Jun.03

electoral-vote.com

Dem 47

   

GOP 53

Big, Beautiful Bill May Be Turning into a Big, Battered Boondoggle

It's always hard to be sure exactly what it is that Donald Trump wants. However, if we assume that the budget bill that passed the House comports with his vision—and he did whip votes very aggressively to get it through the lower chamber—then it looks more and more like he's headed for disappointment. Here's a rundown of some of the main obstacles that have emerged in the last week or so:

• Right-Wing Blowback, Tap the Brakes Category: Yesterday, Politico had a piece headlined: "A surprising coalition of GOP senators holds all the megabill leverage." It's a rundown of what writer Jordain Carney calls the "Medicaid moderates"—an ad hoc caucus of Republican senators who are at different places on the political spectrum (from center-right to far, far right) but who do not relish the idea of taking away health insurance from hundreds of thousands or millions of their constituents. Among those GOP senators who have made clear that this is where they stand are Susan Collins (ME), Josh Hawley (MO), Jim Justice (WV), Jerry Moran (KS) and Lisa Murkowski (AK).
  
  This list is bad news for the bill, as currently constituted, for a number of reasons. First, the careful reader will notice that 5 > 4, and all it takes is 4 GOP "nay" votes to kill a bill so dead that J.D. Vance's tiebreaker vote can't save it. Second, the more Republicans who rebel, the harder it is to bring them into line, because it's much less plausible for Donald Trump to laser-focus his anger/scorn on, say, half a dozen people than on one. Third, Collins and Murkowski, in particular, have shown a repeated willingness to buck their conference when bills veer too far-right, so they are probably not bluffing.
  
  Fourth, and finally, Speaker Mike Johnson (R-LA) crafted the bill so that it "achieved" the cost savings necessary to (sort of) balance out the tax cut for rich people, but also so that it gave members who voted for the bill some cover. Indeed, he continues to flog his spin, which is "We're not kicking anyone off of Medicaid; anyone who loses coverage is kicking THEMSELF off." If the senators are not buying in on this spin, then the whole house of cards may fall. If the Medicaid cuts go away, then either the bill blows a bigger hole in the budget OR the tax cuts go away (or some of both). Each of those outcomes will cost the bill some votes in both the Senate and the House.
  
  
• Right-Wing Blowback, Hit the Gas Category: Further complicating matters in the Senate is that there are several Republican members who think the bill does not go far enough in slashing spending. The two obvious examples here are Ron Johnson (R-WI) and Rand Paul (R-KY). The former may not be running for reelection the next time his seat is up, and the latter has spent years building a brand that all spending is bad spending. So, like Collins and Murkowski, they will likely stick to their guns. Sure, their votes might be gettable with more aggressive cuts, but then even more of the "Medicaid moderates" will rebel.
  
  Put another way, in its current form, there are almost certainly four "nay" votes on the bill: Collins, Murkowski, Johnson and Paul. And whatever direction Senate Majority Leader John Thune (R-SD) moves, in order to get back a couple of those votes, he probably loses a couple more. Senators are also less tolerant of rhetorical tricks than representatives are, so the Johnson maneuver—cook up some really good spin—is not likely a solution here.
  
  There are also plenty of right-wingers who are not in the Senate, and who think the bill does not go far enough. We've noted that Elon Musk has bashed the bill for not slashing spending enough; so has Gov. Ron DeSantis (R-FL). There are many other examples. It's easy enough for them to bellyache, since their necks are not on the line. Still, if they think the bill does not go far enough, they and the other critics are not going to lift a finger to defend a bill that is softened to make the "Medicaid moderates" happy.
  
  
• Market Blowback: The markets are not reacting well, either. We've mentioned this before, but it's important, so we'll mention it again: The rates the government pays for bonds have shot up, and stayed up, in the last year or so. Courtesy of the St. Louis Fed, here's a chart of the 10-year yield on U.S. government bonds, adjusting for inflation, since the commencement of Trump's first term:
  
  
  
  It's clear that the pandemic made it much cheaper for the government to borrow money, at least for a while. However, for the past couple of years, borrowing has gotten much more expensive. And the problem is that even small changes have a big effect over time (recall the probably apocryphal, but still on-the-nose, Einstein quote: "The most powerful force in the Universe is compound interest."). The cost estimate for the big, beautiful bill is an extra $3.1 trillion in debt over the next decade. But if, for example, the 0.8% increase that began in September of last year holds steady, it would increase that to more than $5 trillion. If that number becomes 1.2%, then it's closer to $7 trillion.
  
  
• Voter Blowback: Yesterday, we had an item about how voters are not happy with the big, beautiful bill. And they are already making their feelings known to their elected representatives via letters, e-mails, and phone calls, and in particular at town halls. This is what led to Sen. Joni Ernst (R-IA) foolishly responding to complaints about Medicaid with the observation that "everyone is going to die, eventually." Time will tell if that proves to be her "macaca" moment.
  
  To yesterday's item, we will add two more things. The first is that people have already noticed that there are a number of Republican senators who will benefit enormously from the tax cuts that the big, beautiful bill contains. Here is a list of the 10 wealthiest GOP senators and their net worth, along with how many SNAP and Medicaid recipients they each represent:
  
  

  Candidate	Net Worth	SNAP Recipients	Medicaid Recipients
  Rick Scott (FL)	$551,710,000	2,969,000	3,568,648
  Pete Ricketts (NE)	$176,650,000	155,000	302,971
  Markwayne Mullin (OK)	$65,620,000	686,800	894,911
  John Hoeven (ND)	$59,610,000	48,700	100,543
  Bill Hagerty (TN)	$55,360,000	711,200	1,268,904
  Jim Risch (ID)	$54,740,000	130,900	296,968
  Ron Johnson (WI)	$54,500,000	705,400	1,108,320
  Mitch McConnell (KY)	$50,490,000	595,200	1,244,822
  John Curtis (UT)	$31,710,000	169,300	300,742
  Steve Daines (MT)	$21,370,000	81,500	193,278

  
  If any of these folks vote for the bill, as it stands, then they will open up a pretty potent line of attack for their next reelection contest: "Sen. [X] is willing to take away your food/healthcare to line his own pockets." It's a double-whammy for nine of the ten; all of them, except Curtis, sit on at least one of the committees responsible for overseeing at least part of the budget bill.
  
