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How McCarthy could pick off centrist Dems with 4 debt-limit ideas

The first test is over for Speaker Kevin McCarthy, who muscled together near-total GOP support for a debt plan he padded with conservative priorities.

The vast majority of the debt-limit package House Republicans passed last week is unacceptable to every single Democrat on either end of the Capitol. But GOP leaders are hoping some components of their plan could get buy-in from a smattering of politically vulnerable lawmakers across the aisle.

That contingent of potentially dealmaking Democrats could prove critical as McCarthy pushes President Joe Biden to abandon his insistence on a “clean” increase to the nation’s borrowing limit. The speaker is set to meet the president for round two of debt-ceiling talks next week, alongside Congress’ other top three leaders, as the nation faces the risk of defaulting on $31.4 trillion in debt in as little as one month.

On several occasions during debt-limit negotiations over the last decade, the unpredictable fallout of a looming deadline has helped persuade dozens of lawmakers from each party to begrudgingly support concessions they didn’t love. This time, ideas like beefing up work requirements for food assistance programs aren’t gaining the bipartisan appeal Republicans might have hoped for, while other proposals — like easing permitting for energy projects — might attract enough interest among Democrats to get added to a final deal.

Here’s a breakdown of the particular policy areas in the House Republican bill that might offer an opening for a bipartisan deal, with a clear-eyed assessment of how realistic those hopes really are:

Energy permitting

A sizable share of lawmakers in both parties agree that it takes too long to get permits for energy project construction in the U.S. So House Republicans’ push to streamline permitting rules just might have legs.

But what an agreement would look like, exactly, remains a big question. And Democrats remain resistant to linking energy policy to the debt-limit debate.

“This may be one of the few things we can actually accomplish in this Congress,” Sen. Martin Heinrich (D-N.M.) said. He added that it’s “very clear” Republicans are focused on permitting for oil and gas pipelines, instead of electric transmission lines — an emphasis Democrats could shift.

“They are just out of step with where the economy and country are,” Heinrich said of House GOP lawmakers. “That’s hopefully where the Senate comes in and rebalances.”

Worried that green perks could go to waste from the party-line tax and climate law they cleared last year, many Democrats want the federal government to make it easier to connect clean energy to the grid. Progressives are reluctant to shorten the length of environmental reviews for energy projects, however, for fear that could hurt low-income communities and communities of color.

Details: The House Republican package would streamline permitting reviews for energy projects and mines. But it’s also chock full of partisan priorities like protecting fracking, forcing the sale of oil and gas leases, killing tax benefits for green energy projects and pooh-poohing Biden’s decision to kill the Keystone XL pipeline.

Sympathizers: Sen. Joe Manchin (D-W.Va.) has tried to rally bipartisan support for overhauling energy permitting rules. But he failed last year, as progressive lawmakers argued against changing the rules for environmental reviews and Republicans spurned him for supporting Democrats’ trademark climate law.

In the House, when the chamber first voted in March on the package of energy policies that got rolled into the debt limit package, four Democrats joined as “yeas.” Those supporters included Henry Cuellar and Vicente Gonzalez, who hail from oil-and-gas-rich Texas, as well as centrists Marie Gluesenkamp Perez of Washington and Jared Golden of Maine.

Work requirements

House Republicans are trying to get a handful of swing-state Democrats in the Senate to support tougher work requirements for food assistance programs. But most have resoundingly rejected the idea.

Details: The debt limit bill House Republicans passed last week includes provisions that would expand existing work requirements for the nation’s largest food aid program, often referred to by its acronym of SNAP, along with other emergency aid that low-income families can use to buy food.

Specifically, it requires so-called “able-bodied adults without dependents” who receive SNAP to continue meeting work requirements until they’re 55 years old, rather than the current age limit at 49.

Sympathizers: Manchin has signaled he could be open to beefing up work requirements, potentially backing tighter rules for people who are “capable and able to do it.” House Republicans are quick to highlight Biden’s own embrace of welfare reform during the Clinton administration in the 1990s, when the position was less fraught among Democrats and Biden was a sitting senator — but the stricter work rules getting pushed by today’s GOP go beyond those.

Spending caps

Democrats have insisted that they’re ready to haggle over federal funding for the fiscal year that kicks off on Oct. 1 — just not with the Treasury Department’s borrowing ability at stake.

In order for that to happen, though, Republicans would have to agree to separate government funding caps that aren’t tied to debt-ceiling talks. And that would amount to a major shift from the GOP’s current demand for $130 billion in spending cuts in exchange for a vote to lift the debt limit.

If those talks get decoupled, it’s plausible that both sides could reach an agreement on military spending, since there’s already broad bipartisan support for ensuring the Pentagon gets enough money to at least keep pace with inflation.

Democrats would never sign off on the domestic spending cuts that GOP leaders are seeking. But it’s possible that they could cut a deal with a handful of Republicans — think centrists, purple-state members and appropriators — to keep non-defense funding essentially stagnant, pairing small cuts with increases elsewhere to rein in spending.

Details: The House debt limit bill would cap spending at $1.47 trillion for the upcoming fiscal year, rolling back the clock by two years on federal funding levels. Then for a decade, funding would be allowed to grow by 1 percent every year.

Sympathizers: A slew of moderate Democrats in both chambers have expressed support for fiscal restraint in the abstract, including long-term strategies for stabilizing the national debt like the 2010 budget plan that proposed trillions of dollars in tax increases and spending cuts.

“I am certainly not opposed to working on ways to reduce the debt. I am very, very, very opposed to putting the full faith and credit of the country at risk,” Sen. Jon Tester (D-Mont.), who faces a tough reelection in a red state, has said. “So you know, if we’re talking about doing something like [the 2010 plan], I not only think that’s a good idea, put me on it.”

Ending student loan relief

It’s hard to see Biden negotiating away a major domestic policy achievement that his administration has so vigorously defended in court. Some have even credited the president’s student debt relief plan, announced in the months leading up to the midterm elections, with helping limit Republican gains in the House last November.

A few moderate Democrats have criticized the president’s embrace of mass forgiveness of student loan debt, however, and have signaled openness to a separate Republican effort to nix the relief.

Details: The House GOP bill would overturn Biden’s student loan forgiveness program, which promises up to $20,000 in debt relief per borrower, even as the president’s plan remains in limbo ahead of a challenge at the Supreme Court.

The Republican bill would also block the administration’s new income-driven repayment plan that’s designed to lower monthly payments. And it would permanently curtail the Education Department’s power to create new policies that increase the taxpayer cost of the student loan program.

Sympathizers: When the president rolled out his student loan forgiveness plan last summer, Manchin called it “excessive,” arguing that people need to “earn it” through public service like working for the federal government. Other politically vulnerable Democrats have also spoken against the plan, including Sens. Catherine Cortez Masto of Nevada and Michael Bennet of Colorado, as well as Rep. Chris Pappas of New Hampshire.

Meredith Lee Hill and Josh Siegel contributed to this report.

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