Thune's biggest megabill fires

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IN TODAY'S EDITION:— GOP turmoil over new Medicaid, tax plans— Massie, Khanna push war powers resolution— Senate poised to pass landmark crypto bill
Senate Majority Leader John Thune has some 'big, beautiful' conflicts to resolve — and fast — if he wants to pass his party's tax-and-spending package next week as planned.
Here's a look at the biggest fires Thune needs to put out to meet his deadline, some of which are newly raging following Senate Finance's release of long-awaited bill text:
MEDICAID JITTERS — 'Medicaid moderates' are reeling after Republicans on the key committee proposed lowering the provider tax from 6 percent to 3.5 percent by 2031 for states that have expanded Medicaid offerings under the Affordable Care Act. Several states rely heavily on this tax to help fund their Medicaid programs.
Republicans, including Sen. Josh Hawley, were already rebelling against the House-passed megabill's move to find savings by freezing the provider tax. Now, Hawley is saying he's 'alarmed' that Senate Finance would go even further and that the plan 'needs work.'
'I don't know why we would defund rural hospitals in order to pay for Chinese solar panels,' he told reporters Monday evening, in a nod to Senate Republicans' plan to ease some of the House GOP's deep cuts to clean-energy tax credits (more on that below).
Sen. Susan Collins also expressed concern about the provider-tax change, though she declined to elaborate as she left the closed-door meeting Monday night where Finance Chair Mike Crapo was briefing GOP senators on his proposal. But Sen. Rick Scott said he doesn't think the plan would go far enough in slashing spending on the safety-net program, suggesting senators should reconsider including a provision that would scale back the federal government's share of paying for states' Medicaid expansion.
Expect this to be a topic of discussion when GOP senators meet with CMS Administrator Mehmet Oz today during the conference's weekly lunch, our Jordain Carney writes in.
HOLD THE SALT — Blue-state House Republicans are seething as senators continue to haggle down their state-and-local-tax deduction cap. GOP senators included the current $10,000 deduction limit — rather than the $40,000 the House passed — as a placeholder in the draft bill text Senate Finance released Monday, giving space for talks to continue.
Rep. Mike Lawler declared the Senate's proposal 'dead on arrival' in the House. But Sen. Markwayne Mullin, who's been backchanneling with SALT Republicans including Lawler, insisted to reporters that the deduction is 'fully open for negotiating.' Thune also told reporters Monday that senators are 'prepared to have discussions' amongst themselves to 'figure out a landing spot.'
LESS GUTTING FOR GREEN CREDITS — Senate Republicans are extending some of the House's aggressive phase-out dates for credits benefitting 'baseload' energy technologies like nuclear, geothermal and hydropower, leaving one GOP proponent of the incentives, Sen. Thom Tillis, 'generally satisfied.' They are still making significant cuts to solar, wind and electric vehicle incentives in Democrats' 2022 climate law, but that's not going to satisfy conservatives who want a full repeal of what they call the 'Green New Scam.'
House Freedom Caucus members, who pushed for deep cuts to the green credits in order to get behind the megabill in their chamber last month, could fight the Senate's slower roll. One member, Rep. Chip Roy, declared on X he 'will not vote for this.'
Dive deeper into the long list of other Senate Finance megabill changes from our Brian Faler.
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THE SKED
The House is out but will convene for a pro-forma session at 11 a.m.
The Senate is in session and will vote on Olivia Trusty's nomination to be a member of the FCC and on Gary Andres' nomination to be assistant secretary of HHS during votes at noon, 2:15 p.m. and 4:30 p.m. The Senate will also vote on the final passage of cryptocurrency legislation during the 4:30 p.m. vote.
— Members will have a security briefing in the wake of the Minnesota shootings at 9:30 a.m.
— Appropriations will have a closed subcommittee hearing on the president's fiscal 2026 budget request for intelligence, with testimony from Director of National Intelligence Tulsi Gabbard, CIA Director John Ratcliffe and NSA acting Director Lt. Gen. William Hartman, and another subcommittee hearing on the budget request for military construction and family housing, both at 10:30 a.m.
— Judiciary will have a hearing on protecting seniors from international scammers at 10:30 a.m.
— Republican and Democratic senators will have their weekly conference lunches at 12:45 p.m.
