Welcome to Another Government Shutdown

On the menu today: Audrey Fahlberg here again, National Review’s political reporter helping fill in for Jim Geraghty until he returns to your inboxes on October 10. Let’s dive in.

Day One of the Shutdown

The House-passed continuing resolution to fund the government through November 21 failed by a 55-45 vote Tuesday evening, paving the way for a shutdown that went into effect at 12:01 a.m. Wednesday. Now comes the tricky part for congressional leaders: finding a way out.

There are early signs that Senate Democrats aren’t negotiating from the strongest possible position. Three members of Senate Minority Leader Chuck Schumer’s caucus broke ranks yesterday to support the House-passed CR: Democratic Senators John Fetterman of Pennsylvania and Catherine Cortez Masto of Nevada, as well as independent Senator Angus King of Maine, who caucuses with the Democrats. (Kentucky Senator Rand Paul was the only Republican to vote against it.) The Senate also voted down on Tuesday the Democrat-drafted continuing resolution, which includes proposals to permanently extend increased pandemic-era Affordable Care Act subsidies, as well as reverse the reconciliation bill’s Medicaid reforms and public broadcasting funding repeals.

No one knows how long this shutdown will last. “At some point they’re going to turn the lights on again,” Senator Ted Cruz told reporters on Tuesday evening of his Democratic colleagues. “But first, they have to rage into the night.”

President Trump reminded Democrats on Tuesday that the administration is ready to make it hurt.

“A lot of good can come down from shutdowns,” Trump told reporters on Tuesday, a nod to Office of Management and Budget Director Russ Vought’s memo to agency heads to draft mass layoffs in the event of a shutdown, among other prospective government program changes.  “We get rid of a lot of things that we didn’t want, and they’d be Democrat things.”

The Senate is slated to vote on the continuing resolution again at 11 a.m. this morning, and Senate Majority Leader John Thune (R., S.D.) scheduled additional votes for Friday and Saturday. The upper chamber will not vote “between sundown” on Wednesday “and sundown Thursday in observation” of Yom Kippur,” Senate Majority Whip John Barrasso (R., Wyo.) told reporters on Tuesday evening.

Thune is projecting optimism that more Senate Democrats will break with their party as the shutdown goes on. “There are Democrats who are very unhappy with the situation that they’re in,” Thune told reporters, emphasizing yet again that he won’t negotiate with congressional Democrats on a prospective deal to extend expiring Affordable Care Act (ACA) Subsidies in the context of a government shutdown talks.

“The negotiation happens when the government’s open,” Thune said.

Republicans are accusing Democrats of hypocrisy here, given how often Schumer presents them with clean stopgap funding bills when a Democrat is in the White House. They say that Democrats could have extended the enhanced Obamacare subsidies again when they were in power, and that Congress has ample time to negotiate on the ACA subsidies given that they don’t expire until the end of the year. In the Senate GOP conference’s view, holding the government hostage isn’t a way to win Republican support for some sort of Obamacare subsidy extension.

“We will not negotiate with them until they reopen. We’re not going to take their temper tantrum and reward it,” Senator Bernie Moreno (R., Ohio) told National Review.

Democrats counter that this is a disingenuous talking point given open enrollment begins in four weeks. They say that Republicans’ refusal to negotiate when they have unified control of Washington is unfair.

At some point, one side will have to give. Right now, it’s anyone’s guess who will blink first. As Semafor’s Burgess Everett observed on Tuesday evening, getting into a shutdown is much easier than getting out of one.

Fiscal Hawks Aren’t Jazzed About Extending ACA Subsidies

What might an enhanced Obamacare subsidy extension deal look like? Some centrist Republican senators have suggested a one-year extension. A bipartisan deal would likely include new restrictions on who can qualify, such as income caps, which some Democrats have already signaled they’re willing to accept in exchange for an extension.

Either way, fiscal hawks in the House and Senate are furious.

“We’re trying to educate the conference in terms of the massive fraud occurring because of that temporary-emergency, Covid enhanced subsidy the Democrats allowed to expire,” Senator Ron Johnson (R., Wisc.) told National Review in a brief interview last night. “So, if you lay out that reality, you start talking about, literally, the billions of dollars that are flowing to insurance companies for policies that people don’t even know they’re signed up for, but they’re not using,” the Wisconsin senator explained, then more GOP lawmakers will come around to the view that extending those subsidies would just perpetuate that “massive fraud.”

“Hopefully we can convince the president and others we can’t do that,” Johnson said, with a hint of resignation about how this will end. “I know people like me are vastly outnumbered here.”

President Trump is considered unpredictable on this front and boy do fiscal hawks know it. Vice President JD Vance told reporters this week that Democrats and Republicans should “work on it together” but only in the “context of an open government.”

The whip count on a prospective extension deal for the enhanced Obamacare subsidies remains unclear. And yet Johnson has a non-negligible number of Republicans in his corner.

“I don’t think we should” extend the subsidies, Senator Moreno told NR last night, also citing fraud concerns. “It’s something like 60 plus percent of the people who are signed up never filed a claim, which probably means they don’t even know that they had that insurance,” he said. “Number two is, these are temporary Covid subsidies. Covid’s over and temporary has a meaning.”

“Why would we agree to extend something that is accompanied by allegations of widespread fraud?” said Senator Cynthia Lummis said in a brief interview with NR. “We’ve got to ferret out the fraud. That’s got to come first.”

And where does the White House stand? “I’m not aware that they’ve weighed in,” Lummis said.

House fiscal hawks are begging congressional GOP leaders to hold their ground. “Republican leadership must not cut a ‘deal’ at the 11th hour to extend the very Covid-era inflationary subsidies crushing working families with unaffordable ‘insurance,’” Representative Chip Roy wrote in a social media post this week. “We’ve never voted for them. We shouldn’t now. Choose #HealthcareFreedom over mandates. Do. Not. Blink.”

ADDENDUM: Uh oh, Schumer. The polls aren’t lookin’ great for ya!

Here’s independent Senator Angus King, who caucuses with the Democrats, explaining why he voted with Republicans to keep the government open.