Johnson Prepares for War With His Own Blue State Republican Colleagues

Speaker Johnson is preparing for a last-minute, must-win round of negotiations with his own Republican colleagues in order to salvage President Trump’s “one big beautiful bill.” Blue state members of the GOP say they will happily sink the legislation if the speaker and his team do not acquiesce to their demands for increased tax deductions for their voters. The debate concerns the State and Local Tax deduction, which is a pricey tax break for those voters who live in high-tax blue states. Mr. Johnson has been trying to strike a balance between those lawmakers in heavily Democratic states who are demanding a break for their constituents, and those who are demanding that the legislation not add a penny to the deficit. On Friday, the House Budget Committee is expected to hold a procedural vote on the total “big beautiful bill” that Mr. Johnson has been trying to push through the House for weeks. Several conservatives have said they cannot vote for the bill because of how much it will accelerate America’s debt spiral, and the SALT demands from blue state Republicans are likely to make those disagreements even worse. One of the leading House members pushing for an increase in the SALT deduction cap is Congressman Nick LaLota, who represents the eastern tip of Long Island. He and his fellow New Yorkers have already rejected the speaker’s offer of a tripling of the SALT cap to $30,000 from $10,000. Talks have gone nowhere since they turned down that olive branch from Mr. Johnson last week. “Still got a lot of work to do,” Mr. LaLota told reporters after leaving a lengthy meeting with his colleagues on Thursday. “Not just on SALT, but on [the Supplemental Nutrition Assistance Program], on Medicaid, on some of the government benefits issues — still got a lot of work to do if we’re gonna get this plane to land in the next week or so.”When asked if he thought Republican leadership and their tax writers were coming closer to a deal with himself and other blue state House members, Mr. LaLota said no progress had been made. The SALT caucus is made up primarily of House members from New York, New Jersey, and California. Two other House members from outside of New York — Congressman Tom Kean of New Jersey and Congresswoman Young Kim of California — say they will vote with their Empire State counterparts to kill the bill if the SALT cap is not raised significantly. “We’re not farther [apart], but we’re not closer either,” Mr. LaLota said Thursday. “Still a lot of specifics that need to be hashed out.”He complained about the increase to a $30,000 deduction cap devised by GOP leadership, which Mr. LaLota says has so far been “tucked into” the tax portion of Mr. Trump’s bill. “That has a value of SALT of around $225 billion. That’s not enough,” he said. “Unlimited SALT costs $1.3 trillion. We’re not asking for unlimited, but we are asking for our fair share.”No matter what the SALT deduction cap is raised to, it will have a hefty price tag. One proposal from another New York Republican, Congressman Mike Lawler, which would raise the deduction cap to $100,000 for individuals and $200,000 for married couples, would reduce revenues by more than $130 billion over the course of just two years, according to the University of Pennsylvania. Another compromise that has been floated by those who want a SALT deduction cap increase is a $62,000 cap for individuals and a $124,000 cap for married couples. The Committee for a Responsible Federal Budget estimates that such a provision would add more than $800 billion to the deficit over 10 years, and would be even more costly than all of Mr. Trump’s other new tax cut promises combined.One deficit hawk who has yet to give his blessing to the reconciliation bill, Congressman Ralph Norman, tells the Sun that whatever these blue state Republicans come up with must be fully paid for. “We can work that out in a manager’s amendment,” Mr. Norman tells the Sun, referring to an amendment process on the House floor that could change the overall bill in order to fit the SALT cap into the legislation. “But they’re gonna have to pay for it. Show me how to pay for it.”When asked about the potential for a raise on the cap to $62,000 for individuals and $124,000 for couples, Mr. Norman responded, “I don’t like that.”He said a $100,000 cap “is out of the question.”

Johnson Prepares for War With His Own Blue State Republican Colleagues

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