House Committee Advances Debt Ceiling Deal To Full Vote

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by Tyler Durden
Wednesday, May 31, 2023 - 10:11 AM

Update (2245ET): The deal to raise the debt ceiling cleared a critical hurdle Tuesday night, after the House Rules Committee voted 7-6 to advance the bill to the full House for a consideration, with every Democrat on the committee voting against the bill - as did GOP Freedom Caucus members Chip Roy of Texas and Ralph Normal of South Carolina.

Prior to clearing the Rules Committee, speculation swirled over whether Rep. Thomas Massie (R-KY) would vote to approve the measure. A 'no' vote would have killed the bill.

Thomas Massie Photographer: Ting Shen/Bloomberg

"My purpose in being on this committee was not to imprint my ideology," said Massie, who has repeatedly said he wouldn't use his position on the Committee to legislate his beliefs.

As Bloomberg reports, House Democratic leader Hakeem Jeffries said on Tuesday; "We are going to make sure the country does not default," adding "We will be able to get this bill over the finish line tomorrow."

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Update (1700ET): As many expected, Rep. Thomas Massie - who sits on the Rules Committee, signaled late Tuesday afternoon that he 'anticipates' voting to move the debt deal forward.

Massie, a libertarian, was the deciding vote sitting on the 9-4 GOP-controlled panel over whether to move the legislation forward. He had previously told Bloomberg that he wouldn't use his position to decide the matter (as noted this AM by Punchbowl News):

“Over the past 10 years, I’ve been an advocate of regular order and trying to make things work, try to make this place work right. And I would be reluctant to try to use the Rules Committee to achieve a legislative outcome, particularly if it doesn’t represent a large majority of our caucus."

And so, it moves forward.

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Update (1550ET): Republican lawmakers have threatened to exact revenge on House Speaker Kevin McCarthy for what they say is a terrible debt deal.

Rep. Dan Bishop (R-NC) told reporters on Tuesday that he plans to formally initiate the process, saying the "motion to vacate has to be done."

He declined to answer questions on whether he would seek to mount his challenge before Wednesday’s scheduled debt-limit vote, leaving unclear whether it would upend the House’s plan to act on the deal. “Every course of action is available,” he said.

McCarthy dismissed that threat and told reporters Tuesday he is confident his job is secure. Supporting the debt limit deal is “an easy vote for Republicans,” he said.

The debt-limit agreement struck by McCarthy and President Joe Biden is in a crucial final stretch with less than a week to win congressional approval before a June 5 default deadline. Biden and McCarthy have both expressed confidence the measure will pass and spent much of the Memorial Day holiday lobbying members of their respective parties. -Bloomberg

As a reminder, McCarthy was only voted in as speaker after forging an alliance with Republican hard-liners, who he agreed to placate. He could be easily ousted if just a few Republicans back his removal, unless McCarthy could rally several Democrats to his side.

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Update (1230ET): The House Freedom Caucus assembled for a presser on Tuesday, where Rep. Chip Roy (R-TX) said: "Not one Republican should vote for this deal. It is a bad deal. No one sent us here to borrow an additional 4 trillion dollars to get absolutely nothing in return," adding "There will be a reckoning about what just occurred unless we stop this bill."


The Freedom Caucus has left open the possibility of filing a motion to vacate McCarthy's chair if he pushes the deal through.

More via the DC Enquirer:

McCarthy reached the deal with Biden on Saturday night, claiming that the deal had the largest spending cuts for the IRS in the history of the nation, per the DC Enquirer. The bill did not end up being everything the House Speaker claimed it to be nor even close to that. The lopsided deal has caused many Republicans to come out in droves against the bill, despite McCarthy’s claim that 95 percent of Republicans in Congress support it.

Rep. Matt Rosendale (R-MT) slammed the deal on Twitter, writing, “The DC Swamp has proposed the largest debt ceiling increase in our nation’s history - $4 trillion!!” The representative then added all the different negatives of the agreement, such as failing to eliminate the 87,000 IRS agents that the Biden administration added or curtailing Biden’s student loan forgiveness plan. 

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With a US default projected for Monday, House Speaker Kevin McCarthy (R-CA) has precious little time to convince several GOP holdouts to come around and vote for a debt ceiling deal that's been widely panned by several conservatives.

