U.S. Congressional Update

Since January, the United States Congress has largely focused its attention on confirming President Trump’s nominees, repealing regulations adopted under the Biden Administration, and advancing reconciliation, a somewhat complicated process designed to enact tax and spending cuts.

Despite early suggestions that President Trump would seek to bypass the Senate’s constitutional power of “advice and consent” by making so-called “recess appointments” for many if not all of his nominees, the regular process has played out as intended. The Senate, with its 53-47 Republican majority, has continued to process nominations at a fairly rapid pace. All of the nominees brought to the full Senate have been approved, some with at least limited bipartisan support, while others have drawn limited opposition from members of the majority (though not enough to result in their defeat).

On the regulatory front, Congress has considered a slew of “resolutions of disapproval” of Biden-era regulations under the Congressional Review Act (CRA). That law allows Congress to overturn regulations by a majority vote within a defined time period after their adoption. The clock to overturn regulations promulgated during the Biden Administration under the CRA process is set to expire around May 10, 2025.

The highest priority for congressional Republicans is “reconciliation”, a process by which Congress can enact changes to the tax code and mandatory spending programs (such as health benefits and food assistance for low-income families) with a simple majority vote, thus bypassing the Senate filibuster. In the President’s parlance, this is the “one, big, beautiful bill” that is key to advancing his agenda.

Congress recently took the first step in this process by adopting a budget resolution, which provides “reconciliation instructions” to various committees on how much they should seek to cut from (or in rare cases, add to) programs within their respective jurisdictions. While the House and Senate were ultimately able to agree on the budget resolution, the resolution itself underscores significant differences that remain between the two bodies.

For example, the budget resolution requires House committees to cut $1.5 trillion from mandatory spending programs over the next ten years, while Senate Committees are only required to make $4 billion in cuts. These bifurcated instructions reflect unease among some Senate Republicans about likely cuts to Medicaid that the larger House cuts would almost surely require.

Similarly, the budget resolution allows the Senate to make an additional $1.5 trillion in tax cuts as compared to the House. This is premised on the questionable assumption—which may or may not pass muster with the Senate parliamentarian, the final arbiter of the rules for reconciliation—that maintaining massive tax cuts enacted in the first Trump Administration would have no impact on the federal deficit.

As many commentators have pointed out, passing the budget resolution was the easy part of the reconciliation process. The hard part will be to actually bridge the many differences among congressional Republicans—some very significant—while maintaining nearly unanimous support from their members in both bodies. The Republicans also decided to raise the debt limit as part of reconciliation, a step that must be taken by sometime late this summer to avoid a U.S. default. The stakes for passing reconciliation are high and the clock is ticking. Stay tuned.