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Debt ceiling negotiators are sounding more positive, but they will have to sell some skeptical parti͏‌  ͏‌  ͏‌  ͏‌  ͏‌  ͏‌ 
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May 23, 2023


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Steve Clemons
Steve Clemons

While Speaker Kevin McCarthy sounds encouraged after talking to President Biden on the debt ceiling standoff, Senator Sheldon Whitehouse, D-R.I. warned yesterday that if the deal is “something that can pass through the House, it’s highly unlikely we’d pass it in the Senate.” It was a reminder that Biden and McCarthy will need to navigate razor-thin margins in both chambers of Congress to ensure the United States’ full faith and credit doesn’t collapse in a week. Over the weekend, I spoke with one of the world’s most successful investors who said, “wait ‘til the markets clear their throats on all this.” Joseph Zeballos-Roig has more coverage on negotiations.

Senator Tim Scott has thrown his hat into the GOP presidential primary race, and Shelby Talcott and Dave Weigel were in North Charleston to cover it. Scott is well-liked on both sides of the aisle and even Donald Trump applauded his entrance in the race, albeit with a statement mostly about how it makes Ron DeSantis look bad. As Trump mentioned, Scott is best known legislatively for his work on “Opportunity Zones” with Democratic Sen. Cory Booker, which ended up as part of the 2017 Trump tax cuts. I talked to the two senators about their work, as well as to the bipartisan economists behind the idea, for an event in 2015. The concept — and how it’s performed in the real world — is likely to get more attention with Scott’s run.

Morgan Chalfant shares the latest on House Select Committee on China Chairman Mike Gallagher’s attempts to address Taiwan security, given concerns about a backlog in arms sales to Taiwan as well as shortfalls in U.S. munitions production amid the war in Ukraine.

Plus, Morgan gets a text from Georgetown Law Prof. Anupam Chander on TikTok suing Montana, which has banned the Chinese-owned social media platform.

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White House: As President Biden and Speaker McCarthy try to unlock an agreement on raising the debt ceiling, the White House is hammering Republicans over the 2024 appropriations bills they’ve already released, estimating the GOP proposals would amount to a 30% cut across priorities like public health and education. The administration released a set of fact sheets laying out what they say would be the impacts on each individual state. Late Monday, the Appropriations panel canceled a planned markup of the bills this week in order to give McCarthy “maximum flexibility as talks continue.”

Senate: Washington Democrats seem to be rallying around Delaware Rep. Lisa Blunt Rochester as their ideal replacement for Sen. Tom Carper, who announced plans to retire in 2024 and backed her as his successor. Majority Leader Chuck Schumer spoke to the congresswoman by phone yesterday shortly after Carper’s announcement, according to a spokesperson for the senator, and “told her he believes she could be a really good Senator and he looks forward to sitting down with her soon.”

House: In a rare show of bipartisanship, the House overwhelmingly passed two China-related bills yesterday — one ordering a Treasury Department report on U.S. “exposure” to China’s financial sector and another requiring a study of illicit financing in connection with fentanyl trafficking. Today, the House will begin considering a resolution revoking Biden’s emissions rules for heavy-duty trucks, which already passed the Senate. That vote is expected to break largely along party lines.

Need to Know
Jerry Lampen/Pool via REUTERS

Treasury Secretary Janet Yellen also sent another letter to congressional leaders warning that it is “highly likely” the so-called “X date,” when the U.S. could default, would arrive in early June and as soon as June 1. She got some backup from the Bipartisan Policy Center, which this morning narrowed its own projection for the drop-dead day to between June 2 and June 13.

E. Jean Carroll is moving to make Donald Trump pay extra damages after the former president said she had “made up” her rape accusations against him and and called her a “whack job” at CNN’s town hall earlier this month. Lawyers for Carroll, who a jury recently awarded $5 million after finding Trump liable for sexual abuse and defamation, argued in a filing that the judge should tack on a “substantial punitive damages” award both to punish Trump and “deter him from engaging in further defamation.”

Special counsel Jack Smith subpoenaed the Trump Organization for any records about its business dealings with seven foreign countries dating back to 2017, the year Trump took office. The subpoena didn’t turn up much new information, according to the Washington Post. But as the New York Times writes, the move suggested federal investigators “have cast a wider net than previously understood” as they look into whether Trump handling of classified documents after leaving office broke the law.

TikTok sued Montana over the statewide ban on the app signed into law last week, alleging it violates the First Amendment as well as other federal laws. The state’s attorney general’s office responded that it was “fully prepared to defend the law that helps protect Montanans’ privacy and security.” Montana is the first state to impose a blanket ban on TikTok. Lawmakers there cited national security concerns associated with the app and its Chinese parent company, ByteDance, which have been echoed by some in Washington.

Morgan Chalfant

Beltway Newsletters

Punchbowl News: The Senate-passed bill repealing outdated 1991 and 2002 Iraq war authorizations is running into some problems in the House, where House Foreign Affairs Committee Chairman Michael McCaul, R-Texas is trying to add to it a measure repealing and replacing the post-9/11 war authorization.

