House conservatives threatened to derail a key tax vote on Monday in an attempt to win more influence over the GOP’s spending strategy, just four days before the deadline to fund the government.
In a dramatic political stunt, more than a dozen members of the House Freedom Caucus withheld their support for a crucial procedural vote on the GOP’s tax bill, threatening an embarrassing blow to GOP leadership.
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The conservatives eventually relented, approving what had been thought to be a formality — a motion to appoint negotiators to hammer out a final tax bill with the Senate.
But the frenzy on the House floor underscored the divisions within the GOP over a spending strategy this month, and that the Republicans’ march toward overhauling the tax code — which has proceeded with relatively little drama so far — could get caught up in the process.
Rep. Mark Meadows (R-N.C.), the Freedom Caucus chairman, said after Monday’s vote that he “felt very good” about his conversation on the floor with Speaker Paul Ryan, who personally involved himself in the arm-twisting of conservatives.
Meadows had earlier stepped outside the House chamber to take a phone call from President Donald Trump, but declined to give any details on the president’s message.
But he did tell reporters that he did not get an ironclad commitment to extend the length of a proposed stopgap spending bill.
Conservatives have balked at GOP leaders’ strategy to pass a two-week continuing resolution that would expire just before Christmas, fearful that Democrats will jam major spending increases into the must-pass bill. The full GOP conference is expected to settle on its spending plan at a closed-door meeting Tuesday, with a full floor vote expected Wednesday.
“There is a whole lot more pressure to get home for Christmas than there is for New Year’s,” Meadows said.
Later Monday night, the House Republican Study Committee also formalized their support for a longer-term stopgap bill.
At the last-minute huddle, the conservative caucus’s steering group agreed to push for a Dec. 30 continuing resolution, though they want it attached to a full year’s worth of defense spending. The group is also seeking long-awaited votes on welfare reform and deficit reduction bills, according to a House GOP source.
The House would likely need to clear a spending bill by Wednesday to allow time for a Senate vote by Friday at midnight.
GOP leaders have expressed confidence that they’ll be able to resolve the differences between the House and Senate tax bills even as they’re working to defuse any government funding battles, and House conservatives have long made it clear that they support the substance of the GOP tax bills.
After the Freedom Caucus stood down on Monday, Ryan ended up naming nine members to the conference committee, headlined by Ways and Means Chairman Kevin Brady (R-Texas). Reps. Devin Nunes (R-Calif.), Peter Roskam (R-Ill.), Diane Black (R-Tenn.), Kristi Noem (R-S.D.), Rob Bishop (R-Utah), Don Young (R-Alaska), Greg Walden (R-Ore.) and John Shimkus (R-Ill.) were also named as conferees.
Democrats named three Ways and Means members: ranking member Richard Neal (D-Mass.) and Reps. Sander Levin (D-Mich.) and Lloyd Doggett (D-Texas). Reps. Kathy Castor (D-Fla.) and Raul Grijalva (D-Ariz.), two non-Ways and Means members, were also appointed.
The Senate is expected to name its negotiators later this week, though many tax observers expect GOP leaders and top tax writers to make the difficult decisions on reconciling the two bills.
But Monday’s vote underscores just how many obstacles Republicans face this month, and how all those issues can easily meld into one larger fight. The GOP is also starting to face intensified opposition from business groups over the Senate’s decision to keep an alternate tax system meant to ensure that corporations provide a minimum level of revenue.
That gives Republicans all the more reason to push through a final tax bill as swiftly as they can — a quick-strike strategy that also helped the GOP push broad tax bills through the House and the Senate in little over a month.
“In this environment, nothing’s going to be easy, particularly with a lot of things hanging over our heads,” said Sen. Johnny Isakson (R-Ga.), a member of the tax-writing Finance Committee. “The quicker we do it, the better off we’re going to be.”
The Chamber of Commerce and other groups insist that the current Senate measure, by keeping the corporate Alternative Minimum Tax, would effectively repeal a key credit for research and development. The Senate latched on to that provision during a last-minute flurry of negotiating, needing the estimated $40 billion of revenue to pay for other initiatives that won the votes of GOP holdouts.
Even though Monday’s floor maneuver was largely about spending, House conservatives have also made it clear that they want to cut the corporate rate from 35 percent to no more than 20 percent, as proposed by both chambers right now. Trump opened the door to the corporate rate rising to 22 percent over the weekend, potentially giving Republicans new reasons to avoid keeping the tax debate open too much longer.
“I hope we don’t sort of undermine our own message,” Senate Majority Whip John Cornyn (R-Texas) said.
Other interest groups also are increasing the pressure on lawmakers with a final tax deal in sight. The National Association of Home Builders, a vocal opponent of a House bill that cuts the mortgage interest deduction, said it would begin a blitz of television and social media advertising targeted at conferees to protect that and other provisions.
Still, the more divisive fight for the GOP might be on the spending side.
Meadows said the Freedom Caucus would prefer that the stopgap spending measure “come due at the end of the year, versus right before Christmas. We think there is a growing consensus that Dec. 30 would work, and we’re certainly encouraging our leadership to work that way.”
But Republican Study Committee Chairman Mark Walker said he was taken aback by the other conservative group’s tactics.
“This is a complete surprise to all of us,” he said, adding that the issue was over the CR, not taxes.
Jennifer Scholtes. Aaron Lorenzo and Seung Min Kim contributed to this report.