Another Year, Another Congressional Funding Deal

Happy Tuesday! In what can only be described as the most heartbreaking split of 2024, professional golfer Tiger Woods announced the end of his 27-year partnership with Nike on Monday. The partnership spawned some memorable ads—and arguably the best example of product placement in sports history.

Quick Hits: Today’s Top Stories

• Lebanese Hezbollah claimed on Monday that a commander in their Radwan forces, Wissam Tawil, had been killed in a suspected Israeli strike on southern Lebanon. Tawil was reportedly a key leader of Hezbollah’s operations in the border region, where Israel and the Iranian-backed terrorist organization have traded rocket fire since the war began in October. The report comes on the same day that Israel Defense Forces spokesman Rear Adm. Daniel Hagari said the Israeli military would shift to a more targeted phase of the war against Hamas in Gaza, utilizing fewer airstrikes and troops. At a campaign speech on Monday at Mother Emanuel AME Church in Charleston, President Joe Biden was interrupted by protesters calling for a ceasefire in the Israel-Hamas war. “I understand their passion,” he said, responding to the protesters and seemingly confirming his role in Israel’s recent willingness to shift strategies. “I’ve been quietly working with the Israeli government to get them to reduce and significantly get out of Gaza.”
• French President Emmanuel Macron announced on Monday that Prime Minister Élisabeth Borne had resigned, giving the president a chance to refresh his government ahead of European Parliamentary elections in June. Borne was just the second woman in France to hold the position, and her cabinet—and Macron’s government—has fractured over contentious efforts to overhaul the country’s pension and immigration systems. “You implemented our project with the courage, commitment, and determination of women of states,” Macron tweeted on Monday. “With all my heart, thank you.” She will continue to run the government until a successor is named.
• The White House and the Pentagon announced an investigation on Monday into why top government officials, including Biden and Deputy Defense Secretary Kathleen Hicks, were not immediately informed of Defense Secretary Lloyd Austin’s hospitalization on New Year’s Day. The White House was reportedly not made aware of the situation until January 4, though the Pentagon reported that four aides were informed of Austin’s situation on January 2 but did not update the White House until two days later. “[I] understand the media concerns about transparency and I recognize I could have done a better job ensuring the public was appropriately informed,” Austin said in a statement over the weekend. “I commit to doing better.” Politico reported Monday that Biden is not considering firing Austin over the situation, and would not accept his resignation should he submit it.
• Former President Donald Trump requested on Monday that election interference charges brought against him in Georgia be thrown out, claiming that he is protected by presidential immunity—echoing claims his legal team has made in the federal election interference case brought against him. “The [president’s] absolute immunity shields him from criminal prosecution as well as civil suit,” Trump’s lawyers wrote in the filing. “The text of the Constitution and early authorities confirm that the exclusive method to proceed against a [president] for crimes allegedly committed in office is by impeachment in the House of Representatives and trial in the Senate.” Also on Monday, Trump asked a Maine judge to halt proceedings blocking his name from appearing on the ballot in the state until the U.S. Supreme Court addressed the issue as raised by the Colorado Supreme Court. Both Maine and Colorado have removed Trump from their primary ballots, alleging he violated Section 3 of the U.S. Constitution’s 14th Amendment by participating in an insurrection on January 6, 2021. The U.S. Supreme Court agreed on Friday to review the Colorado Supreme Court ruling, with oral arguments set to be heard on February 8.
• GOP Rep. Larry Bucshon of Indiana announced on Monday that he will retire at the end of his seventh term next year. “For over 230 years, men and women have chosen to serve our nation in the Congress—in many cases through very trying times in our history—and I’m honored to be included among their ranks,” he said in a statement. “Recent disputes in Congress and difficulties advancing policy on behalf of the American people have not soured my faith in our Constitutional Republic form of government. In fact, it has strengthened that faith.” Bucshon joins nearly 40 other lawmakers not seeking reelection to the House in 2024.
• The Michigan Wolverines defeated the Washington Huskies 34-13 on Monday night to cap an undefeated, 15-0 season and secure their first college football national championship since 1997.

Negotiating on a Thin Line

House Speaker Mike Johnson and Senate Majority Leader Chuck Schumer reached a tentative deal on Sunday to fund the government in 2024—exactly one year to the day from when Kevin McCarthy secured his speakership after a marathon 15 votes. Now, Speaker Johnson faces the same challenge that precipitated his predecessor’s downfall: joining forces with Democrats while corralling enough House Republicans to avoid a government shutdown on a tight deadline. 

