Latest news with #JohnThune
The Hill
a day ago
- Business
- The Hill
Reconciliation and rescissions roil Congress
The threat of being kept after school if you hadn't completed your homework was a motivator back in my high school days. Apparently, it doesn't work on adults in Congress. Senate Majority Leader John Thune (R-S.D.) threatened to keep the upper body in session on Juneteenth and through the weekend if necessary to complete action on President Trump's 'One Big Beautiful Bill Act,' also known as the fiscal 2025 reconciliation bill. Senate Republicans emerged from their conference on Monday evening after being briefed on what changes the Finance Committee had made in the House-passed bill. They seemed just as divided as they were when they went into the meeting, primarily over cuts in Medicaid benefits, tax cut issues, and various smaller items tucked away in the 1,000 plus page measure (little jagged gems are still being discovered by close readers). The prospect of missing an extended weekend back home was not sufficient to spur immediate action. The larger issue looming over both the House-passed and Senate-tweaked bills is whether they provide steep enough cuts to make a real difference in the deficit. Disgruntled House Republicans are outraged that the bill, according to Congressional Budget Office estimates, would actually increase the deficit over the next decade rather that reduce it. The president's Office of Management and Budget disagrees with that assessment and scores the measure overall as a deficit reducer. The battle of the scorekeepers rages on with predictable arguments being made by both sides. Reconciliation is an obscure term plucked by the drafters of the 1974 Congressional Budget and Impoundment Control Act to accomplish a very simple objective, at least on paper. The two houses adopt a budget resolution for the coming fiscal year. It is a concurrent resolution on the budget with no force or effect in law — an aspirational goal of Congress on what it wants the federal government's fiscal status to look like. The congressional budget does have real consequences, though, once that framework is fleshed out. The regular appropriations process complies with the budget through caps on discretionary spending. In addition, reconciliation instructions to authorizing committees may direct changes in existing laws to either increase or reduce the amount of spending needed to achieve the budget resolution's goals, so-called mandatory spending, mainly in taxes and entitlements. And therein lies the rub, since a handful of members in both chambers have strong objections to particular items in the House-passed bill. The original aim was to complete action on reconciliation by the July Fourth recess, but House Speaker Mike Johnson (R-La.) thinks that deadline will now slip to later in the month. The fourth leg of the budgetary process is rescission. In the 1974 Budget and Impoundment Control Act, rescissions became the impoundment tool of presidents. If the president wants to withhold or cancel appropriations that have been enacted, he must submit a rescission request to Congress. If it approves the request within 45 days, the spending is cancelled. If not, the spending goes forward. President Trump, on May 30, submitted a $9.4 billion rescission request to the Hill. The House passed the rescission bill narrowly last week. The Senate will take it up after it completes action on reconciliation. In his first term, Trump proposed $15 billion in rescissions. The Senate rejected the entire package. The Government Accountability Office, the auditing arm of Congress, has just released a report finding the Trump administration has violated the law by rescinding funds for The Institute of Museums and Library Services without seeking the approval of Congress. Earlier this year, the agency made the same finding about the administration's cancellation of the $5 billion program for electric vehicle charging stations, again without seeking Congress's go-ahead. The Government Accountability Office indicated earlier this year that it is inquiring into over three dozen unilateral funding cuts by the administration, most of which originated with Elon Musk's Department of Government Efficiency or DOGE. There are those in the administration who do not think rescission bills are necessary because, they argue, the president already has unilateral authority to withhold funding as he sees fit without congressional approval. Moreover, they think the entire budget act is unconstitutional. This underlying dispute ultimately will be resolved by the Supreme Court. Until then, the administration is considering whether and how to complete its homework assignment by trying to put as many DOGE cuts as it can on the right side of the law with additional rescission requests. And Congress should ensure it completes its fiscal 2025 budget process assignment before time runs out on Sept. 30. Don Wolfensberger is a 28-year congressional staff veteran culminating as chief-of-staff of the House Rules Committee in 1995. He is author of, 'Congress and the People: Deliberative Democracy on Trial' (2000), and, 'Changing Cultures in Congress: From Fair Play to Power Plays' (2018).
