Republicans are looking to regroup on President Trump's agenda, which one GOP lawmaker says is becoming a "trainwreck."
Senate Republicans met at the Library of Congress Wednesday to plot a path forward on the stalled budget reconciliation bill, amid growing tensions between conservatives, who want to make deep cuts to government spending, and moderates, who worry about the impact on Medicaid and other federal benefits.
Speaker Mike Johnson’s (R-La.) goal of getting “one big, beautiful bill” to Trump’s desk by Memorial Day won't be met and now there’s a danger that negotiations of the tax bill will slip past July 4, the target date set last week by Treasury Secretary Scott Bessent.
“We are keeping very close tabs on it,” said a Republican senator of the negotiations in the House, who said the two chambers are heading in separate directions, with little direct negotiation.
“Sooner or later we have to pass the same thing and I’m worried that this is potentially a trainwreck. We can’t really get on the same page,” the lawmaker warned.
A Senate Republican aide pushed back on the senator’s concern that the Trump’s agenda is at risk of derailing, arguing that negotiations over big, complex bills naturally have “peaks and valleys.”
Senate Majority Leader John Thune (R-S.D.) told The Hill that Republican senators made progress at their retreat Wednesday, downplaying the simmering tensions in his conference.
“We had a really good, I thought, very constructive conversation,” he said.
Republicans in both chambers remain deeply divided over how much to cut spending to offset the cost of extending Trump’s 2017 tax cuts, enacting new tax relief, securing the border and boosting the Pentagon.
A person familiar with the discussion at Wednesday’s retreat said that Thune expressed frustration with the pace of the negotiations in the House and the lack of progress on finding deficit-reduction measures that could muster the 218 votes needed to pass the lower chamber.
Thune argued at the start of the 119th Congress that GOP leaders should break up Trump’s agenda into two bills, one focused on border security and defense and the other focused on extending the 2017 tax cuts, providing new tax relief and reducing the deficit.
Some GOP senators now say that the House should have embraced Thune’s strategy because the negotiation of tax relief and deficit-reduction is taking a lot more time than the Speaker expected.
Sen. Kevin Cramer (R-N.D.) said he “would welcome” shifting to Thune’s two-bill strategy if his colleagues remain stalled on tax relief and deficit reduction.
“I’m trying to resist saying ‘I told you so,’” he said.
“Part of the problem … is that this great big, beautiful bill is very, very complicated,” he said. “We should have had our bill, extending the [2017] Tax Cuts and Jobs Act, border security and defense increases done. It should be law right now.”
“There’s some frustration that we’re doing the big, beautiful bill thing and that’s probably getting away a little bit. It’s too much, it might be too much,” Cramer said.
On the other hand, he said if Republicans leaders manage to get the massive bill passed by the fall, it would be a huge accomplishment.
Republicans are divided over elements of the tax package, such as how much to raise the cap on state and local tax (SALT) deductions, which is a top priority of GOP lawmakers from New York and New Jersey.
But the biggest sticking point is how to pay for a substantial part of the bill’s cost, which could swell to trillions of dollars over the next decade.
More than 30 House Republicans signed a letter to Speaker Johnson and House Majority Leader Steve Scalise (R-La.) Wednesday warning that the bill enacting Trump’s agenda “must not add to the deficit.”
The letter argued that while extending the 2017 tax cuts “will generate $2.5 trillion in additional revenue through economic growth,” the cost of all additional tax cuts or increases in spending “must be offset.”
“The deficit reduction target must be met with real, enforceable spending cuts — not budget gimmicks,” the group warned.
Senate conservatives led by Sens. Ron Johnson (R-Wis.), Rick Scott (R-Fla.) and Mike Lee (R-Utah) are making a strong push to reduce total annual federal spending from $7.3 trillion to $6.5 trillion.
Johnson says the $1.5 trillion deficit reduction number that the Speaker is aiming for is “a joke.”
“$1.5 trillion over 10 years? That’s $150 billion a year. That takes it from $7.3 trillion to, at most, $7.1 trillion. What I’m saying, at most, we should be looking at $6.5 trillion,” the Wisconsin senator said at the WisPolitics D.C. Breakfast in March.
He said that cutting total annual federal spending to $6.5 trillion would bring spending down to what it was before the pandemic, accounting for population growth and inflation.
A Republican senator involved in the debate over deficit reduction said hitting Johnson’s total spending target must remain a top priority, even though Republican moderates are pushing back hard against cuts to Medicaid and other safety-net programs, such as the Supplemental Nutrition Assistance Program (SNAP).
“I am concerned about it,” the senator said. “We’re going to keep pushing on it. We’ve got to get it $6.5 [trillion,] total spending. You can’t do all that through reconciliation but we need a pathway to get there. … Our willingness to support the [package] will depend on the ability of a combination the White House and our leadership to have a framework in place for us to get to $6.5 [in total annual spending.]
“There are 535 chefs,” the lawmaker added, referring to the total number of lawmakers in the Senate and House.
Republican lawmakers generally agree on adding new work requirements to Medicaid and SNAP but deficit-reduction reforms that could impact benefits remain highly controversial.
Speaker Johnson disappointed Republican budget hawks Tuesday evening when he ruled out a proposal to reduce the amount the federal government pays to states to provide expanded coverage of Medicaid, something known as the Federal Medical Assistance Percentage (FMAP).
He also indicated that he would not likely support a controversial proposal to place per capita caps on Medicaid spending.
But Republicans who warned they would not support a budget reconciliation package that cuts deeply into Medicaid cheered the announcement.
“The House has said that they’re not going to do the FMAP [cuts,] which is good,” Sen. Josh Hawley (R-Mo.) said. “They said they’re going to do work requirements, which I’m fine with.
“I think that’s a good trend because I don’t want to see any Medicaid benefit cuts,” he said.
Hawley said that Senate and House negotiators are working on parallel tracks in hopes of merging their work later this year.
“My understanding is we’re writing our own thing,” he said. “It’s dual track. … My sense is that we’re going to write our own bill, we’re not going to take whatever [the House chairmen] do.”
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