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Speaker 1: From the opinion pages of the Wall Street Journal. This is Potomac Watch.

Kyle Peterson : House Republicans oust Liz Cheney from leadership as a new report shows a record number of job openings and more States move to end the federal boost for unemployment benefits. Welcome, I'm Kyle Peterson with the Wall Street Journal. We're joined today by my colleagues, WSJ columnists, Kim Strassel and Bill McGurn. On Wednesday morning in a closed door meeting, House Republicans voted to remove Liz Cheney from the number three post in their leadership. It was reportedly a voice vote, so there's no official tally. But here's what leader, Kevin McCarthy wrote to his conference in advance of this meeting. "All members are elected to represent their constituents as they see fit. But our leadership team can not afford to be distracted from the important work we are elected to do. And the shared goals we hope to achieve." So Bill the message there from McCarthy seems to be no hard feelings Ms. Cheney, but we don't need the headache that you're creating for us.

Bill McGurn : Yeah. Good luck with that. I think they're going to be a lot of hard feelings over this. Look again, there's been two iterations of this. There was an earlier vote on Liz Cheney and I think it was fairly overwhelming for people to say, no, she shouldn't step down. And I don't think the issue is really like recognizing the election or so forth. I just think that people in the Republican conference were tired of having a leader using her position to pick a personal fight with the former president. I just think that they have different priorities and they didn't want that. I didn't think Liz Cheney should've been removed for her vote and so forth. But I think she's brought it into a new stage and I think that's reflected in the turnaround in the conference vote.

Kyle Peterson : But is it a personal fight that she's picking here? I mean, sure, she's putting the GOP in a bit of a tough spot. But you know who else is doing that is president Trump. Joe Biden won the electoral college big enough that Trump would have to flip three States to overturn the result. It would involve throwing out tens of thousands of ballots. There's just no evidence of any fraud or malfeasance and anywhere near close to that. And yet on Monday here was president Trump on his website saying, "The major Michigan election fraud case has just filed a bombshell pleading, claiming votes were intentionally switched from president Trump to Joe Biden. The number of votes is massive and determinative. This will prove true in numerous other States." And there's an audit going on in Arizona. A clip of somebody involved in that has been going around this week, where one of the participants says they're looking for bamboo fibers that would supposedly show fake ballots dumped in from Asia. And to Kim, I mean is Cheney's argument here I think, just that the best path forward for the GOP going into 2022 is to repudiate these conspiracy theories.

Kim Strassel : Well, that's the argument that she is making. And if you read all of the press, she was really thrown out today because the GOP simply can't abide her truth telling. And she's the only one with the courage of her convictions. But that's not why she lost her job. And that's just, let's be really clear, there's many Republicans who agree with her. They're not unsympathetic to her views on this. And they have real issues with Donald Trump. The problem is they want to be done relitigating the last election. And you're right, Donald Trump is out there doing it, but they're ignoring it. The person that's making it impossible for them to ignore it is Liz Cheney, or has been for the last couple of weeks. And that's why she's losing her job. She's the conference chair. Her job is to be singularly focused on helping the GOP regain the majority next year. That is the definition of a leadership job. That particular position is also one of a kind of PR job. It's supposed to be the voice of the party. And what they want her to do, what they expected her to do is to focus on the things that unite them, which is focusing on the Biden agenda. And instead she was making this all about her, her views on Donald Trump, and generating massive headlines as happened again today. And I think, it's possible for her to both be right and for people to not like the way that she is handling this situation and feel that she's not the best person, therefore, to be in that position. And that's really what went on today. By the way, I'm told this vote was very quick. It all seemed to happen in under 10 minutes. She spoke, then McCarthy spoke. It was a voice vote, but it was a resounding voice vote so much so that no one even asked for a recorded vote in the end.

