Congressional Republicans Have Two Bad Options

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To my embarrassment, I’ve never understood the mechanics of Congress as deeply as I’d like. In the past few weeks, I’ve struggled to parse the incremental developments in Republicans’ “One Big Beautiful Bill”—that’s actually what they’re calling it now—to enact as much of President Donald Trump’s agenda as they can. Usually, when I get confused about Capitol Hill, I call my colleague Russell Berman for guidance. Yesterday, he published a story on the “significant risk” (as the economist Mark Zandi described it) that congressional GOP moves could crash the economy. I spoke with him to understand where we are and how to know where we’re going.

David A. Graham: Do I really need to pay attention to Congress right now?

Russell Berman: Yes, you do. Even though Trump has gone around Congress in many ways, Republicans are now debating a bill that is, in scale and potential impact on the deficit, much larger than anything we’ve seen in the past few years. This bill would extend the 2017 Trump tax cuts at a cost to taxpayers of some $5 trillion. It would surge funding for Trump’s southern-border plan. It would increase military spending. It might reduce or eliminate taxes on tips, overtime pay, and Social Security benefits. It’s a really big deal, and it’s a big question mark whether and when they might get it done, in large part because the GOP can’t agree on how—or even whether—to offset that $5 trillion price tag.

David: Remind me why it has to be one big, beautiful bill.

Russell: It doesn’t. The Republicans in the Senate initially wanted to just give Trump his border funding and increase defense funding, and save the extension of the tax cuts for a second piece of legislation. In the House, the Republicans were concerned that it’s hard enough to pass one bill. Eventually, Trump sided with the House, but if they reach an impasse, the next step probably is to break it up into multiple pieces of legislation.

David: Given how much control Trump seems to have over Congress, why can’t the White House just tell them what to put in the bill and pass that?

Russell: Trump is not that interested in Congress. At many points during this process, Republican leaders have looked to him for leadership, and time and again, the president has said, Whatever, you all figure it out. They can’t figure it out, but they need to reach an impasse for Trump to get involved and use his political weight.

David: Where are the Democrats in all this? Are they relevant at all?

Russell: The short answer is no, because the Republicans, just as the Democrats did under Joe Biden, are using the process known as reconciliation, which will get them around a filibuster in the Senate. Democrats, frankly, are pretty happy to just sit back and throw darts from the sidelines.

David: Your story makes it seem like the options here are either a success that threatens to tank the economy or a failure that tanks Trump’s agenda and also possibly the economy. Is there another option?

Russell: The third option is to do a more fiscally responsible bill, which would extend the tax cuts but offset them with either spending cuts or tax increases elsewhere. But that’s not likely to pass, because Republicans do not like tax increases of any kind, so what happens is usually just deficit-inflating tax cuts. If that were to happen this time, economists are telling me it could precipitate even more of an economic collapse. If the 2017 tax cuts were to expire at the end of the year, that would be a big tax increase on basically everybody at a time when, because of Trump’s tariffs, the economy may be heading toward a recession—or will already be in one.

David: For people who struggle to follow every twist of this process, what can we watch for as an indication of where we’re headed?

Russell: The things that we don’t know are: Are they going to touch Medicaid? Are they going to be able to get these additional Trump tax cuts in the bill? Are they going to be able to raise the debt limit in this bill? If they don’t increase the debt limit, you would have a potentially catastrophic default by the United States government, or Speaker Mike Johnson and Majority Leader John Thune would have to go to the Democrats to say, Help us again.

David: It seems like there are perpetually warnings of doom for congressional Republicans trying to pass legislation, and every time, Johnson pulls a rabbit out of a hat. Why would this time be different?

Russell: I wouldn’t bet against them passing a bill, but there are all of these fail points, where if they reach an impasse over Medicaid, the particular nature of the tax cuts, or whether and how to pay for it at all—that’s where we could see things collapse. They could just resort to extending the tax cuts and nothing else, which wouldn’t accomplish a large part of Trump's agenda, but it would forestall a tax increase.

David: And because they’re using reconciliation, is the expectation that whatever they don’t pass now is not going to happen in this Congress?

Russell: The assumption is that a president really has a year and a half, because then you get into the midterm campaign, and it’s hard to pass anything at that point anyway. In this case, it’s even more condensed, because they have that deadline of the looming tax increase at the end of the year. It really is 2025 or bust.

Related:

• The “significant risk” that Republicans tank the economy
• The missing branch

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Breakfast Is Breaking

By Yasmin Tayag

Lately, breakfast diehards like me have noticed a troubling change. At my neighborhood diner, a breakfast plate that cost $11.50 in 2020 now costs $14—and it isn’t just because of inflation. Although all kinds of food have gotten more expensive in recent years, traditional breakfast has had a particularly rough go of it. The cost of eggs has soared; supply shortages have driven coffee and orange-juice prices to historic highs. And that’s not even taking President Donald Trump’s tariffs into account … The stream of staples that have made American breakfast so cheap for so long is now starting to sputter.

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P.S.

Three weeks ago, I profiled Allison Riggs, the North Carolina Supreme Court justice who won her election by 734 votes last November but who still hasn’t been certified as the winner, because her challenger, Jefferson Griffin, was seeking to change the rules of the vote after the fact. An update on that story: Last night, a federal judge ordered the state board of elections to certify her as the winner, though he stayed the decision for seven days to allow for appeals. That means the nation’s final unresolved race might be coming to an end soon—but not quite yet.

— David

Stephanie Bai contributed to this newsletter.

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