CNN
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As top Republicans give themselves just two months to pass President Donald Trump’s sweeping tax and spending cuts package, some GOP lawmakers are worrying it’s not enough time to resolve their biggest intraparty fights.
Under fierce pressure from the White House, GOP officials are attempting to finalize that package by a self-imposed deadline of July 4 – with Speaker Mike Johnson insisting he can pass the House’s bill sooner. But many rank-and-file Republicans worry that breakneck pace isn’t realistic with the massive policy landmines that lie ahead, from corporate tax perks to health care cuts that are already roiling the party.
“My understanding is right now we are currently writing two different bills,” Sen. Josh Hawley put it bluntly as he described the two chambers’ collision course on policy differences.
House Republicans are charging ahead with a half-dozen committee markups planned for this week and more next week. Johnson wants to hold a vote by the end of May, but Senate Republicans are proceeding far more cautiously.
“Seven legislative weeks away if we had resolved all the differences in a bicameral basis would be a lot of work,” Sen. Thom Tillis, a Republican from North Carolina, told CNN. But, he added, “we aren’t through all the big issues yet.”
For now, Trump has largely stayed out of the fray with lawmakers. Instead, the president has dispatched top Cabinet officials and aides, including Treasury Secretary Scott Bessent, to iron out trillions of dollars in differences among House and Senate tax writing committees. He’s also letting key GOP committees find consensus among their ranks on tough calls about potential changes to Medicaid and food stamps.
“People say, ‘This is my red line. I can’t cross it.’ And we say, ‘OK, where can we meet?’ And that’s what we’re working on,” House Energy and Commerce Chairman Brett Guthrie told reporters Monday about his panel’s tricky path forward on Medicaid – finding enough savings without causing GOP centrists to balk. “It’s almost getting close to an individual-to-individual kind of thing, and that’s why it takes a little bit.”
One of the biggest pieces to iron out in the days ahead will be how Guthrie’s panel can cobble together $880 billion in savings.
That committee is slated to begin its mark-up next week, but Republican members have been meeting privately to hold informal discussions and internal votes on which provisions they can back – and which are not going to be politically palatable. Those talks have raised enormous questions about whether the committee will even be able to hit their $880 billion savings goal – which, to many House GOP hardliners, is their own firm line in the land.
The widespread expectation among Republicans is that Medicaid will account for a large share of that $880 billion in savings, though the committee has broad jurisdiction and can get some savings from energy and broadband programs.
So far, the committee has found broader consensus to implement work requirements for Medicaid recipients, ensure there are more regular eligibility checks for program recipients and institute guardrails to make sure that no federal dollars are going to helping immigrants who are illegally in the country access the program. It’s currently illegal for federal Medicaid dollars to flow to immigrants in the country illegally, but some states do have state-funded health care programs for undocumented immigrants. And hospitals that treat patients of all immigrant status are eligible for Medicaid reimbursements.
The biggest flashpoint among Republicans on Medicaid is a wonky yet critical part of the current program’s spending: the so-called FMAP, or the federal medical assistance percentage. That determines the amount in federal funding that flows to states to cover Medicaid recipients in their state.
Many conservatives argue that states should be responsible for a larger share of the cost burden, especially for populations that became newly eligible for Medicaid through the Affordable Care Act.
But leadership has struggled to build consensus for those changes as many members – especially those from Medicaid expansion states – argue that it could affect coverage if states decline to make up the revenue difference.
“There’s a lot of negotiation on FMAP. I think everything’s on the table until we figure out where 218 are. But I think that’s the more difficult thing to change,” Guthrie told reporters.
Guthrie is among multiple senior Republicans who are skeptical that their party can agree to make changes to such a key piece of the program.
“Our members understand that Medicaid needs to be reformed. There are a lot of problems with it,” one member who has been close to the discussions told CNN. “You know I don’t know if we can get some of our members to go there on FMAP in this particular reconciliation bill.”
In the Senate, there is also concern about making substantial changes to how much the federal government contributes to a state’s Medicaid burden.
“You know, North Carolina if you did a change to the FMAP, you would have about 600,000 people that were no longer eligible for Medicaid,” Tillis warned.
Besides Medicaid, some Republicans are rankled by another push to cut spending from a safety net program for low-income Americans – food stamps, according to multiple people familiar with the discussions.
The House Agriculture Committee – one of about a dozen House Committees involved in the reconciliation process – is tasked with finding $230 billion in savings, which many predict will come from making changes to food stamps and who is eligible for them.
One idea that has been floated, according to multiple members who serve on the agriculture committee, is to require states to take some share of the cost of the program. Currently, the program is covered by the federal government. GOP lawmakers are also discussing creating work requirements to save money on the program.
But not everyone is comfortable with the idea of forcing states to share the cost of a program that has been handled by the federal government.
“I need to see the nuts and bolts of it,” Rep. Derrick Van Orden, who represents a competitive seat in Wisconsin, said. “Because generally speaking, no, we have to make sure that we protect the most vulnerable amongst us, hungry kids, our seniors, our vets, single moms, people are struggling.”
GOP leaders, though, are under intense pressure to find steep savings – or risk losing the votes of their right flank. Conservatives are warning that they can’t vote for a bill that doesn’t meet the House’s steep savings target of $1.5 trillion.
“You’re gonna see a collision if we get under the $1.5 trillion [in spending cuts] and really the $2 trillion. That’s what we told the American people,” Rep. Ralph Norman of South Carolina told CNN.
There’s another unexpected policy area that’s attracting the ire of some conservatives: A new $20 tax on vehicles.
The idea was floated by the House Transportation Committee and would put an annual $20 levy on vehicles – and more for electric and hybrid vehicles. It could be a way to reduce the current gas tax – a fee that some GOP lawmakers complain that electric vehicles have been able to evade. But it has already faced backlash from some conservatives who argued gas vehicles shouldn’t be subject to the new cost.
“I’m already catching, gimmicks,” said Rep. Chip Roy, a conservative from Texas. “There’s this car tax, right? … The party of limited government is going to go out and say, ‘We’re going to have a car tax.’ You know what? I was told, ‘Don’t worry about it. We’ll get rid of it later in the highway bill.’ So what does that really say? You should go be for a car tax as a gimmick to pay for this so we know that we’re not actually going to pay for it. That’s how this town works.”
Each of these policy disagreements are bursting into public view even before lawmakers sort through differences on tax provisions.
A key priority for House Republicans from states like California, New York, New Jersey and Illinois, has been to raise the state and local tax deduction cap that was put in place during the 2017 tax bill. The speaker is scheduled to meet with some of those members later this week to try and find a compromise. But many Republicans have balked at the idea of raising the threshold, arguing that the federal government shouldn’t be making up for the burden left by high-tax states.
“I am not a fan of the federal government subsidizing high tax states,” Rep. Dusty Johnson, a Republican from South Dakota, told CNN. “That being said, politics is about the art of the possible, and to get to 218 votes and 51 votes, we are clearly going to need to do something with SALT. It is not my preference, but Dusty Johnson doesn’t get everything he wants around here.”
Republican senators have also largely balked at the idea of raising the SALT cap, but Johnson argued that GOP Senate leaders understand everyone is going to have to give if they are going to move Trump’s agenda.
“They understand the complexities that we’re going to work through, and they have their own issues over there, so we’re going to give one another lots of grace back and forth. And it’s going to end well,” Johnson said.
CNN’s Veronica Stracqualursi and Haley Talbot contributed to this report.