  We recognize that some of these folks (e.g., McConnell) don't have to worry about being elected ever again. For the others, we also recognize that "Sen. [X] is willing to take away your food/healthcare to line his own pockets" might not be literally correct. But that's how politics works sometimes. It ain't beanbag.
  
  The other thing we'll point out is that the professional economists are weighing in, and are almost universally panning the bill. Yesterday, for example, six Nobel-winning economists released a letter in which they assert that the budget bill will add even more trillions to the debt than the Republicans claim, and will also increase wealth inequity. These six economists are all lefties, but that doesn't mean their numbers don't add up, and won't be compelling to some/many voters.
  
  
• The Parliamentarian: We had some questions about this over the weekend, and now we have some firmer answers. Senate Parliamentarian Elizabeth MacDonough and her staff are going through the current iteration of the bill with a fine-toothed comb, and preparing a report. The two biggest sticking points appear to be Section 70302 (trying to curtail the power of federal judges) and whether or not the bill would increase the deficit beyond a 10-year window—if so, that's not allowed. Once MacDonough renders her rulings, well, John Thune said yesterday that he will abide by them. We will see if he keeps his word.

Given these sausage-making challenges, Trump has some choices to make. And yesterday, he got out his smaller-than-average... social media app, and posted a couple of messages. Here's the first:

Passing THE ONE, BIG, BEAUTIFUL BILL is a Historic Opportunity to turn our Country around after four disastrous years under Joe Biden. We will take a massive step to balancing our Budget by enacting the largest mandatory Spending Cut, EVER, and Americans will get to keep more of their money with the largest Tax Cut, EVER, and no longer taxing Tips, Overtime, or Social Security for Seniors — Something 80 Million Voters supported in November. It will unleash American Energy by expediting permitting for Energy, and refilling the Strategic Petroleum Reserve. It will make American Air Travel GREAT AGAIN by purchasing the final Air Traffic Control System. We will secure our skies from our adversaries by building The Golden Dome, and secure our Border by building more of our Wall, and supercharging the deportation of the millions of Criminal Illegals Joe Biden allowed to walk right into our Country. It will kick millions of Illegals off Medicaid, and make sure SNAP is focused on Americans ONLY! It will also restore Choice and Affordability for Car purchases by REPEALING Biden's EV Mandate, and all of the GREEN NEW SCAM Tax Credits and Spending. THE ONE, BIG, BEAUTIFUL BILL also protects our beautiful children by stopping funding for sick sex changes for minors. With the Senate coming back to Washington today, I call on all of my Republican friends in the Senate and House to work as fast as they can to get this Bill to MY DESK before the Fourth of JULY. Thank you for your attention to this matter!

And here's the second:

So many false statements are being made about "THE ONE, BIG, BEAUTIFUL BILL," but what nobody understands is that it's the single biggest Spending Cut in History, by far! But there will be NO CUTS to Social Security, Medicare, or Medicaid. In fact, they will be saved from the incompetence of the Democrats. The Democrats, who have totally lost their confidence and their way, are saying whatever comes to mind — Anything to win! They suffered the Greatest Humiliation in the History of Politics, and they're desperate to get back on their game, but they won't be able to do that because their Policies are so bad, in fact, they would lead to the Destruction of our Country, and almost did. The only "cutting" we will do is for Waste, Fraud, and Abuse, something that should have been done by the Incompetent, Radical Left Democrats for the last four years, but wasn't.

We will make a couple of observations, particularly for the benefit of those readers who don't want to try to parse a couple of walls of text. First, note the relatively far-off target date and much more conciliatory tone: "I call on all of my Republican friends in the Senate and House to work as fast as they can to get this Bill to MY DESK before the Fourth of JULY." That doesn't sound like someone who thinks he can say "jump" and expect the senators to respond "How high?"

Second, note the promise: "there will be NO CUTS to Social Security, Medicare, or Medicaid." He's said that before, and if he really means it, then either the budget hawks or the tea partiers (or both) will have lost. For a guy who campaigned on budget austerity and taming the national debt, well... everyone knows that Trump Always Chickens Out.

Reading the tea leaves, we assume Thune will be able to come up with a bill that gets 50 votes in the Senate. It will likely eliminate Section 70302 and most or all of the cuts to Medicaid and SNAP. That will cost the votes of Johnson and Paul, and probably Rick Scott, but that's within Thune's margin of error. Then the bill will go back to the House, and the question will be whether or not the Freedom Caucus sticks to its guns, or meekly submits. You can never tell with them, but remember the general trend in the 119th Congress: T(FC)ACO.

One wonders what Mike Johnson was thinking when he rammed this bill through in the first place. Specifically, what we mean is that he surely didn't believe the Senate was going to swallow it as-is, and he surely knew that one day soon he would get a bill back that is entirely unacceptable to parts of his conference. Was he just giving himself cover, along the lines of "Hey! It's not my fault that the big, beautiful bill never became law!" or "Hey! It's not my fault that the big, beautiful bill didn't cut spending as much as I wanted!" It's certainly possible. (Z)