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PRESENTED BY

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

THE TOP

Happy Thursday. Somehow, it’s July. And, by the way, let’s go Nats. 

News: During a closed-door meeting with freshman House Republicans Wednesday, Minority Leader Kevin McCarthy had a stark warning.

If any Republican accepts an appointment from Speaker Nancy Pelosi to the Jan. 6 select committee, they better be ready to get all their committee assignments from her.

Republicans, McCarthy said, get their committee assignments from Republicans — not from Democrats. Or else.

That’s a pretty stark threat. To be clear, the only Republicans that Pelosi seems to be considering for the new select committee are Reps. Liz Cheney (Wyo.) and Adam Kinzinger (Ill.), who voted for it. Although both of them may be out of Congress by 2023. Of course, McCarthy can move to strip them of their current committee assignments, but that seems like a bridge too far.

Still, McCarthy’s threat — relayed to Punchbowl News by multiple people present — lays bare how he views Pelosi’s idea to name one of his lawmakers to the panel investigating the insurrection. 

→ Also: McCarthy told the room that he had planned to give $6 million to the NRCC this month, but ultimately gave $7.7 million.

THE NEW WASHINGTON

Vote no, hope for dough

One of the most interesting things about today’s House vote on the INVEST Act — a $715 billion surface transportation and water infrastructure bill — is that it’s the first big piece of legislation with earmarks since the practice was reinstated earlier this year.

And in this case, dozens and dozens of House Republicans — more than 100 GOP lawmakers in total — are expected to vote “No” on the bill despite the fact that they have $1.5 billion-plus in earmarks stuffed inside the legislation.

Remember how earmarks were supposed to help build support for bills? Nah, not anymore!

In the old days, this would never happen. If a member got an earmark, they’d vote for the bill. Or their earmark would get dropped somewhere along the way, and they’d never get another one.

But House Republicans are hoping the bipartisan Senate infrastructure plan passes. That would provide them with a chance to get their earmarks while also voting against roads, bridges and highways this time around — something all lawmakers usually love — only to be able to vote for them later. We’ll explain.

House Republicans are opposed to the House Democratic legislation put together by Reps. Peter DeFazio (D-Ore.) and Frank Pallone (D-N.J.), the chairs of the Transportation and Infrastructure and Energy and Commerce panels respectively.

Republicans complain the bill isn’t offset by any spending cuts elsewhere, and that especially on the surface transportation portion of the package, there are too many provisions dealing with climate change. Republicans have tried to label these provisions “The Green New Deal revisited” basically. It’s not accurate, but that’s the Republican messaging here.

“This is a very partisan bill, it has little to do with infrastructure,” House Minority Whip Steve Scalise (R-La.) said, explaining the GOP position. “It’s more about the Green New Deal. It’s over $700 billion completely unpaid for, all deficit spending.”

Scalise said the $974 billion bipartisan Senate package, already endorsed by President Joe Biden, “is a lot closer to what Sam Graves and a lot of others have worked on that’s traditional infrastructure — roads, bridges, ports, waterways and broadband. That’s also paid for.” Graves, a Missouri Republican, is the ranking member on Transportation.

So now some Republicans will vote against the bill, even though they have earmarks in it.

“This place has kind of devolved over the last 20 years. And the normal standards since I arrived in 1994 don’t apply anymore,” said Rep. Frank Lucas (Okla.), one of those Republicans who is voting no despite getting some money for earmarks. “I would say we’re in a legislative world where there are no norms anymore. You play it by ear, we have to sort our way though.”

The outlook for the bipartisan Senate infrastructure bill, however, is tied up with a massive, multi-trillion dollar Democratic reconciliation package that will include Biden’s American Jobs Plan and American Families Plan. Biden and Democratic leaders want very badly to pass that second piece of legislation. But they worry that Democratic moderates won’t vote for that proposal unless they get the Senate infrastructure bill too. So the White House and party leaders are trying one bill to the other — if Democratic moderates vote for reconciliation, then the Senate infrastructure bill can be passed, with Repbublican votes if needed.

Which is where the earmarks come back in. There aren’t earmarks in the bipartisan Senate bill — it’s only a shell right now — but they could be added to the legislation during House-Senate negotiations. And that revised bill could then be adopted by both chambers, signed into law by Biden, and bingo, earmarks for everyone.