Johnson and Schumer reached an agreement over the weekend on a $1.59 trillion topline spending number, which includes $886.3 billion in defense spending and $704 billion in non-defense spending. It also leaves in place a $69 billion side agreement for additional non-defense spending that McCarthy negotiated with President Joe Biden last May as part of the deal to raise the debt ceiling—a bargain that strained McCarthy’s relationships with some GOP lawmakers and contributed to his eventual ouster. With the side deal included, topline spending would be $1.66 trillion for fiscal year 2024.

“It’s a good deal for Democrats and the country,” Schumer said on a call with his colleagues. The Senate majority leader and House Minority Leader Hakeem Jeffries both emphasized the spending left intact under the agreement. “It will also allow us to keep the investments for hardworking American families secured by the legislative achievements of President Biden and Congressional Democrats,” the pair said in a joint statement. Schumer was even more explicit in a floor speech on Monday. “When we began negotiations, our goal was to preserve a non-defense funding level of $772 billion, the same level agreed to in our debt ceiling deal last June, and that $772 billion was precisely the number we reached,” he said. “Not a nickel—not a nickel—was cut.”

Johnson, keen to sell the Republican conference on the deal, highlighted different aspects of the deal in a letter to his colleagues on Sunday. “The agreement today achieves key modifications to the June framework that will secure more than $16 billion in additional spending cuts,” he wrote. The speaker didn’t dwell on the “extra-statutory adjustments” (also known as the $69 billion side agreement) in his letter, though he noted that the agreement does “not cut as much spending as many of us would like.” 

House GOP hardliners seemed more inclined to buy Schumer’s presentation of the deal than Johnson’s. “Don’t believe the spin,” the House Freedom Caucus tweeted in response to the deal. “Once you break through typical Washington math, the true total programmatic spending level is $1.658 trillion—not $1.59 trillion. This is a total failure.” 

Is this a good deal for Democrats or Republicans? In order to understand how much money is actually spent or cut under the framework, we need to revisit the spending and debt ceiling deal from last year. At the end of May, Biden signed into law the Fiscal Responsibility Act (FRA) that reflected the results of a compromise with former Speaker McCarthy. The law set a spending cap for FY 2024 at $1.59 trillion, and negotiators also agreed to the separate $69 billion in non-defense discretionary spending.

But the FRA included a number of budgeting gimmicks that artificially inflated the spending cuts. Johnson negotiated several changes that made savings more enduring, even though the topline numbers remained unchanged. “While the levels of emergency spending from FY23 will be maintained, no additional emergency funding, or additional no-outlay changes in mandatory programs (CHIMPS), will be included thus eliminating two of the worst accounting gimmicks included in the FRA framework,” Johnson said. The $16 billion in additional spending cuts provided for in the new agreement includes a $6 billion rescission of unused COVID-19 funds and an acceleration of a previously agreed-upon $10 billion cut to the Internal Revenue Service’s (IRS) funding, meaning a total of $20 billion in IRS funding will be cut in 2024.

“The broad topline is the same,” Liam Donovan, a lobbyist and former GOP Senate operative, told TMD. “The side deal spending is the same, but I think the pay-fors are more real in that you’re getting rid of some of these fake gimmicks and replacing them with real things like more IRS cuts, like real COVID rescissions … not just stuff that exists on paper.”  

The House now faces the difficult task of hashing out appropriations bills to determine how the $1.66 trillion will actually be spent. “The difficult process of conferencing FY24 appropriations bills now begins under extremely tight timelines,” a spokesperson for House Appropriations Chair Kay Granger said on Sunday. Part of the government will shut down on January 19 if no action is taken—thanks to the laddered continuing resolution (CR) Johnson spearheaded in November—meaning lawmakers have just 10 days to pass at least four appropriations bills to keep the government fully open (the agencies funded through the other eight appropriations bills will run out of money on February 2). Johnson has not yet indicated whether he’ll try to pass the appropriations individually or group them in some way. 

House GOP hardliners and fiscal hawks made it clear they’d rather shut down the government than get behind the agreement, citing their beef not only with the spending levels set in the bill, but with what they say is a lack of attention to border security. “The Republican House majority cannot and must not continue funding a government that is purposefully facilitating the unprecedented invasion at our Southern Border,” Rep. Bob Good, chair of the House Freedom Caucus (HFC), told NBC News last week.