E&E News
a day ago
- Business
- E&E News
Fossil fuel booster meets with Republicans on megabill
A fossil fuel advocate briefed Senate Republicans during a meeting at the Capitol on Wednesday, as leadership looks to iron out disagreements over clean energy credits in the GOP megabill. Senate Majority Leader John Thune (R-S.D.) said the issue of energy tax credits 'is not totally settled' after the Finance Committee released text Monday. The legislation targeted wind and solar incentives but extended the runway for other sources like geothermal, hydropower and nuclear. It would also get rid of tax breaks for electric vehicles, rooftop solar and other residential energy-saving incentives. Advertisement Alex Epstein, an author and longtime supporter of fossil fuel expansion, met with Senate Republicans during a lunch. White House chief of staff Susie Wiles was also at the Capitol on Wednesday.
Politico
2 days ago
- Business
- Politico
Megabill debt warnings fall on deaf ears inside the GOP
Senate Republicans are fielding mounting warnings from economists that their signature legislation would add trillions of dollars to the deficit. It appears to be the last thing on their minds. As Senate Majority Leader John Thune prepares to jam through the GOP's sprawling border, energy and tax package to President Donald Trump's desk, fellow Republicans are largely ignoring a host of reports warning that their bill would worsen the nation's fiscal trajectory in a serious way. They're instead relying on estimates from the White House that assume vastly greater economic growth than virtually every other economic model — while trashing the credibility of Congress' nonpartisan budget scorer, the Congressional Budget Office, which said on Tuesday that the House-passed border, energy and tax bill would add around $2.8 trillion to the deficit over a decade. 'It's a model. And obviously, they've been famously wrong before,' said Sen. Kevin Cramer (R-N.D.) of the latest CBO report. 'We do have more debt now than we had before, for sure, but I think they grossly underestimate the economic benefits.' The problem highlighted by CBO and other economists is this: While the GOP's tax cuts may provide some economic growth, they will likely not juice the economy as much as when Republicans first enacted Trump's tax cuts in 2017. On the flip side, with federal debt closing in on $37 trillion, the rising costs of servicing more expensive interest payments will far outweigh any additional revenue that is generated from increased economic growth. 'The economic and fiscal state is not what it was in 2017,' said Paul Winfree, president and CEO of the Economic Policy Innovation Center, who was previously a top economic official in the first Trump administration. Winfree added in a text message that 'the stock of debt is so large that anything we do to modestly increase productivity (and growth) without reducing spending … will lead to higher costs.' That was underscored Tuesday when CBO put a number this week to the warning economists have been making for months: that the GOP package would hike interest rates and in turn increase borrowing costs. Higher interest rates would boost payments on the national debt by an estimated $440 billion over a decade, CBO predicted, while the megabill would drive yearly economic growth of just 0.5 percent on average during that time. House Republican leaders are claiming the bill would generate $2.5 trillion by banking on total average growth of 2.6 percent. That finding prompted an unusual phenomenon. Usually tax-cutting bills tend to cost less under so-called 'dynamic' scores that include economic effects. Not so here: The $2.8 trillion figure released Tuesday outstripped the CBO's prior $2.4 trillion estimate that did not include economic analysis — mostly attributable to the fact that, in their words, the bill 'would increase interest rates.' Lack of recognition of the dynamic has upset at least one Republican, Sen. Ron Johnson of Wisconsin, who dropped his own report Wednesday illustrating that the GOP's megabill has little shot of bending the deficit trajectory downward, even in the rosiest of economic circumstances. Johnson, who said he will vote against the massive tax and spending package as it's currently written, is challenging his colleagues in the Senate and in the administration to show him where he's wrong. 'The whole point of laying out the report was to get everyone to acknowledge and admit reality,' Johnson told reporters. 'Nobody's pushed back on my numbers. Here's an opportunity to do it. … I've shown people my work. Who else has shown people work?' But Thune took to the Senate floor on Wednesday to argue that the party-line megabill would generate enough revenue — around $4.1 trillion — through economic growth to completely make up for the deficit impact from the reduced revenue, citing a report from the White House's Council for Economic Advisors that asserts the bill would lead to long-run GDP growth of up to 3.5 percent. Thune added that CBO 'characteristically, I should say, underestimates the economic growth, and hence the revenue, that this bill would provide.' The White House figures are outliers compared with other economic models. The conservative-leaning Tax Foundation found, for instance, that the GOP's plan would boost economic growth by 0.8 percent in the long-run but still, on a dynamic basis and after $1.5 trillion in net spending cuts, add $1.7 trillion to the deficit over 10 years. The Penn Wharton Budget Model estimates that the bill would spur economic growth of 0.4 percent over 10 years and add $3.2 trillion to the deficit over a decade, all things considered. Kyle Pomerleau of the American Enterprise Institute called the White House estimates 'outrageous' and 'way higher than everyone else's.' He said the in-house analysis takes into account tax incentives, like those for domestic manufacturing, that didn't end up in the bill that passed the House in May. 