Playbook: Nikki Haley’s campaign is out with a new memo hitting Ron DeSantis as “Trump without the charm.”

Axios: Virginia Gov. Glenn Youngkin is taking another look at running for president in 2024, but he’s likely to wait until after the state legislative elections in early November to jump in if he decides to do so.

Joseph Zeballos-Roig

White House tries to quell Democratic fears as it negotiates on the debt limit

REUTERS/Leah Mills


There were few signs that Democrats and Republicans had come much closer to a debt ceiling deal by the time House Speaker Kevin McCarthy emerged from his 90-minute meeting at the White House on Monday. But the acrimony that had clouded talks over the past few days seemed to have lifted, with leaders from both sides offering cautiously upbeat assessments as aides continued negotiations late into the evening.

“I think the tone tonight was better than any other time we’ve had discussions,” McCarthy told reporters after his meeting. President Biden issued his own statement saying, “We reiterated once again that default is off the table and the only way to move forward is in good faith toward a bipartisan agreement.”

As it plugged away at talks with McCarthy, the White House also attempted to calm unease percolating among Congressional Democrats, who are concerned that any final deal capable of winning GOP support would have to impose severe budget cuts or new burdensome work requirements on safety net programs.

According to two Democratic Senate aides, Biden staffers unexpectedly joined a weekly messaging call with Senate Democratic offices on Monday. During it, White House communications director Kate Berner told participants that the administration will not take votes from his own party’s lawmakers for granted as negotiations go on. “What we are very much trying to emphasize is a bipartisan deal can’t be made solely on their partisan terms,” Berner said, according to one of the aides on the call.

A group of 11 Senate Democrats have continued urging Biden to keep his options open, and be prepared to sidestep Congress and declare the debt limit unconstitutional under the 14th amendment. One of them, Senate Budget Chair Sheldon Whitehouse, warned on Monday that a bipartisan deal may well collapse in the upper chamber.

“If it’s something that can pass through the House, it’s highly unlikely we’d pass it in the Senate,” the Rhode Island senator said in a press call organized by the left-leaning Roosevelt Institute.

Some Congressional Democrats are getting more specific about concessions they’re willing to make to Republicans. House Minority Leader Hakeem Jeffries acknowledged for the first time on Monday that members of his caucus were open to holding federal spending at current levels next year, an option the White House has proposed in talks.

“We’re willing to discuss freezing spending,” Jeffries told reporters on Monday evening. “That’s an inherently reasonable position many in our party might even be uncomfortable with, but President Biden recognizes we’re in a divided government situation.”

Republicans have already rejected that offer, however. On Monday, McCarthy once again said his members would only accept a deal that cut next year’s overall discretionary spending below its 2023 levels.

Republicans have made that math more daunting however by pushing to boost the Pentagon and veterans budgets. That leaves non-defense programs that make up just 15% of the federal budget, but are cherished by Democrats — such as initiatives for childcare, housing, education, and scientific research — to absorb the cuts.

“I’m just saying to you, look at what is being proposed in terms of cuts,” Rep. Rosa DeLauro, the top Democrat on the appropriations panel, told reporters. “Don’t talk about spending in the abstract. Headstart — 200,000 kids no slots, 100,000 kids without childcare.”


If Biden does manage to strike a deal with McCarthy, it seems unlikely Congressional Democrats would really vote to reject it and throw the stability of the entire global economy into question, no matter how strongly they feel about the merits of the 14th Amendment or $1 trillion coin as workarounds. And it’s all but certain that few if any in either party are going to be completely satisfied with any agreement capable of passing both houses of Congress.

“If they come out and AOC is mad and Chip Roy is mad, then you’re probably looking at a bill that has a chance of passing,” a House Democratic aide told Semafor. “If one of them is super happy, then you’re maybe looking at voting math problems.”


Who knows, maybe Whitehouse isn’t bluffing.

Shelby Talcott and David Weigel

‘Grievance or greatness?’ Tim Scott makes his pitch for president

REUTERS/Randall Hill

NORTH CHARLESTON, S.C. – Tim Scott entered the 2024 presidential race on Monday as “the candidate the far left fears the most,” rallying with hundreds of supporters at the college that started his journey from aimlessess to becoming the only Black Republican in the Senate.

The bulk of his message, workshopped over a month of traveling to early primary states, framed the election as a choice between “victimhood or victory” and “grievance or greatness,” with an optimistic “kid raised in poverty” offering an alternative to President Joe Biden.

As we’ve reported in Semafor, Scott faces a steep uphill battle for the presidency. He’s still little known nationally and has not made an impression in early polls.

His talent is not in doubt, though, and he’s found a warm reception from conservative audiences in the run-up to his launch. As one Trump ally texted after his event: “Tim Scott doesn’t have to write ‘Be Likeable’ at the top of his notepad.”

