Speaker Johnson Scrambles for Plan B to Avoid a Shutdown

Plus, the Senate clears emergency $2.9B veterans benefits bill ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ [The Fisc]( By Yuval Rosenberg and Michael Rainey Happy Thursday — though it’s been a [very unhappy day]( for North Carolina Republican gubernatorial candidate [Mark Robinson](. Here’s what else is happening. Johnson spoke to reporters after last night's vote (Reuters) Mike Johnson Searches for Plan B to Avoid a Shutdown Now what? That’s the question after House Speaker Mike Johnson’s plan to avert a government shutdown and enact a controversial voter ID requirement failed to pass Wednesday evening, with 14 Republicans voting against it. Congress now has 11 days to come up with — and pass, a Plan B. Johnson has not put forth a fallback option; he’s apparently stayed tight-lipped even privately. He [told]( reporters and his [leadership team]( that he’d discussing the options with former President Donald Trump, who has called for Republicans to shut the government down unless the funding package includes their SAVE Act, which requires proof of citizenship from people registering to vote in federal elections. "If Republicans don't get the SAVE Act, and every ounce of it, they should not agree to a Continuing Resolution in any way, shape, or form," Trump posted on his Truth Social site yesterday. As Johnson works to get his party on the same page, he is now expected to move on to what seemed inevitable all along: a “clean” continuing resolution funding the government into December, which will need to be passed with considerable help from Democrats. “Many House Republicans — including those tasked with funding the government — increasingly expect that he’ll soon greenlight that plan,” Politico [reports](. “That prediction is also shared by House Democrats and multiple senators.” But with Johnson’s next steps unclear for the moment, Democratic Senate Majority Leader Chuck Schumer on Thursday began preparations for the Senate to move ahead with its own continuing resolution, filing cloture on the legislative vehicle for the stopgap spending fix. “Instead of doing the bipartisan work everyone knows is required for avoiding a shutdown, the House Republican leadership has wasted two weeks — two weeks — listening to Donald Trump’s ridiculous claims on the campaign trail,” Schumer said on the Senate floor. “Now that their efforts have failed, House Republicans don’t seem to have any plan for actually keeping the government open. So, the Senate will step in.” Schumer said that Johnson now must choose between “blind obeisance” to Trump or a bipartisan deal to avoid a shutdown. And he added another swipe at the former president, asking: “How does anyone expect Donald Trump to be a president when he has such little understanding of the legislative process? He's daring the Congress to shut down. I remember he did that with Speaker Pelosi and I in his office a while back. It didn't work out too well for him. Our Republican colleagues should not blindly follow Donald Trump. He doesn't know what he's doing.” The Senate could still allow the House to act first, but Schumer said his move allows “maximum flexibility” as the two sides try to figure out how to keep the government open. Key appropriators have already signaled that bipartisan talks have begun or are about to get underway. Even as Johnson now must look for a new path forward, he has continued to defend his strategy, including in an [interview]( last night with Fox News’s Sean Hannity. “The play that we ran tonight was the right play. It was the right fight for the American people. It’s the one they demand and deserve,” he said, adding, “I’m very disappointed it didn’t pass. We ran the right play. We came a little bit short of the goal line. So now we go back to the playbook, we’ll draw it up. We’re already hearing good ideas from our members, and we’ve got time to fix this, and we’ll get it done.” Hannity sounded a bit incredulous. “You keep saying it’s the right play, and you can’t get every Republican to vote for it. That’s your own party.” The bottom line: Despite pressure from Trump, Johnson is likely going to have to rely on Democrats to avoid a government shutdown that would hurt Republican candidates in key election contests. The deadline is at the end of the month, but a House vote on a shorter-term funding patch reportedly could come next week, allowing members to then leave town until after the elections. Both parties will still have to decide whether to include disaster aid, additional Secret Service funding or any other provisions as part of the deal. Senate Clears Emergency $2.9 Billion Veterans Benefits Bill Following a successful