Category: debt ceiling

McConnell, McCarthy finally jell with debt limit fight 

Posted on (Updated by Alexander Bolton

The relationship between Speaker Kevin McCarthy (R-Calif.) and Senate Republican Leader Mitch McConnell (Ky.) jelled this month as they worked together on a debt ceiling deal.

McConnell played an instrumental role as adviser to McCarthy and President Biden during months of stalemate, when the president refused to negotiate directly with the Speaker. 

The veteran Kentucky deal-maker helped break the impasse when he called Biden directly after a May 9 meeting of the top four congressional leaders and informed the president bluntly that he needed to cut a deal with McCarthy, according to a person familiar with the conversation. 

“There was a lot of back-channel communication, and I think what Speaker McCarthy asked for and what he got was the support from the Republicans over here, which produced some leverage. Every time Biden said he wasn’t going to negotiate or it was going to be clean debt ceiling or nothing, the fact that [Senate Republicans] also said ‘no debt ceiling’ strengthened his hand,” said Sen. John Cornyn (R-Texas), an adviser to McConnell’s leadership team.  

McCarthy also won plaudits from McConnell and other GOP senators by winning passage in April of a GOP plan to raise the debt ceiling and cut $4.8 trillion from the deficit.

“I was very pleasantly surprised because we saw the Speaker’s election, and it wasn’t exactly a well-oiled machine,” said Cornyn, referring to the 15 votes McCarthy needed to win election as House Speaker.

McCarthy’s struggles prompted worries in the Senate that he would have a tough time passing legislation. Those doubts were a major factor in the decision by some GOP senators to support the $1.7 trillion omnibus package McConnell negotiated with Biden and congressional Democrats at the end of 2022. Senators feared McCarthy wouldn’t be able to move spending bills if they got punted into this year. 

The lack of trust was so severe that McCarthy met with Senate Republicans in the Senate’s famed Mansfield Room on Dec. 21 to plead with them to have faith in his ability to lead.  

“He talked about how we need to work better together than we have in the past,” then-Sen. Rob Portman (R-Ohio) told reporters after the meeting. 

McConnell played a major role in unifying the Senate GOP conference behind McCarthy as their lead negotiator on the debt limit, despite those doubts.

After Biden invited McCarthy, McConnell, Senate Majority Leader Chuck Schumer (D-N.Y.) and House Democratic Leader Hakeem Jeffries (N.Y.) to the White House for a meeting that made little progress, McConnell called the president to deliver a blunt message.   

He told Biden he needed to “shrink the room” and had to work with McCarthy directly, according to an Associated Press report that was confirmed by a person familiar with the conversation. He made it clear he would not intervene to hash out a last-minute deal like he did in 2011.  

Cornyn said House passage of the GOP debt-limit plan caught Biden off guard.

“Because he was able to keep his troops together, I think that stunned Biden folks because they thought [House Republicans] were going to collapse and be unsuccessful,” he said. 

Senate Republicans and GOP aides believe the rapport that McCarthy and McConnell developed will pay dividends going forward as they tackle other tough issues, like avoiding a government shutdown and providing more military and economic aid for Ukraine.   

Scott Jennings, a Republican strategist who advised McConnell’s political campaigns, said the teamwork developed during the debt limit fight was “quite important and shows the strategic awareness of both men.” 

“The role he played was an adviser to both Biden and McCarthy and the advice was very simple, and he had been giving it publicly: These two guys are going to have to cut a deal,” Jennings said.  

“McConnell was the clear-eyed person here. ... I think this was a great moment for Republican Party unity,” he added.  

McConnell for years was the top Republican in Washington, but now he is ceding more of the spotlight to McCarthy, who had little leverage when he was in the House minority.

The two split publicly over last year’s omnibus spending package, which McConnell backed as a win for the Defense Department. McCarthy opposed it and even asked Senate Republicans to block it to give the incoming House GOP majority a chance to renegotiate the spending levels.  

Aides said they met regularly throughout 2021 and 2022, but McConnell and McCarthy rarely appeared together in public. 

Each leader has a very different relationship with former President Donald Trump.  

McConnell excoriated Trump on the Senate floor after his 2021 impeachment trial for fanning unsubstantiated claims that Biden won the 2020 presidential election because of widespread fraud.  

