Debt limit becomes the GOP's next process fight

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Jan 15, 2025 View in browser
 
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By Mia McCarthy

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Americans for Prosperity

With assists from POLITICO’s Congress team

Speaker of the House Mike Johnson stands on the dais in the House chamber.

Speaker of the House Mike Johnson concludes the joint session of Congress that certified Donald Trump's victory in the 2024 Presidential Election in the House Chamber of the U.S. Capitol in Washington, on Jan. 6, 2025. | Angelina Katsanis/POLITICO

LATEST: Speaker Mike Johnson has removed Mike Turner as the chair of the House Intelligence Committee. Read more here.

DEBT LIMIT DEBATE RAGES

House Republicans are, once again, fighting internally about how they should address a major legislative priority. This time, it's the debt limit.

GOP lawmakers need to raise the debt ceiling sometime in the next several months or risk a catastrophic default. While Speaker Mike Johnson proposed lifting it using the party-line reconciliation process last month, leaders are now signaling they’d rather deal with it in a spending bill that will have to pass along bipartisan lines, at least in the Senate.

Both options come with significant headaches. The so-called reconciliation bill — where the GOP hopes to tackle the border, energy and taxes — is already a mess. But if leaders raise the debt limit in a bipartisan bill, Democrats will expect significant concessions in return for their help.

So far, most senators are signaling they’re willing to defer to what the House can pass. Republicans in the chamber largely brushed off questions or were indifferent when asked about including the debt limit in the reconciliation package on Wednesday.

Here’s where key groups stand:

Leadership: Both Johnson and Senate Majority Leader John Thune have indicated that they’re leaning towards addressing the debt limit outside of a reconciliation bill, though Johnson said he isn’t “wed” to any option. It’s not hard to see why: GOP leaders already have enough on their reconciliation plate, with little room in the vote count for error, and Democrats have reliably helped avoid a default.

Conservatives: Here lies leadership’s first problem. Conservative hardliners, who hate raising the debt limit, want it in the reconciliation package. They don’t want leadership making a deal with Democrats, and they want GOP leaders to meet their demands for significant spending cuts in exchange for a hike. Remember, Johnson said in December that Republicans would pair raising the debt limit with spending cuts of $2.5 trillion in a reconciliation package this year.

Rep. Chip Roy (R-Texas) called the suggestion of a massive funding bill with a debt limit hike the work of “swamp creatures.”

“I hope the president's team comes in and rejects that, and tells them it's a bad idea,” Roy said this week. Other GOP hardliners aren’t teeing off at leadership, yet. Don’t expect it to last if Johnson keeps leaning toward a bipartisan solution.

Appropriator and budget types: Appropriations Chair Tom Cole (R-Okla.) and Budget Chair Jodey Arrington (R-Texas) don't even appear to be on the same page on the debt limit, hinting at more problems here. While Cole has suggested it should be dealt with in a bipartisan spending bill, Arrington has said he thinks it should go in reconciliation.

Democrats: House Democrats have made clear that hitching the debt ceiling to more disaster aid for California, as some Republicans have proposed, is a nonstarter for them. They’re not going to let Republicans off that easy.

“It should be a negotiating posture,” said Rep. Richard Neal (D-Mass.). “They're going to need us to raise the debt ceiling.”

And an important note: If past is prologue, Trump doesn’t care much about the process for how Congress raises the debt limit. He just doesn’t want it to become his problem. So don’t count on him to settle this debate.

 

A message from Americans for Prosperity:

The Tax Cuts and Jobs Act (TCJA) is a proven success. Higher wages, more jobs, and $1,500 saved annually for families. Congress must prioritize renewing this vital framework for economic prosperity. Learn more.

 

GOOD EVENING! Welcome to Inside Congress, the play-by-play guide to all things Capitol Hill, on this Wednesday, Jan. 15, where we want more snow.

YOUR QUICK READOUT ON THE CONFIRMATION HEARINGS

Wednesday was a packed nomination hearing day. We caught up with our POLITICO colleagues who covered each one and got their quick summaries.

Top takeaways: Many of Wednesday’s hearings went smoothly for Trump’s picks, with some of them an openly bipartisan affair. But there weren’t a lot of controversial incoming nominees on the docket today.

  • Barring a few tense interactions with Democrats, the hearing for potential attorney general Pam Bondi went smoothly — so much so that Senate Judiciary Democrats spent their limited time attacking Kash Patel, Trump's pick to run the FBI. It's an indicator that Bondi's path to confirmation appears almost certain, and Democrats aren't even trying to put up a fight. — Hailey Fuchs
  • Sean Duffy, Trump’s pick to be Transportation secretary, is on track for a seamless confirmation after a successful showing before the Senate Commerce Committee; Chair Ted Cruz (R-Texas) said he did a “terrific job.” Duffy, flanked by his wife Rachel and eight of their nine children, appeared comfortable during a hearing that was notable mostly for its comity in an era of high partisanship; he was introduced by Wisconsin Sens. Tammy Baldwin, a Democrat, and Ron Johnson, a Republican. — Chris Marquette
  • John Ratcliffe, Trump’s pick to head the CIA, had a breezy confirmation hearing Wednesday at the Senate Select Committee on Intelligence, with Chair Tom Cotton (R-Ark.) promising to hold a vote on his nomination as early as Monday. The hearing nonetheless may put Ratcliffe on a collision course with Donald Trump, who has long accused the U.S. intelligence community of unfairly targeting him. The former Republican Congressman vowed Wednesday to put politics aside and stand up to the president if he becomes CIA Director. — John Sakellariadis
  • Sen. Marco Rubio's hearing to be Trump's top diplomat was a chummy and cordial affair, previewing how he's expected to easily sail through confirmation with plenty of Republican and Democratic support alike — possibly on Day One of Trump’s new administration. Rubio did face some sporadic protesters who would shout at him, sometimes in Spanish, before being escorted out. — Robbie Gramer
  • Though Russ Vought shouldn’t have a problem getting confirmed for his second tour atop the White House budget office, he’s under significant pressure to promise he’ll spend funding as Congress prescribes. He reiterated during his first confirmation hearing before the Senate Homeland Security and Governmental Affairs Committee that Trump believes “impoundment” law is unconstitutional and instead thinks presidents should be able to spend less than Congress prescribes. — Jennifer Scholtes
  • Despite protester interruptions and nuanced questions about his views on climate change, Chris Wright, Trump’s nominee to lead the Energy Department, appeared to easily navigate his Senate confirmation hearing on Wednesday. Chair Mike Lee (R-Utah) told reporters he hoped to have Wright confirmed on the floor this month. — Kelsey Tamborrino

