US Speaker Johnson faces challenge in tax cut renewal

Significance The last-minute scramble to avert a government shutdown just before Christmas underscored how divided House Republicans remain over fiscal issues. Speaker Mike Johnson, who yesterday received President-elect Donald Trump’s support in next week’s election to retain his post, will struggle to reconcile different factions in both Congress and the White House. Impacts Elon Musk’s consultative 'DOGE' will suggest cuts to executive agencies to help offset tax cuts. Projections for possible tariff revenues may be used to argue that tax cuts will not result in an increase to the deficit. While speculative, tariff forecasts could help gain support from those worried about fiscal, rather than political, impacts of tax cuts. The need for special elections to replace House members who are joining the new administration is another problem for Johnson.