| | | | By Eugene Daniels, Rachael Bade and Ryan Lizza | | With help from Eli Okun and Garrett Ross
| Kevin McCarthy went on an immediate blitz, addressing reporters, briefing his members and spinning the deal on “Fox News Sunday” in the first 12 hours after the deal was announced. | Jose Luis Magana/AP Photo | | | DRIVING THE DAY | | SPECIAL REPORT — This morning, POLITICO’s Victoria Guida takes a look at the pandemic-era policies that led to a historic closing of the income gap in the U.S. — and how a move away from those policies threatens those gains. “One of the lowest tiers of earners — people making an average of $12.50 per hour nationally — saw their pay grow nearly 6 percent from 2020 to 2022, even after factoring in inflation,” Victoria writes. “That’s significantly bigger than what low-wage workers got during the entire administration of President BARACK OBAMA, following the Great Recession. “Now, however, those gains are in jeopardy, as the government moves to end bipartisan pandemic-era spending that injected trillions of dollars into the economy, spurred consumer spending and put workers in ultra-high demand.” Read the full story DEBT DEAL VIBE CHECK — Last night, with just over one week until a potential federal default, the House released the 99-page Fiscal Responsibility Act that, if passed, would pare back government spending, marginally adjust federal policies around aid programs and environmental permitting and, most importantly, avert a self-inflicted economic catastrophe. Let us reiterate: If passed. Here are the key provisions from the bill: Raising the debt limit … The debt ceiling won’t be a problem again until well after the next presidential election. The text suspends the debt ceiling until Jan. 1, 2025, but the Treasury Department’s “extraordinary measures” will be replenished during that time, pushing the next X-date at least several months later. Spending caps … Negotiators agreed to place limits on overall discretionary spending for the next two fiscal years, but they notably agreed to break the principle of “parity” between defense and nondefense spending that had been key to previous budget agreements. Defense spending would rise about 3% next year, while nondefense spending would remain essentially flat. (Note that with annual inflation still over 4%, both amount to a real-dollar cut.) Appropriations incentives … The bill gives Congress some encouragement to actually pass their annual appropriations bills rather than simply sidestep the new budget caps with a full-year CR: If the 12 spending bills aren’t passed by year’s end, a 1% spending cut would be enforced — applied evenly to defense and nondefense accounts to keep the pressure bipartisan. Covid aid clawbacks … Nearly $30 billion in unspent relief money Congress approved during the height of the pandemic would be clawed back from dozens of programs. There are cutouts for some programs such as veterans health care and Covid-19 treatment and vaccine research. IRS rollbacks… After Republicans spent months railing President JOE BIDEN’s push for $80 billion in Internal Revenue Service funding, the deal would divert a chunk of that money, meant to boost tax enforcement and crack down on fraud. The bill itself rescinds $1.4 billion of the funding first provided in the Inflation Reduction Act, and the White House says it could shift $20 billion more to backfill other nondefense spending. Work requirements … Adults 49 and under currently need to meet work requirements to receive SNAP nutrition benefits, and the bill would gradually raise that age to 54. It would at the same time fully exempt veterans, the unhoused and those who were recently in foster care for the first time. Environmental permitting … The long-rumored “permitting reform” element of the deal turned out to be less than monumental — amounting to a new “shot clock” for federal environmental reviews, limiting them to one or two years. The bill picks one big winner, though: West Virginia’s Mountain Valley Pipeline — a key priority of Sen. JOE MANCHIN (D-W.Va.) — would get a green light from Congress. Student loan repayment … While we wait for the Supreme Court to render judgment on Biden’s student loan relief program, the president agreed to completely end the repayment pause that has been in place since the Trump administration at the end of August. Read the full bill text
