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House Rules

Updated: Mar 8, 2023

You may have missed it, but if so, it was some of the best theater I’ve seen in years. What is normally a non-eventful process in the House of Representatives, seldom visible to the American people, took center stage this past January as part of the process to elect Kevin McCarthy as the Speaker of the House of Representatives for the 118th Congress.

Unfortunately for Mr. McCarthy, his lack of trust within his own party made it virtually impossible for him to garner the number of votes needed from fellow Republicans to easily become Speaker. While McCarthy readily captured around 200 votes from ‘establishment’ Republicans, his ability to become Speaker required 218 votes - under the assumption that all GOP members cast ballots. Thwarting his efforts were a group of 20, let’s call them ‘conservative’, members of the GOP who wanted to see substantive changes made to the way in which the House of Representatives would be managed and wanted a larger voice in the legislative process. Within this group of 20 were 6 hardliners that indicated they would not vote for McCarthy under any circumstance.

With this background the show began! With popcorn in hand, I sat down to watch C-SPAN. Riveting I know! What a show it was. What made the vote for House Speaker so entertaining is that all House members have to go on record by verbally casting their vote. As the votes were taken and tallied it became quite clear that Mr. McCarthy would not reach the required number to be elected speaker. With each vote the tension grew as did behind the scenes negotiations regarding new House rules. Heck, even a fight broke out after vote 14. Finally, on the 15th vote Mr. McCarthy reached the required number but only after several members voted ‘present’ and Mr. McCarthy having to agree to a sweeping set of changes in House rules and committee assignments.

So, what changed and what impact might this have on businesses and individuals? Let’s take a look:

According to CNN here’s what the holdouts got from McCarthy in exchange for the speakership and my thoughts (in blue) on their significance:

  • Any member can call for a motion to vacate the speaker’s chair

    • This should hold Speaker McCarthy to the commitments he made to his members as failure to do so would likely result in many calling for his removal

  • A McCarthy-aligned super-PAC (the Congressional Leadership Fund) agreed to not spend in open Republican primaries in safe seats

    • While there are no implications here for business or individuals, it is a clear indication that conservative members of the House do not want McCarthy using his PAC to defeat more conservative Republican primary candidates

  • The House will hold votes on key conservative bills, including a balanced budget amendment, congressional term limits, and border security

    • Of course, we would need to see the details associated with these bills but the simple fact that all House members will have to go on record regarding these topics will tell us a lot. And if any of these were to pass it would be a huge win for businesses and individuals alike

  • Efforts to raise the nation’s debt ceiling must be paired with spending cuts

    • A huge win for American businesses and individuals. If you were maxed out on three credit cards do you think another company would give you a 4th? A debt ceiling that keeps going higher is just like getting that 4th credit card. Our government needs to be brought back to something resembling fiscal sanity and this is a good step in that direction – BTW, don’t believe the nonsense reported about the U.S. defaulting on its debt. That’s not going to happen. By prioritizing debt payments and cutting spending, debt obligations can be met and the financial position of the country would improve as a result

  • Move 12 appropriations bills individually, instead of passing separate bills to fund government operations

    • This is a key provision as it will permit the House to appropriate money for government activities individually thereby providing more oversight as to how tax monies are being spent. This will end the massive spending bills passed in the dead of night with no time for review or amendment. This can only benefit individual Americans although some businesses may find that this process results in the loss of government freebies

  • More Freedom Caucus representation on committees, including the influential House Rules Committee

    • This is not likely to have any material impact on business with the exception of those businesses (i.e. Big Tech and Pharma) who will be the target of some of the investigative committees already up and running

  • Cap discretionary spending at fiscal year 2022 levels, which would amount to lower levels for defense and domestic programs

    • Ideal for business and individuals. Putting a cap on discretionary spending is long overdue and at a minimum will ensure that the government is not continuing to contribute to the inflationary pressures already impacting the economy

  • 72 hours to review bills before they come to the floor

    • The fact that this even needs to be a rule is sad and says a lot in terms of the way the House has operated in the past under both Democrat and Republican Leadership. Ensuring our elected officials actually know the content of the bills they are voting on can only be good for business and individuals.

  • Give members the ability to offer more amendments on the House floor

    • Depending on how this is used by both parties this could be positive and negative. Time and circumstances will tell

  • Create an investigative committee to probe the “weaponization” of the federal government

    • While likely having limited impact on business with the exception of Big Tech and Pharma, this committee, if true to its mission, will shine a light on the non-elected ‘administrative state’ and may very well prove to be eye opening

  • Restore the Holman rule, which can be used to reduce the salary of government officials

    • Again, likely to have little or no impact on business, this rule, coupled with oversight and spending authority should provide the House with the tools it needs to effectively investigate and shine a light on government malfeasance. And wouldn't it be nice to see some government officials have their pay cut or suspended!

If you happened to follow the main stream media’s reporting of the changes outlined above, you might think the world was coming to an end. These rule changes have been characterized as being potentially destructive to America and a pathway to ‘right-wing’ witch hunts against Republican enemies. Maybe I’m naïve, but I don’t see it that way. As I look at the changes outlined above, I think about what was happening in the House of Representatives before these new rules took effect. When I consider it from this perspective it seems to me that these new rules provide for a number of changes that are to the benefit of American business and individuals.

This is particularly true in regards to the changes related to spending.

It is incumbent upon Congress to be good stewards of the tax receipts received from American businesses and individuals. Unfortunately, Congress is addicted to spending and prior rules made it easier for elected officials to push through massive spending through combining appropriations bills as a means of funding the government. By combining these activities and providing no time for bill review, many members felt compelled to vote for these bills as a means of avoiding government shut-downs. Hopefully the changes to the appropriations process and the checks on spending in general will force some common sense when it comes to government spending which would benefit everyone. We’ll see.

While the changes to House operating procedures at the surface appear positive, history has shown time and again that our elected officials rarely live up to the promises they make whether direct or implied. While we can credit the House for adopting changes that appear positive for business and individuals alike, let’s remember that these changes would not have occurred if not for 20 representatives. That’s 20 out of 435. And even of these 20 it was only 6, yes, just 6 who took a hard line. Given these numbers I think it’s safe to say that the Washington establishment is still alive and well.

Tired of the Washington establishment? If so, in addition to voting incumbent politicians out of office there is a way to lessen the damage being caused by lifetime politicians. It’s called the Article V Convention of States and it’s a movement of members of citizens of all political parties who are tired of the status quo. Article V of the Constitution provides a mechanism for the States to call for a Constitutional Convention to amend the Constitution. How do amendments for Congressional Term Limits and a Balanced Budget sound? If they sound good to you click here to sign the Article V Convention of States petition and begin putting pressure on your State legislators to call for a Convention.

By the way, if you like theater, pay attention to the current hearings in the House of Representatives regarding the ‘Weaponization of Government’, Ukraine funding and other fun topics. Who needs reality TV when we can watch government officials squirm under oath!

May God Bless America!

Next Up: Political Inflation

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