House vote earlier this week, the Senate on Thursday passed a $2.9 emergency funding bill covering disability and education benefits for veterans. President Biden is expected to sign the bill ahead of a Friday deadline to avoid a potential delay of payments on October 1. In July, the Veterans Administration informed Congress that it needed another $2.9 billion to cover its benefit obligations in the current fiscal year, which ends on September 30. About $2.3 billion will go toward pensions, and nearly $600 million is for “readjustment” services, which include education. VA officials said that outlays have been higher than expected this year, in part due to the PACT Act, which significantly expanded health care and disability benefits for veterans with chronic illnesses related to their service. Joshua Jacobs, the undersecretary for benefits at the VA, said this week that about 340,000 veterans are now receiving benefits who would have previously been ineligible, and that figure includes 60,000 cancer patients. The Senate Veterans Affairs Committee held a hearing on the issue Wednesday, after an earlier effort to provide the funding was postponed due to Republican complaints about a lack of fiscal rectitude. Sen. Jerry Moran of Kansas, the senior Republican on the committee, said he was in favor of providing the benefits. “But here's what troubles me, is the lack of budgeting accountability, knowing the facts in time to make better decisions,” he said. “And what is really troubling to me is the lateness in which this issue arose.” Republican Sen. Rand Paul of Kentucky threatened to delay the fast-track approval of the bill on budgetary grounds, demanding that lawmakers vote on an amendment that would cut an equal amount of money from the Department of Energy. That vote failed 47-47, well short of the 60-vote threshold for passage. What happens next: The VA dodged one potential budgetary crisis, but another could be just around the corner. VA officials say they need an additional $12 billion to cover medical expenditures in fiscal year 2025 and are hoping that the money is included in the stopgap funding bill lawmakers are expected to pass before October 1. Quote of the Day “I understand that candidates, when they campaign, they float a variety of different ideas, but they can’t all be true. So how do you bring them back to Earth? And that’s going to be the hard job we’re going to have next year. We’re going to have to deal with reality when we’re actually making laws.” − Republican Sen. John Cornyn of Texas, who sits on the Finance Committee, speaking to Politico’s Brian Faler about Donald Trump’s growing list of tax cut proposals, which includes the elimination of taxes on Social Security benefits, tip income and overtime pay. “Former President Donald Trump is tossing out tax cut proposals like candy on the campaign trail, even as his fellow Republicans wonder how they can afford to renew expiring federal tax breaks,” Faler [writes](. “The flurry of ad hoc proposals would cost trillions, on top of the eye-popping $4.6 trillion it will cost if lawmakers act to prevent taxes going up on a huge swath of Americans at the end of next year when big chunks of the GOP’s 2017 tax cuts will expire.” Faler notes that the tax cut proposals seem to be aimed at specific voting blocks in key states, such as service workers in Nevada. But Republican lawmakers would reportedly rather focus on their main priority, the extension of the 2017 tax cuts — a difficult effort in its own right, even if it’s less politically rewarding. Sen. Mike Crapo of Idaho, the senior tax writer in the upper chamber, has not stated explicitly whether he supports the proposals. “I get asked about everything Trump says, and whether I support it, and my answer is always the same: We’re looking at everything in the tax code right now, getting ready for next year,” he told Faler. “And I don’t have a problem if he, or anybody else, wants to talk about fixes to the tax code.” Number of the Day: 72% As of March 2024, 72% of private industry workers had medical benefits available, according to data released Thursday by the [Bureau of Labor Statistics](. For family coverage, employers paid 68% of premiums, while 32% were covered by employees. Just 43% of those workers had access to dental benefits and just 28% had access to vision benefits. A higher share of state and local government workers, 89%, had medical benefits available, and 60% of those government employees had access to dental plans, while 39% had vision coverage available. --------------------------------------------------------------- Send your feedback to yrosenberg@thefiscaltimes.com. 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