‘You’ve underestimated us’: How McCarthy’s haggling stopped a Republican debt revolt – KESQ

By Manu Raju, Melanie Zanona and Lauren Fox, CNN

Speaker Kevin McCarthy he rolled the dice.

As he walked from the speaker’s suite to the House floor Wednesday night, the California Republican wasn’t entirely sure he had the votes on the most important bill of his young presidency: raising the national debt limit. of $31.4 billion in Republican support alone.

McCarthy knew it was nearby but couldn’t guarantee it, according to a person familiar with the matter.

After months of internal wrangling, the speaker had been engaged in round-the-clock talks with groups of dissident members, cutting deals and haggling to get one Republican vote after another in their high-stakes fight, all an attempt to show the House Blanca and the country that her party speaks with one voice on the ensuing economic battle.

But a Republican member was absent Wednesday, and some far-right members did not explicitly say how they would vote, forcing the speaker to take a long shot. In the end, it was two Democratic absentees that helped McCarthy: allowing him to pass the bill by the narrowest of margins, 217-215, and now shifting the focus to the White House and Senate Democrats.

“We’re the only ones lifting the debt limit to make sure this economy isn’t in jeopardy,” McCarthy smiled in the Capitol’s ornate Statuary Hall moments after the gavel fell, calling on President Joe Biden to negotiate a spending-cutting deal he’s resisted for months. And he added: “You have underestimated us.”

It was an effort that took months to complete. Immediately after securing the speaking seat in a disorderly 15-vote race, McCarthy made a concerted decision to avoid the pitfalls of his predecessor, John Boehner, and allow rank-and-file members to feel they could shape the final package rather than being overwhelmed by leadership. Two members of his core team, Reps Tom Emmer of Minnesota and Guy Reschenthaler of Pennsylvania, conducted a dozen listening sessions beginning in February. Then there were regular meetings of the so-called “Five Families,” dubbed by the mob families in “The Godfather,” who represent various ideological factions of the conference and were led by Rep. Garrett Graves of Louisiana.

But even after they accepted a summary of their deal last week, McCarthy continued to stumble into traps. At a meeting last week in the Capitol basement, he and his team moved to appease conservatives who wanted to target tax breaks for biofuels in the Democrats’ Inflation Reduction Act. McCarthy agreed, prompting a furious pushback from Iowa Republicans, including a tense phone call between Governor Kim Reynolds and McCarthy.

It was an issue that could have derailed the bill and put McCarthy in the familiar crosshairs among his conference’s competing factions. But he finally reached an agreement just after 2 am Wednesday and helped move closer to securing the votes more than 15 hours later.

“They realized they weren’t going to be able to crush four people from Iowa,” said Rep. Zach Nunn, an Iowa freshman, referring to the four Republican members of the delegation.

However, more trouble arose, and McCarthy moved to avoid it. Rep. Nancy Mace told reporters Wednesday morning that she was ready to vote against the plan out of concern that it didn’t go far enough to balance the budget. But after an afternoon meeting in his office, the South Carolina Republican said he would back the plan. The promise, according to a source familiar with the matter: votes on bills dealing with women’s access to reproductive health care and a vote on a bill dealing with active shooter alerts.

“I haven’t gotten the leaders to beat me on anything yet,” Mace said, defending his deal.

The final plan would increase the debt limit by $1.5 trillion and propose implementing a series of spending cuts in national programs, in addition to new job requirements on Medicaid recipients and provisions targeting Biden’s national and regulatory agenda. It would save $4.8 trillion over the next 10 years, according to the Congressional Budget Office. But the $1.5 trillion increase would only last until March 2024 at the latest.

In a private meeting on Capitol Hill, Republican leaders debated what debt limit increase they should seek. Some had floated odd numbers because it sounded more intentional than an even number. One member suggested $1.69 trillion, but that was rejected because of innuendos associated with that figure, according to three Republican sources. Ultimately, $1.5 trillion increase was the number they settled on.

Republicans say the deal that has since occurred was the result of new relationships forged since McCarthy’s protracted fight over the speaker’s gavel in January.

“It’s absolutely reaped benefits for everyone in the conference,” Rep. French Hill, R-Arkansas, said of the relationships that were formed.

‘This is going to bite us’: an explosion in Iowa

But passing the bill was never a sure bet, something McCarthy felt last week when he moved to appease conservatives and push for the repeal of energy tax breaks.

“This will come back to bite us,” McCarthy warned Conservatives last week, according to one person in the room, as they demanded that the bill repeal green energy tax credits and other provisions of the Inflation Reduction Act. McCarthy feared that taking that step would unblock a process that would allow the Senate to later bog down the House on thorny tax-related provisions.

But he had a more immediate problem: the governor of Iowa.

An enthusiastic Reynolds, the two-term Republican governor, spoke by phone with McCarthy on Tuesday, conveying his concerns about the provision in his debt ceiling plan to repeal tax breaks for ethanol use, according to people familiar with the call. warning her. it would be detrimental to the farmers in the state of it.

The four Republican members of the Iowa delegation, who were also in constant communication with the governor, told leaders at a meeting Tuesday night that taking back the tax credits was a “red line” for them, according to sources at the hall.

McCarthy now had a math problem. His allies had believed that Iowa Republicans, some of the leadership’s closest allies, would swallow the provisions and ultimately side with their party in its high-stakes fight with the White House. But they miscalculated, forcing the speaker to reach a last-minute deal after repeatedly insisting they would not open the bill up for change.

Nunn, the Iowa Republican, told CNN he learned of the agreement around 2:30 a.m. Wednesday, when Graves arrived at his office along with Rep. Michelle Fischbach, a Minnesota Republican who had similar issues with the provisions. about ethanol.

“We had been chatting all day, but by Tuesday we had really picked up,” Nunn told CNN. “Nice Iowa also means stubborn Iowa.”

It was a problem that Republican leaders had tried to avoid. He worried that if they reached an agreement with the Iowa delegation, they would have to make similar agreements with members of the fossil fuel-intensive districts to make them happy.

And the leaders knew that if they were going to make last-minute changes to appease Midwestern Republicans, they would also have to offer some concessions to conservatives, and ultimately agreed to faster implementation of Medicaid work requirements. Yet even that wasn’t enough to satisfy some conservatives who had been pushing for that change, namely Republican Rep. Matt Gaetz of Florida, who was upset that the deal was cut at the last minute after leaders said that they would not change the bill, according to people familiar with the matter. He was one of four who later voted against the plan.

Rep. Ken Buck, a member of the whip team, said at the end that he voted “no” because the GOP bill didn’t do enough to reduce the deficit. The Colorado Republican told CNN: “$58 trillion with Biden’s numbers and $53 trillion, that’s too much debt.”

But a member McCarthy had been lobbying turned up: Rep. Eli Crane. The Arizona Republican had been wavering on the bill and was being heavily whipped by the leadership, but he said he ultimately backed the legislation because of his constituents.

“We conducted a poll in a teletown hall last night and the people who responded overwhelmingly supported this bill,” he told CNN. “I was a bit surprised, honestly.”

With this victory secured, McCarthy could have an even bigger test on his hands: if he is forced to ask his conference to back any deal with Biden to raise the debt limit, something that would almost certainly not go as far as the House plan for spending cuts.

Its members watch it closely.

“What Kevin has assured us is that he will not go back and present a watered-down version,” said Rep. Ralph Norman of South Carolina, a member of the House Freedom Caucus.

The CNN Wire
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Annie Grayer, Alayna Treene, Haley Talbot, and Morgan Rimmer contributed to this report.

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