DEMS HAIL CEASEFIRE DEAL … WITH A CAVEAT

Democrats are hailing the ceasefire and hostage deal between Hamas and the Israeli government that was announced Wednesday. But many progressives wish it had come before the election.

“In terms of the general question, would a ceasefire have helped last year? Of course it would, but I think Netanyahu knows that,” said Rep. Alexandria Ocasio Cortez (D-N.Y.), referring to a belief that some progressive voters stayed home last November in protest of President Joe Biden’s handling of the war.

“Clearly, one of the things that probably hurt Joe Biden the most was his inaction, as perceived by many of my constituents in that area,” said Rep. Mark Pocan (D-Wis.). “I just want to move forward at this point.”

Others weren’t sure it would’ve made a difference. Rep. Don Beyer (D-Va.) voiced a widely held sentiment in the party that the election was “mostly about inflation and how people felt about their personal financial situation, not about the war.”

— Nicholas Wu 

 

A message from Americans for Prosperity:

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HUDDLE HOTDISH 

Lime bikes get Timothee Chalamet to movie premieres and Maxwell Frost to votes (though probably not in this weather).

Lots of confirmation hearing speeches for Rick Scott. 

Jill Biden was disappointed in Nancy Pelosi’s role in pushing Joe Biden out of the race.

Daniella is freaking out that Nydia Velázquez and Alexandria Ocasio-Cortez met Bad Bunny.

Tammy Duckworth shares a personal story about Marco Rubio supporting her during his confirmation hearing.

Save the date for House Democrats’ Issues Conference on March 12-14 this year.

Congrats to the new Problem Solvers leadership team.

We love a collab of our resident Hill foodie and fashionista.

QUICK LINKS 

Democratic Senators Say a Campaign Treasurer Stole Their Money, from Rolling Stone Magazine

The smallest initial Senate battleground ever? From Nathan Gonzales at Roll Call

The old-school senator working to confirm Trump’s unorthodox DOJ picks from Liz Goodwin at the Washington Post

 

A message from Americans for Prosperity:

In 2017, Congress delivered for the American people with the TCJA—a transformative policy that saved families $1,500 annually and positioned businesses to create millions of jobs. With inflation and high costs challenging budgets, now is not the time to roll back progress.

Renewing and strengthening the TCJA will provide certainty, promote growth, and ensure America remains competitive. Congress has the opportunity to protect and extend this critical achievement. Learn more.

 

TRANSITIONS 

Former Rep. Jake LaTurner (R-Kan.) is now a partner at FP1 Strategies.

Former Rep. Larry Bucshon (R-Ind.) is now a senior policy adviser in Holland & Knight’s public policy and regulation group.

William O’Grady is joining Sen. Jim Justice’s (R-W.Va.) office as communications director. He was press secretary for Sen. Eric Schmitt, a SASC member.

Ryan Ebrahimy is now legislative assistant for Rep. Dave Min (D-Calif.). He was previously a legislative correspondent for Sen. Ben Ray Luján (D-N.M.).

TOMORROW IN CONGRESS

The House and Senate are in session

THURSDAY AROUND THE HILL

9 a.m. Senate Homeland Security and Governmental Affairs holds a hearing to examine the Remain in Mexico policy. (Dirksen 342)

10 a.m. Senate Environment and Public Works holds a hearing on the expected nomination of Lee M. Zeldin, to be administrator of the Environmental Protection Agency. (Dirksen 406)

10 a.m. Banking, Housing, and Urban Affairs holds a meeting to set committee rules and procedures followed by a hearing on the nomination of Eric Scott Turner to be secretary of Housing and Urban Development. (Dirksen 538)

10 a.m. House Rules Committee holds an organizational meeting for the 119th Congress. (H-313)

10 a.m. Reps. Peters, Castor, Jayapal and Levin host a press conference on protecting climate progress. (House Triangle)

10:15 a.m. Senate Judiciary Committee holds a second-day hearing on the incoming attorney general nomination of Pam Bondi. (Hart 216)

10:30 a.m. Senate Finance holds a hearing on the nomination of Scott Bessent to be secretary of the Treasury. (Dirksen 215)

TRIVIA

TUESDAY’S ANSWER: Graydon Daubert correctly answered that John Quincy Adams was the president who nearly drowned while skinny dipping.

TODAY’S QUESTION, from Joan Kleinman: Who said “I came to Washington to work for God, FDR and the millions of forgotten, plain common workingmen"?

The first person to correctly guess gets a mention in the next edition of Inside Congress. Send your answers to insidecongress@politico.com.

GET INSIDE CONGRESS emailed to your phone each evening.

 

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