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A Debt Deal Still Seems Out of Sight
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A Debt Deal Still Seems Out of Sight

After passing their borrowing bill, House GOP leaders are betting Democrats will blink.

President Joe Biden and Speaker of the House Kevin McCarthy on March 17, 2023. (Photo by SAUL LOEB/AFP via Getty Images)

House Republicans emerged from the chamber Wednesday night, having barely passed their debt ceiling bill, with a clear message: The standoff is now in the White House’s hands.

“This is on them now,” said Texas Rep. Dan Crenshaw. “We raised the debt limit. We did our job here.”

Not so fast, say Democratic leaders. 

“No, I don’t think it adds any pressure at all,” Rep. Richard Neal, the top Democrat on the powerful Ways and Means Committee, told The Dispatch after the vote Wednesday night. “Their Pyrrhic victory in numbers today didn’t strike me as a mandate by any stretch of the imagination.”

For months, House Speaker Kevin McCarthy has signaled his party’s plans to use this summer’s debt ceiling deadline to extract policy concessions from Democrats: government spending cuts, expanded domestic oil and gas drilling, and more work requirements for social safety net programs. But in a divided Congress they have few opportunities to make those demands law, and President Joe Biden has rejected tying a debt ceiling increase to Republican priorities. Congress should raise the limit and avert economic catastrophe without any conditions, he says.

“Happy to meet with McCarthy,” Biden said this week. “But not on whether or not the debt limit gets extended. That’s not negotiable.”

Some moderate House Democrats, though, privately characterize the White House’s position as absurd. They want to reach a deal, recognizing give-and-take will have to happen in a divided Congress. Behind-the-scenes calls from Democrats for Biden to sit down with McCarthy—the two haven’t met on the matter in nearly three months—may grow louder after this week.

At least one Senate Democrat is openly urging Biden to negotiate: “Speaker McCarthy did his job and he passed a bill that would prevent default and finally begin to rein in federal spending,” West Virginia Sen. Joe Manchin said after the bill passed. “While I do not agree with everything proposed, it remains the only bill moving through Congress that would prevent default and that cannot be ignored.”

The Republican legislation would raise the nation’s borrowing limit by $1.5 trillion or until March 2024, whichever comes first. It would also cap discretionary spending at fiscal year 2022 levels, although it doesn’t specify where those cuts would occur. The Congressional Budget Office estimated this week the plan could save $4.8 trillion over a decade. But the measure doesn’t have a chance in the Democratic Senate.

Democrats who side with Biden’s hardline approach anticipate GOP infighting will overtake the discussion. They’ve goaded the House GOP conference to come up with a more detailed plan to cut government spending. And even after Republicans reached a deal to pass McCarthy’s bill this week, Democratic lawmakers slammed the GOP’s process.

Connecticut Sen. Chris Murphy lambasted McCarthy’s middle-of-the-night tweaks to the bill to win more Republican support. “This very public display of dysfunction is a clear indication of how disastrous a negotiation would be,” he said.

Chaos within the GOP conference is certainly possible in the coming months, even after Republicans coalesced behind McCarthy’s plan this week. But Republicans argue their ability to pass the bill shows unity and should force Democrats to the table.

“Whatever—they can say what they want. Working until 2 a.m., it’s called legislating,” Crenshaw said in response to Murphy’s comments. “They’re being ridiculous. They know that they’re going to have to actually do some serious negotiation and that we’re not going to budge a whole lot.”

McCarthy is now taking a victory lap, arguing the press and Democrats have underestimated him since he became speaker after 15 rounds of voting in January. But his slim majority still imperils his leadership position. As we’ve written to you before, some members may have been more willing to support the debt ceiling bill because it stands no chance of becoming law. They could look past their policy complaints and back their party in what they viewed as a strategic move to kickstart talks. The stakes will be much higher with a plan that could pass and receive Biden’s signature.

And McCarthy may have set unrealistic expectations. Conservative Rep. Ralph Norman of South Carolina described this week’s GOP bill as “the bare minimum.” He and other members who supported it wouldn’t back anything weaker, he told reporters. Four Republicans voted against the measure—the most McCarthy could lose without Democratic support or absences.

For now, Republicans are going to wait and see how the White House responds. They have no alternative plan if Biden doesn’t flinch, other than messaging to pin the stalemate on Democrats.

“We’ve done our job,” said Texas Rep. Chip Roy. “Now it’s up to the Senate and the president. If they want to sit back and say we’re just going to wash our hands of it and say it’s a clean debt ceiling increase, then it is they who own it.”

Does Roy think this standoff will come down to the last minute? “That’s how this always works.”

A Look at GOP Leadership

My colleague Michael Warren has a piece on the site today looking at McCarthy’s relationship with House Majority Leader Steve Scalise, the conference’s second-ranking Republican. He writes:

House Republicans eked out a crucial win Wednesday by passing a bill to raise the debt limit. Yet the victory has only temporarily eased tensions between the conference’s top two leaders, Speaker Kevin McCarthy and Majority Leader Steve Scalise, as the razor-thin GOP majority looks ahead to more high-stakes challenges.

In the weeks leading up to the successful vote, McCarthy allies have portrayed Scalise, the No. 2 House Republican, as a bit player. News reports with key details of the internal negotiations rarely included Scalise’s name and instead highlighted McCarthy loyalists as consequential figures. 

Those in Scalise’s world say such claims mischaracterize the majority leader’s role on a leadership team that overcame tough odds to pass a deal with a narrow GOP majority.

“Steve Scalise is always in the room,” a former senior leadership aide told The Dispatch.

The simmering tension reflects the precarious position McCarthy finds himself in months after surviving a protracted election on the House floor to become speaker. Even Wednesday’s victory is only the first in a series of upcoming tests on the debt ceiling for McCarthy, and any missteps along the way could threaten his position. A longtime member of GOP leadership, Scalise could be an obvious successor if McCarthy’s support evaporates.

Read the rest of the story here.

Of Note

Haley Wilt is a former associate editor for The Dispatch.