There are two important developments that help illustrate the warp speed with which Hill Republicans are trying to push President Donald Trump’s legislative agenda.
1) Senate Majority Leader John Thune told a private meeting of Senate Republicans Wednesday that the chamber may vote on a joint House-Senate budget resolution next week, as we scooped. Remember, the House and Senate need to pass an identical budget resolution to unlock reconciliation.
Thune’s projection that the chamber could vote next week represents an accelerated timeline. It’s a week earlier than Thune laid out to Republicans just a day earlier. And it comes after a particularly productive meeting between Thune, Speaker Mike Johnson, top tax writers and key Trump administration officials on Tuesday.
But before the Senate can begin considering a compromise budget resolution, Republicans need to have a ruling in-hand from Senate Parliamentarian Elizabeth MacDonough on whether they can use a scoring method known as the “current policy baseline” to make the 2017 Trump tax cuts permanent without requiring massive new offsets.
That’s because, as Johnson told us earlier this week, the House wants assurances that this baseline tactic will pass muster with the parliamentarian before moving forward.
“We know that they’re talking about that with the parliamentarian, and they’re going to see what they can do on their side with regard to that, and then we’ll talk about it with House members,” Johnson said.
MacDonough will need to meet jointly with GOP and Democratic aides before making a formal decision.
But according to three sources familiar with the matter, that meeting has yet to be scheduled. However, we’re told that MacDonough will be able to decide fairly quickly once that happens. Aides from both parties have already been making the case to MacDonough for and against the baseline strategy.
Using the current policy baseline is a stated necessity for Senate GOP leaders. But it’s never been used in reconciliation before, and some Republicans are skeptical of the scoring method. Sen. Bill Cassidy (R-La.), for example, railed against it during a closed-door GOP lunch on Tuesday.
If Thune and Senate GOP leaders can settle the baseline issue and pull off a vote next week (that’s a big “if” at this point), House Republicans could try to clear the budget resolution before both chambers recess for the Easter and Passover break.
It’s Johnson’s goal to get a reconciliation package to Trump’s desk by Memorial Day. So this accelerated timeline could help him move in that direction. But remember, simply passing a unified budget resolution won’t clear the deck of the thorniest challenges for GOP leaders on spending cuts, specific tax policies and more.
2) Thune’s embrace of the House GOP effort to address the debt limit in reconciliation puts Republicans in alignment on a key element of the budget resolution. It also creates a de facto deadline for the Senate and House to pass a final reconciliation package – the so-called “X-date,” when the U.S. government hits its borrowing limit.
CBO projected Wednesday that this will come in August or September. The Treasury Department sets the actual X date, so the CBO estimate is unofficial. If tax revenue comes in lower than projected Congress could need to raise the debt limit by late May or June.
“We’ve always been working under the assumption that it would be early June,” Johnson told us Wednesday. “That’s probably still within the realm of possibility. It certainly confirms our sense of urgency.”
Thune put it this way:
“You know how that is, nobody knows for sure until tax receipts come in in April and June. But our assumption is, yes, it’s going to be summer whether it’s early, mid, late summer – still a little up for grabs. But it puts a deadline on it.”
Let’s be clear about one thing. Despite the upbeat talk, Memorial Day is still a very aggressive deadline to get a reconciliation package to Trump’s desk, especially given all of the policy fights that need to be resolved. Even people involved in the process acknowledge that the August recess is a more realistic backstop.
But in order to get any of this done, Thune and Johnson need Trump. The president will have to be the closer. Republicans can’t lose more than three votes in the Senate. It’s pretty much a guarantee that with a $4 trillion or $5 trillion debt-limit hike, Sen. Rand Paul (R-Ky.) will vote no. But Trump will have to convince Sen. Ron Johnson (R-Wis.) and other fiscal hawks that they need to be with him because his presidency rides on this.
Also: The Business Roundtable is up with a new ad debuting on Fox News that touts the success of the 2017 tax cuts and urges Congress to “extend and strengthen President Trump’s tax reform.” It’s part of a massive eight-figure tax campaign this year from the group, which represents CEOs of the largest U.S. companies.
McCarthy’s cash: Former Speaker Kevin McCarthy transferred $587,000 to the NRCC this week. McCarthy made the transfer to help out Rep. Brian Jack (R-Ga.), the NRCC’s recruitment chair who served as the political director to the former speaker. This is more than some House Republicans gave this quarter.