“The process isn’t over yet, we’ll see how it goes,”  said Rep. Tom Cole (R-Okla.) when asked about the propriety of House Republicans voting against a bill which includes their own earmarks. “I think in the end, we’ll get to a bipartisan deal, in which case not every earmark will survive … but if they survive the scrutiny of the committee originally, they’ll survive.”

PUNCHBOWL NEWS x PETER DEFAZIO

Our interview with the transportation chairman on his $715B bill

We interviewed House Transportation and Infrastructure Committee Chair Peter DeFazio (D-Ore.) about the $715 billion INVEST Act, a combination surface transportation and water infrastructure bill that he’s helping to shepherd through the House.

The stakes are enormous here, both politically and policy wise. Everyone from President Joe Biden on down says the United States has to dramatically ramp up its spending on infrastructure or risk falling further behind China and other leading countries.

However, the debate over traditional “hard” infrastructure has gotten caught up in a push by Biden and Democratic leaders on Capitol Hill for trillions of dollars in new spending on “human” infrastructure as the country emerges from the Covid-19 pandemic. This debate is playing out not only along traditional partisan lines; it also threatens to worsen ideological battles inside the Democratic Party itself.

Climate change is another huge issue. The recent record high temperatures in the Pacific Northwest, including DeFazio’s coastal Oregon district, have shocked many from the region. There’s a sense among many lawmakers that this is a growing crisis that requires a more dramatic response from Washington. 

And all this comes in the post-Donald Trump era, where trust and comity on Capitol Hill has reached a low point.

Punchbowl News: How many Republicans are going to vote for this bill?

DeFazio: “I’m hoping to get a few. We got three on final passage last year. We lost two Democrats, they’re not back.” DeFazio noted that two Republicans voted for the bill in committee, although this pair is now seen as unlikely to vote for it on the floor due to Democratic leadership’s decision to twin the surface transportation bill with a large water policy package.

Punchbowl News: What does it say that the two parties can’t get an agreement on infrastructure, which has been a bipartisan issue in the past?

DeFazio: “Well, they object to the levels of spending, which are quite comparable to those in the [Senate] bipartisan bill, reflecting the bipartisan senators recognize the extraordinary need. And the White House. They [the Senate group] are lower than the White House, I’m lower than the White House.

“[Republicans] particularly object to any [climate change] provisions. They say, ‘Why are there any environmental provisions in a surface transportation bill?’ I said, ‘Because the largest source of fossil fuel pollution is from transportation. We have to deal with that.’ I believe climate change is real.”

One of the big issues in the INVEST Act is building charging stations for electric vehicles. DeFazio noted that he brought in Fred Smith, CEO of FedEx, to talk about how his company is shifting to electric vehicles for its ground operations. He also talked about U.S. companies building large electric trucks, yet the United States lacks a network of charging stations for passenger vehicles and big rigs.

Punchbowl News: Republicans are referring to the environmental provisions in this legislation as the “Green New Deal.” What’s your reaction to that?

DeFazio: “Yes, I guess. Whatever. The mere electrification of the national highway system and plans to reduce fossil fuel production, or have states look at transit and rail options before they build eight more lanes of highway that become immediately congested. Those they say are ‘Green New Deal.’”

Punchbowl News: What about the fact that this legislation increases the deficit and isn’t offset by spending cuts?

DeFazio: “It will be later. You can catch Richie Neal [Ways and Means Committee chair], I don’t get to do that part. The bipartisan senators have offered a plan. The White House has offered a plan. Richie Neal is fully ready to sit down, he’s been talking to [Senate Finance Committee Chair Ron] Wyden, he’s been talking to [Treasury Secretary Janet Yellen], he’s been talking to the president, he’s been talking to [Transportation Secretary Pete] Buttigieg… They’re ready to move when they’re ready to negotiate.”

Punchbowl News: The recent stunningly hot temperatures in the Pacific Northwest, what does it mean?

DeFazio: “That was not a normal heat wave. There’s been a lot written about it. There’s a scientific consensus that carbon pollution is accentuating heat waves. This would be an unusual heat wave no matter what in the Northwest. But everyplace was off the charts. Some places were 40 degrees above normal. Every place in the Northwest broke all-time temperature records. It was so hot, the asphalt was melting.”

Punchbowl News: What does it say to you when a member gets an earmark in a bill — like some Republicans have here — and still votes no?

