What's next for the debt ceiling deadlock

Transcript

NIALA: Good morning! Welcome to Axios Today!

It’s Thursday, April 27th.

I’m Niala Boodhoo.

Here’s what we’re following today: Disney sues Florida Governor Ron DeSantis. Plus, writer E. Jean Carroll takes the stand to accuse former president Trump of rape. But first, what’s next for the debt ceiling deadlock. That’s today’s One Big Thing.

What’s next for the debt ceiling deadlock

NIALA: The House voted yesterday, 217 to 215, to raise the debt ceiling while cutting government spending. But, the bill has no chance of becoming law. So what does this mean for the country's looming financial deadline? Axios’ Mike Allen is here this morning with the big picture.

Good morning, Mike.

MIKE ALLEN: Good morning, Niala.

NIALA: Mike. A really narrow vote, but still a big win for Speaker McCarthy?

MIKE: Niala, yes. This was a win for Speaker McCarthy, a Republican because he got all the Republicans he needed. Of course, that shouldn't be news, but Niala in this narrowly divided House where you have a divided Republican party where of course, Speaker McCarthy had to scramble days to become Speaker. This wasn't a sure thing. Our reporters counted as many as eight hard nos from Republicans against this plan to raise the debt ceiling. And of course, that's trying to avoid fiscal calamity when the United States runs out of borrowing room as soon of June.

In the end, the tally was half that only four Republicans voted against it. Now, it's headed for trouble because now it heads for the Senate. Senate Democrats have no plans to pass this. And Niala, I can't say it any better than the lead headline of my former employer, The Washington Post, U.S. drifts toward cliff as debt ceiling bill passes House.

NIALA: So how will this affect negotiations with Democrats and President Biden?

MIKE: Two things, Niala. One, this was designed to push those negotiations. The whole point of this was to try to get president Biden to engage on it. Our Axios story this morning says that McCarthy told reporters after the vote that not only did we offer a plan, we passed it. So that's Republican's effort to take the offensive. But Niala, here's the problem, now goes to the senate. Where of course, Democrats hold one vote of control when the Vice President breaks ties and the White House says this package has zero chance of becoming law.

And what about McCarthy's politics? He already took some pain and some controversy from his own side for this package. He's gonna need to make more concessions to meet President Biden in the middle. So, that's not like the normal calculus for a negotiation that doesn't necessarily work. That's why people have always said, oh, the calamity of, are not passing the debt ceiling increase impossible to imagine. Yes, impossible to imagine, but necessarily possible to sketch out how you avoid it.

NIALA: Author of AM and Axios co-founder Mike Allen. Thanks, Mike.

MIKE: Niala, have the best day.

E. Jean Carroll takes the stand

NIALA: Two other stories we’ve been following…

The writer E. Jean Carroll took the stand yesterday in a civil trial over sexual assault and defamation lawsuits she’s brought against former President Trump. Carroll testified that Trump raped her in a Manhattan department store dressing room in the mid 90s.

The former president has denied the allegations and in a Truth Social Post last year called them a hoax and a lie.

On the stand Carroll said “he lied and shattered my reputation and I’m here to try to get my life back.”

Trump hasn’t attended the first two days of the trial and it’s unclear if he will testify. The trial is expected to last five to seven days.

In other news…Chief Justice Roberts has declined to testify at the Senate's Supreme Court ethics hearing, set for next week.

Roberts was invited to the hearing following questions of ethics violation from Justices Clarence Thomas and Neil Gorsuch.

Thomas was accused earlier this month of failing to disclose luxury trips from a billionaire GOP donor. As for Gorsuch, a report came out recently that he sold a vacation property without revealing the buyer is a head of a major law firm that often practices before the high court.

Instead of testifying or designating another justice to do so – Chief Justice Roberts gave the judiciary committee a statement of the ethics principles and practices of the court signed by all the justices.

Senate Judiciary Chairman Dick Durbin said that the committee will proceed with the hearing.

In a moment, the Disney-DeSantis feud reaches new levels.

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Disney sues Florida Governor Ron DeSantis

NIALA: Welcome back to Axios Today. I'm Niala Boodhoo.

Disney is suing Florida Governor Ron DeSantis, alleging the state of Florida has waged a “targeted campaign” of government retaliation against the company. It's the latest escalation in the feud between the Republican governor and Florida's largest employer. Axios’ Tampa Bay Reporter Yacob Reyes is here with the big picture, including how this could affect DeSantis' potential presidential campaign.

So we tend to think of Republicans as being pretty pro-business, but can you take us back to how this all started. Disney says when it took a stance against DeSantis’ Don't Say Gay bill?

YACOB REYES: So, Disney spoke out when this bill was going through the legislature and DeSantis certainly did not like that. And he used Disney, to essentially make an example out of them. And to showcase that he was willing to stick up against what he calls the woke mob in order to protect his state.

NIALA: And so at issue here is a special taxing district Reedy Creek. Can you help us understand why this prompted this current legal situation?

YACOB: Disney has had this presence in Florida since the late 60s. And while special districts in Florida are not uncommon, the power that Disney wields over the special district is somewhat unique and DeSantis targeted that. DeSantis called a special session, and he encouraged lawmakers to repeal Disney's special taxing district. This year he signed legislation that transferred control over the district to the state. He appointed a bunch of political allies on the board and he was prepared to fully take control of this district. But Disney had other plans.

As lawmakers were attempting to create legislation to transfer the control over the district to a governor-appointed board. The Disney Allied Board passed through a bunch of development agreements that essentially neutered the incoming board. Disney's moveIs seen by many as pantsing DeSantis on the national stage. It undercut his political narrative that he defeated woke corporatism, and he came back with an aggressive approach, one that Disney utilized as a larger point that DeSantis has attacked them in a targeted campaign.

NIALA: So how are other Republicans reacting to all of this?

YACOB: Within DeSantis own state, you know, Florida GOP lawmakers, a lot of them have expressed frustration of having to essentially carry water for him this legislative session and take up priorities that aren't really theirs. This Disney episode is one of them.

NIALA: What about nationally? How is this helping or hurting DeSantis' potential presidential campaign?

YACOB: I think to those who aren't familiar of DeSantis’ background in Florida, I think this Disney issue would really provide some context. This is not DeSantis’ first time pursuing action against those who speak up against them. During the Coronavirus pandemic, he did this to individuals, but he also did this to school districts. He lobbed fines against them for bucking his order to not place mask mandates on students. And so, I think this shows a national audience that DeSantis is someone who's willing to take action against those who speak against him.

NIALA: What has the DeSantis administration said about this lawsuit?

YACOB: They released a statement saying that this was Disney's effort to undermine the will of the Florida voters and operate outside the bounds of the law. They did not address the argument that they stifle Disney's right to free speech. Instead, they just really emphasize that no company holds a right to special privileges.

NIALA: What happens next?

YACOB: Legal experts told me that DeSantis will likely try to have this lawsuit thrown out and dismissed, but that's unlikely to happen. So, DeSantis will be put into a position in which his lawyers will have to answer to the statements that he's made, which Disney highlighted throughout the complaint. A legal expert said that DeSantis is his own worst enemy here. He wrote an entire chapter on this book and how he decided to go against Disney because of their statements. And so now he'll have to answer for that in court.

NIALA: Yacob Reyes is an Axios Tampa Bay reporter.

YACOB: Thanks for speaking with me.

NIALA: That’s it for us today! I’m Niala Boodhoo - thanks for listening - stay safe and we’ll see you back here tomorrow morning.