million to the NRCC. He’ll also give checks to the Congressional Leadership Fund, the House GOP super PAC, and state parties.

McCarthy has given $40.5 million to members, candidates, the NRCC and state parties this cycle. McCarthy plans to stay politically engaged to help Johnson and House Republicans keep their majority, he told us.

– Johnson will use the closed meeting to announce a transfer to the NRCC and tell Republicans he raised $4 million in Texas over the weekend.

– Scalise will dole out $3 million today, a mix of transfers to the NRCC, candidates and state parties. Scalise will announce a $1 million transfer to the NRCC. Scalise has given $26 million to candidates, lawmakers, the NRCC and state parties this cycle — more than he did all last cycle.

– Emmer will announce another $750,000 transfer to the NRCC and $1.1 million to candidates and incumbent House Republicans. Emmer will also host a fundraiser this afternoon for three dozen Vanguards — GOP candidates running in safe Republican seats. This event will raise $1 million. Emmer has transferred $12 million to candidates, members and the NRCC this cycle and raised nearly $30 million overall.

– Several House Republicans running in safe open seats will also be making the rounds in Washington today, including Florida GOP candidate Mike Haridopolos, who will donate $178,800 during the NRCC’s altar call.

— Jake Sherman, Melanie Zanona and Andrew Desiderio

TOMORROW: Join Punchbowl News founder and CEO Anna Palmer on Thursday, Sept. 19, at 9 a.m. ET for a conversation with Rep. Stephanie Bice (R-Okla.). They’ll sit down to discuss the news of the day, the state of play, legislative landscape and key players central to defense aviation. RSVP!

The Vault: The rate cut you’ve been waiting for

Happy Fed Day, Washington. This is the big one.

The Federal Reserve is expected to cut interest rates today for the first time since hiking them steeply in 2022 to battle inflation. And we say “expected,” but officials including Fed Chair Jay Powell have made very clear for weeks now that the time has come for cuts.

The big question now is the size of the cut, at least for economists. The field remains effectively split on the odds of a 25 or 50 basis point cut. But the consensus is now leaning toward 50 basis points as the more likely outcome.

The other thing that makes this Federal Open Market Committee meeting “the big one” is timing. This is the FOMC’s last scheduled meeting before the general election on Nov. 5. And while there was plenty of griping in the months leading up to today about the political risks of cutting rates on the verge of an election, heads have mostly cooled off here on Capitol Hill.

Virtually every lawmaker we’ve interviewed during the last two weeks has said that the Fed’s decision to cut rates today won’t reshape the election, probably. Inflation has been on the back foot for a while, and lowering rates is an acknowledgement of that success.

“I think the election is mostly baked in for the overwhelming majority of people,” said Sen. Mitt Romney (R-Utah). “The economy is doing well at this stage, and I don’t see any indication that there’ll be some abrupt change.”

There will be sectors of the U.S. economy that feel the impact of lower rates first. Housing is at the top of the stack. Lower interest rates could jumpstart home sales and give early-to-mid career workers an affordable shot at homeownership. It won’t be immediate, however.

Progressives like Sens. Sherrod Brown (D-Ohio) and Elizabeth Warren (D-Mass.) have argued the Fed may be contributing to inflation with higher rates, as the cost of shelter has been inflation’s main driver for many months now. “Nobody’s building new [homes], and nobody can afford to buy one,” Warren told us Tuesday night.

This is an area where many Republicans agree, at least in theory. “There’s a certain segment of young adults between the ages of 25 and 35 who have done everything they should do, including saving for a down payment, and they just simply can’t break into the housing market,” Rep. Scott Fitzgerald (R-Wis.) said. Fitzgerald added that today’s cut could be a “light at the end of the tunnel” for would-be homeowners.

Many lawmakers aren’t all that stressed about the size of a cut, and plenty deferred judgment when asked. “Whether they go with 25 basis points or 50, it shows the direction that the economy is going,” Rep. Madeleine Dean (D-Pa.) said. “Which is, it’s going in the right direction.”

Then again, others made the point that a bigger cut could suggest economic angst at the Fed, which could spill onto Wall Street. Fitzgerald said a 50 basis point could “absolutely signal that either the Fed sees something the rest of us aren’t seeing, or the predictions from pundits that we are on our way to a recession could be real.”

At the end of the day, the Fed isn’t making this decision in a political vacuum. Plenty of Democrats are optimistic that a rate cut would help Americans feel better about the economy in the short term.

“I hope it sends a signal to the electorate — do you want to lose this pace of progress?” Dean said.

— Brendan Pedersen and John Bresnahan

TECH REPORT

Senate Intel panel to grill tech execs on election interference

The Senate Intelligence Committee will hear today from top executives at Alphabet, Meta and Microsoft about foreign election interference.

It could get tense.