| | A message from Altria: The future of Tobacco Harm Reduction. More than 70% of U.S. adults 21+ surveyed support Tobacco Harm Reduction as the right path forward for tobacco regulation. And two out of three believe the FDA should focus its efforts on Tobacco Harm Reduction. See the poll results here. | | ALWAYS BE CLOSING: Now that the text is out, the big hurdle is getting enough lawmakers to swallow their objections in service of preserving the full faith and credit of the United States of America. The gist from leaders on both sides: “PLEASE, FOR THE LOVE OF GOD, VOTE FOR THIS!” — House Speaker KEVIN McCARTHY went on an immediate blitz, addressing reporters, briefing his members and spinning the deal on “Fox News Sunday” in the first 12 hours after the deal was announced. And today we have reached the WSJ op-ed portion of the program, with the speaker hailing the spending caps as a “historic and foundational change.” “[W]e will spend less money next year than we did this year — stopping inflationary spending while fully funding national defense, meeting our obligations to veterans, and preserving and protecting Social Security and Medicare,” he writes. “No other debt-limit increase in the past decade has reduced overall spending, reduced nondefense spending and reduced the deficit. The Fiscal Responsibility Act is true, transformative spending reform.” — The White House held the first in a series of briefings with Democrats last night. There’s still anger within the party that the White House was a step behind the GOP on messaging the deal to their own side, but 60-plus one-on-one calls with key lawmakers have helped prevent a widespread revolt, and multiple additional briefings are scheduled with top administration officials in the coming days. Their top selling point is not what Biden was able to get in the bill, but instead what he was able to keep out. As our colleagues Jennifer Haberkorn, Holly Otterbein and Adam Cancryn write, the White House argument boils down to, “it could have been a LOT worse.” White House officials are especially touting how they kept GOP mitts off Medicare, Social Security, Medicaid and the Inflation Reduction Act. At the same time, they are attempting a balancing act, promoting Democrats’ wins without banging their chests so much that it scares off Republicans wary that they are settling for a raw deal. — As for the whip counts: The trio reports that the calls and briefings have “left the White House feeling generally positive about cobbling the votes together from their side of the aisle to give the bill a chance of passage.” Centrist Democrats in the House and Senate, they note, “voiced cautious optimism about the agreement” ahead of the text’s release last night. On the Republican side, the WSJ’s Siobhan Hughes and Sabrina Siddiqui report that the GOP is “bracing to lean on Democratic votes due to announced defections by at least six Republicans” on the conference’s far right: Reps. RALPH NORMAN (R-S.C.), CHIP ROY (R-Texas), DAN BISHOP (R-N.C.), BOB GOOD (R-Va.), MATT ROSENDALE (R-Mont.) and ANDY BIGGS (R-Ariz.). It was always baked in that Democratic votes would be needed to push a bipartisan debt deal over the finish line. But the open question is whether McCarthy will need a couple of dozen crossover votes — or potentially many more than that.
| | A message from Altria: Altria is leading the way in transitioning millions of adult smokers from cigarettes to a smoke-free future. | | WHAT TO WATCH: The legislative schedule for the coming week is beginning to come into view, with the House coming in tomorrow night for bed-check suspension votes and Rules Committee consideration of the debt deal. That would set up a final House vote as soon as late Wednesday night. Senate Majority Leader CHUCK SCHUMER announced yesterday the Senate would “move to immediately begin consideration” once the House sends the bill over and warned members to “prepare for potential Friday and weekend votes” ahead of the Monday X-date deadline. Needless to say, there is little room for error, and there’s two things to keep a close eye on today that could mess with the timeline:
- Rep. THOMAS MASSIE’s Twitter account: With Roy and Norman, the Kentucky Republican is among a hard-right trio on the House Rules Committee that could move to block the debt bill from reaching the floor, as WaPo’s Paul Kane outlines. But Massie has been holding his fire, and it would save a lot of procedural headaches if he stays loyal to McCarthy.
- DONALD TRUMP’s Truth Social account: The former president weighed in earlier in the negotiation process, calling on the GOP not to give an inch, even suggesting at his CNN town hall that “you’re going to have to do a default” if Democrats don’t cave on spending. Since the deal was cut, however, he’s been silent — spending his time instead promoting the LIV golf tournament at his Virginia golf club and attacking “Ron DeSanctimonious.” Will that continue?
We wish you a solemn and restful Memorial Day. Thanks for reading Playbook. So are you a Wambsgans truther? Drop us a line: Rachael Bade, Eugene Daniels, Ryan Lizza.
| BIDEN’S MONDAY: Earlier today, the Bidens hosted a Memorial Day breakfast at the White House.
10:40 a.m.: The Bidens will leave the White House for Arlington National Cemetery, where they’ll take part in a wreath-laying ceremony at the Tomb of the Unknown Soldier at 11 a.m., with VP KAMALA HARRIS and second gentleman DOUG EMHOFF attending.
11:15 a.m.: Biden will deliver the Memorial Day Address at Memorial Amphitheater.
12:10 p.m.: The Bidens will leave to return to the White House.
