Reconciliation Buzz: The Republican conference continues to negotiate the path forward for a reconciliation strategy to advance President Trump's agenda. Finding ways to pay for this agenda is central to the strategy, yet new and costly proposals continue to emerge. This week, Republicans in both chambers called for between $100 billion and $200 billion for defense programs, which would be one of the largest boosts for defense in recent decades. We expect to see a budget resolution in early February, which will shed some much-needed light on projected spending levels.
Chiming in on the discussion yesterday was the House Freedom Caucus, releasing its proposal for reconciliation that calls for two bills, instead of the one-bill plan championed by Speaker Mike Johnson (R-LA). The proposal includes a two-year increase to the debt ceiling (about $4 trillion) in exchange for a commitment to dollar-for-dollar savings over 10 years on both reconciliation and appropriations bills. The proposal also outlines how their strategy will decrease Democrats' leverage in the appropriations process and the debt ceiling, setting the stage for cuts in 2026 and letting DOGE get to work.
For those interested in learning more about the reconciliation process, we discussed the highlights this week in our post here.
Power of the Purse: This week, Democrats zeroed in on the Impoundment Control Act (ICA) – a law that ensures Congress, and not the executive branch, decides where taxpayer dollars go. Although the ICA has been ruled constitutional by the Supreme Court, President Trump has said that the law is unconstitutional. Additionally, Russell Vought, Trump's nominee for Director of OMB, stated during his confirmation hearing on Wednesday that presidents under some circumstances may spend less than Congress has appropriated if they believe they can accomplish the objectives of the law with less money. He did, however, agree that the ICA is the law of the land.
More Disaster Assistance: Unfortunately, FEMA seems to be stuck in a continuous cycle of needing supplemental funding as natural disasters continue to affect communities across the country – the latest being the devastating fires occurring in southern California. Although Congress passed $110 billion in funding for the agency just before the holidays, a new infusion of cash will be needed sooner rather than later, and congressional leadership is preparing for that eventuality. At the beginning of the week, Speaker Johnson proposed tying disaster aid to the debt ceiling, a plan that angered Democrats who reminded their colleagues that they had not demanded offsets nor conditions on aid to red states in the wake of similar natural disasters.
What's in a Name?: This week, the House Appropriations Committee announced that it had changed the name of its "State-Foreign Operations" (SFOPS) Subcommittee to the "National Security-State" Subcommittee. The subcommittee's jurisdiction will remain the same, but Chairman Tom Cole (R-OK) has said the change represents a new focus on national security. This change, however, will not transfer over to the Senate, where the SFOPS title will remain.
Cardinals Are Finalized: Speaking of the House Appropriations Committee, we have the full list of subcommittee chairs for the 119thCongress. They are as follows: Rep. Andy Harris (MD) – Ag-FDA; Rep. Hal Rogers (KY) – CJS; Rep. Ken Calvert (CA) – Defense; Rep. Chuck Fleischmann (TN) – Energy and Water; Rep. Dave Joyce (OH) – FSGG; Rep. Mark Amodei (NV) – Homeland Security; Rep. Mike Simpson (ID) – Interior; Rep. Robert Aderholt (AL) – Labor-HHS; Rep. David Valadao (CA) – Leg Branch; Rep. John Carter (TX) – MilCon-VA; Rep. Mario Diaz-Balart (FL) – National Security-State; and Rep. Steve Womack (AR) – T-HUD.
The Senate has not yet announced subcommittee assignments for the 119th Congress, though that list is expected soon.
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