A day after passing a stopgap spending bill, and with lawmakers evidently growing punchy — almost literally — after 10 straight weeks in session, the House on Wednesday adjourned early for its Thanksgiving break after conservatives angered by yesterday’s action exacted a measure of retribution by blocking plans to pass more spending bills. The Senate, meanwhile, appears headed to a vote as early as tonight on the House-passed stopgap, defusing the threat of a shutdown at the end of the week.
Here’s the latest.
House GOP Hardliners Revolt, Forcing an Early Thanksgiving Break
Thanksgiving is still more than a week away, but the House is already heading home for the holiday after 19 far-right Republicans rebelled against Speaker Mike Johnson and GOP leaders Wednesday and voted to block action on a 2024 spending bill and a separate piece of legislation pertaining to frozen Iranian assets. With any chance of progress on spending bills halted and nothing else left on the schedule, Republican leaders canceled votes for the rest of the week and sent members home to cool tensions.
The GOP hardliners joined with Democrats in voting against a typically routine procedural step to open floor debate on the two bills, including funding for the departments of Commerce and Justice — a revolt that was, at least in part, retaliation for House Speaker Mike Johnson’s decision to press ahead Tuesday with a “clean” stopgap spending measure to avert a government shutdown at the end of the week. That bill, known as a continuing resolution or CR, was passed by relying on Democratic votes. A majority of House Republicans supported it, too, but hardliners were incensed that it did not include spending cuts or other of their policy priorities.
“We’ve had enough,” said Rep. Scott Perry, chairman of the House Freedom Caucus. “We’re sending a shot across the bow.” Moderates saw it somewhat differently. “This is retaliation when something doesn’t go their way,” said Rep. Dusty Johnson of South Dakota, chair of the more moderate Main Street Caucus, according to Politico.
GOP leaders also had to pull the bill funding the departments of Labor, Education and Health and Human Services from the floor due to opposition from moderates to steep proposed spending cuts and anti-abortion provisions.
Wednesday’s ultraconservative revolt is reminiscent of a similar blockade on House legislative activity by hard-right lawmakers earlier this year after then-speaker Kevin McCarthy agreed to a deal with the White House to raise the debt limit. GOP hardliners have insisted that lawmakers should pass individual annual spending bills rather than massive year-end packages that combine those single-subject measures. Yet while the House has thus far passed seven of the 12 annual spending bills, Republicans have struggled to reach agreement on the five remaining pieces of legislation, with multiple planned votes derailed by intraparty clashes.
“On Wednesday’s rule vote, GOP objectors expressed dual concerns,” Roll Call reports. “First, they opposed the Commerce-Justice-Science bill for not going far enough to cut FBI spending, despite 9 percent cuts already baked in. Second, they didn’t like that the rule governing debate on the Iran bill was “closed,” precluding members’ ability to offer amendments.” Some moderates also opposed the Commerce-Justice-Science bill out of concern over anti-abortion language and those cuts to law enforcement.
Johnson’s honeymoon is over: Hardliners had indicated that they would give their new speaker some leeway in his first weeks on the job, and while they aren’t threatening Johnson’s job — yet — they are already signaling limits to their patience. Rep. Chip Roy of Texas, a member of the conservative House Freedom Caucus, told CNN that Johnson’s decision to back a spending bill without cuts and pass it under a suspension of the normal rules and with Democratic help amounted to “strike 1 and strike 2.”
What’s next: The Senate appears set to pass the stopgap spending bill, averting a shutdown this week and setting up new deadlines in January and February. It could happen as soon as tonight, though Senate leaders still have to overcome an obstacle or two.
On the House side, Johnson faces a fight — or several fights — after Thanksgiving, and Republicans don’t have a clear path to advance the five annual spending bills that are now in limbo due to their infighting. Keep in mind that Johnson has vowed that he’s now done with short-term spending bills and that the House and Senate will still need to hash out differences between their respective versions of the full-year spending bills. With less than two dozen legislative days on the calendar before mid-January, the new House speaker has his work cut out for him.
US Postal Service Reports $6.5 Billion Loss
This was supposed to be the year the U.S. Postal Service broke even, according to a 10-year restructuring plan rolled out two years ago. Instead, on Tuesday USPS posted a $6.5 billion loss for the 2023 fiscal year, a disappointing result for an organization that hopes to turn a profit next year.