— Commerce will have a subcommittee hearing on Chinese doping with testimony from U.S. Anti-Doping Agency CEO Travis Tygart, former Olympic swimmer Katie McLaughlin and others at 2:30 p.m.
— Intel will have a closed hearing at 3 p.m.
The rest of the week: The Senate will work through more of Trump's nominations Wednesday before breaking for the holiday. The House is out all week and will return Monday.
THE LEADERSHIP SUITE
Congressional leaders grapple with security issues
Thune said Monday that senators 'all have a responsibility to dial it down' and to 'lower the temperature' after the weekend shootings of Minnesota state lawmakers and their spouses. Temperatures, however, are still running high.
Democratic Sen. Tina Smith confronted GOP Sen. Mike Lee in a hallway off the floor Monday over his X post blaming 'Marxists' for the deadly violence. Smith, a friend of slain state Rep. Melissa Hortman, told reporters afterward that she 'wanted [Lee] to know how much pain that caused me and the other people in my state.' Senate Minority Leader Chuck Schumer condemned Lee's comments in a floor speech.
Tillis told Calen that 'anything short of condemning [violence] would be unacceptable.' But other Republicans largely declined to directly criticize Lee for his postings, with some saying there was little chance of neutralizing the political toxicity of the moment.
'You can talk about it all you want, but it's never going to happen. I've been in sports all my life. Everybody is competitive. They're always going to push back. Nobody is going to give up,' Sen. Tommy Tuberville, a former college football coach, told Calen.
Mullin, who also called for cooler heads, warned that 'unfortunately, it's going to take someone in the House or the Senate to get hurt really bad — God forbid it happens, but it's probably a reality — before maybe they start taking it serious here.'
But the Oklahoma Republican, who leads the Senate appropriations subcommittee that funds congressional law enforcement operations, also stopped short of calling for additional money for member security when Lisa asked about it Monday evening: 'I'm not saying that right now.'
Senators have a security briefing with the chamber's sergeant at arms and the Capitol Police this morning, where the question of resources for lawmaker safety could come up. Across the Capitol, House Minority Leader Hakeem Jeffries is asking Speaker Mike Johnson to increase funding for members' security as more elected officials learn they were potential targets of the man suspected of the shootings in Minnesota. A spokesperson for Johnson didn't comment.
Johnson's incoming war powers headache
A bipartisan group of House members is supporting a war powers resolution in the wake of Israel's strike on Iran — and it's shaping up to be a potential political problem for Johnson and GOP leaders when the chamber returns next week.
Republican Rep. Thomas Massie and Democratic Rep. Ro Khanna are leading the introduction of the resolution that would block U.S. involvement in the conflict in Iran, they said in separate X posts Monday night.
'This is not our war,' Massie said in his post. 'But if it were, Congress must decide such matters according to our Constitution.'
Further illuminating the diverse coalition of support for such a measure, Rep. Alexandria Ocasio-Cortez also said she would also sign onto the effort.
Some pro-Israel lawmakers have already come out against it: 'If AOC and Massie are a yes, that's a good bet that I'll be a no,' moderate New York Rep. Lawler said.
But Khanna said the resolution would come up as 'privileged,' meaning leaders would be forced to take it up in some capacity within a certain number of days. And if the resolution gains enough traction on both sides of the aisle, there's a chance it can actually get adopted — an enormous risk for GOP leadership if the White House digs in against it.
Johnson will have to decide whether to try and block this resolution from ever receiving a floor vote to begin with through maneuvering inside House Rules. He's done this before to stymie bipartisan privileged motions, though it's not clear whether he'd get overruled this time around.
POLICY RUNDOWN
CRYPTO BILL SET TO CLEAR SENATE — The Senate is on track this afternoon to pass landmark cryptocurrency legislation, one of Trump's biggest policy priorities outside the megabill, our Jasper Goodman writes in.
The bipartisan bill would create a regulatory framework for digital tokens known as stablecoins, which are pegged to the value of the dollar. It's expected to draw support from close to 18 Democrats after a month of turbulent negotiations with Republicans, who worked to gather enough support to clear the chamber's 60-vote threshold. The stablecoin regulations have been a longtime lobbying goal for Washington's digital asset industry, which hopes the legislation will be Congress' first step toward making crypto mainstream.
The path to passage in the House, however, remains murky. Financial Services Chair French Hill is weighing whether to package the stablecoin bill with an even bigger prize for the crypto industry: a separate, broader measure that would divide oversight of digital assets between market regulators.
