Jan. 17 (Bloomberg) -- House Speaker John Boehner, facing a fight over raising the $16.4 trillion U.S. debt ceiling and funding the federal government in coming weeks, is working first to forge a more manageable Republican caucus.
Boehner is making moves to control his members. The speaker removed four Republicans who opposed him on spending issues from the Budget and Financial Services committees, and a Boehner ally took control of a group of more than 165 members that aligns with the anti-tax Tea Party on fiscal issues.
The stakes are high as House Republicans gather today in Williamsburg, Virginia, for a retreat to plan strategy. Members are demanding spending cuts from President Barack Obama and the Democratic-led Senate in exchange for a debt-ceiling increase. Still, Republicans risk being blamed for a government shutdown - - or should the U.S. default on its debt for the first time.
“It is a very difficult conference to manage,” six-term Representative Tom Cole, an Oklahoma Republican and an ally of Boehner, said in an interview.
Boehner, from Ohio, leads a reduced majority of 233 members, down from 241 Republicans in the last session of the 435-seat House. Many Republicans are smarting over their inability to prevent tax-rate increases in a Jan. 1 deal to avert automatic tax increases and spending cuts.
Rank-and-file members will do much of the talking during the private getaway, and Boehner will do the listening.
“We’re going to be talking a lot about policy issues, the kinds of initiatives that we’re going to try and come together on,” said Representative Trent Franks, an Arizona Republican.
Although the debt limit has been periodically raised since its creation in 1917 -- with Congress raising or revising it 79 times, including 49 times under Republican presidents, since 1960 -- Republicans are preparing for confrontations with Obama and Senate Democrats over spending. That will start with a debate about raising the debt ceiling next month.
The Treasury Department has said that it expects to run out of emergency measures to prevent a breach of the current debt limit between mid-February and early March.
Investors in U.S. Treasury bonds, who most directly bear the risk of a government default, haven’t shown any alarm.
The last time Congress fought over raising the ceiling, Obama signed an increase on Aug. 2, 2011, the day the Treasury Department warned that U.S. borrowing authority would expire. Standard & Poor’s cut the nation’s credit rating. Still, yields on 10-year U.S. Treasury notes declined to 2.56 percent on Aug. 5 and have continued to drop. The yield rose two basis points, or 0.02 percentage point, to 1.84 percent at 8:15 a.m. today in New York.
Another political showdown may emerge in early March, when Congress must decide whether to replace $110 billion in automatic cuts in federal defense and discretionary spending. The reductions had been set to start this month, until Congress delayed them in the Jan. 1 tax deal with Obama.
On March 27, a short-term measure that funds government agencies will lapse, creating a third potential fight.
The House speaker can’t leave decisions about the trio of issues to his caucus, Cole said.
“I would hope that there is some sort of game plan that they have in mind because I really think when you are a leader you have to lead,” Cole said.
Lawmakers also expect Boehner and his chief assistants -- Majority Leader Eric Cantor of Virginia and top vote-counter Kevin McCarthy of California -- to show that they are unified after ending the last lame-duck session at odds.
“As long as Cantor and Boehner are on the same page, I don’t think there should be a problem,” Representative Mike Simpson, an Idaho Republican, said in an interview.
In an unusual leadership split, Cantor and McCarthy voted against the Jan. 1 bipartisan tax plan. Among the House’s 241 Republicans, 151 opposed the measure. The division was notable, given that the Senate vote adopting the deal was close to unanimous -- just five of the chamber’s 47 Republicans opposed it.
“The most important thing for Republican unity is a unified leadership team,” said Cole. “ If we do not get a strong lead from there then everything else is impossible.”
Because House Republicans voted against the Jan. 1 budget deal, Boehner had to rely on Democratic support to push it through. Eighty-five Republicans and 172 Democrats voted for the measure while 16 Democrats and 151 Republicans opposed it.
That violated an informal House Republican rule dating to former Speaker Dennis Hastert of Illinois, who led the House for eight years starting in 1999. He said he wouldn’t bring legislation to the floor unless most of the Republican majority backed it.
Boehner had to bypass that rule again this week when the House passed financial aid for Hurricane Sandy victims. Only 49 Republicans joined 192 Democrats in supporting the measure, while 179 Republicans and one Democrat voted against it.
Boehner has taken several measures to bring members into line during his second term as speaker.
Republicans Walter Jones of North Carolina and David Schweikert of Arizona were removed from the Financial Services Committee, while Republicans Justin Amash of Michigan and Tim Huelskamp of Kansas were removed from the Budget Committee.
All four opposed a 2011 budget bill that ended an impasse between Republicans and Obama. A Republican leadership aide said on condition of anonymity last month that the four were removed because they weren’t regarded as team players.
Amash, Schweikert and Huelskamp were elected in 2010 with support of the Tea Party. Their reassignments drew a protest from FreedomWorks, an umbrella group for the Tea Party movement.
Boehner has said that he will stop negotiating with Obama behind closed doors and instead work through public channels, Cole and Huelskamp said in interviews. Twice, private deficit talks between Boehner, 63, and Obama, 51, collapsed because of House Republican resistance to tax increases.
Boehner’s Republicans scuttled a plan he wanted to bring up for a vote during last month’s budget negotiations. The speaker’s “Plan B” sought to preserve tax cuts for people earning less than $1 million a year.
Anti-tax Republicans forced him to cancel the vote, and Congress wound up enacting a plan that retained the tax cuts for fewer people -- individuals earning up to $400,000 and married couples earning up to $450,000.
Some House Republicans taking leadership positions may help Boehner unify his caucus. Representative Steve Scalise of Louisiana took the reins of the Republican Study Committee, a group of more than 165 lawmakers that promotes small government and aligns with the Tea Party on fiscal issues.
Unlike his predecessor, Representative Jim Jordan of Ohio, Scalise is considered a Boehner ally.
Representative James Lankford, a second-term member from Oklahoma, took the House Republicans’ fifth-ranking leadership position as chairman of the Policy Committee. Lankford is a member of the conference’s “largest single class,” consisting of lawmakers elected in 2010, said fellow Oklahoman Cole.
“He’s perfectly suited for the job,” Cole said, because he “could bring peace among quarreling teenagers” running one of the largest Christian youth camps before joining Congress.
Still, the speaker faces a difficult task in managing his caucus, Ron Bonjean, a Republican strategist and former aide to Hastert, said in an interview.
“This is one of the toughest times for the Republican majority because of their divisions,” Bonjean said.
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