McCarthy Suffers a Pair of Stinging Defeats

Plus: House Republicans release 2024 budget blueprint ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ [The Fisc](   By Yuval Rosenberg and Michael Rainey Happy Tuesday! We hope you’ve had a better day than House Speaker Kevin McCarthy, who remains locked in a struggle with his own party members over annual spending bills with less than two weeks to go before the government could be forced to shut down. Here’s the latest. All eyes are on the speaker and his infighting members. (Reuters) GOP Hardliners Hand McCarthy Two Stinging Defeats House Republican dysfunction was on full display Tuesday as conservatives forced leaders to pull a key vote on the party’s own proposed stopgap spending bill and then torpedoed another vote to advance a Defense funding bill, handing House Speaker Kevin McCarthy a pair of embarrassing defeats. “McCarthy is now left without a viable plan to fund the government, with just 12 days left to avoid a shutdown,” Politico [said](. The stopgap spending bill introduced Sunday by Republican members of the House Freedom Caucus and the Main Street Caucus was quickly met with opposition from staunch conservatives. The bill, which would extend funding until the end of October, had been scheduled for a procedural vote Tuesday. Instead, McCarthy had to postpone it because of ongoing divisions in his conference that meant the vote would have failed. “Trying to get all but four Republicans to back a short-term funding bill has proven to be a herculean effort for the conference, which has faced objections from far-right lawmakers who are making demands that the conference has little to no time to address,” the Washington Post [reports](. A short-term funding patch is necessary to avert a government shutdown once current funding expires at the end of the month. The House Republican stopgap wouldn’t accomplish much given that it would more than likely be rejected by the Senate even if McCarthy’s members united behind it, but the speaker has been urging his conference to pass a plan so he could have some leverage in talks with the Senate. House Republican hardliners have instead pressed for promises that their fiscal demands will be met in any deal. Some in the party oppose any stopgap and insist that they should be passing their annual appropriations bills instead. Some have expressed openness to a shutdown. "Will it take a couple weeks of shutdown? Probably so. That's a fight we need to be willing to have right now," said Rep. Ralph Norman of South Carolina, according to [Axios](. "The odds of not having a shutdown are slim-to-none." Some McCarthy allies reportedly believe that several conservatives simply want to provoke a shutdown so they can oust the speaker. Moderates in the party are growing frustrated. "Some people would vote against the Bible because there is not enough Jesus in it," said Rep. Don Bacon of Nebraska, according to Axios. Republican Rep. Mike Lawler of New York [told reporters]( that the holdouts were demonstrating “stupidity,” not conservatism: “These people can't define a win. They don’t know how to take yes for an answer. It is a clown show.” GOP Defense bill fails again: GOP infighting has also meant that Republicans have only been able to pass one of the 12 annual appropriations bills so far. On Tuesday, the intraparty divisions resulted in the House failing to advance an $826 billion Republican bill to fund the Defense Department for fiscal year 2024. Hardliners in the party are demanding that discretionary spending for the coming year won’t exceed the 2022 level of $1.47 trillion, which is $120 billion below the caps that McCarthy and President Joe Biden set as part of their deal to raise the debt limit earlier this year. Opposition from conservative hardliners had forced Republican leaders to pull the Defense spending bill from consideration a week ago, but McCarthy brought it back up this week knowing that a defeat was possible. In the end, five Republicans — Reps. Andy Biggs of Arizona, Dan Bishop of North Carolina, Ken Buck of Colorado, Norman of South Carolina and Matt Rosendale of Montana — joined with Democrats in voting against the measure, which failed 212-214. Democrats oppose the bill because it includes measures targeting abortion access, transgender care and diversity efforts. “Hard-right lawmakers have been calling on GOP leaders to pass all 12 appropriation bills to fund the government for the full year,” the Post notes. “But many have also served as an impediment to that goal, blocking basic procedural steps and preventing the rest of the House Republican conference from approving policies many largely support.” What’s next: The GOP’s Chaos Caucus is out in full force, leaving little sign that Republicans can unite behind a strategy or that a government shutdown will be averted. “I think today's vote showed just how broken we are,” Republican Rep. Tony Gonzales of Texas [told CNN](. “There's no doubt in my mind we're headed for a shutdown. I'm looking at it as, Is that shutdown gonna be 10 days or is that shutdown gonna be 10 weeks?” Still, some lawmakers are reportedly looking to tweak the short-term funding bill to appease the holdouts and there’s talk that some Republicans may consider passing some version of a stopgap funding bill with Democratic help. House Republicans