Principals

☞ White House: Biden published an op-ed in the Wall Street Journal urging Republicans and Democrats in Congress to pass legislation to “hold Big Tech accountable” that boosts online privacy, reforms Section 230, and promotes competition in the tech sector. Meanwhile, he’s due to speak about inflation after December’s Consumer Price Index is released this morning.

☞ Chuck Schumer: Keeping Joe Manchin happy is a key part of Schumer’s job, and he got a nice assist Wednesday from the head of the Consumer Product Safety Commission, who clarified the agency isn’t looking at banning gas stoves after one commissioner suggested it was on the table. Manchin had reacted angrily to the possibility, as did Republicans and a legion of home cooks on Twitter.

☞ Mitch McConnell: Washington is starting to assume it will be up to the Kentuckian — who’s enjoying a late-career turn as a bipartisan dealmaker — to hash out a debt ceiling agreement with the Biden administration because, well, have you seen the House?

☞ Kevin McCarthy: Smoking is still allowed indoors in the Capitol and the new Republican majority is taking full advantage, Bloomberg reports. Oklahoma Rep. Tom Cole’s cigars were the official smell of the speaker’s race for many reporters.

☞ Hakeem Jeffries: The Minority Leader recently claimed that the U.S. has never defaulted on its debt. Fact check: Mostly true! There have been instances where the U.S. have accidentally delayed or altered terms on bond payments — see the fleeting technical default of 1979 — but nothing like a debt ceiling breach.

The FAA is still reviewing the cause of the alert system outage that disrupted flights nationwide on Wednesday, but in a statement said “preliminary work has traced the outage to a damaged database file.” Officials said there is no evidence of a cyberattack. Senate Commerce Committee Chair Maria Cantwell, D-Wash. said she plans to launch an investigation. The outage is another headache for Transportation Secretary Pete Buttigieg, who was already dealing with the fallout from Southwest Airlines’ meltdown over the holidays. But on the other hand: He’s a former consultant overseeing a government agency that badly needs an enterprise software upgrade. It’s like his whole career has been leading to this!

Biden aides discovered a second batch of classified documents in a different location than those found at his former office in Washington in November, according to NBC News, though the details are still vague. Sen. Lindsey Graham, R-S.C. is calling for a special counsel to investigate (Attorney General Merrick Garland has already assigned the U.S. attorney in Chicago, a Trump appointee, to review the files). The leaders of the Senate Intelligence Committee also sent a letter to Director of National Intelligence Avril Haines asking for access to the classified documents found at Biden’s former office, a damage assessment, and briefing, according to a spokesperson for Sen. Marco Rubio, R-Fla.

Another contender is gunning for Dianne Feinstein’s Senate seat: California Democratic Rep. Barbara Lee told lawmakers during a closed door meeting that she’s running, according to Politico.

The Chamber of Commerce has its latest wish list for Washington ready. In her State of American Business address on Thursday, which was previewed to Semafor, CEO Suzanne Clark will urge Congress to finally reform energy permitting and immigration, and nudge the White House to redouble trade talks with the U.K.

— Morgan Chalfant

Punchbowl News: Republican Senators are already worrying about deadlines for must-pass legislation due to the dynamics in the House. “Some of these things are not like, ‘Well, we disagree, we’ll come back and do it next year,’” Sen. Thom Tillis, R-N.C. told Punchbowl. “These are date-certain sorts of challenges that we’re going to have to look to the House to figure out how they bring together a coalition.”

Playbook: Former President Trump plans to make an appearance in South Carolina later this month to roll out his campaign team.

The Early 202: Lobbyists are fielding calls from concerned clients about the debt limit and the new China select committee, in a sign of wariness on K Street about the Republican-controlled Congress.

Don’t bet on this buzzy procedural trick to raise the debt ceiling

With conservative Republicans vowing a showdown over the debt ceiling later this year, at least one moderate GOP lawmaker says they’re willing to buck their party and cut a deal with Democrats if it’s necessary to avoid a potentially catastrophic breach of the government’s borrowing limit.

