House Republicans met late into the evening Tuesday in Speaker Mike Johnson’s office furiously trying to avoid letting the Senate jump out ahead of them and take any remaining steam out of the House’s “one big, beautiful” budget reconciliation bill.
The House is scheduled to be in recess the week of Feb. 17. And under the timetable that Johnson, R-La., initially laid out, the chamber by then would have adopted the budget blueprint needed to write the reconciliation bill, which can bypass the Senate’s 60-vote hurdle.
But there was no sign late Tuesday that the Budget Committee would be ready to mark up the budget resolution this week. “It’s not scheduled for this week.
Factions within the House GOP are still wrestling with what the budget’s “instructions” for the reconciliation bill will look like. Some of the most outspoken spending hawks are pushing for at least $1 trillion in cuts over a decade; according to sources familiar with the talks, GOP leaders have proffered around $900 billion.
But Scalise said the gap was narrowing. “I think, when you look at where we are, we’re close to a trillion and still working,” he said.
The Congressional Budget Office has posed a hurdle for GOP lawmakers trying to reach agreement in a couple of ways, Scalise said. One issue is the “dynamic” revenue impact from faster economic growth Republicans predict as a result of enacting President Donald Trump’s agenda.
Scalise and other Republicans believe that’s a generous number — they’ve assumed $3 trillion in extra revenue from an ambitious 3 percent real economic growth projection over a decade. But the CBO may not agree, which could require more savings from the spending side of the ledger.
“I mean, you know CBO’s got their numbers and we’ve had real issues with them, because CBO has been wrong so many times, but yet you still have to start with their numbers,” Scalise said.
And on the cuts themselves, authorizing committees are working with a set of savings estimates from past CBO scores as well as from outside sources, which may not match updated figures the CBO comes back to them with. And that could cause a reconciliation bill to lose its privilege under the budget rules protecting it from a filibuster.
“There’s a lot of back and forth, because if a committee has their own estimates that their cuts are going to yield $200 billion in savings, and then CBO comes in and says it’s 190, you better not put 200 in the resolution because 190 is all they’re going to give you credit for,” Scalise said. “And then you could jeopardize the whole title of that committee’s work.”
One issue along those lines is the score they’ll get back from rescinding unspent funds appropriated in the 2022 climate and clean energy reconciliation package. The CBO may not give lawmakers dollar-for-dollar credit for taking money out of those funds, Scalise said, for various technical reasons.
‘Math problem’
Rep. Ralph Norman, R-S.C., wasn’t in the late-Tuesday meeting in Johnson’s office, but he’s a member of the hard-line Freedom Caucus and a key vote on the Budget panel. Norman wants the budget to require committees to come up with $2 trillion in 10-year spending cuts.
So far the only numbers Republican leaders have been able to float have 12 digits, however, which is not good enough for Norman.
“When you divide $2 trillion by 10 years, that’s not much, considering the math problem that we’ve got,” Norman said, referring to federal debt that’s projected to break the World War II-era record as a share of the U.S. economy within the next several years.
But centrists balking at deep cuts to programs like Medicaid and food stamps are squeezing the GOP whip operation from the other side.
Republican Rep. Don Bacon, who won by less than 2 percentage points in the famous “blue dot” Nebraska district that former Vice President Kamala Harris carried in November, said all of the spending-cut talk was a distraction from the main issue: ensuring that the 2017 tax cuts don’t expire after this year.
The tax cuts’ extension has always been the centerpiece of the mammoth reconciliation plan. But its multitrillion-dollar cost, coupled with other expensive items like border and defense funding — as well as the need to raise the $36 trillion statutory debt ceiling later this year — has conservatives insisting on deep spending cuts as their price.
“If we don’t extend the tax code, we’re going to see a 20 percent tax hike. We’re going to get our asses kicked.
Scalise said the conference plans to keep talking about the budget and reconciliation in their regularly scheduled meeting Wednesday morning as well as in smaller groups throughout the week, eyeing next week as the current target for a budget markup.
While this week has proved to be a bit of a setback, Scalise downplayed the impact it would have on the House’s timetable.
He said that because so much work was going into ironing out the actual details of the reconciliation package now, as opposed to waiting until the budget resolution is adopted, it means the 11 authorizing committees will have less work in March when they write their pieces of the bill.
“There’s a lot of front-loading we’re doing right now on work that might have been done in March,” Scalise said. “We’re doing it now, so compressing the timeline but doing it in the context of the budget, because reconciliation is a two-step process.”
‘Still fooling around’
Norman said he was “willing to work all weekend” to try to get close to an agreement and then have Trump work over any holdouts.
But Norman was losing faith in the House’s ability to get a budget plan the GOP can agree on, which was making the Senate’s two-bill approach — border, defense and energy policy first, and tax cuts later — more attractive.
The Freedom Caucus position from the outset has been supportive of the two-track plan, which is what Senate Budget Chairman Lindsey Graham, R-S.C., will brief his conference on Wednesday. If House Republicans can’t coalesce around a plan by the time Senate Republicans meet with Trump at Mar-a-Lago on Friday night, Graham and his colleagues may have ample ammunition to sway the president in favor of their strategy.
“Here’s the good news: We’re going to have two bills. Because we’re running out of time,” Norman said. “We’ve had now, what, two months to come up with this? And still fooling around.”
Scalise said he doesn’t think the Senate was gearing up to jump out in front of the House quite yet. And he was borderline critical of the Senate for not prioritizing the tax cuts package.
“What they’re doing doesn’t involve keeping your
Aidan Quigley and Paul M. Krawzak contributed to this report.
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