6 p.m.: The Bidens will depart for New Castle, Del., arriving at 6:55 p.m. | | | | DON’T MISS POLITICO’S HEALTH CARE SUMMIT: The Covid-19 pandemic helped spur innovation in health care, from the wide adoption of telemedicine, health apps and online pharmacies to mRNA vaccines. But what will the next health care innovations look like? Join POLITICO on Wednesday June 7 for our Health Care Summit to explore how tech and innovation are transforming care and the challenges ahead for access and delivery in the United States. REGISTER NOW. | | | PHOTO OF THE DAY
| An election representative shows a ballot with a vote for the Turkish President Recep Tayyip Erdogan at a polling station in Istanbul, Turkey, Sunday, May 28. | Emrah Gurel/AP Photo | | | PLAYBOOK READS | | 9 THINGS YOU SHOULD BE READING TODAY: 1. GREAT MEMORIAL DAY READ: “A half-century later, a congressman visits the site of his father's fatal helicopter crash in Vietnam,” by NBC’s Scott Wong, Julie Tsirkin and Kate Santaliz: “In 1979, when DEAN PHILLIPS was 10 years old, his mother told him a story while driving home from hockey practice that would change him forever: His biological father, a man he had never met before, had been killed in the Vietnam War when Phillips was 6 months old. … This spring, Phillips, now a Democratic congressman from Minnesota … embarked on a pilgrimage to Vietnam to visit Dragon Mountain, the site of the helicopter crash that killed [Army Capt. ARTHUR “ARTIE” PFEFER] and seven other soldiers 54 years ago. “‘It had become a mission,’ he continued. ‘And when I got there, I can remember thinking, “This is where he took his last breath.” And for me, it felt like a place where I could take my first.’” 2. ON THE OFFENSIVE: The Biden campaign and the DNC are planning on launching attacks against current and potential Republican candidates, Jonathan Lemire writes. “Democrats feel that allows them to continue the strategy that worked in last year’s midterms — painting nearly any GOP contender as out of step with most Americans. … While not all Republicans can be directly tied to some of Trump’s record, or his role in inspiring the Jan. 6 riot, Biden aides still believe they can be lashed to the former president. DNC staffers have begun branding all Republican hopefuls as enablers of MAGA policies, making their support of Trump a throughline.” 3. KNOWING MARIANNE WILLIAMSON: In her own words, Williamson is running against “the political media industrial complex” in the Democratic primary, in addition to Biden and ROBERT KENNEDY JR., write Brittany Gibson and Jackie Padilla. “But even if Williamson is destined to be an also-ran in 2024, she’s polling higher than she did in 2020 — hitting 9 percent in a FOX News poll, which is higher than most of Donald Trump’s declared challengers in the GOP primary. … “When Williamson talks about her 2024 bid, she brings up many of the issues that she campaigned on in her first run for Congress in 2014, things like universal healthcare, universal pre-school and free college. But now, Williamson is moderating some of the emotional language and talk of love that earned her coverage as an unserious candidate in previous campaigns.” 4. GRAHAM CRACKUP: “Russia issues arrest warrant for Lindsey Graham over Ukraine comments,” AP: “In an edited video of his meeting on Friday with Ukrainian President VOLODYMYR ZELENSKYY that was released by Zelenskyy’s office, Graham, a Republican from South Carolina, noted that ‘the Russians are dying’ and described the U.S. military assistance to the country as ‘the best money we’ve ever spent.’ While Graham appeared to have made the remarks in different parts of the conversation, the short video by Ukraine’s presidential office put them next to each other, causing outrage in Russia.” Graham’s response: “See you in the Hague!” 5. BEHIND THE OUTRAGE: “A Small Town’s Tragedy, Distorted by Trump’s Megaphone,” by NYT’s Charles Homans and Ken Bensinger: “Mr. Trump and Ms. [MARJORIE TAYLOR] GREENE were among a chorus of Republican politicians — including several members of Congress and the attorney general of North Dakota — who rushed to condemn Mr. [SHANNON] BRANDT. They relied on a handful of early news stories that cited a state highway patrol officer’s report, which suggested Mr. Brandt killed Mr. [CAYLER] ELLINGSON because he believed he was a ‘Republican extremist.’ … “But the episode quickly became an example of another media phenomenon: the distortion of complex, painful events to fit an opportune political narrative. Although evidence in the case suggests the two men argued about politics that night, law enforcement officials concluded quickly that the killing was not politically motivated.”
| | A message from Altria: Altria is leading the way in transitioning millions of adult smokers from cigarettes to a smoke-free future. | | 6. WEALTH WHISPERS: “Wall Street Mobilizes for a Presidential Election, Reluctantly,” by WSJ’s Cara Lombardo: “Wall Street likes Biden’s steady hand and cabinet picks like Commerce Secretary GINA RAIMONDO, but his aggressive stance on antitrust enforcement has turned off potential backers whose profits depend on a healthy supply of corporate deals. And while another Trump term could deliver the traditional Republican goodies of lower taxes and less regulation, financiers are worried that the former president’s unpredictability could wreak havoc on global markets. “‘Everybody is hoping for a miracle,’ said one senior deal-maker, one of more than 20 people that The Wall Street Journal spoke with to gauge Wall Street’s mood around the election. ‘Nobody wants Biden, and nobody wants Trump.’”
