Congress
The headache that won’t go away for Mike Johnson
An arcane financial policy idea that conservatives love to hate has become a perpetual nightmare for House Speaker Mike Johnson.
House Republicans have been pushing legislation for years that would ban the Federal Reserve from creating a central bank digital currency. Republican hardliners have repeatedly pushed to ban a CBDC in key bills that require Democratic support in the Senate to pass, imperiling their path forward.
Conservatives secured their biggest victory on the issue yet Wednesday after convincing GOP leaders to combine the digital currency ban with a bill reauthorizing government spy powers set to expire Thursday. That’s setting up a major clash with the Senate, where Democrats oppose a CBDC ban and Majority Leader John Thune has warned that a combined bill is “dead on arrival.”
House hardliners’ anti-CBDC crusade has contributed to the growing dysfunction among House Republicans. The issue is also bewildering to Senate Republicans, who don’t want the push to imperil other legislation.
“I understand if there is a fear out there on it, but right now we’ve got some other fish to fry, and we need their help to get these other issues done,” said Sen. Mike Rounds (R-S.D.), a senior member of the Senate Banking Committee. “Let’s take the wins that we can get.”
The House on Wednesday approved an extension of a key section of the Foreign Intelligence Surveillance Act that will be combined with a CBDC ban before being sent to the Senate. The combined measure is unlikely to clear the upper chamber, and it’s unclear how lawmakers will extend the spy powers before they expire at the end of the month.
Conservative hardliners say a CBDC would lead to government financial surveillance and suffocate private-sector innovation in the crypto industry. The ban has been a priority of the House Freedom Caucus this congress.
“It’s a worthwhile cause,” Rep. Warren Davidson (R-Ohio) said of the ban. “It’s the creepiest surveillance tool ever developed.”
The trouble for Johnson started last July when conservative hardliners froze the House floor, demanding that the CBDC ban be included as part of a larger crypto measure. To resolve a standoff over the demand, Johnson promised the House Freedom Caucus that the ban would be attached to a must-pass defense authorization bill later that year — a pledge he later broke.
The issue created another snag when GOP hardliners said a temporary ban included in a now-stalled Senate housing package didn’t go far enough, threatening to tank the bill if it came to the floor. Now FISA’s fate is wrapped up in the issue.
Johnson told reporters Wednesday that “the Senate knows exactly what we’re doing, of course.”
“They’re watching this very closely, and hopefully they can process what we send them,” Johnson said.
The vast majority of Republicans support the CBDC ban. However, most don’t think the issue should hold up other major legislative party priorities.
Rep. Andy Barr (R-Ky.), a senior House Financial Services Committee member, said the ban was an “important issue” but “shouldn’t prevent us from making progress in other areas.”
Another senior House Financial Services Committee member, Bill Huizenga (R-Mich.), said that he wants a ban “probably more than a lot of folks do” but that “people are not necessarily using the proper time, proper place” to push the policy.
Acting Attorney General Todd Blanche is in the Capitol meeting with holdout GOP Sens. Lisa Murkowski of Alaska and Bill Cassidy of Louisiania as he tries to lock down their support for his confirmation as permanent leader of the Justice Department.
Sen. Bernie Moreno (R-Ohio) declined to respond directly Wednesday to Speaker Mike Johnson’s refusal to denounce his former son-in-law Rep. Max Miller over abuse accusations leveled by Moreno’s daughter: “These aren’t accusations in my world,” he said.
“In my world, this is the reality,” Moreno told reporters at the Capitol. “This is not something that is theoretical to me. This is my lived reality of my daughter and my family every single solitary day.”
In an interview with Dasha Burns for Blue Light News’s The Conversation, Johnson declined to take sides in the dispute between Miller (R-Ohio) and Emily Moreno. He called for a House Ethics probe to “play out.”
Defense Secretary Pete Hegseth’s expected choice for Army chief of staff faces resistance that could imperil his confirmation, according to the chair of the panel that needs to approve it.
Senate Armed Services head Roger Wicker (R-Miss.) said Wednesday that he was aware of “some opposition within the committee” to acting Army chief of staff Gen. Christopher LaNeve taking the job on a permanent basis.
LaNeve, previously Hegseth’s senior military aide, was confirmed as Army vice chief of staff in January. But he has also served as acting chief of staff since April when Hegseth forced out popular Gen. Randy George, a move that drew widespread criticism from lawmakers in both parties.
Wicker said he was “not able to predict right now” if lawmakers could address concerns about LaNeve. He did not specify whether the concerns were raised by Republicans, but GOP resistance is likely given that nominees could advance through the committee on a party-line vote.
LaNeve has only held the position of four-star general for six months, an anomaly for the the senior most Army officer.
The Wall Street Journal first reported about Republican opposition to LaNeve, citing Sen. Joni Ernst’s (R-Iowa) concerns about his lack of experience at the four-star rank.
Ernst, in an interview, did not dispute that she was the source of the holdup. But she called it a moot point as President Donald Trump has not yet formally nominated LaNeve to the position. And she disputed reports that LaNeve’s lack of experience was the sticking point.
“I don’t think that time and grade has anything to do with leadership ability, so I don’t know how that came about, honestly.” she said. “That’s not what I’ve told anyone.”
If the opposition continues, Trump could decide to leave LeNeve in the acting position indefinitely.
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