President Donald Trump urged the House GOP to stop negotiating and pass his “big, beautiful” filibuster-proof reconciliation bill Tuesday, with sharp words for blue-state Republicans pushing for more tax relief and conservatives seeking additional spending cuts.
In an appearance during the weekly GOP conference meeting, Trump told conservatives to lay off Medicaid, scolded blue-state Republicans for rejecting a $30,000 cap on state and local tax deductions, and urged the party to increase the country’s borrowing limit through the rest of his term, members leaving the meeting said.
Trump’s Capitol Hill visit comes as House GOP leadership is trying to unite the party behind the reconciliation package they’re relying on to enact much of the president’s agenda.
“It’s not a question of holdouts. We have a tremendously unified party. I don’t think we’ve ever had a party like this,” Trump said, heading into the meeting. “There are some people that want a couple of things that maybe I don’t like or that they’re not gonna get.”
But lawmakers leaving the meeting told a different story. Conservative hard-liners stuck to their guns on needing more cuts to Medicaid, and Republicans from New York rejected the president’s insistence that they accept the $30,000 “SALT” cap included in the package.
Trump’s visit did little to move the needle in support of the bill, leaving leadership where they started the week: trying to strike a balance between steeper cuts needed to satisfy conservatives without alienating centrists, and finding space for more SALT relief.
Republicans can afford to lose no more than three GOP votes and pass the partisan legislation.
After the meeting, Speaker Mike Johnson said he was ready to convene the holdouts in smaller groups to try to reach a deal.
“What we’re leaving to do right now is gather up this small subgroup in the House Republican Conference and tie up the remaining loose ends,” Johnson, R-La., said. “I’m very confident that we’ll be able to do that.”
House Freedom Caucus Chairman Andy Harris said he was still a “no” on the measure, and Rep. Chip Roy, R-Texas, one of the caucus’ lead negotiators, wasn’t yet on board either. Both went into Johnson’s office for further talks after Trump left the Capitol.
Trump singled out by name Rep. Thomas Massie, whose vote was written off from the start, saying both inside and outside meeting that he wouldn’t mind if the Kentucky Republican lost his reelection.
Massie wasn’t fazed by the critique, but predicted the still-emerging package passes over his objections.
“We’ll see what happens. I predict they get the bill passed. He was very persuasive in there,” Massie said after the meeting. “I predict that the president persuaded the Freedom Caucus and the blue-state Republicans to give up their fights and go along.”
SALT flip, again
Trump’s history with the SALT cap is complicated.
While he campaigned last year on finding a SALT “fix,” during his first term he signed the $10,000 cap into law, along with the rest of his 2017 tax law. The reconciliation package would raise the cap to $30,000 for households making up to $400,000, which blue-state Republicans have rejected as too stingy.
Republicans from higher-tax, Democratic-leaning states like New York and California have repeatedly pointed to Trump’s campaign promise as they’ve pushed for more SALT relief this year. But Trump seemingly abandoned them heading into the meeting, painting the issue as one that would mostly benefit blue-state Democratic governors.
“The biggest beneficiary, if we do that, are governors from New York, Illinois and California,” Trump said. “I think we’re going to be explaining that these are all very blue states.”
In the room, Trump urged the SALT Caucus to accept the $30,000 cap included in the package, lawmakers said. That would be lower than more recent offers leadership has made to blue-state Republicans.
Leadership on Monday night offered to increase the cap to $40,000 for individuals and $80,000 for couples for four years for households making less than $751,000 a year. After that it would drop down to $30,000 for families earning up to $400,000 and snap back to a $10,000 cap at some point after that, according to a source familiar with the offer.
Rep. Kevin Hern, R-Okla., said Trump characterized SALT as an issue for wealthy voters, while Republicans should be focused on the working class.
“What he said was that SALT was not going to determine elections in New York or California, that most of the country didn’t know what SALT was,” Hern said. “But now they are being aware, and the other 47 states now are becoming a little aggravated that they need to pay for increased tax breaks for the wealthy in these states.”
Rep. Dusty Johnson, R-S.D., said patience was running out for further negotiations on SALT.
“The president is comfortable with where the bill is at today on SALT. That doesn’t mean there can’t be some additional tweaks, but clearly the patience of the conference and the president for negotiations are running low,” Johnson said. “I haven’t talked to each of those members yet, but I think they understand the time to cut a final deal is now.”
The president’s message didn’t seem to chasten New York Republicans Mike Lawler and Nick LaLota, who leaving the meeting reiterated that the $30,000 cap would not earn their votes.
“As I’ve said repeatedly, that is insufficient. We will continue the dialogue with leadership. But as it stands right now, I do not support the bill,” Lawler said. Lawler would not comment on additional offers from leadership, but LaLota rejected them.
“Those numbers last night didn’t work for me or the members of the SALT Caucus. We need a little more SALT on the table to get to ‘yes,’” LaLota said.
‘Waste, fraud and abuse’
Trump’s message to limit Medicaid changes to rooting out “waste, fraud and abuse” had swing-state centrists breathing a sigh of relief.
“We’re not doing any cutting of anything meaningful. The only thing we’re cutting is waste, fraud and abuse,” Trump said. “We’re not changing Medicaid.”
But fiscal hardliners were undeterred, insisting that further cuts to the program were needed to fulfill the president’s mandate.
Harris, R-Md., had been pushing for changes to the federal government’s share of funding for Medicaid expansion states, which is currently 90 percent.
That formula, called the federal medical assistance percentage or FMAP, has been a pain point for Freedom Caucus members. But Harris appeared to back down on that demand Tuesday if deep cuts to the provider tax are made instead.
“We could eliminate waste, fraud and abuse without going into FMAP, but it’s going to involved deep changes to the provider tax,” Harris said.
States can tax providers and then leverage that funding to gain higher Medicaid funding from the federal government. Harris suggested eliminating that option for states that expanded Medicaid.
The bill prevents states from establishing new provider taxes or increasing their current rates, which essentially leaves it “mostly intact.”
“For expansion states, it should be eliminated completely. For nonexpansion states, it should remain in place, and that will be the incentive for nonexpansion states to not expand,” Harris said.
Debt ceiling
Trump also said he wanted the debt limit extended further than the $4 trillion under the current bill, Hern said. That is estimated to last into 2027, but Trump wants it kicked to at least 2029, when his term will be over.
“Every president would like to have the debt limit outside of their term in office,” Hern said. “Obviously, currently, we have it in the bill as two years, but we’ll have to see what the Senate does on their side.”
Trump described the debt ceiling issue as “one of the most important things” in the bill, Rep. Robert B. Aderholt, R-Ala., said.
The Senate’s reconciliation instruction allows Republicans to raise the borrowing cap, currently set at $36.1 trillion, by another $5 trillion. That probably wouldn’t allow Congress to kick the can down the road another four years, but it would likely buy time until after the 2026 midterms.
The debt issue was exacerbated Friday when Moody’s Ratings downgraded U.S. credit. Treasury bond yields, a reflection of U.S. borrowing costs, have risen over the past week since the details of the House package became available.
On Tuesday, the Congressional Budget Office said the measure could add roughly $2.2 trillion to deficits over the next decade, not counting higher interest costs or interactions between provisions that haven’t yet been scored.
“There’s no doubt in my mind that this is going to balloon our debt,” Massie said.
David Lerman contributed to this report.
The post Trump doesn’t satisfy GOP holdouts as budget bill talks drag on appeared first on Roll Call.