'They just say that, 'well, the individual income tax — that's going to make people work more and that's it,'' he said. 'But it misses so many different details of the actual reform itself.' Democrats say voters will notice if the GOP package becomes a drag on the economy rather than the boon Republicans are marketing. Reiterating a claim party leaders often voice, Sen. Chris Murphy (D-Conn.) said the 2017 tax bill 'ended up being a stone' around Republicans' neck 'that helped lead to their bloodletting' in the 2018 midterms. 'At some point they have to look at all this new information and decide to stop and go back to the drawing board,' Murphy said in a brief interview. 'Because what they're designing is not going to help our economy and is going to hurt a ton of people.' The release of the CBO report comes as Senate Finance Chair Mike Crapo (R-Idaho) fields requests from several of his GOP colleagues to scale back changes to taxes that fund Medicaid and cuts to green energy credits. Crapo has been also pushing to use an accounting maneuver known as a current policy baseline, which would effectively zero out the cost of around $3.8 trillion in tax cut extensions. It would allow Senate Republicans to make Trump's tax cuts permanent without having to offset much of their deficit impact, which would otherwise be required by the Senate's budget rules. Asked for his reaction to the new CBO report, Crapo said he has 'the same reaction I've always had' to the official scorekeeper's numbers: 'They're not using the right baseline, and they aren't analyzing it dynamically.' Jordain Carney, Jennifer Scholtes and Katherine Tully-McManus contributed to this report.
Bloomberg
2 days ago
- Health
- Bloomberg
Senate Republicans Float Rural Hospital Fund to Ease Impasse Over Tax Bill
Senate Republicans are crafting provisions to provide funding for struggling rural hospitals in order to resolve an impasse on Medicaid changes that is one issue holding up passage of President Donald Trump's tax-cut bill. Senate Majority Leader John Thune told reporters on Wednesday he is working with members of his party on a solution that would ensure financially vulnerable rural hospitals aren't threatened by the legislation's cuts to the Medicaid health program for low-income and disabled Americans.
Politico
2 days ago
- Business
- Politico
AI's energy appetite exposes a renewables rift in Washington
With help from Aaron Mak The astronomical energy needs of data centers for the fast-growing artificial intelligence industry have triggered a huge buildup of new power generation across the country — but the role that renewable energy will play in that mix is still very much up for grabs. Tech companies, which have long touted their public commitments to climate goals, have leaned heavily on renewable energy as a way to ramp up their power-hungry data centers without pumping more carbon into the air. In late 2024, U.S. data centers accounted for half of total US corporate clean energy procurement, according to an analysis by S&P Global. Now, however, the energy politics of Washington are changing — and this week's horse trading over the Senate's megabill showed that the tech industry may be shifting its stance. At the center of the debate are the tax credits for solar, wind and energy storage that were part of the Biden-era Inflation Reduction Act. Republicans running the reconciliation process on the tax bill in the House and Senate have pledged to eviscerate the subsidies. The tech industry has publicly pressed Congress to preserve those tax incentives — an issue that became urgent when the House tried to gut clean energy subsidies far sooner than the IRA timeline. A group called the Data Center Coalition — whose 38 members include Amazon Web Services, Google, Meta, and Microsoft — sent a letter last month to Senate Majority Leader John Thune, asking him to extend the deadline for building new clean energy facilities with the subsidies. The letter warned that energy constraints could hinder or delay the buildout of data centers vital to U.S. leadership in AI, and that the credits were important to being sure that new power got built. 'We urge you to take a pragmatic approach to ensure we can meet the energy needs of data centers at a pivotal moment for our industry and country,' the letter reads. The Senate did not exactly comply. In its tax proposal, the Senate Finance Committee took a more moderate approach than the House of Representatives, but still issued a plan to wind down subsidies for most renewable energy by 2028. Senate Finance Chair Mike Crapo (R-Idaho) said in a statement that his committee's portion of the megabill 'achieves significant savings by slashing Green New Deal spending and targeting waste, fraud and abuse in spending programs.' Instead of solar and wind tax incentives, the legislation bolstered nuclear and geothermal energy. DFD asked Amazon, Google, Microsoft and Meta — some of the biggest members of the Data Center Coalition — for a response to the Senate's latest moves. None provided an answer. The Data Center Coalition, which initially pressed the Senate to keep the credits, also didn't comment on the Senate's bill. One industry player willing to address it this week was Chris Lehane, chief global affairs officer for OpenAI, whose CEO Sam Altman is an aggressive investor in clean energy. Lehane did not critique the Senate or House moving to sunset off the tax credits. Instead, he focused on permitting delays as an impediment to building new power sources. 