Kyle Peterson : Yeah. And to Kim's argument, I mean, it is interesting, especially in recent weeks, how Liz Cheney has really leaned into this. And Bill, you mentioned that in February, she won a similar leadership challenge, but back then she was reportedly whipping votes, calling her allies. And this time everyone seemed to understand that she was going to lose. And she seemed to sort of embrace that, giving a defiant speech on the house floor on Tuesday, saying that voters have been misled by Trump. Here's part of what she said, "Remaining silent and ignoring the lie, emboldens the liar. I will not participate in that. I will not sit back and watch in silence while others lead our party down a path that abandons the rule of law and joins the former president's crusade to undermine our democracy." I mean, Bill, that's a speech that is embracing that she's going to be defeated here.

Bill McGurn : Yeah. Look, I think she saw the writing on the wall in that. Again, I believe that she had the right to vote the way she did, but other people have the right to disagree as well and say, you're not doing a good job of representing our concerns. Look, Donald Trump issued a statement in response that was a really childish statement, attacked her personally and stuff. He did something even more foolish, which is he attacked her father who, as far as I understand, has been pretty silent on his daughter's fight with Trump. And in the past has always backed Trump as the nominee. He said, he's support the Republican nominee. So it's another gratuitous attack. And again, I think it comes back to what is the strategy with Donald Trump? He's trying to litigate the 2020 election. And the question is, do you repudiate him publicly and denigrate him? Or do you just try to ignore him and move on? I think as Kim said, Liz Cheney gave him a little more prominence with these things. We're hearing also, I think Republicans are tired of hearing this is a moment of choosing. This dramatic event, it'll never be forgotten. I think it's going to be forgotten in three months. And I think it's going to be very different for Liz Cheney to try to make her case as just a member of Congress, rather than in the Republican leadership.

Kyle Peterson : So the front runner to replace her, kind of running a campaign, a bit of a public campaign for it is Congresswoman Elise Stefanik. Kim, who is she? And what do we know about her?

Kim Strassel : So she's a New York state Republican. She was elected in 2014 at the age of 30, which made her the youngest female representative right up until Alexandria Ocasio-Cortez was elected in 2018. She's in a North country district. And one that had in fact elected a moderate Democrat in the prior three elections and a district that had also voted twice for Barack Obama. And she managed to flip that district. And then since then has really consolidated it into more of a GOP district. She worked before she got to Congress on Tim Pawlenty presidential campaign. She worked for a time for Paul Ryan, the former speaker. Actually, interestingly, she actually backed John Kasich for president before Donald Trump, because the reality is, is that a lot of her votes, especially in the beginning of the Trump administration were much more kind of moderate in the middle Centrist's votes. She is viewed as a more liberal member of the party because of that voting record. For example, she voted against the 2017 tax cuts, which were the signature Republican issue that year. She voted to block Trump from withdrawing from the Paris Climate Accord. But what really propelled her into fame is during the first impeachment hearings, she was on the house intelligence committee. And she just really took exception to the way Democrats were running that investigation and handling impeachment. And she became a very forceful advocate for the president and really was on TV a lot, got a lot of notice. People who talk about her say that she's very talented, that she's also a real team player. I've been told that she apparently has no interest potentially in staying in leadership a long time. That maybe just she'll do it this Congress. She's very policy oriented. And I think her ambition is ultimately to land at like a major committee as the chair of a committee. But we'll see. I think the most important thing, and the reason that she has such backing and will be put into this position is because she is a team player. And she's made it very clear that her own policy issues aside, she wants to be that voice for the GOP and really talk about the Biden agenda and really help them win back the majority next year.

Kyle Peterson : Hang tight. We'll be right back. You're listening to Potomac Watch from the Wall Street Journal.

Speaker 1: From the opinion pages of the Wall Street Journal. This is Potomac Watch.

Kyle Peterson : Welcome back. Bill, I think Kim, gave a very good overview of Elise Stefanik here. She seems to me like a good messenger, a very talented well-spoken politician, member of Congress. What's your read of her?