He said the Jan. 6, 2021, attack on the U.S. Capitol was spurred by “the growing crescendo of false statements, conspiracy theories and reckless hyperbole” that Trump “kept shouting into the largest megaphone on planet Earth.”  

McCarthy, by contrast, joined a majority of the House Republican conference in voting on Jan. 6 to sustain objections to the certification of the 2020 election.  

They also split over a $1 trillion bipartisan infrastructure package Biden signed into law in November 2021. 

McConnell hailed the law as a major win for his home state, which is set to receive more than $2.2 billion for its transportation needs, while McCarthy whipped his House GOP colleagues to oppose it.  

And while McConnell voted for a bipartisan bill to address gun violence after the mass shooting at Robb Elementary School in Uvalde, Texas, and a bipartisan bill to invest tens of billions of dollars in the domestic semi-conductor manufacturing industry, McCarthy voted against both of them.  

McCarthy panned the Chips and Science Act as a “$280 billion blank check” to the semiconductor industry.  

Those votes fueled concerns among Senate Republicans about McCarthy’s willingness to stand up to conservatives in his conference.  

Asked about those doubts, Jennings observed: “The House Republicans are a diverse and rowdy bunch.” 

“Were there questions about how they would all end up jelling and working together? Sure. That’s natural,” he said. “I think there was some basic wondering. … I don’t think it’s fair to couch it as, ‘Oh everybody thought McCarthy was weak or whatever.’ I think that’s what the punditry was."  

McCarthy’s future on the line as he whips debt ceiling deal

Posted on (Updated by Emily Brooks

He got President Biden to negotiate. And then he got a deal. Now, Speaker Kevin McCarthy (R-Calif.) is in the final phase of his debt ceiling saga: whipping up enough support for the bill in the House GOP conference to secure his political future.

Basic political wisdom dictates that McCarthy needs a majority of House Republicans to support the bill in order to maintain his political power, and McCarthy has repeatedly said that he will meet that standard. He knows he’ll need Democratic help to pass the measure, but the more GOP members that vote with him, the better for the Speaker.

“If a majority of Republicans are against a piece of legislation and you use Democrats to pass it, that would immediately be a black letter violation of the deal we had with McCarthy to allow his ascent to the Speakership, and it would likely trigger an immediate motion to vacate,” Rep. Matt Gaetz (R-Fla.) said on Newsmax on Tuesday, referring to a move to oust McCarthy from the Speakership.

Speaker Kevin McCarthy (R-Calif.)

Speaker Kevin McCarthy (R-Calif.) speaks to reporters at the Capitol following a meeting at the White House with Congressional leaders and Vice President Harris to discuss the debit ceiling on Tuesday, May 16, 2023. (Greg Nash)

As of Tuesday evening, more than two dozen members of the slim, four-seat GOP majority in the House said they will vote against the bill, meaning McCarthy will need to rely on Democratic members supporting the Biden-blessed deal to pass the bill.

If more Democrats than Republicans vote for the bill, McCarthy could be in hot water.

“I am predicting it'll have more Democrat votes than Republican votes,” Rep. Bob Good (R-Va.) said Tuesday. “Democrats are truly being told to suppress their enthusiasm, to not talk about it publicly.”

House Minority Leader Hakeem Jeffries (D-N.Y.) said Tuesday that Republicans committed to deliver at least two-thirds of their conference — around 150 GOP members — in favor of the bill. He said Democrats would provide the vote needed to pass the bill, but vowed to hold McCarthy to that number.

McCarthy did not answer a question Tuesday on whether he could deliver 150 GOP votes for the bill, but said that he expects the bill to pass. 

More coverage of the debt ceiling from The Hill:

Some members are already starting to threaten McCarthy’s grasp on the Speaker's gavel, officially ending the honeymoon that lasted for months after the four-day, 15-ballot saga to elect McCarthy as Speaker in January.

Rep. Dan Bishop (R-N.C.) became the first GOP member to publicly call for ousting McCarthy by making a motion to vacate the chair over the debt deal Tuesday. While it takes just one member to force a vote on ousting the Speaker — a threshold McCarthy agreed to lower from five during his drawn-out Speaker election in January — Bishop did not explicitly commit to making that motion. 