DeFazio: ”I believe in members of Congress having discretion to help their district in meaningful and appropriate ways. Republican or Democrat. I’m not Jack Murtha. I’m not going to say, ‘Sorry, there all gone.’ … I never expected this was going to get a whole bunch of them to vote for the bill.”

SNEAK PEEK

Yarmuth sees budget movement next week

Crunch time is getting closer for Democrats on the budget resolution and reconciliation. House Budget Committee Chair John Yarmuth (D-Ky.) told us on Wednesday that he expects his counterpart, Senate Budget Committee Chair Bernie Sanders (I-Vt.), to share “a framework of their resolution instructions by next week. We’ll look at those.”

This isn’t the actual budget resolution; that’s not expected for at least a couple more weeks. Instead, this is a discussion draft for internal talks between the two committees. These instructions could also cover the debt limit. The various committees then put together that legislation, which is then sent back to the respective Budget Committees.

Yarmuth and Sanders will introduce the same budget resolution, although Senate Democrats will have to go through a “vote-a-rama” before final passage.

Yarmuth also made an interesting point that we’ll probably hear more of in coming weeks. When discussing the cost of any reconciliation package that Democratic leaders may offer, Yarmuth mentioned it was the “net cost” that was the key issue, meaning any spending increases Democrats pursue will be offset by tax hikes in a reconciliation package.

“It depends on what the net is,” Yarmuth noted. He pointed to the 2017 GOP tax cut, which was actually more than $5 trillion but then was offset by ending some tax breaks. Republicans ultimately keep the cost of that package to an estimated $1.5 trillion to $2 trillion. But even then, Sen. Mitch McConnell (R-Ky.) and other Republicans claimed it would be “close to revenue neutral” because the tax cut would spur economic growth and produce more revenue for the federal government. Which, of course, wasn’t how it played out as the deficit worsened following the GOP tax cut. Yet the messaging was effective for the GOP at the time.

So look for Democrats to use this same playbook in reverse this year when estimating the cost of their expected reconciliation package.

MOMENTS

6:55 a.m.: President Joe Biden and First Lady Jill Biden will leave for Andrews, where they will fly to Miami. They’ll arrive in Miami by 9:30 a.m. Karine Jean-Pierre will brief on Air Force One. 

10:05 a.m.: The Bidens will get briefed by Miami-Dad Mayor Daniella Levine Cava, Florida Gov. Ron DeSantis and other local officials.

10:30 a.m.: Speaker Nancy Pelosi will hold her press briefing.

11 a.m.: The president and first lady will visit first responders.

11:30 a.m.: House Minority Leader Kevin McCarthy will hold his press briefing.

12:30 a.m.: The president and first lady will meet with families affected by the disaster at the St. Regis Hotel.

1:30 p.m.: The Covid-19 response team will brief in D.C.

3:50 p.m.: Biden will speak at the St. Regis Hotel.

5:20 p.m.: The president and first lady will leave Miami and are expected to arrive at Andrews at 7:30 p.m. and the White House around 8 p.m.

CLIP FILE

CNN

→ “Republican trip to the border highlights how proxy voting has changed Congress,” by Annie Grayer, Kristen Wilson and Sarah Fortinskty

NYT

→ “Behind Biden’s Pledge to Share 80 Million Vaccine Doses: Lots of Bureaucratic Hurdles,” by Noah Weiland

→ “Inside the Capitol Riot: An Exclusive Video Investigation”

WaPo

→ “N.Y. grand jury said to return criminal indictments against Trump’s company and its CFO, the first from prosecutors probing the former president’s business dealings,” by Shayna Jacobs, Josh Dawsey, David A. Fahrenthold and Jonathan O’Connell

→ Paul Kane column: “So much for ‘action’: McCarthy dials back early pledge to rein in Republicans who cross the line as Gosar, others go unpunished”

→ “U.S. arrests more than a dozen in Capitol riots, among the most made public in a single day,” by Spencer Hsu and Rachel Weiner

WSJ

→ “Robinhood Agrees to Pay $70 Million to Settle Regulatory Investigation,” by David Michaels

Politico

→ “Powell and Biden link arms for America’s inflation summer,” by Victoria Guida

PUNCHBOWL NEWS x GINA MCCARTHY

What Gina McCarthy told us

Gina McCarthy, the president’s national climate adviser, spoke to us Wednesday during a Punchbowl News Pop-Up Virtual Conversation about the infrastructure bill and the Biden administration’s efforts to combat global warming.

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Editorial photos provided by Getty Images