South Carolina Republican Rep. Ralph Norman addressed his concerns with the bill yesterday.* “If this is the best Republicans can do,” he said, “there’s no hope of ever balancing our budget or securing the border.” GOP Reps. Matt Gaetz, Andy Biggs, and Matt Rosendale have all said the government should shut down if there’s no action on the border.

But Johnson likely isn’t counting on HFC members to get behind the deal—Good and Norman both voted against the FRA and the laddered CR. “If you liked that [FRA] deal, this deal is a little bit better,” Donovan told TMD. “If you hated that deal, you’re not going to be made happy by the marginal improvements.” Given the opposition to the spending agreement from hardliners and some members of the powerful House Rules Committee, the appropriations bills will likely need to be passed by suspending the rules—a parliamentary maneuver that bypasses the Rules Committee and sends legislation directly to a floor vote. But doing so would require a two-thirds majority to pass the appropriations bills, which will in turn require Democratic votes. (Johnson has suspended the rules before, in order to pass the laddered CR in November)

The House Republican Conference, its majority down to two after recent retirements, will meet on Wednesday, providing the first full temperature check on GOP support for the deal. Whether enough of Johnson’s colleagues will be satisfied with the incremental Republican wins secured in his agreement remains an open question. The speaker emphasized in his letter on Sunday that Republicans can still push for conservative policy reforms as the appropriations are drafted, saying the framework offers a route to “reprioritize funding within the topline towards conservative objectives” and to “fight for the important policy riders included in our House FY24 bills.” But in a divided government, any policy reforms attached to the bills will be limited to what Senate Democrats can stomach. Jeffries and Schumer made clear that “Democrats will not support including poison pill policy changes in any of the twelve appropriations bills put before the Congress.”

Rep. Mike Collins, a Georgia Republican, posed a somewhat tongue-in-cheek question on Sunday that summed up the challenge facing Johnson and his conference: “Are we learning that negotiating with the Democrats in the White House and Senate with a slim majority is hard and you can’t get everything you want, no matter who is in the Speaker’s office?”

Worth Your Time

• Writing for the Texas Tribune, Lucy Tompkins tells the story of Community First! Village, which offers permanent tiny housing to the ballooning homeless population in Austin, Texas. “In 2012, [Community First founder Alan Graham] acquired a plot of land in a part of Travis County just northeast of Austin,” she wrote. “It was far from public transportation and other services, but it had one big advantage: The county’s lack of zoning laws limited the power of neighbors to stop it.” The village enforces rules such as mandatory rent, quiet hours, and many residents have jobs in the village. Private philanthropy, public support, and donations from Texas staples such as Tito’s Vodka and Alamo Drafthouse have also helped to build the community, which hinges on creating and enforcing a strong culture—both the greatest benefit and challenge of living in Community First. “The single biggest issue for people is the cultural change,” Graham said. “You develop relationships with people and you have compassion for them, but in order to maintain a community you have to have some community standards. That is extremely difficult to navigate.’”  

Presented Without Comment

The Hill: [Former President Donald] Trump Says He Hopes Economy Crashes in Next 12 Months: ‘I Don’t Want To Be Herbert Hoover’

Also Presented Without Comment

ABC News: United [Airlines] Finds Loose Bolts on 737 Max 9 Planes in Wake of Alaska Airlines Door Plug Incident

Toeing the Company Line

• In the newsletters: Kevin considered (🔒) the past and future of higher education, the Dispatch Politics team previewed the Iowa caucuses, and Nick wondered whether a post-Trump Republican Party could transform as quickly as the pre-Trump Republican Party did.
• On the podcasts: Sarah and David attended to some Advisory Opinions housekeeping before diving into some creative 20th Amendment theories, Trump’s claims to prosecutorial immunity, and much more.
• On the site: Emily Zanotti explains why she agrees with Pope Francis and opposes surrogacy, Matthew Levitt reflects on the important role of slain Hamas leader Saleh al-Arouri, and Chris notes that, in many ways, the 2024 election will be about the elections process itself.

Let Us Know

Do you think House Republicans will attempt to oust Speaker Mike Johnson over his latest attempts to negotiate with Democrats and fund the government?

Correction, January 9, 2024: Originally, this newsletter mistakenly referred to Rep. Ralph Norman as a Georgia Republican. He is a South Carolina Republican.