And Rep. Ken Buck (R-Colo.) confirmed an NBC News report that in a House Freedom Caucus call Monday night, he asked whether they were considering calling a motion to vacate due to spending levels in the debt bill being higher than fiscal 2022 levels.

"[Rep.] Scott Perry [R-Pa.], the chairman of the Freedom Caucus, told me it's premature,” Buck said on MSNBC on Tuesday.

Republican leaders called members back to Washington for votes and a conference meeting Tuesday evening, allowing leadership to whip support for the bill in person.

“We're kicking way beyond our weight. We barely control half of a third of the government,” House Homeland Security Committee Chairman Mark Green (R-Tenn.) said in a House GOP press call Monday evening.

In a two-and-half hour House GOP conference meeting stretching into Tuesday night, opponents of the bill aired grievances, while leaders and their allies argued in favor of the bill. Members left the meeting saying their minds had not been changed.

But the meeting also aimed to lessen any retaliation against leadership by those angry with the bill.

“It's a foregone conclusion it's gonna pass. They're gonna have Democrat support to pass it,” said Rep. Ralph Norman (R-S.C.). “And so, we just talked about the after-effects. I don't think McCarthy wants another uprising like this.”

Rep. Thomas Massie (R-Ky.), who was a swing vote on a procedural hurdle to advance the bill in the House Rules Committee, announced his support for the bill in the meeting. It is the first legislation that he can vote for that has a chance to make it into law that cuts spending, he said.

“The engineer and the problem-solver in me wanted to vote for the bill, and the politician did not,” Massie said. “I'm going against my political instincts in voting for it.”

Massie says he plans to help advance debt limit bill

The deal that McCarthy struck with Biden claws back some spending, increases work requirements on public assistance programs and does not include tax increases — meeting all of the Speaker’s stated red lines for a deal.

But it has significantly fewer cuts and policy reforms less than the “Limit, Save, Grow” legislation the House GOP passed in April. Some members accuse GOP leadership of overstating how much money the bill saves, pointing out loopholes that can undermine or nullify some of the GOP’s stated wins.

Members of the hard-line conservative House Freedom Caucus are pushing GOP members to vote against the bill — warning that their conservative credentials are on the line.

“If every Republican voted the way that they campaigned, they would vote against tomorrow’s bad deal,” Rep. Lauren Boebert (R-Colo.) said in a press conference Tuesday.

Heritage Action, the advocacy arm of the conservative Heritage Foundation, will oppose the bill and include a “key vote” against it on its scorecard — a metric of conservatism that holds weight with many Republican members of Congress, campaign donors and voters. The conservative advocacy organization FreedomWorks also called a “key vote” against the bill Tuesday.

Some members are showing that they can be swayed. Rep. Marjorie Taylor Greene (R-Ga.) told reporters that while the bill is a “shit sandwich,” she is interested in what “sides” leaders can provide to make the metaphorical meal more appetizing — such as a balanced budget amendment or rescinding more IRS funding. “Dessert,” Greene said, would be impeaching Biden or Homeland Security Secretary Alejandro Mayorkas.

Rep. Marjorie Taylor Greene, R-Ga., speaks during a news conference on Capitol Hill in Washington, Thursday, May 18, 2023. (AP Photo/Carolyn Kaster)

McCarthy brushed off conservative criticism of the bill Tuesday.

“I’m not sure what in the bill people are concerned about. It is the largest savings of $2.1 trillion we’ve ever had,” McCarthy told reporters, citing what Republicans say are preliminary Congressional Budget Office (CBO) estimates of how much the deal could reduce the deficit. 

Critics of that figure say that appropriations targets past 2025 are not enforceable.

The CBO on Tuesday evening estimated the deficit reduction at $1.5 trillion over 10 years.

McCarthy also told CNN that he is not worried about his Speakership, saying that he is “still standing” and that reporters are “underestimating” him.

Some of the opposition to the bill is coming outside of the House Freedom Caucus. 

First-term Rep. Wesley Hunt (R-Texas) — who flew back from visiting his wife and newborn in the hospital in order to vote for McCarthy for Speaker in January — said Tuesday that he will vote no on the bill. Rep. Vern Buchanan (R-Fla.), a senior member on the House Ways and Means Committee, also tweeted he plans to oppose the bill.