And they think they have a way to do it: A rarely-used procedure called a “discharge petition” that can force a vote on bills that have majority support in the House even if leaders refuse to bring them to the floor.

“It’s one of many options,” Rep. Brian Fitzpatrick, R-Pa., who said he’s working with Rep. Josh Gottheimer, D-N.J. on a plan, told Semafor on Tuesday. “We cannot allow ourselves to default.”

Outside of Washington, some big names on Wall Street, like investment firm PIMCO, are also expressing optimism that a discharge petition backed by more centrist Republicans will ultimately defuse a debt crisis.

It’s a tactic with some history of success. Discharge petitions were used to put pressure on the House to pass the 1964 Civil Rights Act and to force a successful vote on the Equal Rights Amendment in 1970. More recently, a discharge petition was used to revive the Export-Import Bank in 2015.

JOSEPH’S VIEW

The discharge petition may be ill-suited to raise the debt ceiling, which carries a hard deadline before causing economic calamity. The process for forcing a vote is clunky and time-consuming and some experts believe House leadership could throw up additional roadblocks along the way.

“It’s kind of like trying to do open heart surgery with an ax,” Josh Huder, a senior fellow at the Government Affairs Institute at Georgetown University, told Semafor. “It’s just a very blunt instrument that’s unwieldy and will take a lot of time to accomplish what you’re trying to do.”

The steps to get to a vote are laborious:

• The bill must first sit in committee for 30 days
• Supporters have to gather 218 signatures
• The measure must sit in the discharge calendar for 7 days
• The Speaker then sets a time for the vote within 2 legislative days after a petitioner says they intend to bring up the motion

Complicated budget negotiations typically go to the last minute. So while a discharge petition might be able to get a bill past an unwilling speaker or a conservative-stacked Rules Committee that could otherwise halt it, the journey would require more time than they’re likely to have. And that assumes the Senate has the votes to follow through as well.

Even a brief default on Treasury debt could be an economic disaster, sending the markets into a panic while making it more expensive for Washington to borrow in the future as investors question the dependability of U.S. bonds.

“I would certainly not bet the faith and credit of the United States on that as plan A,” Rep. Brendan Boyle, D-Pa., the ranking member of the House Budget panel, told Semafor. He predicted the whole process “from beginning to end will take at least four months.”

Still, a discharge petition could potentially play some role in talks with enough foresight and coordination.

One option Democrats are likely to pursue is submitting “clean” bills early in the debate to raise the debt ceiling temporarily, or by a set amount, as a failsafe option.

Having a clean debt limit bill on deck could give moderate Republicans a way to pressure either side to reach a deal.

In this scenario, some Republican members might initially support their side in budget talks — but warn conservatives that they planned to join the petition if they determined the caucus was no longer working toward a realistic agreement or were keeping proposals with bipartisan backing from the floor.

If just five Republicans followed through on their threat and joined all Democrats, that would then get the petition to 218 signatures, enough to trigger a vote.

Conservatives, for their part, don’t seem too worried about an end-run around them. “It’s a bigger lift than you think on those things,” Rep. Chip Roy, R-Texas, one of the Republicans who initially resisted McCarthy, told Semafor.

ROOM FOR DISAGREEMENT

At The Intercept, Ryan Grim reports that some progressives like Rep. Alexandria Ocasio-Cortez, D-N.Y. are bullish on using discharge petitions on a variety of issues — the debt ceiling, abortion rights, immigration, and anti-monopoly legislation.

The continuing adventures of George Santos

Whatever remaining firewall of Republican support George Santos had went poof on Wednesday — at least in New York.

A who’s who of Long Island Republicans got together for a morning press conference to call on Santos to resign, with each speaker offering more brutal condemnations than the last.

