Senate Republicans Declare House Budget Unacceptable

Tuesday’s significant victory for Speaker Mike Johnson may be short-lived.

Senate Republicans Declare House Budget Unacceptable
House Republicans engaged in extensive negotiations before unveiling a budget blueprint dubbed “one big, beautiful bill.” However, Senate Republicans are now gearing up to dismantle it.

Following a narrow 217-215 vote in the House on Tuesday, GOP senators signaled on Wednesday that they are unlikely to accept Speaker Mike Johnson’s fiscal plan in its current form, indicating challenges ahead for President Donald Trump’s legislative goals in Congress.

While Senate Republicans are not looking to start over entirely, most expressed a willingness to adopt the House’s single-bill strategy after initially advocating for a competing two-bill approach for over two months. Nonetheless, they demand significant modifications to the policy decisions included in the House’s proposal.

Senate Majority Leader John Thune described the approved House budget as “a first step in what will be a long process, and certainly not an easy one.”

During a closed-door lunch session on Wednesday, Thune informed senators that adjustments to the House budget would be necessary. An informal meeting is scheduled for next week to begin reconciling the two chambers' positions, as relayed by an anonymous attendee. Thune, alongside Johnson and the leaders of Congress’s tax committees, plans to meet with the White House later in the day to discuss Trump’s tax initiatives.

At a luncheon earlier this week, Senate Republicans acknowledged that further negotiations were essential with their House counterparts regarding Trump’s domestic policy agenda, which encompasses defense, energy, border security, and a tax code overhaul. This includes potential amendments to the budget resolution, according to two sources who spoke anonymously about the private discussions.

“It doesn’t fit the president’s plan in its current form, so we would have to make some changes,” said Sen. Mike Rounds.

Having already approved their own budget earlier this month, Senate Republicans have yet to decide whether to formally request a conference committee with House members or pursue informal negotiations with both the House and the Trump administration to reach a compromise. Thune mentioned in a brief conversation that he was keeping “all the options available to us.”

Following the House’s approval of its budget, Thune emphasized the necessity of including a permanent extension of the 2017 Tax Cuts and Jobs Act in any Republican tax legislation. This remark implicitly critiqued the House’s budget, which permits $4.5 trillion in net tax cuts—insufficient, according to tax writers in both chambers, to facilitate the permanency of the TCJA alongside Trump’s other tax priorities.

“I know my Senate colleagues are committed to, as is the president, permanence in the tax situation. And we don’t have yet in the House bill so we’re going to work together in a cooperative way,” asserted Sen. John Barrasso, the No. 2 Republican in the Senate.

Sen. Steve Daines of Montana, who spearheaded a letter on February 13 urging Trump to make the tax cuts permanent, noted that he and Finance Chair Mike Crapo met with Trump earlier in the week to advocate for the permanence of the expiring tax cuts.

“We had Howard Lutnick, Scott Bessent on the phone strongly supporting permanence; Kevin Hassett strongly supports permanence,” Daines said, referencing the Commerce Secretary, Treasury Secretary, and Director of the National Economic Council. “The Senate’s behind permanence. I think many in the House leadership will support permanence, as well.”

Senate Republicans are scrutinizing not only the tax extensions but also a provision in the House framework that proposes at least $880 billion in cuts from the committee overseeing certain health care programs. Critics warn that this plan could lead to significant reductions in Medicaid and other social programs—issues that some GOP senators strongly oppose.

“There might be a lot of things we change. There are going to be a lot of concerns over the Medicaid cuts,” said Sen. Josh Hawley. “I realize it’s just a broad instruction to that committee, but I think there will be concerns about that and what that may lead to.”

Some GOP senators previously helped defeat a budget amendment from Sen. Rand Paul that suggested a minimum of $1.5 trillion in spending cuts—equivalent to the House budget—indicating the inevitable conflicts between the two chambers.

Hawley noted that while he expects Republicans to support work requirements for Medicaid recipients, they are likely to reject any cuts affecting working Americans. He added that it remains uncertain how Senate Republicans will address these issues, but suggested that safeguards could be incorporated into the final budget plan to ensure that spending cuts would be “not to include the following.”

Conversely, some senators advocate for even steeper reductions in spending. Sen. Ron Johnson stated that the House budget’s proposed cuts are “just not adequate.” He expressed a desire to reduce federal spending to pre-2020 COVID-19 levels.

Additionally, Senate Republicans have not committed to maintaining the House’s proposed $4 trillion increase in the debt ceiling. Certain Senate conservatives have warned against supporting a budget resolution that includes a debt-limit increase, although the majority of the House’s hard-liners ultimately agreed to it.

“Acquiescing to a $4 trillion increase in the debt ceiling is for me a non-starter,” Paul stated, having opposed the Senate GOP budget approved earlier this month. “It basically acknowledges that this year the government’s going to be $2 trillion short.”

Senate GOP leaders continue to deliberate on tying a debt ceiling increase to the ongoing government funding negotiations, which would necessitate Democratic support. Raising the debt ceiling outside of reconciliation would allow Congress to temporarily suspend the borrowing limit instead of voting on a specific figure, a politically sensitive maneuver.

Ben Leonard contributed to this report.

Ramin Sohrabi contributed to this report for TROIB News