To some Republicans, the opposition to the deal is puzzling.

“We don't control all those levers of power. So we can't throw a Hail Mary pass on every play, which is what some that are our conference may want to do,” Rep. John Rutherford (R-Fla.) said Monday, saying the bill “is like a 60-yard pass, maybe completed pass.”

Mike Lillis and Mychael Schnell contributed.

Greene leaning toward yes on ‘s— sandwich’ debt bill — but she also wants impeachment

Posted on (Updated by Mike Lillis

Rep. Marjorie Taylor Greene (R-Ga.) said Tuesday that she’s inclined to support the bipartisan debt ceiling proposal set to hit the House floor Wednesday, but she first wants to secure a commitment from GOP leaders to move several other proposals in the future, including the impeachment of President Biden or a top cabinet official. 

“If you have to eat a shit sandwich, you want to have sides, OK? It makes it much better,” Greene told reporters just outside the Capitol office of Speaker Kevin McCarthy (R-Calif.). “So what I'm looking for is, I'm looking for some sides and some desserts.”

Greene named two “sides” in particular: A vote on a balanced budget amendment and another on legislation to prevent the hiring of new IRS agents — not only in 2024, as the bipartisan debt-limit bill would do — but also in the years to follow. 

President Biden last year signed legislation providing the IRS with $80 billion over a decade to streamline customer service, update technology and hire auditors to go after those who don’t pay the taxes they owe. 

Republicans have attacked the extra funding, arguing falsely that the IRS intends to use it to hire 87,000 new agents to target middle-class workers, particularly Republicans.

“There were audits and conservative groups were targeted,” Greene said. “One of the sides … I would like to see with this shit sandwich is a way to completely wipe out the 87,000 IRS agents.”

Then she named her “beautiful dessert.”

“Somebody needs to be impeached,” Greene said. She singled out Alejandro Mayorkas, the secretary of the Homeland Security Department, as “the lowest hanging fruit” in the eyes of Republicans for his handling of the migrant crisis at the southern border. 

“The border is a serious issue that matters to everyone all over the country, even the Democrat mayor of New York City, the Democrat mayor in Chicago, and just people everywhere,” she said. 

Lax security at the border has also allowed the flow of illicit drugs from Mexico, Greene continued, which in turn has contributed to the deadly fentanyl crisis across the United States. 

“Three hundred Americans are dying every single day,” she said. “Mayorkas, and I argue Biden as well — President Biden — both of them should be impeached for that.”

Greene said the proposals she’s seeking would not be attached to the debt-ceiling bill, but could come later.

“It doesn’t have to happen necessarily today,” she said. “But it can happen quickly, and I’m working on that.”

Greene emphasized that she remains undecided on Wednesday's debt ceiling vote — “I’m still coming to my decision,” she said — but she also suggested those Republicans fighting to kill the proposal were playing into the hands of Senate Democratic leaders who would prefer a “clean” debt ceiling hike without the GOP spending cuts. She predicted Senate Majority Leader Chuck Schumer (D-N.Y.) — with an assist from GOP Sen. Lindsey Graham (S.C.) — would attempt to attach the proposal to more funding for the war in Ukraine, which she opposes. 

“I don’t want to see that happen,” she said. “I don’t want to see our group responsible for more funding to Ukraine.”

The comments arrive as McCarthy and his leadership team are racing to shore up GOP support for the debt ceiling proposal they secured Saturday with the White House following tough-fought negotiations that spanned most of the month. 

The Treasury Department has warned that, without congressional action, the government will default on its obligations June 5 for the first time in the nation’s history. 

A group of conservatives has balked at the agreement, saying it doesn’t contain nearly the level of spending cuts needed to rein in deficits and the national debt. Some of those conservatives are now floating the notion that they’ll try to topple McCarthy from the Speakership for his handling of the negotiations. 

Greene, however, threw cold water on that idea, praising McCarthy for his work ethic and blasting his conservative detractors for dividing the party. 

“I think some of this talk is maybe for attention, maybe for fundraising,” she said. “It’s not serious, and it would be a horrible decision.”

