Saturday, February 24

Analysis | The House GOP is test driving a new campaign slogan

The question has been deployed as a catchall phrase at the House Republican retreat this week for blaming Democrats for inflation and high gas prices, a spike in drug overdoses Republican argue is due to lenient border policies and the increasing power of Big Tech.

“The real answer is we cannot afford it,” Minority Leader Kevin McCarthy (Calif.) said Wednesday on the retreat’s first day. “We will act differently. This Congress will be different. It will be focused on solutions and we’re willing to work with anybody that wants to work on solutions.”

That assertion is sure to be met with skepticism from Democrats.

To agenda or not to agenda?

House Republicans are working to complete what they say is an updated “Commitment to America” agenda, which they credit for helping them pick up more seats than expected in 2020, to give voters an early look at how a GOP majority would govern.

But releasing an election-year agenda has divided the party. Senate Minority Leader Mitch McConnell (R-Ky.) has made clear he thinks Republicans should focus on criticizing Democrats and forego running on policy prescriptions.

The retreat has focused mostly on traditional Republican policy agenda items such as national security and the economy and not so much on the cultural issues that have recently animated the party.

Absent from the public aspects of the confab but lingering in the air is the question of whether the party will continue to fully embrace the populist rhetoric of former president Donald Trump or begin to move back to its more traditional policy fare.

Asked by Punchbowl News Thursday night whether he’s confident he’ll win the speakership if Republicans retake the House, McCarthy said he expects members to hold his feet to the fire but expressed optimism he’d land the job.

“If you’re minority leader the day of the election and you win the majority, you’re probably going to be the speaker,” he said. “They’re not going to change the coach between the playoff and the Super Bowl.”

Steven Rattner wants Larry Summers in the Biden administration

Seven questions for … Steven Rattner: We chatted with the former Obama administration official about President Biden‘s economic agenda, his admiration for former Treasury Secretary Larry Summers and why he thinks Sen. Joe Manchin (D-W.Va.) was right about the Build Back Better Act. This interview has been edited and condensed for length and clarity.

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The Early: You’ve been one of the leading Democratic critics of Biden’s economic policy. How would you grade his record so far?

Rattner: It gives me no pleasure to say this, but I don’t think history is going to look back on either his economic policy or the Fed’s monetary policy with great favor. In retrospect, there’s no question that we way overstimulated the economy relative to what was needed. No one would disagree with the fact that some amount of stimulus was certainly needed in 2020. But by the time we got to 2021 and certainly sitting here in 2022, the last thing this economy needs is more fiscal stimulus.

The Early: In his State of the Union, Biden said, “One way to fight inflation is to drive down wages and make Americans poorer. I have a better plan to fight inflation. Lower your costs, not your wages.” What do you make of that approach?

Rattner: There are certainly elements of Biden’s Build Back Better proposal and other proposals that he’s made that, in the long run, could have a positive impact on inflation. The idea that in the short run you’re going to somehow move around a set of costs in a way that’s going to have a meaningful impact on inflation doesn’t seem obvious to me. I don’t believe that you need to “drive down wages” in order to restrain inflation. But you do need to reduce demand, which is what has caused a lot of this inflation.

The Early: You wrote in a New York Times op-ed last month that Biden’s claim that “the reason for the inflation is the supply chains were cut off” was “misleading.” What do you make of Biden’s recent remarks blaming Russian President Vladimir Putin for rising gas prices?

Rattner: Oil prices were already rising before the Russian invasion. They’d already gotten above $80 a barrel, because the world is, broadly speaking, short of oil. The world is still using huge amounts of oil, and supplies are not growing nearly as fast. Russia certainly compounded that problem. But [Russia] is by no means the only reason why gas prices have been rising now for a couple of years.

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Rattner: I think you have to be careful what you wish for. We are trying to achieve an energy transition away from fossil fuels. The more you bring down gas prices, the more you encourage gasoline use. You would be amazed at how close a correlation there is between gas prices and what kind of cars people buy. So, in a way, if you’re in favor of an energy transition, you should want higher gas prices, not lower gas prices. I certainly recognize the impact of high gas prices on consumers — particularly lower-income consumers. But a much better way to address that problem would be to provide a broader kind of tax relief rather than targeting lower gas prices, per se.

The Early: Manchin has cited inflation as one of the reasons he’s been hesitant to move forward with the Build Back Better Act. He’s indicated recently that he’s ready to start negotiating a more limited bill focused on energy, prescription drugs, tax hikes on the wealthy, etc. Do you think there’s any reason at this point not to pass such a bill because of inflationary concerns?

Rattner: I’m very much in favor of much of the Biden agenda being passed. I just want it to be properly financed and paid for. One of the problems with the original Build Back Better bill was that, in theory, it was paid for but 1) the [revenue] was spent sooner than the money was collected, and 2) several of the spending proposals were set to expire in order to make them fit into this kind of budgetary construct. And we all know that government programs don’t expire that often. So I think Senator Manchin was right in pointing out those issues and in bringing a halt to it so that we can hopefully come up with a better package.

The Early: If you could add one person to Biden’s economic team, who would it be?

The Early: And why is that?

Rattner: Because Larry is the smartest, clearest-thinking economic policy person I know. Larry has been right on all of this from the beginning and it would have been great to have had his voice in the room when much of this was decided.

Biden travels to Poland for meetings with Polish leader

✈️On the schedule: Biden will travel today from Brussels to Rzeszów, Poland, near the Ukrainian border. He’ll be briefed on the refugee crisis and meet with soldiers from the U.S. Army’s 82nd Airborne Division deployed in Poland before flying to Warsaw.

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🚨 New partnership alert: President Biden and European Commission President Ursula von der Leyen announced today in a joint appearance a new joint task force to reduce Europe’s reliance on Russian fossil fuels, as the West looks to further punish Russia for its invasion of Ukraine, our colleagues Emily Rauhala, Tyler Pager and Ashley Parker report. 

What else we’re reading about the trip: 

Sen. Manchin launches new push for ‘all of the above’ energy bill

What Manchin wants: Manchin “has restarted talks with fellow Democrats about reviving the party’s climate and social spending bill, according to two people familiar with the matter,” our colleagues Maxine Joselow, Anna Phillips and Tyler Pager report.

Manchin “has told staff members and colleagues that the legislation must be voted on before senators leave town in August, according to the two people, who spoke on the condition of anonymity to describe private conversations.”

  • He’s “said that he wants the bill to take an ‘all-of-the-above’ approach to energy policy, these people said, and that it’s still possible to reach a deal that includes billions of dollars’ worth of provisions to tackle climate change, cut prescription drug costs and update the tax code.”
  • “He has also indicated that he wants the Biden administration to make some concessions related to oil and gas drilling in the Gulf of Mexico and natural gas exports, they added. The current five-year plan for offshore oil and gas leasing in federal waters expires on June 30, and the Interior Department is running behind schedule in drafting a new one, which has frustrated drilling proponents.”

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