Trump-Approved Spending Plan Goes Down in Flames

Trump-Approved Spending Plan Goes Down in Flames

The speaker's Plan B failed.
Sipa USA
By Yuval Rosenberg and Michael Rainey
Thursday, December 19, 2024

We’re less than 29 hours away from a shutdown deadline and chaos reigns in Congress. Here’s the latest.

Trump-Approved Spending Plan Fails Spectacularly, Amid Bipartisan Opposition

President-elect Donald Trump and House Republican leaders had a Plan B to avoid a partial government shutdown this weekend. It just got shot down because of bipartisan opposition.

GOP leaders and members spent much of Thursday frantically negotiating among themselves for a new bill to avert a looming partial shutdown just hours after Trump and billionaire Elon Musk unceremoniously trashed a deal negotiated by House Speaker Mike Johnson. They managed to cobble together a significantly slimmed-down package that won Trump’s approval — but it failed an initial vote on the House floor, falling well short of a two-thirds majority required by the fast-track process GOP leaders used.

Republicans dared Democrats to vote against the plan, and Democrats did just that — along with dozens of conservatives, who opposed the new proposal despite Trump’s support for it. If this was a test of Trump’s power as he prepares to take office for a second term, the results suggest the Republican-run House will continue to be chaotic and unruly.

The president-elect made clear he wanted Republicans to fall in line. “SUCCESS in Washington! Speaker Mike Johnson and the House have come to a very good Deal for the American People,” Trump posted to his social media site, adding, “All Republicans, and even the Democrats, should do what is best for our Country, and vote ‘YES’ for this Bill, TONIGHT!”

It didn’t happen — and the bill failed to get even a simple majority, signaling that any effort to pass the bill under regular order could also fail. The vote tally was 174-235, 197 Democrats and a stunning 38 Republicans voting against the bill. Two Democrats voted for it along with 172 Republicans. One Democrat voted “present.”

House Minority Leader Hakeem Jeffries, the Democratic leader, called the new plan “laughable” and said that “extreme MAGA Republicans” are driving toward a government shutdown. Jeffries reportedly told his caucus his position on the GOP plan was, “hell no.” And the White House said Republicans are doing the bidding of billionaires. “Republicans are breaking their word to support a bipartisan agreement that would lower prescription drug costs and make it harder to offshore jobs to China—and instead putting forward a bill that paves the way for tax breaks for billionaires while cutting critical programs working families count on,” Press Secretary Karine Jean-Pierre said in a statement.

More than a few hardline Republicans also made it clear that they wouldn’t support leadership’s latest proposal and the planned vote was doomed. “I am absolutely sickened by a party that campaigns on fiscal responsibility and has the temerity to go forward to the American people and say you think this is fiscally responsible,” Texas Republican Rep. Chip Roy said on the House floor. “It is absolutely ridiculous.”

Trump had targeted Roy in social media posts earlier in the day, saying the congressman was standing in the way of a great Republican victory “for the sake of some cheap publicity for himself.” Trump also called for Roy to face a primary challenge.

What was in — and out — of the GOP plan: While the original bill came in at 1,547 pages, the latest bill, titled the American Relief Act, is — or was, if it’s dead — a relatively slim 116 pages. It would fund the federal government through March 14, provide $110 billion in disaster relief and extend the farm bill for a year. It would also suspend the debt limit through January 30, 2027, delivering on one of Trump’s demands after he insisted that the debt ceiling should be dealt with while President Joe Biden was still in office. He also called for the debt limit to be eliminated entirely.

The new plan scrapped other provisions that drew the ire of Trump and conservatives, including a pay raise for members of Congress and a measure allowing Washington, D.C. to control the site of a football stadium. Restrictions on U.S. investment in China and reforms to pharmacy benefit managers were also cut, though an extension of telehealth for seniors was kept in. The new bill would also have wiped out a $1.7 trillion tab on what’s known as the PAYGO scorecard, eliminating a requirement that Congress find some spending cuts to offset deficit increases.

The bottom line: Trump’s approved plan just failed spectacularly. GOP leaders will now have to cobble together a Plan C. At the moment, it looks like we’re speeding toward a government shutdown. House Republicans don’t have a plan that they can all get behind or one that can win the necessary votes. GOP leaders appear to have abandoned the idea of trying to pass their new plan via regular order, so the next steps are unclear.

What Happens if the Government Shuts Down

There’s a fair chance that lawmakers will fail to agree on the path forward in the next day or so, resulting in the loss of some federal functions starting at midnight on Friday. Here’s a rundown on what that would mean for different agencies and services.

* The military would not get paid. The Department of Defense warned Thursday that in the event of a shutdown, troops will not receive their paychecks, typically issued at the end of the month. The nation’s roughly 2 million military personnel would nevertheless be required to report for duty, both at home and abroad. The roughly 800,000 civilians who work for the military will also not receive their pay, including the 400,000 who would still be required to report to their offices.

* Hundreds of thousands of federal employees would be furloughed. Many nonessential federal workers would be told to stay home without pay. Each agency will have its own plan for how to operate during the shutdown, and many would define the majority of their workers as nonessential.

* National parks and museums would close.

* Air traffic controllers and TSA screeners would be required to work without pay. Federal workers in the transportation system are deemed essential and are required to report to work, though without pay. Absenteeism among airport workers could hinder operations.

* Federal courts would operate until funds run out. Federal courts could maintain their schedules relying on fees and other funding, but a long shutdown would eventually force courts to cut back on their activities.

* Wall Street cops step off the beat. The Securities and Exchange Commission would maintain a skeleton staff, with 90% of its 4,600 employees sent home.

* Some White House staff would be furloughed. Essential workers would remain on duty, but more than half of the workers at the White House could be furloughed. In the 2018-2019 shutdown during the first Trump administration, 1,100 of the 1,800 staff in the Executive Office of the President were furloughed.

* Lawmakers would get paid, but staff would not. Members of the House and the Senate would continue to receive their paychecks, but those who work for them would be told to stay home.

* Congress eventually pays the bills. In the past, Congress has paid furloughed workers for the days they missed. But Congress can’t make up for the losses experienced by non-government workers and business owners as a result of the shutdown. According to the Congressional Budget Office, the record 35-day shutdown in the first Trump administration cost the economy about $3 billion.

US Economic Growth Revised Higher in Q3

Gross domestic product increased at a faster pace in the third quarter than previously estimated, the Department of Commerce announced Thursday.

In its third revision of the economic data, Commerce raised its estimate for third-quarter growth to an annualized rate of 3.1%, up from 2.8% in the previous estimate. Both exports and consumer spending grew more rapidly than first estimated, with the latter increasing by 3.7% — the fastest pace since early 2023.

“The numbers reinforce the notion that the economy is still powering ahead despite expectations among forecasters for an eventual slowdown,” said Bloomberg’s Matthew Boesler. “The report comes just a day after the Federal Reserve triggered a stock-market selloff by signaling a slower pace of interest-rate cuts in 2025, in part premised on recent stronger-than-expected economic data.”

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