Total operating revenue for fiscal year 2023 was $78.2 billion, a 0.4% decrease compared to the same period last year, USPS said. Inflation was a factor pushing up costs, and reduced mail volumes ate away at revenues as first-class mail recorded the lowest volume since 1968.
The current turnaround plan was created under Postmaster General Louis DeJoy, who took over the USPS during the Trump administration. His controversial “Delivering for America” plan mixes price hikes and service reductions, with the goal of eliminating operating losses as the agency moves into the black.
DeJoy said he was “not happy” with the results, even though the USPS is still just in the “early stages” of a massive transformation. “Our efforts to grow revenue and reduce labor and transportation costs were simply not enough to overcome our costs to stabilize our organization, the historical inflationary environment we encountered and our inability to obtain the [Civil Service Retirement System] reform we sought,” he told the Postal Service Board of Governors.
Critics charge that DeJoy’s reforms are part of the problem. Kevin Yoder, a former Congressman who now serves as Executive Director of the advocacy group Keep US Posted, said higher prices are depressing overall shipping volumes. “Twice-annual, above-inflation postage hikes are worsening the USPS' financial woes and trapping it in quicksand, as even more mail is driven out of the system,” he said in a statement, per CBS News.
Number of the Day: -0.5%
In another sign that the U.S. economy could be in the midst of a historic “soft landing,” the producer price index declined 0.5% in October, according to government data released Wednesday. The decline in the index, which measures wholesale prices paid by businesses, was driven by a drop in prices for goods, led by a major decrease in fuel prices.
A separate report showed that retail sales fell by 0.1% in October, a sign that consumers are taking a break from the shopping spree they’ve been on for quite some time. But the decline was less than expected, suggesting that consumers haven’t given up on that spree entirely.
“Consumer spending will continue to grow in 2024, but at a modest pace,” Bill Adams, chief economist at Comerica Bank, said, per The Wall Street Journal. “The economy has a good shot at returning to a more normal rate of inflation and pace of growth without slipping into recession.”
Fiscal News Roundup
- House Heads Home After Defeat of Rule for Iran, Spending Bills – Roll Call
- Defense Bill Dispute Holds Up Senate Vote to Fund Government – Politico
- Conservatives Block Spending Bill in Retribution Over Johnson Stopgap – Politico
- House GOP Punts Labor, Health Bill Amid Republican Infighting – Politico
- How Government Shutdown Politics Lost Its Mojo—for Now – Wall Street Journal
- Stopgap Spending Bill Raises Sequester Specter at Pentagon – Roll Call
- How 10 Weeks Together Drove the House GOP Off the Rails – Politico
- Sen. Joe Manchin Says He 'Absolutely' Would Consider a Presidential Run – NBC News
- Falling Retail Sales, Cooling Prices Point to Soft Landing for Fed – Bloomberg
- The Elusive Soft Landing Is Coming Into View – Wall Street Journal
- New TV Ad Targets Speaker Mike Johnson on Medicare, Social Security – NBC News
- Facing Financial Ruin as Costs Soar for Elder Care – New York Times
- More Than 800 U.S. Counties Are 'Insulin Deserts.' How These Senators Want to Help Americans With Diabetes – USA Today
Views and Analysis
- In His First Big Showdown, an Unyielding Conservative Yields – Carl Hulse, New York Times
- Despite the House Passing a Stopgap Funding Bill, Representatives Acted Out a Farce – Stephen Collinson, CNN
- Why Republicans Are on the Verge of Fistfights – Kelly Garrity, Politico
- Did Mike Johnson Just Doom Himself to the Same Fate as Kevin McCarthy? – Ian Ward, Politico
- How Speaker Johnson Got It Done – Dennis Aftergut, The Hill
- House Republicans Circle Their Own Budget Ouroboros Once More – Ryan Cooper, American Prospect
- Selling Bidenomics Is Biden’s Only Chance to Beat Trump – Jonathan Chait, New York
- While All Inflation Feels Bad, Housing Inflation Is the Worst – Greg Ip, Wall Street Journal