House GOP pursuing two-step plan to avert government shutdown

House Republicans are pursuing a two-step plan for funding the government, three sources familiar with the matter told CNN, as Congress barrels toward another spending deadline Friday.

Newly elected House Speaker Mike Johnson announced the plan on a GOP conference call with members Saturday afternoon and argued, “I wasn’t the architect of the mess we are in,” according to a source on the call.

While Johnson embraced the right-wing members of his conference by pitching the two-step approach, he didn’t fully cave to their wishes. The package does not include the deep spending cuts his right flank pushed for but instead extends funding at its current levels.

“This two-step continuing resolution is a necessary bill to place House Republicans in the best position to fight for conservative victories,” Johnson said in a statement Saturday.

The first bill would extend funding until January 19 and would include funding for military construction, Veterans Affairs, transportation, housing and the Energy Department. The second part of the bill, which would extend funding until February 2, would include funding for the rest of the government.

Neither bill includes additional aid for Israel or Ukraine.

The two-step approach was widely pushed by Republican hardliners but dismissed by many senators as a complicated solution that would be hard to execute. Still, given that funding for the agencies would stay at current levels, it could be harder for Democrats to reject.

A Senate Democratic leadership aide signaled their openness to Johnson’s funding plan, telling CNN, “It’s a good thing the speaker didn’t include unnecessary cuts and kept defense funding with the second group of programs.”

White House press secretary Karine Jean-Pierre, however, cast Johnson’s plan as “a recipe for more Republican chaos and more shutdowns – full stop.”

“House Republicans need to stop wasting time on their own political divisions, do their jobs, and work in a bipartisan way to prevent a shutdown,” Jean-Pierre said in a statement.

Ahead of the conference call Saturday, Republicans had been weighing multiple options, including a more straightforward stopgap bill with some added sweeteners along with the more complicated two-step approach Johnson is pitching.

The conference has been divided over which option to pursue, with appropriators in favor of a “clean” stopgap bill and members of the Freedom Caucus pushing the laddered approach.

Still, GOP Rep. Chip Roy, who is part of the far-right House Freedom Caucus, said on X that he is against Johnson’s plan because it does not have the deep spending cuts the right wanted.

House Minority Leader Hakeem Jeffries previously slammed the prospect of a two-step continuing resolution as a nonstarter, calling it a ”right-wing joyride which would crash and burn the economy.”

But senior Democratic sources told CNN on Sunday that they want to see how Johnson handles his divided conference first and whether Republicans make any changes to the plans before taking a position themselves.

To get the bill approved by a majority vote in the House, Johnson will first need to get a rule approved to set the parameters for a floor debate. But since the minority party typically votes against the rule in lockstep, Johnson can afford to lose only four Republicans to approve it. It’s unclear whether Republican hardliners will give him a honeymoon and vote for the rule as they come out opposed to the underlying bill.

If they can’t pass a rule, it would have to pass under suspension of the rules – which requires a two-thirds majority. That means a large number of Democrats would be needed to approve the bill.

GOP leadership sources say they haven’t made a decision on how to proceed.

At the moment, Democrats are privately critical of Johnson’s strategy, saying keeping the government open in two steps is untenable. But they also acknowledge Johnson avoided spending cuts, which had been their red line.

The big question: How many Democrats will ultimately support the plan? The answer could unlock the GOP’s floor strategy.

If lawmakers fail to pass a spending plan by Friday, many government operations will grind to a halt until Congress acts. Government functions that are deemed essential, however, will continue.

Each federal agency comes up with a contingency plan that outlines which of its functions will continue during a shutdown, as well as how many of its employees will continue working and how many will be furloughed until the shutdown ends.

On a national scale, government shutdowns can have far-reaching economic consequences, hampering growth and promoting uncertainty, especially if they drag on. Some of these costs include raising the unemployment rate, lowering the growth in gross domestic product, and raising the cost of borrowing.

This story has been updated with additional information.

CNN’s Shania Shelton contributed to this report.

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