Dysfunctional Republicans Consider the Steve Scalise Option
Author: Greg Valliere
January 4, 2023
January 4, 2023
GRASPING AT STRAWS: Republicans we talked with last night were close to throwing in the towel — they already are focusing on a potential new candidate to replace the hapless Kevin McCarthy as the potential House Speaker.
SOME REPUBLICANS, UNDAUNTED, PLAN TO LOBBY Sean Hannity and Tucker Carlson, urging them to rally the GOP base behind McCarthy, and others are looking at a scheme that would reduce the number of House votes needed to elect a speaker; could it be less than 218? That would require some Democrats to refrain from voting; good luck with that.
BY VERY EARLY THIS MORNING THE FOCUS HAS SHIFTED to who might replace McCarthy, who has made enormous and humiliating concessions that have had no impact on far-right House Republicans. They simply want McCarthy out, period.
BY DEFAULT, THE FALLBACK CANDIDATE is Steve Scalise, the Louisiana hard-liner who has good relations with virtually all House Republicans, who respect his recovery from a serious gunshot wound in 2017. The problem is that Scalise, the incoming Majority Leader, is a strong McCarthy supporter and so is Rep. Jim Jordan, who also will be on the short list if McCarthy can’t win.
WHO ELSE COULD JUMP IN? Elise Stefanik, 38, the House Republican Conference Chairman; Lee Zeldin, who narrowly lost his race last fall to become New York governor; and dark horse Patrick McHenry from North Carolina. This process could take time — and without a leader, the House GOP will be paralyzed, unable to move on policy.
DEMOCRATS COULDN’T CONCEAL THEIR GLEE yesterday, with Hakeem Jeffries of New York winning more votes than McCarthy (but not the 218 votes needed to win the speakership). For President Biden, who still has not decided whether to run again, the focus will be on governing and bipartisanship.
BIDEN WILL TRAVEL WITH MITCH McCONNELL today to celebrate the construction of a bridge between Ohio and Kentucky that will be built with funds from the $1.7 trillion spending package enacted last month. Then Biden will deliver a strong anti-MAGA message on Friday, the second anniversary of the Jan. 6 riot. He wants a sharp contrast with the GOP.
BOTTOM LINE: We return this morning to several major themes for the financial markets: this Friday’s jobs report and the impact on the Fed; Russia’s battlefield ineptitude; the Chinese covid outbreak; and now this fiasco in the House.
IF THE HOUSE DEADLOCK continues for weeks — or longer — the markets may have to worry about fiscal policy uncertainty. If House Republicans can’t even elect a leader, how will they respond when a debt default crisis looms later this year?
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