Good cop, bad cop: How GOP negotiators handled debt ceiling talks
FILE – Top Republican debt crisis mediators Rep. Garret Graves, R-La., left, and Rep. Patrick McHenry, R-N.C., center, chairman of the House Financial Services Committee, with Rep. Chip Roy, R-Texas, upper right, have a laugh as they stop for questions by reporters on progress in the talks with the Biden administration, at the Capitol in Washington, Tuesday, May 23, 2023. Rep. Chip Roy, R-Texas, a member of the conservative House Freedom Caucus, has blasted the tentative debt ceiling deal struck by Speaker Kevin McCarthy, R-Calif., and President Joe Biden and says he will try to stop it in the House. (AP Photo/J. Scott Applewhite, File) J. Scott Applewhite/AP
Good cop, bad cop: How GOP negotiators handled debt ceiling talks
Reese Gorman June 04, 05:00 AMJune 04, 05:01 AM Video Embed
Biden, who was scheduled to leave for Japan the next day, and McCarthy agreed to name a team of negotiators to meet and discuss a deal to raise the debt ceiling. The president would choose Steve Ricchetti, his senior adviser, and Shalanda Young, the director of the Office of Management and Budget. McCarthy would choose Rep. Garret Graves (R-LA) as his lead negotiator and Rep. Patrick McHenry (R-NC). Also crucial in working to strike a deal during the negotiations were members of McCarthy’s staff, including his former chief of staff Dan Meyer, his deputy chief of staff, John Leganski, the deputy chief of staff for policy, Brittan Specht, and two senior policy advisers, Jason Yaworske and Emily Domenech.
The speaker always knew that if he had to nominate someone to be the lead negotiator that he would choose Graves, as both of them have abilities that complement one another. The Louisiana Republican looks at things from a policy and legislative point of view, whereas McCarthy likes to think about the strategy and how to best get something done.
“He is hands down the best strategist I’ve ever worked with,” Graves said of McCarthy. “It has been amazing being able to be with him behind closed doors this year. And see somebody think not just about the next step but thinking five and six steps down.”
On the contrary, Graves likes the policy angle of everything and working to craft and negotiate legislation.
“As not a member of Congress, [Graves] would be a skilled legislative negotiator and would be one of the sharpest leadership staffers in the building,” McHenry said. “But as a member of Congress, he is wickedly sharp and incisive on policy and understands the equities of House Republicans and understands the speaker’s equities.”
McHenry, the House Financial Services Committee Chairman, wasn’t brought into the negotiations until later in the process following a meeting with McCarthy and Graves. Both McHenry and Graves had gotten close during the Speaker’s race in January when they were trying to win over McCarthy’s holdouts, and they knew how to work together.
The two legislators, through their very different styles, were able to form a team that pulled out several Republican wins from the White House, raised the debt ceiling, and won over a majority of their party. Graves and McHenry played to their strengths, which complimented one another. While their roles were interchangeable, Graves would often play the good cop, trying to convince the White House why the provisions they were fighting for were good for the public, and McHenry would often play the bad cop, relentlessly advocating what the speaker wanted, according to a source familiar with the talks.
The negotiators worked for 11 days straight. Pizza, tacos, and Chick-fil-A became staples in the speaker’s office and negotiating rooms throughout the talks, as the negotiators would oftentimes stay in the Capitol until well past midnight before breaking and starting back up again early the next morning.
At one point, on the day the deal was announced, Graves and McHenry were working on some final provisions when McCarthy walked into the conference room and told them, “We’re going to Chipotle.” They then went to two different Chipotles because the first one was out of chips, McHenry said.
While McCarthy continued to talk optimistically about the negotiations, saying they were “productive” and going to keep working, there were moments when things didn’t look bright.
Throughout the process, there were several blowups in negotiations where those involved began to think they wouldn’t get something done, McCarthy said at a press conference after the bill passed out of the House.
“There were times that one side would say to the others, ‘Maybe we need to give up. Maybe we have to have somebody else different in the room,’” McCarthy said.
The most notable blowup came on Friday, May 19, when a McCarthy staffer shouted “bulls***” across the table at White House staff as they continued to push for more spending and insist work requirements for welfare services were a red line.
After about 10 minutes of everyone yelling at one another, they decided to pause the negotiations.
“We had probably three major blowups in this negotiation, one of which was that Friday,” McHenry said.
There was another tense moment closer to the “X-date” when McCarthy got upset with Ricchetti and started cursing at him, saying the White House needed to get serious.
While the moments were tense behind the scenes, there was still a strong sense of respect for the negotiators, and that was portrayed in public statements from McCarthy and his two negotiators.
“I have great respect for the individuals on the president’s team,” McCarthy said two days after the Friday blowup. “They’re bright, they’re articulate, they know exactly what they’re doing. We may philosophically disagree, but we have respect for one another because we’re coming from a place of principles, and when you come from a place of principles, normally, at the end of the day, you can find common ground and keep your principles at the same time.”
That way of thinking allowed for negotiations to move in a positive direction to reach a compromise.
Both sides had their set of red lines that couldn’t be crossed and a set of red lines that were eventually ceded on. For example, the White House was adamant about raising the debt ceiling through the election, whereas McCarthy and his team wanted a one-year debt increase. While both sides pushed for their desired length, the speaker’s team eventually agreed to raise the debt ceiling through the election both for the sake of their own members not having to take a tough vote during the primary but also because the White House made clear they wouldn’t back down from that, according to a senior GOP aide.
“Republicans would not be in a stronger position if this came up in early 2024 because they would be incentivized to vote ‘no’ because it’s primary season,” the senior GOP aid said. “So, if you have a lot more Republicans inclined to vote no and the White House knows that, what leverage do Republicans have in that case?”
And on the other side, the White House originally said work requirements and permitting reform were a nonstarter, but both of those made it into the final bill after much negotiating. Biden started to express an openness to some form of work requirements earlier in the process, but permitting reform really held things up.
When Biden expressed on Friday, May 26, he was “very optimistic” a deal would come by that night, there were still some issues being ironed out, most pressing of those issues was permitting reform. At the time, some staffers involved in the negotiations had given up on including permitting reform in the final bill, and it seemed to be on the chopping block, according to a source.
But Graves was not willing to back off getting it in the deal, telling McCarthy they needed to stand firm on it because the White House had previously been open to including it in the bill.
By doing so, they were able to get the most “substantial environmental permitting reform in over 40 years,” as Graves referred to it.
McHenry took on work requirements as one of his main provisions to get into the bill. At one point, when the negotiators met at the Eisenhower Executive Office Building across from the White House, he stayed back afterward to talk with the White House team about work requirements and a couple of other key provisions, he said.
“It was a lower key way to actually have an interaction on policy without it being part of that larger negotiation conversation,” McHenry said.
The bill that ultimately came out of the negotiations raised the debt ceiling until January 2025, included spending cuts and caps, had permitting reform, added work requirements to Supplemental Nutritional Assistance Program and Temporary Assistance for Needy Families, and had an administrative PAY-GO all significant GOP wins.
Despite the pushback that came from the right flank of the Republican Party and the progressive wing of the Democratic Party, the bill passed overwhelmingly out of both the Senate and House and is on its way to Biden’s desk to be signed into law.
Graves credits all these wins to McCarthy and his strategy.
“It is why they [the White House] absolutely have tire tracks on this negotiation, it is why we absolutely ran over them in negotiations on about seven of their red lines, and that’s why you see them out there trying to sell this and spin it in a way that benefits them,” Graves said.
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