Shutdown fears spur horse-trading

Shutdown fears spur horse-trading
© Greg Nash

Horse-trading between Republicans and Democrats seeking to avoid a government shutdown is intensifying, with ­ObamaCare subsidies and increased funding for the Pentagon both on the table.

Democrats have offered to agree to an additional $15 billion in military funding as part of a spending package to keep the government operating if Republicans in Congress agree to fund ­ObamaCare insurer subsidies.

Signing off on the Democratic offer would avert a government shutdown set to begin Saturday.

It would ensure that the reimbursements to health insurers would continue, preventing what could be a mass exit from the exchanges.

That would be a victory for Democrats, who have sought to protect the payments.

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But the deal would also give something to defense hawks and President Trump, who have been demanding additional money for the Pentagon.

Democrats previously have said that defense spending should only be increased if nondefense spending is also increased by the same amount. The new proposal would break that standard, which has essentially been in place since a 2011 spending deal.

The payments to insurers, known as cost-sharing reduction, have been made for years by the executive branch so arguably would not represent new nondefense discretionary spending.

The payments are now in doubt, however, because Trump is in the White House and because congressional Republicans sued the Obama administration over the subsidies, arguing they were unconstitutional because Congress never appropriated funding for them.

Trump has given mixed signals over whether he would keep making the payments and has said he would like to use the issue as leverage with Democrats.

Republicans are also split on the payments, as some centrists in the House and Senate would like to see the payments continue to avoid havoc in the healthcare system. Insurers have warned that if the funding is discontinued, they will have to increase their premiums.

There is no deal yet, but members on both sides of the aisle expressed optimism that an agreement was in reach — especially now that Trump has dropped any demands to include funding for a U.S.-Mexico border wall in the measure.

“That may fly,” a senior Senate Republican said.

Democrats also want Republicans to agree to money for retired miners’ healthcare benefits, but that’s a much less controversial proposal. Senate Majority Leader Mitch McConnellMitch McConnellTrump’s isolation grows Ellison: Trump has 'level of sympathy' for neo-Nazis, white supremacists Trump touts endorsement of second-place finisher in Alabama primary MORE (R-Ky.) voiced support for the mining provision on Tuesday.  

The contours of the deal put Speaker Paul RyanPaul RyanGOP chairman to discuss Charlottesville as domestic terrorism at hearing Trump’s isolation grows GOP lawmaker: Trump 'failing' in Charlottesville response MORE (R-Wis.) in a difficult position.

With Republicans in control of Congress and the White House, Ryan and McConnell want to avoid a shutdown that would likely be blamed on the GOP. They will need Democratic votes to get a measure through the Senate and will probably need help from Democrats in the House.

The difficult part for Ryan would be agreeing to funds for ­ObamaCare just over a month after the House GOP failed to repeal the law, which it has promised to kill for years.

Ryan will definitely face criticism from conservatives on and off Capitol Hill if he agrees to a deal that provides billions for ­ObamaCare.

A senior Democratic aide said the final figures of a deal are unclear.

One congressional source estimated that it will cost $5 billion to $7 billion to fund the cost-sharing reductions if they are included in the package. Another official pegged it at $10 billion.

The deal would give House Republicans an escape hatch from their 2014 lawsuit against the Obama administration. The lawsuit made for good politics when a Democrat was in the White House, but now that a Republican is president, it puts them in an awkward position of suing their president overpayments that, if discontinued, would cause harm in the marketplace that might boomerang back on the GOP politically. 

If Ryan refuses to provide funding for the cost-sharing subsidies, then Democrats will demand that the $15 billion in extra military funding be matched with an equal increase in supplemental funding for nonmilitary programs — the standard they have long insisted upon.

Spokespeople for Ryan and McConnell declined to comment on the details of their talks with Democratic leaders.

McConnell told reporters Tuesday afternoon that the negotiations are continuing, without delving into specifics.

AshLee Strong, a spokeswoman for Ryan, and Jennifer Hing, a spokeswoman for the House Appropriations Committee, declined to comment about specific offers, citing the ongoing talks.

But after a rocky first 100 days of Trump’s presidency, there’s a growing desire among Senate Republicans to avoid a major blowup — either in the form of a government shutdown or ­ObamaCare exchanges collapsing because of an impasse over cost-sharing subsidies.

“We need to show people that we can govern. The time for soapbox standing and the bully pulpit is over,” centrist Rep. Ileana Ros-Lehtinen (R-Fla.), a Ryan ally, told The Hill. “We need to legislate; we need to pass budgets. So if that’s what it takes, to give something to the Democrats and they like it, and we like it … I’m for anything that gets us to a practical solution to solve this problem.

“An impasse again. We just can’t sell it back home. If we can’t govern, people will say, ‘What are you guys doing up there?’ ”

Democratic negotiators think that they have Republicans, who are worried about Trump’s dismal 40 percent approval rating and desperate to show voters they can govern, stretched over a barrel.

“They know we have a lot of leverage, and we intend to use it,” said a senior Democratic aide.

Republican negotiators have already jettisoned some of Trump’s spending priorities.  

GOP leaders have agreed to leave extra funding for Trump’s proposed border wall and deportation force out of the spending bill, the officials said.

Two sources familiar with the talks said Republicans have also agreed to keep the number of beds at deportation centers at the same level as authorized under President Obama.

Capping the number of beds would limit how many undocumented immigrants the administration can process for deportation.

Trump initially asked for $30 billion in supplemental military spending, and GOP leaders have agreed to reduce that amount by about half.