11 months ago
House conservatives hated the summer debt deal so much they ousted Kevin McCarthy for negotiating it. But now they’re weaponizing the agreement heading into next month's budget showdown, with behind-the-scenes coaching from Donald Trump’s former budget chief.
Strategically, it’s a 180-degree turn by GOP hardliners. But six months after McCarthy and Democrats struck the debt accord, its terms have become more favorable to them — and they see it as a handy way to cut domestic spending.
That’s because the deal mandates across-the-board cuts or caps if lawmakers can't reach an agreement on funding the government for the fiscal year that ends in October. When then-Speaker McCarthy and President Joe Biden reached the deal in June, the ax was set to fall harder on defense than non-defense programs — a tradeoff that many conservatives disliked.
Since then, nonpartisan budget scorekeepers at the Congressional Budget Office readjusted their calculations. Under the new numbers, if Congress resorts to a long-term spending patch, the non-defense funding that most Democrats prize would get slashed much more deeply than defense spending. That’s good news for conservatives, who are now more open to a long-term continuing resolution, because it would trigger deeper cuts.
“That’s Mike Johnson’s ace that he was dealt. He got a lot of crummy cards. But he got an ace,” said Rep. Thomas Massie (R-Ky.), a key architect of the 1 percent across-the-board cuts and caps in the debt deal.
The January showdown will play out just as Trump’s presidential primary rivals struggle to overcome his lead in the polls in Iowa and New Hampshire. And GOP conservatives are talking out their strategy with Russ Vought, who served as Trump’s Office of Management and Budget chief as his term ended.
Connecticut Rep. Rosa DeLauro, Democrats' top House appropriator, said it is clear Vought’s guidance “has a very direct effect” on the GOP game plan.
“It’s all a transparent ploy to extract the cuts that Democrats don’t want and that most Republicans don’t want,” DeLauro said. “Russ Vought has his fingerprints all over this strategy.”
Conservatives want Johnson to use the threat of the sweeping cuts — which would take effect at the end of April, in the form of either an across-the-board cut or caps based on that cut — to force Democrats into more specific spending reductions, as well as policy riders that limit federal support for abortion, among other changes.
Massie predicted that the speaker would risk the kind of revolt that led to McCarthy’s undoing if he instead strikes a spending deal that passes the House with mostly Democratic support and only a few dozen Republican votes, rather than the reverse.
"If it’s lopsided toward the Democrats or perceived as lopsided toward the Democrats in the House, that’s perilous for the speaker," Massie said.
Johnson isn’t talking publicly about how the risk of cuts or caps is factoring into his spending strategy as he bats offers back and forth with Senate Majority Leader Chuck Schumer and swears off another short-term spending patch.
But the speaker frequently notes in public that the debt limit deal, massive cuts included, is the “law of the land" — as he decries the agreement’s “side deals” that would add tens of billions of dollars in spending beyond what’s explicitly written in the text.
Democrats are irate to hear Johnson suggest he won't honor those side deals.
“It’s reneging on what was already agreed to,” said Sen. Patty Murray (D-Wash.), chair of the Appropriations Committee. “It was a total agreement."
The impasse will come to a head in less than a month, when cash for many federal agencies expires on Jan. 19. Two weeks later, on Feb. 2, funding for the military and other major programs runs out.
Resorting to a continuing resolution to fund the government through October would cut non-defense funding by $73 billion and forgo $26 billion in defense spending, as it is now widely understood among fiscal conservatives and spending leaders in Congress. That adds teeth to Johnson’s vow that he would pursue such a patch without a deal, even as Senate Minority Leader Mitch McConnell on Tuesday sounded skeptical of a long-term stopgap.
“He's put himself in a box, saying we'll never do another CR,” Rep. Steny Hoyer (D-Md.), former House majority leader, said of the speaker. “But he will be confronted with the responsibility for shutting down the government."
The cuts would be harsh under a shorter funding patch, too. Come April 30, if the government is still operating under a stopgap that doesn’t run through September, it would trigger $41 billion in non-defense funding cuts, plus $10 billion in defense reductions.
Republican defense hawks are not pleased with either scenario.
“That’s why I voted against the debt deal. I thought it was stupid,” said Sen. Lindsey Graham (R-S.C.). “Everybody’s getting screwed.”
Neither party could have predicted the current situation when the deal became law. But Rep. Garrett Graves (R-La.), a top broker of the debt agreement alongside McCarthy, said his colleagues are also just beginning to realize “the genius of that negotiation.”
“You are seeing a sobering, or a better understanding, of what the hell the bill did," Graves said, "and realizing how it actually significantly benefits Republicans."
Rep. Chip Roy (R-Texas), who opposed the debt agreement last spring, said the cuts would essentially reduce spending to the total the House Freedom Caucus sought all along.
“Frankly, had they sold it then at the level that we now understand,” Roy said, “we might have been a little more bullish at the time.”
Roy concedes that the power of the automatic cuts is subject to the interpretation of Biden’s budget director, Shalanda Young — a storied dealmaker during her years as the House’s top appropriations aide. Months ago, The New York Times published an article about Young that credited her with dreaming up the budget-cuts scheme while scrolling through Netflix, despite conservatives' claim that it was their brainchild.
"Shalanda, she can do what she wants to do. That's the world we live in,” the Texas Republican said.
Roy said he has been talking to Vought about the impending cuts. Trump's former budget chief publicly encouraged him to use his position on the House Rules Committee to try to sink the debt deal in May.
Vought did not respond to a request for comment about what advice he's giving conservatives.
It's still possible that lawmakers could extinguish the impending funding cuts, the way Congress did repeatedly during the decade of budget austerity that followed then-President Barack Obama's 2011 debt deal with the GOP.
“What remains to be seen is whether, or to what degree, this is going to create a group of unlikely allies that could come together to get around it,” said Sen. Mike Lee (R-Utah).
Lee, however, is hopeful that the coming cuts could enfranchise conservatives who are so often stiff-armed by Congress’ veteran dealmakers.
"I've been very critical of what I call the firm — the firm that until recently was the law firm of Schumer, McConnell, McCarthy, Pelosi," Lee added. "And this has the potential to level the field in a way that I think would be useful."
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