The hearing is being held amid worries the tactics by bad actors are growing more sophisticated. It also follows the recent indictment of two Russian employees of the Moscow-run RT news site.

Expect Intel Committee Chair Mark Warner (D-Va.) to demand the companies tell lawmakers what they’re actually doing to fulfill commitments they’ve made to try to detect foreign election interference.

Despite election interference being a major issue since 2016, Congress doesn’t often haul the tech companies before lawmakers to discuss the issue.

Here’s what we’ll be watching for as Alphabet President of Global Affairs Kent Walker, Meta President of Global Affairs Nick Clegg and Microsoft President Brad Smith head up to the Hill.

Russia, Russia, Russia: The committee’s top priority is going to be the Kremlin’s efforts to tilt November’s contest. While the basic tactics of fake content and stoking divisions by posing as Americans are alive and well, Russia’s ability to jump quickly on U.S. political developments and to supercharge its efforts with AI have grown.

Research released by Microsoft on Tuesday showed Russia has already quickly pivoted to attacking the Harris-Walz ticket. The shift highlights that Vladimir Putin’s intelligence services have been able to gin up new messages and exploit emerging fissures.

To committee leaders, these efforts are more sophisticated and coming faster. Compare a phony Russian-linked, AI-generated video of Harris supporters behaving badly to efforts in 2016, which were sometimes slow to adapt to new developments and more or less illiterate on U.S. culture.

Iran’s election interference efforts are sure to pop up too.

X is the elephant in the room: Notably absent from the witness table is X, the social media site formerly known as Twitter and owned by Elon Musk, a vocal supporter of former President Donald Trump.

The committee had locked in a witness from X, Nick Pickles, a policy official who routinely represented the company at past grillings by lawmakers. But Pickles announced earlier this month that he was leaving the company.

Will the bipartisanship hold? Warner and Sen. Marco Rubio (R-Fla.), the committee’s vice chair, try to move somewhat in lockstep on big issues.

Ultimately, though, Russia’s efforts are aimed at bringing Trump back to the White House. And there’s plenty of domestic disinformation that benefits from Republican pressure on tech companies to pull back on content moderation.

The pullback is real. David Evan Harris, who worked at the defunct civic integrity team at Facebook, testified on Tuesday at a Senate Judiciary Committee hearing that “trust and safety teams have shrunk dramatically” during the last two years. “Secrecy is on the rise and transparency is on the decline,” Harris said.

— Ben Brody

HOUSE FREEDOM CAUCUS

Andy Harris will be next HFC chair

Rep. Andy Harris (R-Md.) is officially the new leader of the House Freedom Caucus for at least the rest of this Congress.

The hardline conservative group tapped Harris Tuesday night to succeed former Chair Bob Good (R-Va.). Rep. Andy Biggs (R-Ariz.), who was also running, dropped out at the last minute, as we first reported.

Good stepped down after losing his high-profile primary earlier this year. Former President Donald Trump backed Good’s opponent.

Harris faces a host of challenges leading the embattled group. The HFC has been plagued by fundraising woes, diminished influence and lawmakers abandoning the group due to near-constant infighting.

Harris is also a cardinal on the House Appropriations Committee, which could test how far he’ll buck leadership on funding bills to advocate for House conservatives. This was one of the concerns members raised about Harris when he was first floated as a candidate for HFC chair.

One member privately told us they think Harris will be able to unite the group more than they have been in the past year.

Harris didn’t comment on his plans or the election, saying he does not talk about internal affairs inside HFC.

— Mica Soellner

THE HOUSE

House GOP ready to back anti-sanctuary cities funding bill

Vulnerable House Republicans are on board with voting for a bill that aims to deny federal assistance to programs that benefit undocumented immigrants in sanctuary jurisdictions.

The No Bailout for Sanctuary Cities Act makes jurisdictions that don’t cooperate with federal immigration authorities “ineligible to receive any federal funds that the sanctuary jurisdiction intends to use for the benefit of” undocumented immigrants.

A vote on the rule for the bill is scheduled for today, with final passage set for Friday.

This seems like standard GOP fare. But Democrats we spoke to told us the bill could have unintended consequences, such as banning funding for infrastructure projects and education programs.

“It’s excessive. A complete blanket ban on funding. Everybody uses roads, everybody uses schools,” Rep. Salud Carbajal (D-Calif.) said.

But Republicans representing Democratic-leaning seats brushed off these concerns.

“I don’t know that it’s a practical, reasonable application of the bill,” Rep. Nick LaLota (R-N.Y.), the bill’s sponsor, told us. “I think they’re trying to find an excuse to wiggle out of it. It’s very popular amongst my constituents.”

“New York is spending billions of dollars of taxpayer money to house, clothe, feed and educate illegal immigrants,” Rep. Mike Lawler (R-N.Y.), another at-risk Republican, said. “That is something that shouldn’t be.”

— Max Cohen

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