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PRESENTED BY

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

THE TOP

We’ve reached a critical moment in the drive to pass President Joe Biden’s legislative agenda. The White House is hosting a series of meetings today to try to whip members into shape. We’ll get into all of that in a minute.

We need to cover the government funding and debt ceiling debate first.

The White House and Democratic congressional leaders must decide very soon how far they’re willing to push this partisan showdown with Republicans over the nation’s debt limit and government funding. 

Funding for federal agencies runs out on Sept. 30. While we don’t believe there’ll be a shutdown, neither side has been willing to back down yet, so it’s a distinct possibility at this point. There’s more time to deal with the debt limit, although not too much more. Treasury Secretary Janet Yellen has warned that the federal government will run out of the ability to obtain new loans sometime in October.

Here’s where things stand right now:

→ The House passed a short-term funding bill on Tuesday night that would keep federal agencies open until Dec. 3 while raising the debt limit through December 2022. It was a straight party line vote: 220 Democrats yeas, 211 Republicans nays. Rep. Debbie Lesko (R-Ariz.) didn’t vote.

→ Due to the way the House considered the measure, it will be sent over to the Senate today without any parliamentary advantage for quick consideration. Senate Majority Leader Chuck Schumer will then call the bill up and file cloture. That cloture vote won’t occur until Friday, Sept. 24. That’s just six days from the end of the fiscal year and a possible shutdown. Senate Democrats won’t get the 60 votes they need to overcome the GOP filibuster. (Schumer has teed up a bunch of nominees for late this week, so senators will be here).

→ At that point, Democrats will be forced into a decision. Do they continue pushing funding legislation with the debt limit increase attached — risking both a government shutdown and even more disastrous debt default? Or do they find another path?

We already know that Senate Republicans, led by Minority Leader Mitch McConnell, will block this continuing resolution because of the inclusion of the debt limit. McConnell has been warning about this for the last two months, so there’s no reason to believe his position will change now. If you’re into the whole procedure thing, Senate Republicans will filibuster the motion to proceed to the combined CR-debt limit bill passed by the House.

→ Democrats could then move a “clean” CR to avoid a government shutdown on Oct. 1. And Republicans will vote for that.

→ Democrats can also create a separate reconciliation bill that deals narrowly with lifting the debt limit. But that will take two to three weeks and will expose Senate Democrats to two “vote-a-ramas.” The huge advantage of using that procedure, however, is that Democrats can pass it with no GOP support at all. This is what McConnell has been suggesting Democrats do since late July.

McConnell and Sen. Richard Shelby (Ala.), ranking Republican on the Appropriations Committee, have filed their own version of a stopgap funding bill without the debt limit.

McConnell’s legislation keeps federal agencies open until Dec. 3, and it includes $27 billion in disaster aid and more than $6 billion for resettling Afghan refugees. This is what the White House has requested.

The McConnell-Shelby bill also has $1 billion for Iron Dome, Israel’s missile defense system. House Democrats dropped that funding from their bill on Tuesday after objections from progressives. But with GOP support, the Iron Dome funding could go back into the new CR, no problem.

So we should know by Friday what situation Democratic leaders and the White House face. Their window for action will be that much smaller. But some action will be required in order to avoid catastrophic outcomes that neither Biden nor Democratic leaders will want.

Join us! Tomorrow morning at 8:30 a.m. Jake and Anna will host a pop-up Punchbowl News interview with Sen. Alex Padilla (D-Calif.) on news of the day and immigration reform. The conversation comes as Democrats look for a way to include a pathway to citizenship in the reconciliation package. Padilla is the chair of the Judiciary Committee’s subcommittee on Immigration, Citizenship, and Border Safety. He also serves on the Budget, Environment and Public Works, and Homeland Security and Governmental Affairs panels. Ahead of the conversation, Fwd.us’ Alida Garcia will present sponsor remarks. Register to join here. 

THE BIDEN AGENDA

The White House wakes up. And the stare down you need to watch

OK, let’s dig into President Joe Biden’s legislative agenda.

The war between Democratic moderates and progressives on Capitol Hill has hit a fever pitch.

There’s a real danger at this point — as we’ve been warning — that both the $1 trillion bipartisan infrastructure bill and the $3.5 trillion reconciliation package could be derailed by this infighting. This would be catastrophic for the Democratic majority and the White House. 

Democratic leaders on the Hill have quietly been begging for Biden to wade in — and that’s now happening. 

Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer are going to the White House today to meet with Biden. A broad cross section of House and Senate Democrats also will trek to the White House to take meetings with Biden in a bid by the administration to shake things up.

Here’s a partial list of people going today:

→ Moderates: Reps. Josh Gottheimer (N.J.), Stephanie Murphy (Fla.), Steven Horsford (Nev.), Suzan DelBene (Ore.) and Mike Thompson (Calif.). 

→ Progressives: Rep. Pramila Jayapal (Wash.), Mark Pocan (Wis.), Barbara Lee (Calif.) and Jim McGovern (Mass.).

→ Some senators are heading over to White House too. We’ll get their names and get back to you. 