Bill McGurn : Well, I work with Elise in the Bush White House. So I got to know her then and I was at the New York Post when she won her seat in New York, which is quite an achievement. The area there is kind of hard Scrabble. The economy has not been kind to it. As Kim mentioned, it had been an Obama district. It kind of became a little Trumpy, kind of like that blue collar, willing to vote for a Republican. I think it explains maybe some of her votes like against the tax cuts and so forth, you mentioned, but it was quite an achievement and she was the youngest person ever elected to Congress at the time. Hardworking woman. She's been treated very badly by sort of the liberal establishment. They booted her off a Harvard committee that she served on. She's a Harvard alum. So I think she's very accomplished. I don't agree with all her votes. I'd probably on voting, I'm pretty sure I would be closer to Liz Cheney than I would Elise. But then again, when you run a party and you want a majority, you have to have people that reflect their own districts and States. We have Susan Collins and I'm glad to have Susan Collins when we need a vote for a judge or something. So, I think she's a good choice. She's very cheerful. And I think that the Republicans believe that by choosing her, they're going to move beyond this debate and get on with going after the Biden administration and providing a clear alternative voice for the Republican party.

Kyle Peterson : But those votes and particularly the one against the Trump tax cuts are creating some interesting pushback. So one group, the Club for Growth has come out saying, Elise Stefanik is not a good spokesperson for the house Republican conference. Saying that by their ranking, she has the fourth worst voting record in house GOP. Another guy, Texas Congressman Chip Roy, who I think is a member of the freedom caucus. On Tuesday, sent a letter to his colleagues highlighting some of those votes, including the one about the tax cuts and the vote to keep the US in the Paris Climate Agreement. And he says, "We must avoid putting in charge Republicans who campaign as Republicans, but then vote for and advance the Democrats agenda once sworn in." And so Kim, his argument was that regular people, average voters, they don't care about these leadership positions. And so why not just boot Liz Cheney and then leave it open, leave the chair vacant.

Kim Strassel : Yeah, well, they're not going to do that because there's a couple of things that are at play here as well as the questions of Liz Cheney. I mean, do note that one of the reasons I was told that Liz Cheney managed to hang on as definitively as she did on the first vote is because Republicans were very wary and understandably of being seen to get rid of what is currently the only woman in their leadership team. And notably when there was a another woman who put her hand forward, that was something that I think made a lot of Republicans feel easier about making this switch. They want to be seen to have a woman working in leadership with them, just from the optics of that. So I don't think they're just going to keep that position open for that. On the question of Elise Stefanik's voting record, some people I've talked to have noted that they'll be very curious to see whether or not that voting record remains as more moderate as it has been in the past. For the simple reason that one of the things that's also come along with Elise Stefanik and her new rise within the party is she's become this fundraising juggernaut. And if you go back and you look at when she was elected in 2014, she did it with the aid of a couple of really prominent donors guys like Paul Singer, the Wall Street investor. And a lot of people felt she maybe felt constrained in her votes in some ways in terms of retaining that support. But now she's clearly proven herself to be able to generate vast sums of money just from the grassroots and from within her district too. And so there's a question about whether or not her voting patterns going forward might be a little bit different. But the last question, and I think the only one that really matters and what's going to sell everyone on her is she seems to have made it exceptionally clear that her voting record and her positions are not what matters. She's going to go out there and be a voice for the GOP agenda, whatever that might be. And nobody gets the impression she's going to try to use that position to push the party in a certain direction.

Kyle Peterson : So one last thought on this Liz Cheney business. Where does this leave the Republican party going into 2022? I mean, some of the headlines this morning are talking about this group of reportedly about 100 prominent Republicans, including at least a couple of former governors that Bill, they're preparing a letter threatening to leave the GOP. Formed their own group. I mean, do you think this has any legs, or as you said a few minutes ago, do you think this will be forgotten in three months too?

Bill McGurn : Yeah. Let me say one name to you, Miles Taylor. Do you know who Miles Taylor was? He was the guy in Homeland security who wrote that anonymous critique of the Trump administration while in office. And everyone was speculating it was some senior guy. He was barely 10 years out of high school and wrote that anonymous thing about how people were working inside the Trump administration to sabotage it. No one remembers him. These are all... The operative word in a lot of these people, is former, they're ex officials. And I just think this is another thing that's being trumpeted. And it's a joke. They'll get some headlines of course, they'll get a sympathetic profile on the New York Times. And on National Public Radio, there'll be interviewed and so forth. But I just don't see it going anywhere because they're all formers. So they have the luxury of saying all these things. And the reality is that there's a Republican party, it's in good shape to contest the 2022 elections. And I think that's what they're trying to focus on. And that's one of the reasons that they're having this controversy now with Liz Cheney and Elise Stefanik. So I just think this is another media sensation of about all has-beens coming forward.

