News: Are you ready for another Big Beautiful Bill?
Mike Johnson is.
House Republican leaders decided at their Florida retreat last weekend that they’re going to pursue a second reconciliation package this year, according to multiple sources who attended the gathering.
The only problem is they have no idea what will go in the package or how they’re going to pay for it.
Johnson is the most optimistic person — some would say unrealistic — in the House Republican leadership. He’s been on a bit of an island in his desire to draft and pass a second reconciliation package.
The rest of the House GOP leadership is skeptical that the Republican Conference has the political will — or discipline — to cobble together another such bill. To be fair, we’re also skeptical given Republicans’ one-vote cushion in the House. There’s also serious doubt in the Senate that this can happen.
The prevailing wisdom in some corners of the GOP leadership is that Republicans should focus on small-bore bills that could help their endangered incumbents.
But with eight months until Election Day, Johnson doesn’t want to give up on a second fast-track bill, seeing it as a wasted opportunity with so much time left in this Congress. Much of next week’s House Republican retreat in Doral, Fla., will be focused on trying to find consensus on this topic.
“We’ll finalize our Venn diagram and see what fits in the middle,” Johnson said in an interview Thursday. “I’ve got some ideas but I don’t want to get out in front of that conversation.”
Hurdles. The big problem here is that House GOP conservatives would almost certainly demand that every penny of a reconciliation package be offset by spending cuts. And the GOP leadership has no clue if or how they will find cuts that’ll pass muster with House Republican moderates.
“The offsets are the areas that are hard to get agreement,” House Majority Leader Steve Scalise told us. “And we don’t have any agreement on those yet. But we’re trying to find consensus amongst our members.”
Left unsaid here by nearly everyone in GOP circles is that the OBBB didn’t give Republicans the political boost they wanted or needed. It’s so far underwater that President Donald Trump calls it by another name instead.
In this case, House Republicans seem to be reverse engineering the process. Instead of agreeing on policies and then finding spending cuts to offset them, the GOP leadership is signaling they’ll look to find offsets first and then decide what kind of narrow policies can fit within that framework.
House Budget Committee Chair Jodey Arrington (R-Texas), a big booster of a reconciliation redux, took his argument about another bill to the Elected Leadership Committee’s retreat at Pier 66 in Fort Lauderdale, Fla., last weekend. He’ll also speak next week at the retreat at Trump National Doral near Miami.
In an interview Thursday, Arrington made the case that if Trump wants more money for the Pentagon, it may be better to pass that under reconciliation, which only needs 51 votes in the Senate.
Arrington, a red-district Republican who isn’t running for re-election, sees political upsides on a second reconciliation despite the difficulties in finding agreement.
“We’re going to do farm bills, FISA — all the things that are regular business that are not going to move the needle,” Arrington said of the rest of the 119th Congress. “They have to be done. They’re important. They’re not going to move the needle in November, and they’re not going to substantially change the things that have been broken over the last four years. What we can put in reconciliation will substantially change that. It will motivate our base.”
What could go in a bill. GOP moderates would love to do something about health care costs, but it would be very challenging to get agreement on that among Republicans. For example, the Trump administration wants Congress to address “most favored nation” drug pricing efforts, but that policy has GOP skeptics in the House and Senate.
Addressing fraud in government programs sounds good to Republicans, but some of their proposals wouldn’t meet reconciliation rules. Others might cut spending so much that they spook moderates.
Scalise said one option would be providing tax credits for first-time homebuyers, playing into interest from Trump and Republican moderates in affordable housing legislation. But there’s also a lot of GOP disbelief that tax changes could be part of a second package after so much went into OBBB.
Trying to address tariffs would probably kill the whole project because the issue divides Republicans as is.
If Trump is interested in new funding — like money for the Pentagon amid the war with Iran or to address the Department of Homeland Security shutdown — that could make some sense. But again, House Republicans would likely have to offset the full cost.
The case for skepticism. Notably, House Ways and Means Committee Chair Jason Smith (R-Mo.) is an outspoken skeptic of the reconciliation 2.0 push. Smith told us that rather than starting with a difficult budget resolution process, House Republicans should try first to unite behind a bill and pass it using the typical process, then see what the Senate says.
“I’ve said it all along that we need one big reconciliation [bill] because I didn’t see a path that there was enough juice for two, and I still stand by that,” Smith said.
Fly Out Day! Rep. Ro Khanna (D-Calif.) was on Fly Out Day this week. Hear what he has to say about the Epstein Files, the war in Iran and why he’s stockpiling campaign cash. Watch here.
