House and Senate Republicans finally agreed on the same budget framework to tee up President Donald Trump’s tax, border security and energy agenda. The bigger challenge will be wrangling Republicans to agree on the specifics of sweeping program cuts and policy details needed to fulfill Trump’s pledges.
As committee chairs get to work over the two-week Easter recess, here’s a rundown of three of the biggest fights they face:
Medicaid — Republicans can no longer avoid figuring out how to slash $880 billion from programs under House Energy and Commerce, an element of the budget that’s poised to lead to Medicaid cuts. Moderates are wary of changes that could lead to benefit reductions, while conservative hard-liners want to make deep cuts to the program.
Speaker Mike Johnson and Trump insist they have no plans to trim benefits and are instead looking to tackle what they see as “waste, fraud and abuse.” But that alone won’t be enough to meet the $880 billion target. Johnson acknowledged Thursday that Republicans are looking at “other areas,” without giving any details.
Some Medicaid changes being considered: One idea is to reduce the federal share of payments for certain beneficiaries, since it’s a joint state-federal program. Another is to include work requirements, something even Senate Republicans otherwise wary of cutting benefits say they support.
Taxes — Both chambers will have plenty to hammer out between extending Trump’s 2017 tax cuts and enacting his campaign tax promises. Several blue-state moderate Republicans, including Reps. Mike Lawler and Nicole Malliotakis, are pushing to raise a key deduction for state and local taxes. Expect that to run into resistance from House hard-liners.
Other Republicans, including Senate Finance Chair Mike Crapo and Sen. Josh Hawley, are eyeing an expansion of the Child Tax Credit, something that’s quietly gaining traction in both chambers but that deficit hawks could also oppose.
Clean-energy credits — Conservatives want to undo former President Joe Biden’s Inflation Reduction Act. But a growing number of Republicans are fighting to preserve the law’s clean-energy tax credits. Four GOP senators — enough to stop the reconciliation package — wrote to Majority Leader John Thune in defense of the tax credits this week. Sen. Lisa Murkowski told POLITICO that the group is prepared to use its leverage. One possible compromise would be to revamp the credits to reduce their cost.
What else we’re watching:
— HHS staff briefs E&C: Robert F. Kennedy Jr.’s HHS staff will brief bipartisan staff from House Energy and Commerce members on his overhaul of the agency today, including sweeping layoffs and a major reorganization. It comes after members of Congress on both sides of the aisle and in both chambers were surprised by the drastic changes.
— Schumer’s upcoming vacancy: Democratic Sen. Michael Bennet is expected to launch a run for Colorado governor today, potentially giving Senate Minority Leader Chuck Schumer another seat to defend down the line.
Ben Leonard, Elena Schneider and Josh Siegel contributed to this report.