'Ultimately … the big challenge in all of this is time,' he said, saying that slow permits were the bigger threat to getting new energy online for data centers. That view dovetails with Republican perspectives on the industry. A senior Senate GOP aide called wind and solar 'mature industries' that no longer need federal support, especially given the high demand for electricity for AI, and said Republicans were more focused on removing permitting hurdles. Climate change used to be a central tenet of tech companies' energy policy. Both Microsoft and Google once said they would be at net-zero or negative carbon emission by 2030, and invested heavily in wind and solar to meet their targets. AWS, Meta, Google and Microsoft did not provide a response on where their climate goals stand right now. OpenAI just agreed to help build data centers in the United Arab Emirates — and the source of energy for those data centers remains unclear. The apparent industry shift is frustrating to some longtime clean-energy advocates. 'Companies like Microsoft, Google, and Amazon have increasingly moved toward an 'all-of-the-above' energy strategy,' said Evan Chapman, senior director of policy at the nonprofit Clean Tomorrow. That includes nuclear, gas, geothermal and utility-owned generation — especially as AI workloads strain power systems. The final shape of energy policy in the AI era is still under construction; the reconciliation bill needs a full Senate vote and House approval before it's passed. But one thing is clear: Big Tech's original ask for keeping renewable energy tax credits isn't likely to be heeded. Lehane said OpenAI would be fine under the new policy and had not been planning to use IRA incentives as part of its massive Stargate data center project in the U.S. The company expects some of its early sites to be natural gas and solar powered, but will look to include nuclear and geothermal energy where possible, a spokesperson said. Observers say the tech sector hasn't turned against renewables. But it's not fighting for them, either — suggesting that in 2025 Washington, there's more to be gained from playing ball with Republicans than from sticking their necks out for clean energy. Local news' tech blues As Donald Trump feuds with journalists and cuts funding to public broadcasting, several blue states are scrambling for ways to protect their local newsrooms as they lose revenue to tech companies like Google and Meta. POLITICO's Tyler Katzenberger reports that Democratic legislators from five states – Hawaii, Illinois, New York, Oregon and Washington – are engaged in parallel efforts to get tech companies to compensate news outlets for using their content. These lawmakers fear that aggregating articles and posting them on Google search results and various social media platforms deprives local outlets of revenue. But it's been an uphill battle. Bills in four of those states failed this year, with only Oregon's proposal still alive. Lawmakers who pushed for the failed bills have pledged to try again. The journalism industry has a long history of trying and failing to get help from governments to stanch the bleeding brought on by digital media. In 1980, Washington Post Publisher Katharine Graham lobbied senators to block a proposal from AT&T to develop electronic yellow pages. The company was able to launch the product only a few years later. More recently, Australia and Canada passed laws requiring the likes of Meta to pay outlets for their content, though pushback from the industry has diminished their intended effects. Prosecutors seize millions in cryptocurrency The Trump administration is asking a federal judge to let it keep $225.3 million in seized cryptocurrency allegedly connected to fraud. On Wednesday, the Department of Justice filed a civil forfeiture complaint allowing the government to keep cryptocurrency confiscated during an investigation into an alleged investment fraud scheme. The department believes more than 400 people were tricked into forking over money for what they thought were legitimate cryptocurrency investments. The department conducted the investigation in conjunction with the U.S. Secret Service and the Federal Bureau of Investigation. The cryptocurrency seizure is the largest in the history of the Secret Service, which investigates the illicit exploitation of U.S. financial systems. Crooks on the blockchain have been stealing and scamming people out of cryptocurrency since the early years of the technology. By 2018, about 80 percent of initial coin offerings – the first round of token sales for a new cryptocurrency – were fraudulent according to estimates from the digital asset investment bank Satis Group LLC. President Joe Biden tried to rein in these scams, and issue a 2022 executive order directing federal agencies to implement new industry regulations and consumer protections. President Donald Trump repealed that order in January. Initially a skeptic of the technology, he's now become an outspoken booster – loosening crypto restrictions and pushing a law passed on Tuesday that would make it easier to launch stablecoins, or tokens pegged to another asset. post of the day THE FUTURE IN 5 LINKS Stay in touch with the whole team: Aaron Mak (amak@ Mohar Chatterjee (mchatterjee@ Steve Heuser (sheuser@ Nate Robson (nrobson@ and Daniella Cheslow (dcheslow@
