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| Presented By The American Petroleum Institute |
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| Axios Sneak Peek |
| By Alayna Treene, Hans Nichols and Zachary Basu · Sep 28, 2022 |
| Welcome back to Sneak. Smart Brevity™ count: 1,084 words ... 4 minutes. 🌀 Situational awareness: Hurricane Ian put on a staggering display of rapid intensification this afternoon, making landfall near Cayo Costa, Florida, as a high-end Category 4 storm. |
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| 1 big thing: GOP's debt limit "nightmare" |
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| Illustration: Aïda Amer/Axios |
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| GOP leaders, congressional aides and business groups are preparing for a potential "nightmare scenario" if House Republicans take back the majority: a debt limit showdown reminiscent of the near-crisis in 2011, Axios' Alayna Treene reports. Why it matters: How GOP Leader Kevin McCarthy (R-Calif.) handles a potential standoff should he become House speaker will be a crucial test for which key stakeholders are already privately planning. Current estimates put the deadline for dealing with the fiscal cliff in fall 2023. Driving the news: The topic has already come up in several private conversations with Senate Minority Leader Mitch McConnell (R-Ky.) — who will play a key facilitating role in debt limit negotiations next year, multiple people familiar with the closed-door discussions tell Axios. - Remember, McConnell was the one who cut a deal with then-Vice President Biden in 2011 to avoid a default.
- "I expect this will be one of the first conversations McConnell has with McCarthy," one Senate GOP aide told Axios.
- Asked whether this will indeed be among the first orders of business he'd raise with a Speaker McCarthy, McConnell smirked.
What to watch: Business leaders and Republican strategists say a key indicator of McCarthy's approach will be who is selected to chair the powerful House Ways and Means Committee, given the debt limit talks fall under its jurisdiction. - The top two contenders are currently Rep. Jason Smith (R-Mo.), ranking Republican of the House Banking Committee, and Rep. Vern Buchanan (R-Fla.), who is seen as the Republican next in line.
- Smith is more of a political firebrand and a close friend of McCarthy, while Buchanan is seen as a more mainstream Republican. The business community is more wary of how Smith would handle a debt limit fight, multiple sources tell Axios.
Smith told Axios in a phone interview he thinks Republicans should leverage debt limit negotiations to "reverse" the administration's "radical" policies — including by sending a bill gutting the Democratic agenda to President Biden's desk and daring him to reject it. Between the lines: The debt limit turning into a "political football" has become a "pattern in divided government," particularly with a Democratic president, Neil Bradley, chief policy officer for the U.S. Chamber of Congress, told Axios. - Rohit Kumar, McConnell's former deputy chief of staff during the 2011 standoff, described raising the debt limit as "this weird, toxic mix of being really politically unpopular, but really economically necessary."
- "That's what always causes me, constantly, so much angst about this issue. The absolute necessity of it juxtaposed with the zero political upside for doing it," he added.
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| 2. 💥 Part II: Going "thermo-nuclear" |
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| Rep. Kevin McCarthy. Photo: Jabin Botsford/The Washington Post via Getty Images |
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| Business leaders, lobbyists, congressional aides and GOP strategists Axios spoke with worry that the current political climate is worse now than it was in 2011, when former President Obama was in power. - Both Bradley and Kumar, in separate interviews, raised the issue of how Republicans in both chambers have repeatedly voted against raising the debt limit and will have to flip their votes in 2023.
- Many of the Senate Republicans whom McConnell had convinced to vote in favor of his debt limit escape hatch in 2021 are retiring.
What they're saying: "There's always this argument and debate about whether the debt limit is leverage. The reality is it's a hostage you can't shoot," Bradley told Axios. "I used to describe it this way to the leaders. … The sequester is like touching a hot stove and pulling your hand away. … A government shutdown is like putting your hand on the hot stove and holding it there until the government reopens. Defaulting on the debt is a thermo-nuclear act that destroys all of Western civilization." Share this story. |
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| 3. 📖 Haberman's time capsule |
| Cover: Penguin Press Headlines from New York Times reporter Maggie Haberman's new book are giving us flashbacks to the frantic early years of the Trump presidency, when reports of his private comments and propositions (like nuking a hurricane) drove news cycles for days: A sampling from the "Confidence Man" book tour: - Trump was on the verge of firing Ivanka Trump and Jared Kushner via tweet before his chief of staff John Kelly advised him he should speak to his daughter and son-in-law directly in person. (CNN)
- Trump raised the idea of bombing drug labs in Mexico — apparently confused after one of his top public health officials, Adm. Brett Giroir, came to the Oval Office wearing his military uniform. (WashPost)
- Trump agreed to condemn white supremacists and former KKK leader David Duke during his 2016 campaign, but told former New Jersey Gov. Chris Christie he was in no rush: "A lot of these people vote." (Insider)
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| A message from The American Petroleum Institute |
| Collaborative research project drives methane solutions |
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| As director of CSU's Methane Emissions Tech Evaluation Center, Dan Zimmerle oversees a facility simulating the real-world workings of the natural gas industry. We spoke with him about why reducing methane emissions matters, how to make methane testing more efficient and the future of energy. |
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| 4. 🇬🇧 Raimondo warns of U.K. "cautionary tale" |
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| Photo: Eric Thayer/Bloomberg via Getty Images |
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| In a rare criticism of one of America's closest allies, Commerce Secretary Gina Raimondo skewered the new British government's massive tax-cut proposal and suggested Prime Minister Liz Truss is not taking inflation seriously. Why it matters: Raimondo, who is well-respected among CEOs and on Capitol Hill, is viewed as a potential successor to Treasury Secretary Janet Yellen if she departs after the midterms. Her comments to Politico's Alex Burns came days after Truss' mini-budget stunned the financial markets and sent the pound into free-fall. What they're saying: RAIMONDO: If you pursue an economic strategy of simply cutting taxes, reducing government and deregulating, it is a failed economic theory that will lead to — long-term — poor results, less growth, more inequality, more fragile supply chains and political division. … BURNS: Would you look at the U.K. today as a cautionary tale, in what you're talking about? RAIMONDO: Yes. You know, it only — these policies are brand new. From where I sit, I don't know how this story's going to end. I would just simply say, we're pursuing a different strategy. We are taking inflation seriously, letting the Fed do its job, watching deficit spending, reducing deficits. |
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| 5. ⛽ Biden's other hurricane warning |
| Satellite image of Hurricane Ian over Florida taken at 3:06pm ET. Photo: NOAA via AP After stressing the "incredibly dangerous" nature of Hurricane Ian in remarks today, President Biden made a point to directly address fossil fuel executives with "one more warning": - "Do not — let me repeat — do not, do not use this as an excuse to raise gasoline prices or gouge the American people."
That quote and related messages were retweeted 11 times by White House chief of staff Ron Klain this afternoon. |
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| A message from The American Petroleum Institute |
| New technology is cutting greenhouse gas emissions |
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| Carbon dioxide emissions in the U.S. are among the lowest levels in a generation, thanks to technological innovations and partnerships across the country. Learn how the men and women of the natural gas and oil industry are building toward a better future. |
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| 📬 Thanks for reading tonight. This newsletter was edited by Zachary Basu and copy edited by Kathie Bozanich. |
 | | Are you a fan of this email format? It's called Smart Brevity®. Over 300 orgs use it — in a tool called Axios HQ — to drive productivity with clearer workplace communications. | | |
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