McCarthy's moment: Debt ceiling win secures Republican US House speaker's standing

By David Morgan

WASHINGTON (Reuters) - Kevin McCarthy earned his stripes as Republican speaker of the U.S. House of Representatives on Wednesday, navigating fierce hardline opposition to pass a debt ceiling bill containing federal spending limits that President Joe Biden for months vowed to resist.

Six months after he endured 15 humiliating floor votes just to be elected speaker, McCarthy proved capable of dragging Biden into negotiations over spending and other Republican priorities, and then marshalling two-thirds of his often fractious House Republican majority to enact bipartisan legislation.

"It's not how you start, it's how you finish," McCarthy told reporters after the vote, repeating one of his comments from the January night he was finally confirmed as speaker. The House approved by a 314-117 margin the bill, which lifts the government's $31.4 trillion debt ceiling in exchange for cutting non-defense discretionary spending and stiffening work requirements in assistance programs.

Yet it was a bruising victory for McCarthy. The bill gained 165 votes from Democrats, outnumbering the 149 from members of McCarthy's own Republican party.

The bill now goes to the narrowly Democratic-controlled Senate, which must enact it and get it to Biden's desk by June 5 to avoid a crippling U.S. default.

Republican Representative Dusty Johnson, a McCarthy ally who helped craft the Republican debt-ceiling legislation that buttressed the speaker in negotiations, said the vote proved wrong Democratic predications that the 58-year-old Californian would have little chance of holding his caucus together.

"They said he would never become speaker, and of course they were wrong. They said he would never be able to manage the floor effectively and we haven't had a single bill fail," Johnson said in an interview. "They said he wouldn't be able to cut a deal with the president, and they were wrong about that."

McCarthy has so far succeeded in passing the bill without drawing direct verbal attacks from former President Donald Trump, who urged Republicans to push for a default if they were not able to extract sufficient concessions from Democrats.

Trump, who is seeking a return to the White House in 2024, had blasted top Senate Republican Mitch McConnell for agreeing to raise the debt ceiling during Biden's first year in office. McConnell largely stayed in the background during these talks, which began to move forward after Biden agreed to one-on-one negotiations on May 9.

Avoiding Trump's ire appears to have protected McCarthy's standing with Republican voters nationally, some 44% of whom told a Reuters/Ipsos poll in May that they approve of his job performance, notably higher than McConnell's 29% approval rate.

The bill approved by the House on Wednesday would suspend the debt limit - essentially meaning that it no longer applies - through Jan. 1, 2025. That sets the stage for another showdown in the weeks following the 2024 presidential election.

APRIL GAMBIT

Republican lawmakers and analysts say McCarthy's masterstroke in getting Biden to the negotiating table was his decision to bring a debt ceiling bill to the floor and pass it in April with only the support of his own party members.

Up to that point, Biden had refused McCarthy's requests to negotiate over the debt ceiling, insisting that House Republicans enact their own budget for fiscal 2024 as a prerequisite for spending talks.

But in getting the April measure passed, House Republicans became the only body in Washington that had acted to raise the debt ceiling.

"Once the House passed a bill, 'no negotiations' was a clearly unsustainable place to be," said Rohit Kumar, a former top aide to Senate Republican leader Mitch McConnell who is now co-leader of PwC's national tax office in Washington.

The White House, for its part, contends that the talks between Biden and McCarthy were not a negotiation on the debt ceiling.

"The debt ceiling had to be lifted, and it had to be lifted for a long period of time," White House budget director Shalanda Young told a Tuesday press conference. "You see this bill lift the debt ceiling until 2025. You can call it a negotiation; I call it a declarative statement."

House Republicans say McCarthy has succeeded as speaker, because of an inclusive leadership style, cultivating support from a majority of caucus members by working through major party caucuses, known as the "Five Families," a reference to the warring organized crime clans of "The Godfather" movie.

"Speaker McCarthy's done an incredible job," said Representative Marjorie Taylor Greene, a member of the hardline Republican House Freedom Caucus. "And I think he's proved over and over again that he defies the odds, and he also defies people's expectations."

McCarthy also expanded his influence through trusted friends and longtime associates such as Representatives Patrick McHenry and Garret Graves, who became his lead negotiators with the White House.

POSSIBLE THREAT

But McCarthy is not quite out of the woods. After stirring the ire of hardline conservatives who decried the compromise bill as a sellout, he could face the prospect of ouster at the hands of any single member.

One of the conditions he agreed to in January to win the speakership was allowing for any one member to call for a "motion to vacate the chair," in essence a vote on whether to depose the speaker.

Senior members of the Freedom Caucus have said they would consider next steps in coming weeks.

One of their number, Ralph Norman, said McCarthy should have forced Democrats to accept the House-passed bill.

"I think it weakens him. Whether it's permanent or temporary, I don't know," Norman said.

But Norman said he would not support an immediate effort to oust McCarthy as speaker, adding "To threaten to kick him out now, that's not right."

A similar threat triggered the resignation of former House Speaker John Boehner in 2015.

"This is where the honeymoon can definitely end," said Republican strategist Ron Bonjean, a one-time aide to former House Speaker Dennis Hastert.

Asked this week whether he expects to keep his speakership, McCarthy told a reporter: "What do you think? You guys ask me all the time, and I'm still standing."

His allies say they will defend him against any potential threat to his position.

"We'll have to deal with the internal politics of a hard-fought fight. Tempers are short and emotions are raw right now. But we'll deal with it," Representative Kelly Armstrong, a McCarthy adviser, told Reuters.

(Reporting by David Morgan, additional reporting by Steve Holland and Jason Lange; Editing by Scott Malone and Suzanne Goldenberg)