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PRESENTED BY

BY JOHN BRESNAHAN, ANNA PALMER AND JAKE SHERMAN
WITH MAX COHEN AND CHRISTIAN HALL

THE TOP

Happy Friday morning. 

News: President Joe Biden will attend the House Democratic retreat in Philadelphia next Friday, the last day of the three-day confab, sources familiar with his schedule told us. We reported a few weeks ago that the White House had yet to confirm that Biden would be there, but he’s now definitely heading to the City of Brotherly Love to speak to House Democrats. Vice President Kamala Harris is also invited.

One detail we picked up on: Several House Democrats will arrive at the retreat on Thursday instead of Wednesday because the Library of Congress is honoring Lionel Richie with the Gershwin Award in D.C. And who wants to miss Mr. “All Night Long?”

That said, Congress is going to be exceedingly busy next week. The House is only in session for three days (really one and a half) before House Democrats leave for their Philadelphia retreat. And the federal government runs out of funding just one week from today.

As of late last night, negotiations were proceeding slowly on the $1.5 trillion omnibus spending package as House and Senate appropriators – with the help of leadership – look to whittle down the remaining policy riders and get a deal to fund the federal agencies through September. Committee aides were swapping offers late yesterday evening. As we said, the current continuing resolution runs out on March 11.

We’re beginning to get the strong sense that Congress may need to pass a short-term spending bill to allow negotiations and drafting to continue. Once a deal is reached, it will still take several days to finish putting the mammoth package together. The House needs a day to pass it, and the Senate will likely need several to clear the huge package and send it to the president’s desk. So we’re looking at a very tight schedule. 

Let’s be clear on this once again – there’s not going to be a government shutdown. Yet the process of passing the 12 annual spending bills, sidetracked for months as Democrats wrestled with the Build Back Better Act, has been anything but pretty. We’re now more than five months into the fiscal year and Congress is still dealing with this issue. This doesn’t augur well for FY 2023.

BUILDING BACK AGAIN?

Digging into BBB politics

There’s been renewed movement – however tentative – among Democrats for some kind of deal that can meet Sen. Joe Manchin’s (D-W.Va.) approval. 

Manchin laid out a potential framework in an interview with Politico on Wednesday. It would include cutting prescription drug costs and “tax reform.” That means reversing some of the 2017 GOP tax cuts. Whatever revenue savings come from that effort would be split between deficit reduction and “climate and social programs,” as long as they’re paid for.  That’s a key for the West Virginia Democrat.

Manchin, who chairs the Senate’s Energy and Natural Resources committee, also wants to halt the importation of Russian oil while allowing more domestic drilling. Other moderate Democrats would back that too, a huge issue following the Russian invasion of Ukraine.

On Thursday, Rep. Pramila Jayapal (D-Wash.), who chairs the Congressional Progressive Caucus, told Greg Sargent and Paul Waldman of the Washington Post, that progressives “are open to that approach,” although there are clearly a lot of caveats here. A lot.

Here’s the challenge: Negotiating with Manchin is something the White House is going to be very cautious about, as will Senate Majority Leader Chuck Schumer. In fact, the level of distrust toward Manchin in Democratic leadership and the White House is pretty strong, based on our conversations with a bunch of participants in both camps.

That said, Schumer and President Joe Biden would love some kind of agreement to come out of the months of work they spent on the reconciliation package. And something is always better than nothing (we’re channeling Nancy Pelosi here.)

Democratic Party leaders are currently distracted by getting the omnibus through Congress. So for at least the next week, that will be their top goal.

Procedurally, any revamped reconciliation agreement would have to comply with the instructions laid out for BBB, including the total cost and individual committee jurisdictions. The Senate parliamentarian will have to scrub the proposal to make sure it complies with the Byrd Rule (never sleep on the Byrd Rule), and it would have to be scored. On the Senate floor, there would be a vote-a-rama prior to a vote on final passage. Then the House will have to pass the legislation and send it to Biden for his signature. All in all, there’s an enormous amount of work to be done, although Democrats aren’t starting at zero.

The point is, it’s doable under the existing BBB reconciliation instructions.

Let’s look at the calendar. May seems like the earliest target date if this effort is real.

The Senate is in session for the rest of this month and the first week of April. Floor time will be taken up next week on the omnibus and potentially the U.S. Postal Service reform bill. Schumer is going to want Kentanji Brown Jackson’s Supreme Court nomination on the floor in early April, which will also eat up a week.

The Senate is currently scheduled to recess from April 11-22. Which means that a new Democratic reconciliation bill probably couldn’t get onto the floor until late April or early May. Of course, Schumer could change the schedule if he thought a deal was possible.