“My office will have no interaction with George Santos or his staff until he resigns,” Bruce Blakeman, the Republican Nassau County Executive, said.

The standout moment: Nassau County GOP chair Joseph Cairo said that Santos once told him he was a volleyball star who won a “league championship” at Baruch College — in fact, he never even went to the school.

By the end of the day, four of Santos’ fellow New York Congressmen — Anthony D’Esposito, Nick LaLota, Brandon Williams, and Nick Langworthy (who is also the state party chairman) — had called for him to resign. Peter King, the former Congressman whose name is synonymous with Long Island politics, joined the chorus as well.

The story is still very different in Washington, however, where Santos could put the barely-elected Speaker of the House one vote closer to disaster if he resigns or goes rogue — a dynamic Democrats are eager to exploit. Until Wednesday, not one Republican member had called on him to resign, and leadership made clear after the press conference that they were not joining the pile-on.

“He has to answer to the voters,” Speaker Kevin McCarthy told reporters, per CNN, adding that “a lot of people” in government had also lied about their past. McCarthy, who had been almost entirely silent on Santos to this point, did confirm he would not get a seat on any of the most sought-after committees.

Facing a request to leave a prestigious job in disgrace in order to sit around unemployed while overlapping state, local and federal probes creeped toward his doorstep, Santos said thanks, but no thanks. “I will NOT resign!” he tweeted.

Meanwhile, Santos’ record continues to be a Mariana Trench for investigative reporters to dive deeper into. On Wednesday, The Washington Post reported new details on his ties to an alleged Ponzi scheme while The Daily Beast reported he “took an almost certainly illegal donation from an Italian national and confessed smuggler of undocumented immigrants—who also happens to be the blood relative of some of his closest local supporters and campaign vendors.” The New York Times also dug up the literal resume he faked.

—Benjy Sarlin

Russia’s energy revenues have taken a serious hit thanks to the price cap that the U.S. and Europe slapped on its oil shipments late last year, according to a new analysis.

But one Democratic lawmaker who’s been pushing hard for a crackdown on Moscow’s crude profits thinks the Biden administration could still be doing more to make the effort bite.

“Energy is the lifeblood of the Russian war machine and the degree that we can strangle that hard currency inflow, we will give Ukraine the chance to win this war in 2023,” Rep. Jake Auchincloss, D-Mass. told Semafor.

Researchers in Helsinki estimated Wednesday that the $60 price cap and EU ban on most Russian oil was already costing Moscow about $170 million per day. But with the country turning to a fleet of “dark” tankers in order to circumvent sanctions, many believe it’s time to take stronger enforcement steps.

Last Fall, Auchincloss and then-Rep. Anthony Gonzalez, R-Ohio wrote to the Treasury Department in order to raise concerns about Russian sanctions busting. In a December letter shared with Semafor, the agency responded that it would use “every tool” available to enforce its price cap.

Now Auchincloss says he’d like to see the administration “tighten” its enforcement regime and expand the number of countries on board. He’s specifically calling for a White House plan to deal with India, a major buyer of Russian oil and gas alongside China, and says he’ll work with House Republicans on oversight of the administration’s penalties against Vladimir Putin’s nation. He wants support for Kyiv to remain bipartisan.

— Morgan Chalfant

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Stories that are being shared less widely across left-leaning or right-leaning outlets, according to data from our partners at Ground News.

WHAT THE LEFT ISN’T READING: Arkansas’ Republican Gov. Sarah Huckabee Sanders banned use of the term “Latinx” in official documents on her first day in office.

WHAT THE RIGHT ISN’T READING: Trump campaign officials received what the Washington Post described as a “wide-ranging” subpoena related to the Justice Department’s Jan. 6 investigation.

I’ll be in Davos later this month for the World Economic Forum, where many of the most powerful people in the world come to do deals and show off their good deeds.

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— Steve Clemons

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— Steve Clemons