Look, we hate debt ceiling and government shutdown fights. We think the President should have used the lame duck to get a clean 4 year increase. But here we are. More DC kabuki.

In the face of a very probable unified Democratic partisan opposition, Speaker Johnson has designed his CR to pass with only Republican votes, with a very welcome assist from President Trump's social media megaphone.

It's a "clean-ish" CR, which provides for 204 days of funding.

The bill maintains most fiscal year 2024 spending levels but there are key changes. Defense spending would increase by approximately $6 billion, while non-defense discretionary programs face a $13 billion reduction; it includes an additional $4.2 billion for ICE per a Trump request. It also maintains a freeze on $20 billion in special IRS funding allocated under IRA in 2022. The CR does not touch Social Security, Medicare, and Medicaid, a concession aimed at neutralizing Democratic attacks on Republican fiscal priorities12. However, it doesn't include the infamous "doc fix".

The reason why the bill needs to pass on a party-line vote is because the big Democratic ask during bipartisan negotiations was provisions limiting the Administration and especially DOGE's discretion in allocating appropriated funding. There was no way the Administration and Congressional Republicans would agree to that, so Democrats have seized on this as their excuse for whipping against the bill. In typical Democrat inversion of victim status, they are calling the bill a "power grab" by the Administration, although it doesn't increase the Administration's power, just declines to limit it further than the status quo. Democrats are also saying the CR includes cuts to election security grants, veterans’ healthcare, and the Army Corps of Engineers’ infrastructure projects, although we're not sure where they're getting that info.

The conventional wisdom is that it should pass. There should be 5-10 moderate Democrats willing to cross the aisles, and the bill should not lose that many Republican votes. Still, this being Congress and this being a debt ceiling fight and this being Washington, expect lots of drama until the 11th hour conclusion.

Policy News You Need To Know

#TransgenderMice — You may have followed this little fracas. During his speech to Congress, President Trump said something about DOGE cutting a study on "making mice transgender." This prompted a flurry of legacy media fact-checking with predictably hilarious results: that's not true!, they shouted; the study was about injecting mice with cross-gender hormones to study their effects. In other words…making mice transgender. So President Trump was right, actually. So far so predictable. But wait! It gets funnier! According to Stephen Dinan at the Washington Times, NIH spent a lot more money on a lot more studies on "transgender animal experiments." Is there a serious policy point in all this? We suppose we can find one, and here it is: these types of studies with outrageous headlines have been a political football for many years. Supporters of this kind of funding point out that a lot of legitimate scientific research can be made to sound silly to the average person—and your correspondent, not being a biologist, will readily admit that he can't categorically know that injecting animals with weird hormones cannot possibly lead to useful scientific or medical breakthroughs. But the fact that silly-sounding legitimate scientific research can be so easily politicized sounds to us like an argument against government funding of these types of studies, not for. If you don't want silly-sounding studies to be politicized, don't put them in the middle of the political process! Your correspondent has no strong ideological objection to the government funding some useful scientific studies, but the government certainly shouldn't fund all of it, and certainly no scientific team is entitled to taxpayer funding.

#DOGE — Here's an example of why the maelstrom of news and pseudo-news and commentary around DOGE is so frustrating. The NYT has an article on the National Oceanic and Atmospheric Administration, which they report is said to cut staff by 20%, "in addition to the roughly 1,300 NOAA staff members who have already resigned or been laid off in recent weeks." The NOAA includes the National Weather Service. This tells us nothing, or very little. There's the what and then there's the how. The what, first of all. Monitoring the weather and the climate is a classic public good, something which it is in the public interest for the government to provide as a service for society, with implications for everything from flight control to agriculture. Your correspondent is not bothered by the Federal government providing this service with taxpayer money. At the same time, is it possible, even likely, that an institution like NOAA might have a lot of fat on the bone? Pointless DEI initiatives? "Climate scientists" using legitimate government activities as an excuse to promote politicized propaganda? Sure. Do we know that to be true? The Times notes that according to Project 2025 which, in a very careful, but not inaccurate, turn of phrase, it refers to as "the policy blueprint published by the Heritage Foundation that is echoed in many of the Trump administration’s actions," the NOAA is "one of the main drivers of the climate change alarm industry." Okay. And then there's the how. Granting that some cuts would be in the public interest, the how of those cuts matters a great deal. To use a at-this-point-well-worn analogy, a scalpel is often a better tool than the chainsaw Musk proudly waved around on the CPAC stage. If you give civil service managers hard targets such as 20% staff reduction, you will very likely run into the "Washington monument problem" where they will start by firing the most useful and politically popular people to try to elicit a political backlash and get the cuts reversed. Do we trust Musk's 20-year-olds not just to make cuts but to make the right cuts, and then navigate those cuts through a complex legal and political process? A strong maybe is the rational answer. As a general proposition, is it possible for 20-year-old super-high-IQ "cracked engineers" (in the Silicon Valley parlance) to do this? Yes. Is it even more likely that such 20-year-olds would do a good job than, say, SES managers or McKinsey? Also yes! Actually. But will these specific 20-year-olds pull it off? We just don't know, and we don't as-yet have the confidence to say so.

#DOGE — Speaking of, AP has an interesting profile of Amy Gleason, the former Silicon Valley exec who worked with both the Obama and Trump administrations, who was appointed as Administrator of the DOGE entity.

#DOGE #USAID — Speaking of, Secretary of State Marco Rubio tweets what sounds like the conclusion of the first DOGE saga: "After a 6 week review we are officially cancelling 83% of the programs at USAID. The 5200 contracts that are now cancelled spent tens of billions of dollars in ways that did not serve, (and in some cases even harmed), the core national interests of the United States. In consultation with Congress, we intend for the remaining 18% of programs we are keeping (approximately 1000) to now be administered more effectively under the State Department." This seems like a good outcome and a happy scenario for how DOGE cuts takes shape: first the DOGE kids come in with a chainsaw, and then (this is key) an aligned political appointee glues some stuff back on, scalpels some other things, and out of this at-times-chaotic process comes an agency that's much leaner and more aligned with what its goals should be.

#CivilRights #DEI — Axios has an interesting item on America First Legal, the public interest legal group founded by Stephen Miller during the Biden Administration, alleging without evidence that Miller and America First Legal are coordinating on policy. They note that America First Legal has been waging a pressure and legal campaign to get American companies to opt out of DEI, as well as "aggressively filing complaints and lawsuits to try to make the federal bureaucracy comply with the new president's executive orders." As they put it, America First Legal "has become a private enforcement arm of the White House's assault on DEI." This all sounds good to us…

#LGBT — SCOTUS announced today it will hear a case challenging a 2019 Colorado law that "prohibits licensed mental health professionals from attempting to change a minor's sexual orientation or gender identity through counseling." Apparently, the law was intended to ban so-called "conversion therapy" but it also ended up banning giving good counsel to children experiencing gender dysphoria. Here's a 2020 article from Ryan T. Anderson on the issue.

#IsOurChildrenLearning — The 2024 NAEP, the National Assessment of Educational Progress, a big yearly study on the question of "Is our children learning?" is out, and AEI has a very good analysis of the results. And they're not good. They're calling it a "five alarm fire." We believe that means "really bad."