House Republicans have a new plan for their agenda next year — one that might even satisfy tech billionaire Elon Musk. They claim they’re going to cut $2.5 trillion in government spending, in return for raising the debt ceiling.
Specifically, this handshake deal — part of Speaker Mike Johnson’s plan to avert a government shutdown — is to cut mandatory spending, which includes major social safety net programs like Medicare, Medicaid, food stamps and veterans benefits.
It would satisfy far-right lawmakers who have been pining for cuts for years. The only problem? Figuring out how to do that with a barely there majority.
“I serve with a very ambitious group of fiscal conservatives in the U.S. Congress,” Rep. Frank Lucas, an Oklahoma Republican, told NOTUS of the new cost-cutting plan. “If it can be done, they can do it.”
Others aren’t so sure.
“If that proposal came over from the House, it would scare the stuffing out of the U.S. Senate,” GOP Sen. Cynthia Lummis of Wyoming said.
Maybe if the target date for accomplishing it was January 2029, she told NOTUS, it would be “doable.” But it seems like a “significant challenge.”
One House Republican, who asked to speak anonymously to be frank and discuss private conversations, expressed deep skepticism that the conference actually could cut $2.5 trillion next year. This member told NOTUS that Johnson laid out a number of possible spending cuts to a group of members prior to this plan on Thursday, and those cuts didn’t even amount to $2 trillion.
The plan emerged after President-elect Donald Trump publicly insisted this week — just a day before the government shutdown deadline — that Republicans should deal with the debt ceiling, too, out of fear it will cause trouble during his first months in office. GOP leaders have tried to accommodate that demand, but they failed to pass such a bill on Thursday night amid opposition from far-right members who don’t want to spend more money.
Johnson sought a balance on Friday, telling lawmakers that the GOP agenda would now include a debt ceiling hike to the tune of $1.5 trillion, like Trump wants — paired with $2.5 trillion in cuts, an attempt to win over fiscal conservatives in the House.
“For me, fighting for the American people means I’m not going to increase the debt ceiling without spending cuts,” Rep. Chip Roy of Texas, one of those members, told reporters Friday. “We want to be able to deliver for the President, so that he can deliver. That means getting the debt ceiling done. Getting the debt ceiling done requires us to have fiscal restraint, so we’ve got to square that circle.”
Members are aware they’re on tricky political ground, with many Americans opposing cuts to most entitlement programs. Some lawmakers suggested they aren’t talking only about cuts — but really savings.
“There’s lots of places over 10 years that you can find opportunities,” Rep. G.T. Thompson of Pennsylvania said. “There are places where you can reduce spending and, quite frankly, things that we can do to increase economic activity, which brings in additional revenue.”
Johnson is in a tough spot: He’s trying to manage Trump’s expectations and keep his conference from mutinying at the same time. During a meeting with Trump’s team on Thursday, according to the GOP lawmaker who asked to speak anonymously, the president-elect’s representatives emphasized that they didn’t care how Johnson got the votes — essentially saying the spending cuts weren’t critical to Trump. All they wanted was a commitment from Republicans to raise the debt ceiling and for Trump not to have to deal with it again during the next two-year term of Congress.
Democrats, for their part, think Johnson’s strategy is laughable.
“Unbelievable,” Sen. Sheldon Whitehouse responded on Friday when told about the plan.
As Republicans now think about shaping their agenda around sweeping spending cuts, some may remember painful prior attempts at changing mandatory programs, especially during Trump’s first term.
GOP lawmakers tried to repeal the Affordable Care Act and make changes to health programs including Medicare and Medicaid in 2017. The House conference had dozens more seats back then and still spent months agonizing over the legislation, which never became law. In January, they’ll have a razor-thin majority with no room for disagreement on the details.
A different Republican lawmaker, who asked to speak anonymously as they left a conference meeting Thursday afternoon, told NOTUS they also thought it was impossible to actually find $2.5 trillion to save — with details that everyone could agree on — in a budget reconciliation bill.
GOP leaders had previously discussed using the reconciliation process — a tool that allows expedited consideration of legislation in the Senate and a lower threshold for passage than other bills — to approve new border security funding and extend tax cuts on a party-line vote. But if that effort expands to include all of fiscal conservatives’ hopes and dreams — like cuts to entitlement programs — there’s a much higher chance Republicans won’t even be able to agree on passing a bill at all.
The path to $2.5 trillion in cuts gets infinitely more complicated if lawmakers stick to Trump’s line that he won’t allow cuts to Medicaid, Medicare and Social Security (not to mention Senate rules that make Social Security cuts nearly impossible under a budget reconciliation process).
Still, members said they weren’t worried.
“Where there’s a will, there’s a way,” Florida Rep. Anna Paulina Luna told reporters after the party’s meeting.
But she wasn’t able to point to specifics. “You all will see the plan that’s rolled out,” she said.
Rep. Lauren Boebert of Colorado was even more optimistic, saying she can imagine “$6 trillion in cuts.”
Where?
“All over,” she replied.
Ohio Rep. Warren Davidson, meanwhile, acknowledged it will “be a challenge for the conference to come together with a narrow majority.” But he said members might be able to agree to work requirements for programs like food stamps and Medicaid.
“I’m very hopeful that we’re undertaking the effort,” Davidson told NOTUS.
New work requirements for entitlement programs would only get members a fraction of the way to saving $2.5 trillion. An analysis from the nonpartisan Congressional Budget Office found that mandating work requirements for food stamps, the Temporary Assistance for Needy Families program and Medicaid have had mixed results in the past, sometimes failing to increase employment and even sometimes resulting in higher costs for the government, depending on how they were structured. And a different CBO analysis of work requirements for Medicaid projected savings of just $109 billion over a decade.
Even so, Rep. Eric Burlison of Missouri also pointed to work requirements as a way out.
“Within Medicaid, we could save a lot of dollars, just without even really having to impact people who truly need it,” he said.
New York Rep. Mike Lawler, a swing-district Republican, wasn’t quite as enthusiastic.
“I’m not getting into any of the specifics on that, except to say we’re not cutting Social Security and Medicare, despite whatever nonsense that people will try to allege,” he said.
As for whether any of this is realistic, Lawler said, “We will deal with that in the new year.”
—
Haley Byrd Wilt and Reese Gorman are reporters at NOTUS. Ben T.N. Mause is a NOTUS reporter and an Allbritton Journalism Institute fellow.
Violet Jira, Nuha Dolby, John T. Seward and Tinashe Chingarande, NOTUS reporters and Allbritton Journalism Institute fellows, contributed to this report.