Release 2024 Budget Blueprint House Republicans on Tuesday released a long-delayed budget resolution for fiscal year 2024, which the Budget Committee will start marking up this week. The plan has almost no chance of becoming law in its current form, but it fulfills a pledge by Republicans to provide a road map for future spending shaped by conservative priorities. Roll Call’s Paul M. Krawzak and David Lerman [say]( the proposal “promises to bring the federal budget into balance over a decade through steep cuts to discretionary spending, new restrictions on the social safety net and relatively rosy assumptions of consistently strong economic growth.” Total discretionary spending in 2024 would come to $1.47 trillion under the plan, satisfying GOP demands to return to 2022 spending levels. After 2024, spending would grow by 1% per year. Total deficits would be $16.3 trillion smaller than currently projected over a decade, and the budget would produce a small surplus in the tenth year. Budget Chair Jodey Arrington told reporters that it is not clear if the plan could win a majority vote in the House. “But I can tell you I think the vast majority of our conference supports this,” he said. Marking up the blueprint will “encourage at a minimum the debate about what that path forward into a more sustainable fiscal future looks like,” he added. Arrington also said that a vote on the plan could help change the minds of conservatives who are currently opposed to a short-term funding bill. “I hope that this will help grease the skids for us to get a unified Republican funding package on discretionary spending,” he said. Trust in Government Near All-Time Low: Survey The mounting chaos in Washington and the threat of yet another shutdown can’t be helping strengthen Americans’ faith in government, which according to data from the Pew Research Center now sits near historic lows. Just 16% of respondents in a recent Pew survey said they trust the government to do what is right just about always or most of the time, the second lowest reading on that issue since pollsters started asking about it during the Eisenhower administration. The only lower result (15%) occurred in 2011 – another year marked by conflicts over debt levels and government funding. Here are some highlights from the [Pew report]( which is based on two representative U.S. surveys. The first survey involved 8,480 adults and ran from July 10 to 16, 2023, while the second involved 5,115 adults and ran from June 5 to 11, 2023. * Nearly two-thirds of respondents (65%) said they always or often feel exhausted when thinking about politics, while 55% said it makes them angry. Just 10% said thinking about U.S. politics makes them hopeful. * A growing minority (28%) said they have unfavorable views of both the Democratic and Republican parties — an all-time high on a question Pew has been asking for 30 years. * Most (63%) respondents said they are dissatisfied with the current crop of presidential candidates. * Most (57%) said that disputes between Democrats and Republicans get too much attention, while 78% said that there is too little attention paid to “important issues facing the country.” * Money in politics is seen as a major problem. Eighty-five percent of respondents said “special interest groups and lobbyists” have too much influence in U.S. politics, while 72% supported limits on how much money can be spent on political campaigns. * The age of political leaders is a concern, as well. Seventy-nine percent of respondents said they favored an age limit for elected officials, while 76% said the same about Supreme Court justices. * The two most common words used to describe U.S. politics were “divisive” and “corrupt.” Other popular terms were “messy,” chaos,” “bad” and “polarized.” The Pew report notes that the survey results are consistent with long-term trends, although something does seem to have changed in recent years. “Americans have long been critical of politicians and skeptical of the federal government,” the report says. “But today, Americans’ views of politics and elected officials are unrelentingly negative, with little hope of improvement on the horizon.” --------------------------------------------------------------- Send your feedback to yrosenberg@thefiscaltimes.com. And please encourage your friends to [sign up here]( for their own copy of this newsletter. --------------------------------------------------------------- Fiscal News Roundup - [McCarthy Scrambles: House Punts Key Vote as Rebellion Rages]( – Politico - [Spending "Clown Show" Ignites House GOP Discord]( – Axios - [House Conservatives Sink Vote on Advancing Pentagon Funding Bill]( – The Hill - [McConnell Warns That Shutdowns Have 'Always Been a Loser for Republicans']( – NBC News - [Shutdown Threatens Ukraine Training, Weapons Deliveries]( – Politico - [Balanced-Budget Plan Unveiled by House Republicans]( – Roll Call - [Farm Bill Deadline Sparks K Street Frenzy]( – Politico - [World Debt Surges to Record $307 Trillion, Rises as Share of GDP]( – Bloomberg - ["Nightmare," Some Planning to Get New COVID-19 Vaccine Getting Bills for Nearly $200]( – CBS News - [Two-Thirds of Americans Have Little to No Confidence in Political System: Poll]( – The Hill - [The Fed Is Still Pushing to Get Inflation Down. 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