“He’s one of the most courageous and authentic men I’ve ever met,” said Tim Taylor, 53, who described himself as a friend of Scott’s for 25 years. “He’s assaulted all day long because he breaks with the narrative: An African-American man in what’s ostensibly supposed to be just a white tribe.”

For now, his campaign seems to be a safe haven of sorts for notable politicians and donors who aren’t fans of Trump, but aren’t yet sold on DeSantis, who currently sits in far second from Trump.

“I think there are a lot of people who are worried about what’s become of the party, and the way that we communicate,” said former South Carolina Gov. Mark Sanford, who was in attendance to support Scott on Monday.

His strong popularity in the Senate gives him a credible base of potential endorsements, starting with Sen. John Thune, R-S.D., who praised Scott’s work on the GOP’s 2017 tax cut law and said he’d bring “boundless optimism” into the race.

Another key advantage for Scott: A $22 million war chest and plenty of friends to add to it who he’s cultivated after years in the spotlight as a rising star inside the party.

“Larry Ellison is here today,” Scott said from the stage, acknowledging the Oracle co-founder who’s expected to play a major role funding his campaign from the sidelines. “I am lucky to have so many mentors in the house.”

Still, he faces skepticism right out the gate over what exactly it is he’s running for. While Scott’s team has swiftly shut down any speculation that he might be running for a vice president slot (theories that have also been raised regarding some of Scott’s opponents), some attendees on Monday told Semafor that they’d love to see the South Carolina lawmaker in that role.

“I think a Trump/Tim Scott ticket would be excellent, because I think Tim Scott could bring to the ticket a little more palatable public speaking,” Deetz Orlowski, a founding member of the Horry County Conservative Alliance, told Semafor.

Just a Bill

China committee chair seeks to boost U.S. arms production

Taiwan needs more weapons than the U.S. can reliably produce to guard against a potential invasion from China. To address the shortage, Rep. Mike Gallagher, who chairs the House select committee on China, is preparing to introduce an amendment to the annual National Defense Authorization Act aimed at getting arms out the door faster.

The war in Ukraine has depleted weapons stockpiles and the Center for Strategic and International Studies warned in a report earlier this year that the U.S. military would probably run out of long-range, precision-guided munitions in less than a week if it were to go to war with China over Taiwan.

Gallagher’s legislation, which is still being worked on, would amend the Industrial Base Analysis and Sustainment Fund, a program run out of the Pentagon that provides grants for critical defense sector needs, in order to boost production capacity, according to an aide to the China select committee. Gallagher, who is also on the House Armed Services Committee, plans to offer the measure during the NDAA markup and introduce a standalone measure in the coming weeks, the aide said.

In addition to munitions, Gallagher has raised concerns about delays in billions worth of armaments to Taiwan including Harpoon anti-ship missiles and F-16 fighter jets, which he views as critical to deterring Beijing from invading the self-governing island.

The NDAA typically offers a vehicle on which members can hitch some of their major security policy priorities. The markup was supposed to take place earlier this month but has been delayed due to the ongoing debt ceiling talks.

Morgan Chalfant


Ukraine is running out of ammo. The West doesn’t have enough.

To watch the video, click here.

It’s ironic that in the era of drones and artificial intelligence, the war between Russia and Ukraine has in many ways become a contest to see which country can get their hands on the most 155-millimeter howitzer shells.

As trench warfare has taken over the conflict’s front lines, Kyiv’s and Moscow’s forces have come to lean heavily on old-school artillery — launching round after round of unguided explosives at the enemy. But both sides are now running low ahead of impending offensives, global stockpiles are dwindling, and ramping up will take years.

In this part-explainer, part-investigative mini-documentary — the third episode of our series The Agenda — Semafor takes a hard look at the state of the U.S. defense industry to answer why supplying Ukraine with the ammunition it needs has become such a daunting task.

“In the US, we’ve done everything we can to expand capacity, and still we’re producing around 14,000 shells a month, and the Ukrainians are firing 6-to-7,000 a day,” Rep. Jeff Jackson, D-N.C, told Semafor. The Pentagon is currently on track to increase its artillery production sixfold, but only by 2025.

“We have multiple threats around the globe here for which we need to prepare,” Rep. Seth Moulton, D-Mass., adds, nodding at a potential standoff in the Pacific. “And I am concerned that when you take that in totality, we’re not moving quickly enough.”

One Good Text

Anupam Chander is a professor of law and technology at Georgetown Law School and an expert in the regulation of new technologies.


Stories that are being largely ignored by either left-leaning or right-leaning outlets, according to data from our partners at Ground News.

WHAT THE LEFT ISN’T READING: Former secretary of state Hillary Clinton said that Biden’s age is a legitimate factor for voters to consider as he runs for a second term.

WHAT THE RIGHT ISN’T READING: Actor Jon Hamm, a Missouri native, narrated an ad for Sen. Josh Hawley’s, R-Mo. Democratic challenger, Lucas Kunce.

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— Steve Clemons