‘Stop, stop’: GOP bashes Biden for taking off during debt showdown

Posted on (Updated by Alex Gangitano

Republicans are blasting President Biden for leaving Washington for Asia on Wednesday without significant progress on debt limit negotiations, as the country inches toward a deadline on defaulting that could prove catastrophic on the financial system.

Biden will be in Japan for this weekend’s Group of Seven (G-7) summit but has canceled the latter portion of his trip, which included stops in Papua New Guinea and Australia, to be back in the nation’s capital and resume talks with congressional leaders. 

Even with the shortened trip, lawmakers criticized Biden for taking off at all.

“Here we are on the brink of a Biden default. And I think we saw the helicopters going across here, and I said I think he’s leaving now to go to Japan. I’m like stop, stop,” Sen. Shelley Moore Capito (R-W.Va.) said during an outdoor press conference at the Capitol on Wednesday.

She criticized the president for priding himself on being a good negotiator yet not negotiating with Republicans between the beginning of February until last week, when he brought leaders to the table again.

“Mr. President, cancel your trip to Japan. Stay at the table,” said Rep. Dusty Johnson (R-S.D). “Good grief, Mr. President, when is enough, enough? Shame on anyone, on anyone, who refuses to act. Speaker [Kevin] McCarthy and this entire team have been responsible, reasonable and sensible. Time is short, Mr. President. Let’s get this done.”

Sen. Rick Scott (R-Fla.), who has gone toe-to-toe with Biden on some key policy issues, said the president “should not leave, and he should worry about the debt limit here at home.”

After his meeting with Biden and other congressional leaders Tuesday, House Speaker Kevin McCarthy (R-Calif.) was asked if Biden should even be attending the G-7 and responded that the president can make his own decisions about his time. 

The White House maintains Biden can be president anywhere, a line they often use when he heads out of Washington.

But on the day of Biden's departure, McCarthy slightly changed his tune, saying, “I think he can” conduct international business while dealing with the debt ceiling before suggesting that the president should not have taken the trip.

“I think America wants an American president focused on American problems,” the California Republican said.

Biden delivered last-minute, unexpected remarks just before take off where he tried to assure the nation that leaders could come to an agreement before the country could default on its debt on June. 1 He referred to his shortened trip, indicating that would return Sunday after the G-7. His absence disrupted another international event — a planned Quad Leaders' summit in Sydney was canceled once Biden determined he would not attend.

When questioned about Biden’s indication that he can return to Washington on Sunday, have a press conference and finish the deal, McCarthy poked at the president for not engaging in talks between Feb. 1 and last week.

“It’s doable, but this is for a guy who didn’t want to meet with us for 97 days, and leaves the country and says he wants to come back Sunday to have a press conference? I really want a president that’s engaged and working through it,” the Speaker said.

The White House brushed off Republican criticism over Biden leaving Washington at all, highlighting the significance of the G-7.

“One of the responsibilities that an American president has is our leadership on the global stage, which is incredibly important and critical,” press secretary Karine Jean-Pierre told reporters on the way to Japan, by way of Alaska, on Wednesday. “There are critical issues, yes, domestically, but also internationally that the president has to take on.”

McCarthy at the White House on Tuesday outlined that Biden had “changed the scope” of who is involved in talks, appointing White House officials, including his Office of Management and Budget director, to work directly with members of the Speaker’s team as they try to reach an agreement.

Biden on Wednesday said that group met last night and will meet again Wednesday as well as in the days following. Biden added he will be in “constant contact” with his team while at the G-7 and in touch with the Speaker.

National security adviser Jake Sullivan defended the decision to cancel the second leg of the trip when questioned about the White House previously insisting that Biden can do the job of president anywhere — right before they announced the trip would be cut short.

“As we were getting prepared to take off on this trip, he … made the determination that in the balance of his time, he needed to be back in Washington for the closing days before the deadline to ensure the United States does not go over a cliff,” Sullivan said.

“The president is confident that we can avoid default, but the reason he’s going back is to make sure that happens. So what he will tell [allies] is he is going home to do what a president does,” Sullivan said, adding that Biden will express confidence to allies that he can strike a deal.

