Fiscal disaster....

GOP leaders banking on Trump to save them from fiscal disaster

Republican lawmakers say Trump’s endorsement of a ‘clean’ debt increase and no-drama funding deal would tamp down an intra-party fight.

By BURGESS EVERETT and RACHAEL BADE

Congressional Republicans, rudderless on an unpopular debt ceiling and government funding strategy, are looking to President Donald Trump to bail them out.

Senate Majority Leader Mitch McConnell and House Speaker Paul Ryan are mulling a basic framework to raise the debt ceiling without spending cuts and avert an Oct. 1 shutdown with a short-term spending bill, according to multiple Republican aides. But while top Trump officials like Treasury Secretary Steven Mnuchin back a “clean” debt increase, the president himself is mum on the latest strategy.

GOP leaders, wary of the the backlash from rank-and-file members who campaigned on reducing the debt, want Trump to publicly endorse the proposal to give them political cover.

“Districts like mine are extremely supportive of this president; if he wants a ‘clean' debt vote, and he’s vocal about it, the right play … would be to let him do the whipping for it and it would get done,” said Rep. Tom Rooney (R-Fla.), a whip team member who personally prefers to cut spending as part of a debt limit hike.

Without Trump’s endorsement, the GOP could plunge into a month of intra-party battles that could rattle financial markets and threaten the economy. And absent relative GOP unity on a crucial fiscal deal, Republican leaders could be forced to beg for Democratic votes to avert catastrophe, a move that would invite criticism from the right.

“I don’t think anybody wants that of the leaders in the Senate and the House and the White House,” said Sen. Roy Blunt (R-Mo.) when asked about a shutdown and debt default in an interview. “Surely we’ll be able to avoid that.”

When pressed by reporters late last month, White House press secretary Sarah Huckabee Sanders said the president supported a “clean” debt ceiling bill.

Trump’s most direct comments on the issue came when he tweaked McConnell and Ryan on Twitter for creating a debt ceiling ‘mess,’ but there are plenty of signals that the president is falling in line — especially after Hurricane Harvey. Paradoxically, the storm, leadership sources believe, could actually smooth the entire process, making September a little easier.

For one, the severity of the damage is convincing top White House officials — and, they’re praying, Trump himself — that now is not the time to pick a fight over the president’s proposed border wall with Mexico being funded in a must-pass spending bill. Trump has signaled to his staff that he’d prefer to have the border wall fight later this year, sources familiar with those conversations said.

That’s in part because Trump has a personal interest in Harvey recovery, visiting the region for the second time over the weekend, demanding quick action to rebuild Texas and Louisiana. Republicans are set to approve $7.9 billion in Harvey emergency package as early as this week. The debt limit must be raised by the end of the month and is likely to move in tandem with a spending bill, whether it's the initial Harvey relief bill or the larger spending bill due by the end of month.

No final decision has been made, and lawmakers may need to wait until the end of the month to lift the debt limit and fund the government past September while also delivering an additional infusion of hurricane aid. Republicans and Democrats have estimated the storm could require more than $100 billion from the federal government, likely delivered in tranches.

Between the aid to recover the Gulf Coast and kicking the debt ceiling past the 2018 mid-term elections, GOP leaders think that Trump will back down on the wall and that the dire situation in Texas could give them cover with conservatives who would otherwise rebel.

Yet some Texas Republicans and conservatives are already pushing back against a catch-all package that rolls Harvey aid with government funding and a debt bill avoids default.

“I don’t want any insular issue to be brought to bear on something that is this important,” said Rep. Jodey Arrington, a Texas Republican who worked on the Katrina relief effort in the Bush administration. “This ought to be as pure and isolated from all the other debates.”

September has an astounding number of challenges for Trump and GOP leaders to address: In addition to the hurricane, spending and debt issues, the Federal Aviation Administration, National Flood Insurance Program and Children's Health Insurance Program also all need to be extended past September.

Further drama appears inevitable. Trump is expected to announce on Tuesday that he will end the Obama-era program shielding some young immigrants from deportation, but will delay the termination by six months to give Congress time to act.

Besides adding another controversial agenda item to an already packed legislative calendar, House Republican leaders fear that if Trump ends DACA, or the Deferred Action for Childhood Arrivals, Democrats will withhold votes on the debt ceiling in protest. And Republicans know they’ll need virtually every Democrat to back the debt ceiling bill or they won’t be able to pass it, since many Republicans won’t vote for it.

And in the Senate, McConnell must decide whether he will try to repeal Obamacare again this month, a move that would similarly alienate Democrats. The parliamentarian has ruled that the chamber has until the end of September to attempt another vote on repealing the law by a simple majority. The party is split over the matter, with some Republicans such as Sen. Lamar Alexander (R-Tenn.) looking to move on to piecemeal efforts to improve the law.

Ryan, McConnell and House and Senate minority leaders Nancy Pelosi (D-Calif.) and Chuck Schumer (D-N.Y.) will meet with Trump on Wednesday to begin the high-stakes fall negotiations. Democrats say they are waiting for the Republican Party to chart a path forward, and are making few suggestions other than that they will deny Trump money for his border wall.

“Republicans have a choice to make. They can do what we did in April, keeping the White House’s unhelpful demands at arm’s length and working with us to navigate the to-do list, or they can throw their lot in with the president, which will make September much harder,” said a senior Democratic aide.

GOP leaders clearly prefer to show they are a governing party by minimizing the drama in September and moving on to tax reform. A shutdown or credit default is the last thing the reeling Republican Party needs after eight months with little to show legislatively for full control of Washington.

But working with Democrats on legislation addressing the debt limit and government funding that does not advance conservative priorities could invite major problems from the right, especially if Trump isn’t leading the fight to avoid fiscal disaster. Conservatives will spend September pushing for leaders to cut spending as a condition for raising the debt ceiling.

“You should make structural changes when you raise the debt rather than just continue on the path of the past 8 years,” said David McIntosh, president of the conservative Club for Growth. “I think you’d see Congress reject [a clean debt ceiling increase] unless Ryan and McConnell decide they want to govern with the Democrats, which they do with their own peril.”

But Republican leaders say that trying to craft bills that slash spending while a fiscal crisis looms could get too messy since they know they need at least eight Senate Democrats to get it to Trump’s desk. They are hoping that leaving so much of the year’s work for just four weeks in September will make everyone more cooperative -- and avoid tarring the GOP as the shutdown or default party.

“Deadlines help,” Blunt said hopefully.