With a Week to Go, House in Disarray Over Funding as Partial Shutdown Looms

Despite agreement among the four key congressional leaders on top level funding for FY2024, the threat of a partial government shutdown a week from now is as real as ever.  The small group of ultra conservative House Republicans who deposed Speaker Kevin McCarthy and put Mike Johnson in his place are demanding Johnson now reject the deal he just agreed to. The existing Continuing Resolution has two expiration dates, January 19 for some agencies and February 2 for others. Another CR will be needed by Friday to keep that first set funded, but whether they can do even that is anyone’s guess.

The New Year has not changed the dysfunction in the House Republican Caucus. As the deadline looms for the expiration of the part of the CR that’s funding departments and agencies in four of the 12 appropriations bills — Agriculture, Energy-Water, Military Construction-VA, and Transportation-HUD — the House Freedom Caucus (HFC) is trying to force Johnson to renege on the deal he just cut with the rest of congressional leadership.

Johnson, his Democratic counterpart House Minority Leader Rep. Hakeem Jeffries (D-NY), Senate Majority Leader Chuck Schumer (D-NY), and Senate Minority Leader Mitch McConnell (R-KY) agreed to the top line spending level for FY2024 on Sunday, a crucial step towards finalizing FY2024 appropriations.

Each side of Capitol Hill has crafted appropriations bills, but with different top line funding figures. The Senate abided by limits in the Fiscal Responsibility Act, which is the law of the land, but the House Appropriations Committee passed bills, on party line votes, at lower levels and incorporating social policy provisions that are anathema to Democrats.

Sunday’s bipartisan, bicameral agreement sticks close to FY2024 limits in the Fiscal Responsibility Act, the debt limit/spending cut bill negotiated by President Biden and then-House Speaker Kevin McCarthy: $886.3 billion for defense, about a three percent increase over FY2023; and $703.6 billion for non-defense plus $69 billion that was part of a side-deal for a total of $773 billion, about a one percent decrease.  Johnson won agreement on $16 billion in cuts: a clawback of $6 billion in unspent pandemic funds and $10 billion from the IRS. He also said the deal eliminated accounting gimmicks in the Fiscal Responsibility Act that could save more than $200 billion over the next 10 years.

The HFC strongly opposes the agreement because it doesn’t cut spending sufficiently. They’ve spent this past week trying to get Johnson to come up with a different deal.

With the margin between the parties in the House so tight — 220 Republicans and 213 Democrats with two Republican vacancies, and Republicans will lose one more on January 21 when Ohio’s Bill Johnson resigns to take another job — only a handful of Republicans can sink a bill that Democrats also oppose.

The HFC is only a small part of the Republican Caucus, about 20 of the 220 members, and many Republicans disagree with their views and their tactics, but they hold power because of that close margin. To demonstrate their power this week, HFC members voted against the Rule to allow three bills unrelated to appropriations to come to the floor for debate. After meeting with Johnson the next day, the vote was held again and it passed. But they made the point that any legislation that has only Republican support must meet their demands or they will tank it.  At the same time they oppose bipartisanship and do not want to pass legislation that has broad Democratic support.

The HFC forced Kevin McCarthy out of his job as Speaker when he and Democrats agreed to pass the first FY2024 Continuing Resolution (CR ) at the end of September. After three weeks of turmoil, Johnson was elected Speaker, but almost immediately earned the HFC’s wrath by working with Democrats to pass the second CR in November. Johnson is closely aligned with the HFC and they did not immediately seek his removal, but under House Republican rules, any Republican can call for a vote of no-confidence in the Speaker at any time. That Damoclean sword hung over McCarthy during his tenure and is now hanging over Johnson.

The November CR crafted by Johnson is the one now in effect. Called a “laddered” CR, it sets January 19 at the expiration date for the first four bills and February 2 for the others.

The one space-related agency in the first set is the FAA’s Office of Commercial Space Transportation, part of the Transportation-HUD bill.  DOD, NASA and NOAA are in the second set.

Monday is a holiday, so when the House and Senate return next week they will have only four days to pass something to keep the government fully operating. It is clear they cannot get the appropriations bills done in time, which means another CR.

Schumer already is taking the first steps to get a new CR passed in the Senate, which takes longer than in the House, but everyone is still debating how long it will last. Early-to-mid March is one possibility, but whether they can get the 12 bills passed by then seems a long shot, too.

Under the CR, not only are agencies held to their FY2023 levels, but new programs cannot start and old programs cannot be terminated. The funding level doesn’t make much difference for non-defense agencies like NASA since they’ll be getting in FY2024 about what they have in FY2023 anyway, but it does for DOD. A three percent increase may be less than President Biden requested, but it’s an increase nonetheless. Being able to terminate old programs and start new ones is also vitally important.

Johnson reportedly suggested a “full year” CR through September 30, the entirety of FY2024, but House Armed Services Committee Republicans threatened to kill it. According to Punchbowl News, HASC Chairman Mike Rogers (R-AL) said he would “make sure that enough defense hawks didn’t vote for it that it has no path forward.”

In a brief statement to reporters today, Johnson defended Sunday’s agreement and said it’s still in place.

Our top level agreement remains. We are getting our next steps together. And we are working towards a robust appropriations process. So stay tuned for all of that to develop.  — Speaker Mike Johnson

The figures are just as described — top level. They are the total to be spent for defense and non-defense, not agency-by-agency breakdowns. Now the appropriations committees on both sides of Capitol Hill have to decide who gets what. The Senate bills already conform to those levels, but not the House. That’s part of the “next steps.”

Johnson has been in the House only since 2017 and never served in leadership. How he will navigate this treacherous terrain is difficult to estimate.

The just-released House schedule for next week says only that “Legislation related to FY24 government funding is expected.”

All of this is separate from the ongoing negotiations over the national security supplemental that would send aid to Ukraine and Israel in exchange for U.S. border security concessions from Democrats.