The idea here by Biden administration officials is to try to soften some hardened positions and show real progress on the reconciliation bill. That will help Democrats get moving on infrastructure too.

The standoff 

Pelosi, Jayapal and Gottheimer — three of the central figures in the House this week — are all going to the White House.

Jayapal, of course, is the chair of the 94-member Congressional Progressive Caucus. Gottheimer is the leader of the Problem Solvers Caucus and the most vocal House Democratic moderate.

If you’re reading this, you probably remember that Gottheimer got Pelosi to “agree” to put the bipartisan infrastructure bill on the floor by Sept. 27. That’s next Monday. As part of that agreement, Pelosi said she would work to get the votes for the $1 trillion bipartisan infrastructure package. The Senate approved that legislation in early August by a big bipartisan margin, giving Biden a chance for a big political win on one of his key issues.

But Jayapal says that at least 48 of her fellow progressives are ready to block passage of the infrastructure bill because the massive $3.5 trillion reconciliation package — the bulk of Biden’s American Jobs Plan and American Families Plan — is nowhere close to being done. To Jayapal and other progressives, the situation is clear — no infrastructure bill without reconciliation.

If the infrastructure bill goes to floor early next week, it will almost certainly fail — unless Pelosi leans in hard to save it.

We’re fascinated by this standoff. This is a trio that we at Punchbowl News watch very closely, so let’s examine what will happen here.

→ Let’s start with Pelosi. Team Pelosi insists that she’ll keep to her word and begin floor consideration of the infrastructure bill on Monday, with a possible vote later in the week. But we’ve covered Pelosi since she first took the speaker’s gavel 15 years ago, and she’s not one to put a bill on the floor that she thinks will fail. Pelosi loathes that; she’s said so many times. 

So can Pelosi convince progressives that there’s been sufficient movement on the reconciliation package to back them off their threat to tank the infrastructure bill? Can she back Gottheimer off of his demand that he needs a vote next week? That seems unlikely, for what it’s worth. Or does Pelosi just put the infrastructure bill on the floor and see what happens?

→ Gottheimer doesn’t at all seem like he’s going to back off. If Gottheimer lets Pelosi out of this agreement, he loses some internal credibility. Moderates already doubt the wisdom of the deal he cut, so Gottheimer can’t back off of it now. Gottheimer’s whole shtick was that infrastructure and reconciliation should be separated. They aren’t separated or on different tracks — you’d have to be living on Mars to believe that to be true — but it was a valiant effort.

Gottheimer’s view on wanting a Sept. 27 vote is this: Biden should pocket the victory that’s at hand. And there’s some hard truth to that. The president’s poll numbers are flagging, Covid is resurging and his foreign policy is teetering. Signing a bill that garnered a big bipartisan majority in the Senate could dramatically alter that — and could be what Democrats need in 2022. Especially moderates in tough swing seats. Furthermore, moderates believe reconciliation is months off and uncertain, so why delay this infrastructure bill?

Gottheimer’s efforts have put the most attention on moderates since 2010, when Obamacare was going through Congress. In a leftward-leaning caucus, he’s given the middle some juice. His view here is that Pelosi promised to get the votes for this package Monday — and she needs to live up to her word. He said as much yesterday.

In the Democratic Party on Capitol Hill and among the senior rung of the White House, Gottheimer is seen as a comer. He worked in Bill Clinton’s administration, for large corporations and is a prolific pol. Gottheimer has $10 million on hand in his campaign account and is widely seen as eyeing statewide office in New Jersey. This isn’t someone that will be going away anytime soon.

→ Jayapal’s CPC is the heart of the House Democratic Caucus. And she comes to the table with a strong hand. Why would progressives ever vote for an infrastructure bill that they don’t love when they have no guarantees about what they’ll get on the social spending side? Even if you assume that Jayapal doesn’t have 40-plus Democrats behind her, it’s not a stretch to believe she has enough to bring the bill down. Why would she back down? 

“I do not believe there’s the votes” for the infrastructure bill, Rep. Alexandria Ocasio-Cortez (D-N.Y.) told us. “It’s not just the process of the situation, where we need to ensure passage of reconciliation. It’s the substance of the bill. It’s a bad bill.”

Furthermore, for progressives, it’s easy to explain why you voted no here: It’s going to pass eventually, but Democrats wanted guarantees on social safety programs.

Jayapal is doing something new. Progressives have typically caved under leadership pressure. She’s using the numbers progressives have to influence the process. Typically the left has deferred to Pelosi on that. 

This seems like a problem the White House will need to untangle. But it’s as interesting of a showdown as we’ve seen in some time on the Hill.

CHEAT SHEET

The reconciliation threats from House Dems

We love our readers. You guys email and text all the time. We respond. It’s great. BTW: Subscribe to Premium to hang out with us today and chat about the politics of governing during our weekly Brown Bag Lunch. 

Anwyay, one of our loyal readers wrote us suggesting we create a cheat sheet for all the threats House Democrats have made so far when it comes to the reconciliation bill. We aim to please.

