Welcome to the maelstrom, Mr. President.
President Donald Trump will leave the gold-gilded White House this morning to join a rambunctious and divided House Republican Conference in the dank Capitol basement.
Trump’s goal is to try to get the House Republican Conference to coalesce around the “One Big, Beautiful Bill.” Speaker Mike Johnson can’t close this vote out on his own. As we saw with the speaker vote, the government-funding bill and the budget resolution earlier this year, Trump remains the only person in town who can move House Republicans en masse.
But what he’ll find this morning is a House Republican Conference with vastly different interpretations of Trump-era Republicanism.
The House Freedom Caucus – led in this instance by Reps. Ralph Norman (R-S.C.) and Chip Roy (R-Texas) – believe the core of Trumpism includes deep cuts to the federal social safety net.
House Freedom Caucus members want to accelerate work requirements for Medicaid and change the formula by which the federal government helps states pay for it. This would be an enormous shift that could leave millions more Americans without health coverage. They also want to gut the 2022 Inflation Reduction Act.
In the view of hardline Republicans, GOP control of Washington under Trump has given them a golden opportunity to reshape government by cutting spending dramatically.
Then there are moderate Republicans who helped deliver the House GOP majority. These Republicans – think of Reps. Don Bacon (Neb.), Nick LaLota (N.Y.), Brian Fitzpatrick (Pa.) and Mike Lawler (N.Y.) – are much more wary that this Medicaid makeover could harm millions of their constituents, as well as their own standing back home. They recognize that companies have taken advantage of the IRA to create jobs, and they want an orderly wind down to the program – if there’s a wind down at all.
These GOP lawmakers view their job as cutting taxes and making common-sense changes to popular government programs like Medicaid.
The reality. We don’t expect Trump to weigh in on the finer points of the debate over FMAP or the provider tax. Trump has won his major campaign-driven asks – the extension of the 2017 tax cuts, plus no taxes on tips and overtime.
But if House Republican leaders want to bring this nearly $4 trillion package up for a vote Wednesday – or even this week – several outstanding disagreements have to be resolved.
Trump’s job is to effectively tell the GOP conference that the time for talk is over, and it’s time to vote. That message is potentially useful for the Republican leadership. But it may not move lawmakers still locked in critical policy fights.
SALT. Johnson hasn’t been able to put together a SALT deal despite lengthy negotiations. This might be Republican leaders’ biggest stumble during the entire reconciliation process. The House SALT holdouts – LaLota, Lawler, and GOP Reps. Young Kim (Calif.), Andrew Garbarino (N.Y.), Elise Stefanik (N.Y.) and Tom Kean (N.J.) – have said for months they’ll oppose the bill if the cap isn’t lifted to their liking.
The SALT group met with Johnson for more than an hour late Monday night but left the Capitol without locking in a deal. Garbarino said Johnson gave the group several options for raising the deduction cap. The holdouts had questions and planned to follow up after House GOP leaders got more data, per Garbarino.
Johnson told reporters there was no resolution on SALT yet but that they were “getting very close.”
But there’s trouble on the horizon, potentially. Norman told us on Monday that in addition to offsetting an increased SALT cap by spending cuts elsewhere, blue-state Republicans should be forced to find those spending cuts.
“We would put that on them, let them decide,” Norman said.
FMAP. Altering FMAP has been a prime ask of conservatives over the last few days. Effectively, this is a way to cut away at Obamacare without repealing the law. Johnson has repeatedly taken it off the proverbial table, only to see it later resurface.
But conservatives are hell bent on forcing a change in the FMAP formula. This could force millions of Medicaid recipients out of the program as states pare back spending.
“Phase it down over eight years,” Roy said Monday.
Johnson said FMAP is no longer part of the discussions.
This will be a major flashpoint between conservatives and moderates that can only be solved by Trump.
IRA. There’s still disagreement over how much to cut from the IRA. Roy and other hardliners want these tax credits ripped out ASAP. The GOP leadership responded by tentatively agreeing to accelerate the phase out of clean-energy tax credits to 2028. But moderates have complained to party leaders that this is way too fast.
LaLota said the phase out should be “gentle and deliberate, rather than sudden and chaotic.”
Let’s just note this here once again: This reconciliation bill is on the floor Wednesday. House Republicans are still squabbling over policy decisions. And this whole package is going to be overhauled by the Senate anyway.
The best argument that Trump can make is that the House needs to pass this bill to get the process moving.
That’s not going to cut with the HFC Chair Andy Harris (R-Md.):
“Look, I’m glad [Trump is] coming to talk to the conference. I always welcome the president, but I’m not sure there’s anything he can say tomorrow that’s going to change the minds of people who do believe that this bill needs more work.”