McCarthy's team thinks they can avoid disaster at today's House Rules Committee at 3pm ET today, however Reps. Chip Roy (R-TX), Ralph Norman (R-SC), and Thomas Massie (R-KY) - three conservatives who serve on the panel - may not vote for the rule which allows the Fiscal Responsibility Act to come to the floor, Punchbowl News reports.

All three have expressed reservations about the bill - however Massie may still back the rule, making him the 'key figure in today's drama,' according to Punchbowl. Of note, there are nine Republicans and four Democrats on the panel - so if Roy and Norman vote 'no' then Massie needs to vote 'yes' for the bill to survive.

Keep in mind this fascinating exchange Massie had with reporters four months ago. Our friend Erik Wasson of Bloomberg asked the Kentucky Republican if he would be “a firewall” on the Rules Committee to make sure a clean debt-limit increase never made it onto the floor. Here’s Massie:

Meanwhile, House Freedom Caucus Chair Scott Perry (R-PA) is holding a press conference today too.

Here's the schedule of events.

12:00ET - The conservative hard-liners in the House Freedom Caucus will hold a news conference outside the Capitol to rally opposition to the deal

15:00ET - The House Rules Committee will meet to prepare the bill for floor action.

18:30ET - The House will hold votes on unrelated bills, giving whips in both parties their first chance to count votes in person.

19:30ET - House Republican leaders will host a closed-door conference meeting, where they will discuss the debt deal. GOP leadership feels that the preliminary CBO score - $2.1 trillion in savings over the six-year life of the included caps - is something they can get behind. That said, after two years, the remaining four years of caps can be waived.

TOMORROW •    09:00ET - House Democrats will meet in a closed-door caucus meeting where they will hear from White House officials.

McCarthy's plan will be to argue that no other bill can save the federal government as much money as the current package, and that Biden never wanted to negotiate in the first place.

Assuming the legislation makes it to the floor, "it's all about the math," reports Fox News' Chad Pergram, who one GOP source said things are "not that great right now."

Pergram was told that there are quite a few undecided votes, but that Republicans should be able to score well over a majority of their majority. That said, fewer Republicans 'yes' votes of course means that Democrats will need to make up the difference - which is a big if.

Needless to say, Rep. Clyde is a 'no' at this point.

Chiming in on the debt deal was Florida Governor and 2024 Presidential candidate Ron DeSantis, who told Fox and Friends that it was "totally inadequate."

"Prior to this deal, Kayleigh, our country was careening toward bankruptcy and after this deal, our country will still be careening toward bankruptcy," DeSantis told guest host Kayleigh McEnany. "To say you can do $4 trillion of increases in the next year and a half, I mean, that is massive amount of spending."

"I think that we’ve gotten ourselves on a trajectory, really since March of 2020 with some of the COVID spending and totally reset the budget and they are sticking with that and I think that is totally inadequate to get us in a better spot."

More via Punchbowl:

Senate Democratic communications directors were briefed on messaging strategy by the White House Monday night, we’re told.

The briefing emphasized that “not everyone gets what they want,” according to one readout, a bid to counter progressive ire. A big focus was the White House’s view that Biden’s negotiators successfully blocked the most dangerous GOP provisions from getting into the legislation.

The Senate is in a holding pattern until the House sends the bill over following the Wednesday vote. In the meantime, it’s worth remembering that Senate Majority Leader Chuck Schumer might have to relent to demands to hold amendment votes in order to speed passage of the bill.

Case in point: Sen. Tim Kaine (D-Va.) is filing an amendment to strip the controversial Mountain Valley Pipeline approval from the legislation. A Kaine spokesperson said the provision, sought by Sen. Joe Manchin (D-W.Va.) and Republicans, “is completely unrelated to the debt ceiling.”

No. 5: Rep. Raúl Grijalva of Arizona, the top Democrat on the House Natural Resources Committee, sent lawmakers a “fact sheet” sharply criticizing the permitting reform provisions in the debt-limit bill.

It’s unusual, to say the least, to have a senior member of the president’s own party criticize a package he crafted in such a public way. But as we noted, a lot of progressives don’t like this bill.

As for the Treasury market, the Fear-o-Meter is down and holding, however the T-bill curve still has some indigestion as things come down to the wire. 

Check back for updates...