All of this, as we noted, is very preliminary, and there will have to be a lot of conversations between Democrats in both chambers if they want to try to do this again. Manchin and Sen. Kyrsten Sinema (D-Ariz.) would again be the focus of everything and everyone in the Senate. Success will hinge on how far they’re prepared to go.

We’ll note here that the February inflation data will be released next Thursday by the Bureau of Labor Statistics. It will be interesting to see what the fallout from that is.

BIDEN’S BIG PROBLEM

Russian attack on Ukrainian nuclear facility spurs calls for Western action

Russia’s brutal military onslaught in Ukraine took on a potentially nightmarish new angle on Thursday evening. Ukrainian officials accused Russian forces of opening fire at the Zaporizhzhia nuclear power plant in southern Ukraine. A fire broke out at the facility, which is the largest nuclear plant in Europe. U.S. officials said the fire was out and radiation levels remained safe, but the Russians have apparently “occupied” the site. President Joe Biden spoke to Ukrainian President Volodymyr Zelensky about the situation. Zelensky later accused the Russians of a “terror attack.”

The Zaporizhzhia nuclear facility supplies roughly one-quarter of Ukraine’s electricity. There are reports that this incident is part of a deliberate Russian strategy of targeting Ukraine’s civilian infrastructure.

With Russian forces apparently gaining ground in southern Ukraine while stalled further north, this new development is going to spur more calls in Congress for further Russian sanctions. We covered the dispute between the White House and Capitol Hill in our PM edition last night over cutting off Russian oil and energy imports to the United States.

In short, most Democrats we talk to want to ban Russian oil imports. Speaker Nancy Pelosi backed a ban Thursday, as did Sen. Chris Murphy (D-Conn.), a key ally of the Biden administration. Here’s Murphy to us last night:

“It’s a complicated question of how you do that. And whether it makes sense to do that with Europe, but it certainly doesn’t make a lot of sense to continue to import Russian oil when we could find other sources. You know, what’s likely to happen is that oil will find its way into China and fill in with other sources. So it might not have as big an impact on Russia as we might think. But still, it …  feels like the right thing to do.”

This is the biggest tension point between Congress and the White House right now. 

We’re also hearing growing discussion on the Hill about revoking Russian preferred trade status, which would raise tariffs on any Russian imports. Several senators have introduced bills to do so.

And lawmakers in both parties are pressing the White House to impose Magnitsky Act sanctions against a wide array of Russian officials, including those in President Vladimir Putin’s inner circle. The Magnitsky Act requires sanctions on human rights violators.

→ Building Back Together, the group that backs President Joe Biden and his policies, is up with another 60-second spot, this time praising the administration’s economic policies. This is airing in D.C. Thanks to AdImpact.

FRONTS

MOMENTS

10 a.m.: President Joe Biden will get his daily intelligence briefing.

12:25 p.m.: Biden will make “an announcement delivering on his Made in America commitments.”

1:10 p.m.: Vice President Kamala Harris will meet with the crown prince of Bahrain.

1:15 p.m.: Jen Psaki will brief.

2:30 p.m.: Biden will meet with Finnish President Sauli Niinistö.

5:35 p.m.: Biden will leave the White House for Delaware, where he’ll arrive at 6:40 p.m.

CLIP FILE

NYT

→ “Pressure on Justice Dept. as Jan. 6 Panel Lays Out Case Against Trump,” by Katie Benner and Charlie Savage

→ “Florida Lawmakers Vote to Ban Abortions After 15 Weeks,” by Patricia Mazzei and Alexandra Glorioso

→ “Washington’s Newest Worry: The Dangers of Cornering Putin,” by David E. Sanger, Eric Schmitt and Julian E. Barnes

→ “Ukraine’s Navy says it purposely sank its flagship Black Sea vessel,” by Andrew E. Kramer

WaPo

→ “In Europe, Blinken seeks to telegraph Western unity to Putin,” by Missy Ryan and Emily Rauhala in Brussels

→ “Republicans telegraph their attacks on Ketanji Brown Jackson,” by Seung Min Kim

WSJ

→ “Companies Bet You’re Ready to Test at Home for More Than Covid-19,” by Austen Hufford

Bloomberg

→ “Energy Hedge Fund Eyes $200 Oil on Potential Russia Export Ban,” by Nishant Kumar and Ben Bartenstein

Politico

→ “Trump warms to Greitens, shaking up endorsement race in Missouri,” by Alex Isenstadt

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Editorial photos provided by Getty Images