GAO HITS TRUMP'S FUNDING FREEZE (AGAIN) — The Government Accountability Office ruled Monday for a second time that the Trump administration acted illegally by withholding congressionally-approved funds for libraries, archives and museums around the country, our Jennifer Scholtes reports. The watchdog concluded that the Trump administration violated the 51-year-old law barring presidents from withholding federal dollars without the consent of Congress by freezing money intended to flow through the Institute of Museum and Library Services. The GAO is currently reviewing 37 other potential impoundment violations by this White House.
BANKING HUDDLES WITH SENATE PARL — Senate Banking staff met Monday with the parliamentarian's office to discuss the committee's proposed contribution to the GOP megabill, two people granted anonymity to discuss closed-door talks tell Jasper. Something to look out for: whether Elizabeth MacDonough will determine that language in the draft bill to zero out the Consumer Financial Protection Bureau's funding would comply with Senate rules governing consideration of the filibuster-skirting tax and spending package.
While Republicans widely oppose the CFPB — conceived of years ago by the panel's ranking member, Elizabeth Warren — some GOP senators have questioned why Banking Chair Tim Scott would include the provision that may not survive MacDonough's review.
ICYMI, for Pros: What you need to know about the Senate Parliamentarian
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CAMPAIGN STOP
SANDERS BETS AGAINST THANEDAR — Sen. Bernie Sanders is endorsing one of Rep. Shri Thanedar's primary challengers, state Rep. Donavan McKinney, in Michigan's 13th Congressional District. Sanders has a history of backing progressive candidates running against sitting Democrats, with a mixed record of success. McKinney's campaign says it's the first time Sanders has made such a play this cycle. Rep. Rashida Tlaib is also backing McKinney.
But McKinney doesn't have the field to himself: Former state Sen. Adam Hollier, who mounted an unsuccessful challenge to Thanedar last cycle, is running for the seat a third time.
FIRST IN INSIDE CONGRESS: VOTEVETS' PICK AGAINST LAWLER — VoteVets PAC is endorsing Army combat veteran and national security professional Cait Conley in the crowded Democratic primary to take on Lawler if he doesn't run for governor. The Hudson Valley seat is one of Democrats' top targets to flip next year. Conley has 'the grit needed to run a tough race,' VoteVets senior adviser and former New York Rep. Max Rose said in a statement.
THE BEST OF THE REST
Thune sends senators sprinting with new voting stop clock, from David Sivak at the Washington Examiner
Republicans Are All About MAHA — And Propping Up the Sugar Industry, from Claire Heddles and Nuha Dolby at NOTUS
JOB BOARD
Jane Vickers is now a press assistant for House Energy and Commerce. She most recently was a press assistant for Rep. Greg Murphy.
Tashi Chogyal is now campaign manager for Dan Lee's congressional campaign in the Virginia special election. He previously was national Asian American engagement deputy director on Kamala Harris' presidential campaign, and is a Barack Obama campaign/admin alum.
HAPPY BIRTHDAY
Reps. Marcy Kaptur and Scott Peters … Newt Gingrich … former Reps. Brad Wenstrup and Jerry Carl … Matt Canter of Global Strategy Group … Matt Miller … Diane Blagman of Greenberg Traurig … CNBC's Christina Wilkie … Maxine Joselow … Kent Lassman … Nisha Ramachandran … Scott Thuman … Gabe Horwitz … Chris Bedford … POLITICO's Samuel Ogozalek … Jessica Boulanger … Boris Abreu ... Katie Grant Drew … Chris Jennings … Melissa Sabatine … former HHS Secretary Alex Azar … Jacob McIntosh of TriNet … Nora Taktajian of Rep. Doris Matsui's office … Dan Hanlon … Lauren Kennedy of Tillis' office … David D'Antonio … Zainab Chaudary of New Heights Communications … NewsNation's Blake Burman … Connor Joseph … Ryan Serote of Meguire Whitney
TRIVIA
MONDAY'S ANSWER: Blaine Salter correctly answered that Woodrow Wilson established Flag Day in 1916.
TODAY'S QUESTION, from Blaine: Who was the first presidential candidate to appear on a late-night television program and what was the name of the program?
The first person to correctly guess gets a mention in the next edition of Inside Congress. Send your answers to [e-mail].