7. THE CLOSER: “How Shalanda Young Helped Broker Biden’s Toughest Deal Yet,” by Bloomberg’s Akayla Gardner: “[OMB Director SHALANDA] YOUNG’s selection speaks volumes to her budgetary expertise and the trust she has built with Biden, who’s famed for leaning on a tight inner circle. … DONNA BRAZILE, a Democratic operative who overlapped with Young on the Hill, said she has an ‘encyclopedic knowledge’ of the appropriations and budget process. ‘It’s not just numbers on the page to Shalanda,’ Brazile says. ‘It is the story behind the numbers, the people.’” 8. BLAND STRATEGY: “Biden Is More Fearful Than the Ukrainians Are,” by The Atlantic’s Kori Schake: “The escalation concern that looms largest for the Biden administration in Ukraine, understandably, is Russian nuclear use. Ukrainians remain admirably stalwart about this prospect, suggesting that a nuclear battlefield strike would not serve Russian objectives. To be more concerned about nuclear use than the likely victims of it are — or to push Ukraine toward untenable outcomes in the name of avoiding that risk — is to actually encourage nuclear threats.” 9. BURNIN’ UP: “Burning trash for the planet? Climate cash sets off branding frenzy,” by WaPo’s Evan Halper: “As the Biden administration allocates billions of dollars in new climate subsidies, environmentally challenged industries are sharpening their green pitches. The companies argue they are just as entitled to lucrative federal incentives as solar farms or electric carmakers, and are working to frame their businesses as global warming solutions.” | | GET READY FOR GLOBAL TECH DAY: Join POLITICO Live as we launch our first Global Tech Day alongside London Tech Week on Thursday, June 15. Register now for continuing updates and to be a part of this momentous and program-packed day! From the blockchain, to AI, and autonomous vehicles, technology is changing how power is exercised around the world, so who will write the rules? REGISTER HERE. | | | | | PLAYBOOKERS | | SPOTTED: Rep. Blake Moore (R-Utah) making a hole in one on Saturday on the 10th hole of the Salt Lake Country Club. Pic WELCOME TO THE WORLD — Erika Walter, media relations director for Associated Builders and Contractors and a Steve Scalise and Republican Study Committee alum, and Jon Walter, proposal and technology manager for Brown & Root Industrial Services, on May 16 welcomed Estella GraceLin Walter. Pic … Another pic — Haley Draznin, founder and producer at audio and digital video production company Haynow Media and a CNN alum, and Jason Leibowitz, CEO and co-founder at cryptocurrency investment consultancy LeboBTC Ledger Group, welcomed Stevie Rose Leibowitz on Tuesday, who joined big brother Brody Jack. Pic ... Another pic WEEKEND WEDDING — Lucy MacIntosh, VP at SKDK, and Will Van Nuys, political director at DCCC, got married Saturday in Tamworth, N.H. SPOTTED: Helen Brosnan, Rebecca Drago, Oren Shur, Daniel Barash, Lisa Vedernikova Khanna, Harry Khanna, Laurel Ruza, Christina Ives, Alaina Haworth, Haley Scott and Bruce Spiva. Pic … Another pic BIRTHWEEK (was yesterday): Matt Orr of Rep. Russell Fry’s (R-S.C.) office HAPPY BIRTHDAY: Sen. Jerry Moran (R-Kan.) … USA Today’s Francesca Chambers … Philip Klein … State Department’s Lee Satterfield … FP1 Strategies’ Jon Conradi … Matthew Dowd … NBC’s Stephen Sanchez (27) … Adfero’s Reilly Knecht … Todd Flournoy … Instagram’s Dayna Geldwert … The Forward’s Jacob Kornbluh … Bri Gillis … Alex Ford of Halcyon Strategy … Annette Guarisco Fildes … Weekly Dystopia’s Chris Johnson … Nucor’s Eileen Bradner … Mary Ryan Douglass … NPR’s Terence Samuel … Jacob Alderman … former Reps. Jeb Hensarling (R-Texas) and Tom Coleman (R-Mo.) (8-0) … Birmingham, Ala., Mayor Randall Woodfin … Hailey Lernihan … Pete Seat Did someone forward this email to you? Sign up here. Send Playbookers tips to playbook@politico.com or text us at 202-556-3307. Playbook couldn’t happen without our editor Mike DeBonis, deputy editor Zack Stanton and producers Setota Hailemariam and Bethany Irvine.
| | A message from Altria: Moving beyond smoking. More than 20 million adult smokers are looking to transition from cigarettes to smoke-free choices. And they are three times as likely to make that change when they have information on Tobacco Harm Reduction.
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