Vice President Harris is set to provide an update to reporters on preventing default Thursday, alongside the director of the National Economic Council Director, Lael Brainard, indicating that she is also stepping in while the president is away.

That’s still not enough for lawmakers.

“[Treasury Department Secretary Janet Yellen] said the U.S. could default as early as June 1, which is 16 days away. With this as a backdrop, President Biden is planning to hop on a plane to Japan tomorrow,” Sen. John Cornyn (R-Texas) said Tuesday. “He can't fly halfway around the globe just as negotiations are gaining momentum.” 

Meanwhile, some Democrats defended the president’s decision to leave town.

"I don't think he's the one sitting in the room doing the negotiations. I think he's the one, hopefully, leading the people in the room negotiating, but he can do that via Zoom or via telephone call,” Sen. Jon Tester (D-Mont.) said. “Look, there's a lot of shit going on in the world he needs to be tending to, too.”

Similarly, Sen. Dick Durbin (Ill.), the No. 2 Senate Democrat, said Biden’s trip to the G-7 is a high priority.

“President Biden has a G-7 meeting, which is an effort to establish global security. It's a very high priority,” he said. “I hope that Speaker McCarthy doesn't try to use that [against him]."

Democratic senators urge Biden to use 14th Amendment to raise debt limit

Posted on (Updated by Alexander Bolton

A group of Democratic senators led by Sen. Tina Smith (Minn.) are circulating a letter urging President Biden to invoke his constitutional authority under the 14th Amendment to raise the nation’s debt limit without having to pass legislation through Congress.  

These senators say the spending reforms that Speaker Kevin McCarthy (R-Calif.) has demanded in exchange for raising the debt limit are unacceptable and that Biden should circumvent Republican lawmakers by raising the debt limit unilaterally, something that has never been done before and would almost certainly be challenged in court.  

“We write to urgently request that you prepare to exercise your authority under the 14th Amendment of the Constitution, which clearly states: ‘the validity of the public debt of the United States...shall not be questioned.’ Using this authority would allow the United States to continue to pay its bills on-time, without delay, preventing a global economic catastrophe,” they write in a letter currently circulating through the Senate Democratic conference. 

The signatories on the letter so far include Sens. Jeff Merkley (D-Ore.), Elizabeth Warren (D-Mass.), Bernie Sanders (I-Vt.) and Ed Markey (D-Mass.).  

More debt ceiling coverage from The Hill:

The lawmakers warned they will not accept any concessions attached to the debt limit that cut federal assistance for low-income Americans without raising taxes on wealthy individuals and corporations.  

“We cannot reach a budget agreement that increases the suffering of millions of Americans who are already living in desperation. At a time of massive wealth and income inequality, we must ask billionaires and large corporations who are doing phenomenally well to start paying their fair share of taxes,” they wrote in response to proposals by House Republicans to increase work requirements for people who rely on Medicaid, the Supplemental Nutrition Assistance Program and Temporary Assistance for Needy Families. 

The Democratic senators warned that Republican proposals in a House-passed bill to raise the debt limit could push as many as 21 million people off of Medicaid and deny nutrition assistance to 1.7 million women, infants and children. 

The lawmakers also blustered at House Republicans’ demands to attach major permitting reforms for fossil-fuel attraction projects to debt-limit legislation.  

“We also cannot allow these budget negotiations to undermine the historic clean energy and environmental justice investments made by Congress and your administration by allowing fossil fuel companies to unleash a flood of dirty energy projects that will worsen the climate crisis and disproportionately impact frontline communities. We must continue the transition from fossil fuels to clean and renewable energy,” they wrote.  

Merkley said the letter is intended to assure Biden that he will have support on Capitol Hill if he decides to use the 14th Amendment to raise the debt limit in the absence of a deal with McCarthy.  

“It’s important because Kevin McCarthy has two main requests: attack ordinary, working families across America by cutting the foundations for health care, housing, education and good-paying jobs, and unleash fossil fuels on America. And both of those are absolutely unacceptable,” he said.  

"I want the president to see that he has the support in the Senate to use the 14th Amendment," he said. "He has support to say no to outrageous demands from the radical right."

Treasury Department Secretary Janet Yellen, however, warned last week that invoking the 14th Amendment would be a "constitutional crisis" and would spur a legal battle.