House Republicans Again at Odds as Shutdown Deadline Nears

House Republicans Again at Odds as Shutdown Deadline Nears

Speaker Mike Johnson says, "Trust us."
By Yuval Rosenberg and Michael Rainey
Tuesday, November 7, 2023

Good evening. Have you voted yet? Yes, it’s an off year, but today’s elections will decide two major gubernatorial contests, in Kentucky and Mississippi, and could provide key signals for 2024 via races for control of the Virginia legislature as well as on an abortion amendment in Ohio. Here’s what else is happening.

House Republicans Again at Odds as Shutdown Deadline Nears

House Republicans held a closed-door meeting of their members Tuesday morning as they look to settle on a strategy for dealing with the looming November 17 deadline to fund the government and avoid a shutdown.

House Speaker Mike Johnson emerged from that meeting saying that his conference wants to avert a shutdown and is committed to providing aid to Israel as well — but that he wasn’t yet ready to reveal the party’s plan with 10 days to go before the deadline.

"We had a very — I would call it a refreshing, constructive family conversation in our House Republican Conference meeting," Johnson said, noting that the group had discussed the "many options" available and he would reveal his plan in short order. "Trust us. We’re working through the process in a way that I think the people will be proud of," Johnson added.

In other words, Republicans are again divided over how to approach spending bills and avoid a shutdown — a scenario similar to the one that resulted in the ouster of former speaker Kevin McCarthy after a vote to keep the government open at the end of September. "There's too many ideas right now, which is fine — the speaker wants us to have an open forum to debate it," said Rep. Richard McCormick of Georgia, according to Politico. "But now there's so many ideas, we have to figure out how to whittle it down." Rep. Drew Ferguson, also of Georgia, reportedly described the path forward as "clear as mud."

The new speaker doesn’t face the same threat since hardliners have indicated they will give him more leeway, at least initially, but it’s not yet clear whether he can unite his conference or reach a solution that can get through the Senate. "The same battle lines are there: Some members are embracing a clean, short-term spending bill, while others are already vehemently opposed," Politico’s Olivia Beavers and Jordain Carney report.

Some of the options Johnson discussed at his news conference are likely to be non-starters on the other side of the Capitol.

Johnson said that one idea he has floated, a "laddered" continuing resolution, would involve two phases, with some agencies funded into December and others into January. That plan, reportedly favored by the members of the conservative House Freedom Caucus, is meant to encourage lawmakers to work toward passing regular annual appropriations bills and to keep the Senate from jamming the House with the kind of mammoth year-end spending package that conservatives fervently want to avoid. Still, some proponents reportedly prefer that the first deadline be set in January and the second later on in 2024.

Appropriators in both the House and Senate have panned the "laddered" approach, suggesting that it would make funding the government more difficult and set up a constant threat of rolling agency shutdowns. "Congress has a hard time walking and chewing gum," Rep. Steve Womack, an Arkansas Republican, told The Hill. "How are we going to juggle multiple deadlines and different approaches?"

The other option Johnson mentioned is a continuing resolution that would extend into January "with certain stipulations" — conservative policy provisions such as border security measures or a debt commission that could set the stage for negotiations with the Senate (or not). Some centrist members may favor a "clean" CR, but lawmakers on the far right are making clear that they oppose the idea.

"There continue to be a pretty wide range of views about what we should do," Republican Rep. Dusty Johnson of South Dakota said, according to The Hill. Another House Republican told Politico: "We are all over the place, like usual."

Senate Democrats, meanwhile, are reportedly aiming to pass a short-term funding bill that would only stretch until early December and allow for the annual appropriations process to be completed by the end of the year, likely via a "megabus" or "maxibus" that rolls up the chamber’s nine remaining annual spending bills. The two chambers must also hash out national security and domestic supplemental funding plans, including the Biden administration’s requests for aid to Israel and Ukraine.

The bottom line: House Republicans will have to formulate a plan quickly, and Johnson could still find himself facing a similar choice to the one that doomed McCarthy, forced to decide between appeasing his most conservative members or enacting policies with bipartisan support.

Chart of the Day: The Cost of US Debt

Persistent budget deficits combined with a big jump in interest rates translate into a rapidly rising cost of servicing the national debt. According to an analysis by Bloomberg News, the annual cost of debt service is now running at more than $1 trillion per year, up from the $879.3 billion paid out in interest in fiscal year 2023, which ended in September. The estimated annual cost has doubled in the last 19 months.

Some analysts think the cost could continue to climb. "There will be further increases to Treasury coupon auctions and T-bills outstanding going forward," Bloomberg Intelligence strategists Ira Jersey and Will Hoffman wrote. "Besides deficits of over $2 trillion in the foreseeable future, climbing maturities following the increase of issuance from March 2020 will also need to be refinanced."


Quote of the Day

"What must indeed be avoided at all costs is debt explosion, which would occur if primary deficits just did not go away. Thus … the right plan is a credible plan of steady primary deficit reduction, but accepting the fact that the debt ratio will increase for some time, and stabilize at a higher level."

—Olivier Blanchard, former chief economist at the International Monetary Fund, writing this week at the Peterson Institute for International Economics, where he is a senior fellow. Blanchard calls for a slow but steady reduction in the budget deficit over a period of years, a process that could take a decade to reach its goal.

Given the "current budget process dysfunction" in the U.S., the effort will likely be difficult. At the same time, moving too fast to reduce the deficit could be "catastrophic," Blanchard warns, "both economically in triggering a recession, and politically, by increasing the share of votes going to populist parties." Ultimately, Blanchard is pessimistic about making progress in the near future. "Thus, the debt ratio is likely to increase for quite some time," he writes. "We have to hope that it will not eventually explode."

Why Biden’s Focus on the Economy Isn’t Working

President Joe Biden has spent months promoting his economic agenda, with an emphasis on job creation in the manufacturing sector and the continued strength of the labor market. But his dismal approval ratings suggest that his message isn’t resonating, and a new poll suggests one major reason why: Voters want to see lower prices throughout the economy more than anything else, indicating that inflation is still a serious problem, both politically and economically.

A YouGov survey sponsored by the Democratic strategy group Blueprint found that the top priority for registered voters is "lower prices on goods, services, and gas." Sixty-four percent of those asked what they would most like to see improved in the economy chose that option, handily beating higher wages (20%), lower interest rates (9%) and more jobs (7%).

The survey of 1,063 registered voters, taken from October 26 to November 2, also contains bad news for Biden as he prepares to face off against Republican frontrunner Donald Trump. Nearly half (49%) of respondents gave Trump credit for focusing most on lower prices, while just 24% said Biden is primarily focused on lower prices. A majority (56%) of respondents said they thought Biden’s policies were "bad" for lower prices on goods and services, while only 44% said they were "good."

Americans also don’t seem to believe some of the positive economic developments that have occurred since Biden took office. A majority of respondents said they did not believe a number of factual statements, including that the U.S. economy grew by 6% in 2021 and 2% in 2022 (53% did not believe), inflation-adjusted income has risen 3.5% since 2021 (54%), gas prices fell by more than $1 a gallon from June 2022 to June 2023 (55%), and inflation has fallen from 8.3% to 3.2% since 2021 (62%).

The bottom line: Biden’s current economic message isn’t working. But the thing Americans want most — a reduction in prices — is unlikely, according to most experts, which means Democrats need to focus somewhere else if they want to convince voters that Biden deserves another term in the White House. 

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