GOP Hardliners Say Border Bill Should Come Before Tax Cuts

GOP Hardliners Say Border Bill Should Come Before Tax Cuts

House Speaker Mike Johnson
USA Today Network
By Yuval Rosenberg and Michael Rainey
Friday, December 13, 2024

Happy Friday! President-elect Donald Trump said in a social media post today that the Republican Party will try to get rid of daylight saving time, calling the twice-yearly time change “inconvenient, and very costly to our nation.”

Here’s what else you should know as we head into the weekend.

Congress Races to Avert Christmas Shutdown

Congress has one week left until a December 20 shutdown deadline and lawmakers are still hammering out the final details of a plan to extend funding into March. A slew of other items, including additional disaster relief funding and an extension of the farm bill, could also get rolled into the year-end legislative package.

Democrats are warning against partisan provisions. “The only way we prevent a shutdown is through bipartisan cooperation, without any last-minute poison pills that only create controversy,” Senate Majority Leader Chuck Schumer said in a social media post Thursday. “Adding poison pills at the 11th hour would only make the risk of a Christmas shutdown greater. That would hurt Americans across this country.”

In the aftermath of devastating hurricanes Helen and Milton, the Biden administration has asked for about $100 billion in disaster funding, but far-right Republicans have expressed concerns about the cost and have called for offsets to such additional spending.

“The House should consider only what is absolutely necessary right now to provide critical relief to hurricane victims and farmers, and pay for it with offsets from wasteful spending elsewhere in the government, then wait for President Trump to take office to better manage disaster relief,” the conservative House Freedom Caucus said in a statement last week.

Congressional Democrats have reportedly also been trying to ensure that $20 billion in IRS funding provided under the 2022 Inflation Reduction Act is kept in place. And Punchbowl News reports that negotiators are nearing a deal on a health package “that could include a major overhaul for pharmacy benefit managers.”

The final bill text is expected to be revealed over the weekend. That would leave enough time to get the legislation through both chambers of Congress and to President Joe Biden’s desk before the Friday night deadline, allowing lawmakers to head home for the holidays.

House Freedom Caucus Says Border Before Taxes

The House Freedom Caucus said Friday that it wants the new Congress to quickly pass a reconciliation bill focused on border issues and then move on to a second, more complicated bill that addresses other key Republican agenda items, including taxes and government spending.

In a letter to Speaker Mike Johnson, the caucus, which includes some of the most hardline Republicans in the House, backed the two-step approach advanced by the incoming Senate Majority Leader John Thune, as well as key incoming White House officials, including Stephen Miller, Trump’s deputy chief of staff.

“It is our understanding that President Trump’s closest advisors and experts on the border believe they must have immediate resources to begin to undo the damage caused by the Biden Administration, secure the border, and start removals and repatriations on day one,” the group wrote. “President Trump’s agenda will be enacted, and border security must move first – and then we should move forward to a second, larger reconciliation bill covering taxes, spending, energy, bureaucracy, and more.”

The group also said they want the bill to be ready right off the bat in January, with the costs “fully offset.”

In sending the letter, the Freedom Caucus is breaking with some key Republican House leaders, including Rep. Jason Smith, the chair of the tax-writing Ways and Means committee. Smith recently expressed concerns about the ability of Congress to pass two reconciliation bills in the same year, especially with such a slim majority in the House.

“My preference is we get right into doing the tax bill,” Smith said earlier this month. “I think that’s going to be one of our most important pieces of legislation. We ought to get right on it.”

Chart of the Day: Tax Cuts Don’t Pay for Themselves

The deficit hawks at the Committee for a Responsible Federal Budget reminded us this week of a fundamental fiscal fact: Despite claims to the contrary, tax cuts generally don’t pay for themselves, even when dynamic economic effects are taken into consideration.

The chart below summarizes the net revenue loss associated with extending the various components of the 2017 tax cuts that are currently scheduled to expire — but will almost certainly be extended by a Republican-controlled Congress working with incoming President Donald Trump. The estimates come from a number of different analysts, using both conventional and dynamic scoring.

The revenue loss estimates vary, with different assumptions made about which provisions are extended and how, but the overall picture is clear enough: Extending the 2017 tax cuts will cost trillions of dollars, and dynamic effects will do little to change that basic fact.

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Quote of the Day

“It’s difficult for me to emphasize, without me sounding like a crazy person, how outlandish this is.”

– Nicholas Bagley, a University of Michigan law professor, in a Roll Call article examining the likelihood that President-elect Donald Trump and key officials tasked with putting together a budget and cutting costs will use a controversial — and legally dubious — process known as impoundment to not spend funds appropriated by Congress.

Congress addressed the issue in a 1974 law prompted by concerns that President Richard Nixon was abusing his power by withholding funding for programs he opposed. The Impoundment Control Act lays out the process a president must use to ask Congress to rescind or delay spending appropriated funds, but that law and other court rulings have made clear that the president cannot unilaterally block expenditures authorized by Congress.

Trump and incoming administration officials and allies have argued that the 1974 law is unconstitutional and that the current Supreme Court would likely side with him on the issue.

Bagley and others say the law is clear: a president can’t unilaterally refuse to spend money appropriated by Congress. “The impoundment that [Trump] and his senior aides have been talking about is flatly against the law and the only way he can proceed legally is to overturn the law,” William Galston, a senior fellow at the Brookings Institution, told Roll Call. “We’re talking about an entirely different constitutional order if the president can treat the Congress’ power of the purse as an advisory opinion.”

Bagley told Roll Call that Trump may have other, more effective paths to delay funding for programs he opposes, such as pointing to bureaucratic red tape. “If the president said ‘I have to abide by these various rules before I take any federal action that may impact spending,’ it is a lot harder to get that kind of anti-impoundment declaration off the ground in that context,” Bagley said.

Send your feedback to yrosenberg@thefiscaltimes.com.

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