→ Rep. Alma Adams (D-N.C.) says HBCUs need to get more than the $2 billion allotted in the reconciliation bill.

→ Rep. Alexandria Ocasio-Cortez (D-N.Y.) says she’s a no on infrastructure until reconciliation has passed both chambers.

→ Reps. Jared Huffman (D-Calif.) and Hank Johnson (D-Ga.) say they will not vote for infrastructure until reconciliation is clearly on its way into law.

→ Reps. Chuy Garcia (D-Ill.) and Lou Correa (D-Calif.) say they will not vote for reconciliation unless it includes a pathway to citizenship.

→ New Jersey Democratic Reps. Mikie Sherrill, Josh Gottheimer, Tom Malinowski, Bill Pascrell and New York Rep. Tom Suozzi all have said they won’t vote for reconciliation unless it peels back the state and local deduction cap. 

→ Sens. Joe Manchin (D-W.Va.) and Kyrsten Sinema (D-Ariz.) have said they need the reconciliation price tag to drop. They’ve made a bunch of demands — too many to list here.

THE PRESSURE

AAN adds to campaign, has $7.5M on TV against Biden’s agenda

News: The American Action Network, the outside group aligned with House Republicans, is dropping an avalanche of new television ads today, hitting 24 districts with spots on six separate issues.

This campaign is costing AAN a whopping $7.5 million. That  includes the $1.5 million in TV ads they announced last week. It’s a big effort for this time of the year, and includes a particularly broad swath of messages about one bill: the emerging Democratic reconciliation package. 

Here’s a smattering of what AAN is putting up.

Rep. Jared Golden (D-Maine) will be hit with an ad highlighting $200 million in federal funding for a park in San Francisco “snagged” by Speaker Nancy Pelosi, as well as electric vehicle credits for “her rich friends.” This will go up in eight other districts as well.

Reps. Stephanie Murphy (D-Fla.) and Lizzie Fletcher (D-Texas) have ads up against them saying that the cost of insurance for hurricane damage will increase thanks to Democrats. 

They call Rep. Josh Gottheimer (D-N.J.) a fake moderate in this spot, saying he caved to Pelosi. Gottheimer’s going to love this one — not.

Two previously announced ads: job losses in Rep. Vincente Gonzalez’s (D-Texas) district and inflation in Rep. Carolyn Bourdeaux’s (D-Ga.) district.

Interesting note: Several of these ads feature not only Pelosi, but also Rep. Alexandria Ocasio-Cortez (D-N.Y.)

Dan Conston, president of AAN: “The more we learn about this bill, the worse it gets. This bill is creating a world of problems for Members in 100 different directions. Members should think long and hard before walking the plank for Pelosi when we’re only beginning to see just how toxic this bill will be back home.” 

MOMENTS

9 a.m.: Speaker Nancy Pelosi will hold a meeting with U.K. Prime Minister Boris Johnson in the Capitol.

9:15 a.m.: President Joe Biden will get his daily intelligence briefing.

10:45 a.m.: Pelosi will hold a meeting with Australian Prime Minister Scott Morrison.

11 a.m.: Biden will hold a virtual Covid summit. Vice President Kamala Harris will participate. 

Noon: Senate Minority Leader Mitch McConnell will hold a news conference on the debt limit.

This afternoon: Biden will host meetings on his agenda with Democratic lawmakers.

5:15 p.m.: Harris will meet with Zambian President Hakainde Hichilema.

THE ROAD TO RECOVERY SERIES

Punchbowl News sits down with CBC Chair Joyce Beatty

Congressional Black Caucus Chair Rep. Joyce Beatty (D-Ohio) joined us for our second in-person editorial event at the Roost on Capitol Hill Tuesday morning. The conversation focused on reconciliation negotiations and the uneven recovery of Black small business owners from the Covid recession. The event was sponsored by Goldman Sachs 10,000 Small Businesses Voices. The full interview is below.

CLIP FILE

NYT

→ “A Botched Drone Strike in Kabul Started With the Wrong Car,” by Eric Schmitt

→ “Trump Campaign Knew Lawyers’ Voting Machine Claims Were Baseless, Memo Shows,” by Alan Feuer

 → “No More Apologies: Inside Facebook’s Push to Defend Its Image,” by Ryan Mac and Sheera Frankel

WaPo

→ “Amid furor over border images, Biden faces Democratic backlash on immigration,” by Sean Sullivan and Nick Miroff 

→ “U.S. default this fall would cost 6 million jobs, wipe out $15 trillion in wealth, study says,” by Jeff Stein

→ “Trump sues New York Times and niece Mary Trump over tax records story,” by Katerina Ang

WSJ

→ “Justice Department Files Antitrust Suit Challenging American-JetBlue Alliance,” by Brent Kendall and Alison Sider

→ Editorial Board: “The Enormity of Manchin’s Skinny H.R.1”

AP

→ “Officials: Many Haitian migrants are being released in US,” by Elliot Spagat, Maria Verza and Juan A. Lozano

→ “Racism, climate and divisions top UN agenda as leaders meet,” by Edith M. Lederer

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Editorial photos provided by Getty Images