The most conservative faction of House Republicans is posturing to derail President Trump’s tax plans — an issue on which he desperately needs a legislative win — if he and GOP leaders do not agree to sweeping changes to food stamps and other safety net programs. Their demands would amount to even more pain for the poorest Americans than Trump has already proposed, in order to fund tax cuts that would primarily benefit the very rich.
That faction, the House Freedom Caucus, has been emboldened by extracting key concessions from Trump in order to pass his health care bill through the House last month. Its members are now effectively threatening to impound a budget resolution that is crucial to any hopes Republicans have of cutting taxes this year, unless the party agrees to $300 billion in social service cuts.
The Freedom Caucus is feeling the strength of its leverage over GOP moderates and the administration — it knows that without its members’ votes, the budget is doomed, and with it, for the next year at least, any hope of passing tax cuts through the Senate on a strictly party-line vote.
“Right now a budget cannot pass in the House of Representatives — it can’t,” conservative Rep. Jim Jordan (R-OH) said at an event Friday with the Heritage Foundation, hinting at divisions among Republicans. “If you don’t get a budget agreement, you can’t get reconciliation. Without reconciliation you can’t do tax reform,” he added.
Republicans are stuck in a bind. Trump is desperate to score legislative points, and would surely be furious if conservatives slowed a tax bill, arguably the most widely shared goal of the GOP coalition. There are also risks to the president and GOP leaders in meeting conservatives’ demands: Cutting programs for the poor to fund tax cuts for the rich plays poorly with large swaths of voters.
But if the Freedom Caucus holds firm, GOP leaders might have no choice.
The Freedom Caucus won on health care. Now they have more demands.
Only two months ago, House conservatives almost cost Republicans the opportunity to pass an Obamacare repeal-and-replace bill. The bill passed the House just barely, after House leadership made concessions on health care regulations the Freedom Caucus demanded, including weakening protections for Americans with preexisting health conditions.
The budget, which usually passes on party lines, is ripe for another conservative stand because it is a near-impossible beast to tackle. There’s overwhelming consensus among Republicans to increase spending on defense, but there’s resistance among party moderates to offset those spending hikes with cuts to domestic programs. The Freedom Caucus sees a chance, in the budget fight, to find new ways to cut spending further.
“Maybe we as the Freedom Caucus can live with a higher budget number if in fact we do real welfare reform on the tax bill — work requirements, time limits on able-bodied adults [are] part of that package,” Jordan said, laying out the proposition. Jordan himself has introduced an overhaul to Temporary Assistance for Needy Families and food stamps (SNAP), proposing provisions such as work requirements. The changes would reduce spending by roughly $300 billion, according to Freedom Caucus staff.
“We think that is the key to unlocking this roadblock we are in — this box that we are in,” Jordan added. “I don’t see any other way out of it to get a budget agreement.”
Jordan and Freedom Caucus Chair Rep. Mark Meadows (R-NC) have proposed the idea to the Budget Committee, which negotiates budget resolutions, and Budget Committee Chair Rep. Diane Black (R-TN) was “receptive” to the idea, one Republican Freedom Caucus aide said. More moderate members like Rep. Tom Cole (R-OK), who sits both on the Budget Committee and the Appropriations Committee, have also floated the idea.
“The problem with spending is entitlement reform,” Cole said after Congress passed a 2017 spending bill to fund the government. Ironically, he said, “what [conservatives] ought to be demanding is that we want entitlement reform,” back in May. They seem to have caught wind of the idea.
But it’s not at all clear that House leadership is fully on board. Ryan, who has long championed welfare reform, called the House’s health bill one of the largest “entitlement reforms” to pass the chamber. There’s no sign he wants to tackle full welfare reform under 2018 reconciliation, and roughly $300 billion in savings is an extremely unrealistic ask.
It all comes down to how hard a line Freedom Caucus members will take on that number.
Passing health care in the House didn’t make Republican disagreements go away
The Republican agenda is moving behind schedule. Negotiations on the health bill were supposed to be wrapped up by mid-spring, the budget passed by June, and tax reform done by the end of summer. That hasn’t happened.
The drag all comes down two political dynamics: an era of extreme partisanship, in which congressional Democrats and Republicans are unlikely to work together, and a Republican Party that is polarized between its own moderates and conservatives. The result has been a Republican strategy that cuts out the Democrats on major issues like health care and tax reform through the reconciliation process, but so far the plan has failed to achieve enough party unity to enact policy.
In the House, the Freedom Caucus has a lot of leverage. Controlling roughly 40 votes (Republicans can only afford to lose 22), they are willing to buck leadership’s vision in a way moderates have not been. But Freedom Caucus–driven policies are unlikely to survive the Senate’s moderate voices.
Ideologically, the Freedom Caucus’s vision for government closely aligns with that of Mick Mulvaney, the director of the Office of Management and Budget, who wrote the president’s budget proposal and is a staunch conservative and former Freedom Caucus member.
But top Republicans in Congress took Trump’s budget seriously but not literally. They called it “symbolic,” and an idea to consider — knowing all too well that they would have to thread the needle between tax cutters, deficit hawks, and defense hawks.
The calendar will force a showdown between those groups. Budget Committee members have said they plan to propose budget resolutions sometime in June. Already Black and Ryan have floated cuts to Medicaid and Medicare, even though Trump said he wouldn’t touch the latter, and said they would consider other welfare cuts. Talks have started in the House, but the Senate, still stuck on health care, seems slower.
Sen. Bob Corker (R-TN), who sits on the Senate Budget Committee, summed up the status of talks succinctly this week: “I don’t know anything about it,” he said Tuesday. “I’m on the Budget Committee and I don’t know.”