Kyle Peterson : Finally, after last week's underwhelming jobs report, it was notable that president Biden came out on Friday and defended his policy of this federal boost to unemployment benefits. And here's part of what he said. He said, "I know there's been a lot of discussions since Friday's jobs report that people are being paid to stay home rather than go to work. Well, we don't see much evidence of that." And Kim, I mean, I guess first it's noteworthy just that the president in the flesh felt that he needed to come out and defend his policy in that way.

Kim Strassel : Yeah. I mean, and he actually noted it saying, we've been seeing a lot of this. And it's because they were getting all kinds of pushback and it was overwhelming. Because there simply is no way out of it. It's incredibly clear that the reason that these jobs, many, many jobs are going unfilled is because of federal government policy on these enhanced unemployment benefits that are going out. And the White House is very worried about that narrative. And the reality of that, because this was a federal, a sort of central point of their COVID relief bill. Now, the simple answer to this, to get out of this self-inflicted political damage is just to ask Congress to repeal that bonus. Say, look, the economy has now recovered to such a degree that we've seen this new problem, and we're all about making it better. So we're going to get rid of them. But Democrats won't do that. They're all about the party of handouts. And instead they doubled down. And it actually just led to yet another wave of headlines, people saying, is the White House really operating in reality, economic reality or not?

Kyle Peterson : Yeah. And Biden's argument in response was, part of it was that the rules don't allow for what people are complaining about. He said, the law is clear. If you're receiving unemployment benefits and you're offered a suitable job, you can't refuse that job and just keep getting the unemployment benefits. But Bill, that is putting a lot of faith in the oversight of these programs it seems to me.

Bill McGurn : Right. It's always like people saying, we're going to eliminate the waste from government. I think it's a sign he realizes that the messaging, that this is a damaging to his administration for people to talk about unemployment benefits keeping people out of work. And he's responding to that. As you say, it's a pretty weak argument. Because the argument doesn't say, it's not happening. It's just saying they're not allowed to do it. Well, we know. We already know that, but the question is, how well enforced this is and so forth. So I think it's sort of a concession that he's in trouble a little bit on the messaging here.

Kyle Peterson : But there's an interesting parallel with some new data. Biden said that we have eight million fewer jobs than we did when the pandemic started. And there's some new information on Tuesday that shows that in March, there were 8.1 million job openings. And that is an all time high I think, for this data series, which started being reported in 2000. And obviously every job is not a fit for every person who is out of work, Kim, but it is interesting how we have eight million jobs short and we have eight million job openings. I mean, it seems like a hot labor market.

Kim Strassel : Yeah. And you saw those job openings increasing all across the economy, but in food services and accommodations, that means hotels basically and restaurants, that's really notable. Because you have seen all of these restaurant owners out there begging for people to come back to work. Those do tend to be lower paying jobs, often more minimum wage level. And they're the ones that are really struggling because of the significant amount of money that workers are looking at if they are on unemployment, especially, remember these are enhanced unemployment benefits. So you are getting a check from the federal government for $300 a week. In addition to whatever state unemployment you are getting too, which can add up to tens of thousands of dollars. And so those areas are really struggling, but also state and local education, arts and entertainment. All of these places are reopening with a rush as more and more people get vaccinated. They need the workers. And there can just be no question that it is the combo of these federal unemployment benefits with local ones that are making it impossible for them to fill them.

Kyle Peterson : But meanwhile, the number of States that have decided they're going to end the federal supplement. On the terms of the law, the enhanced unemployment goes through September, but the number of States that are looking at the job's numbers and saying, this can't go on is growing. We talked about a few of them last week, the journals news pages say there are at least nine States now and joining them on Tuesday were Iowa and Tennessee, they also include Alabama and Arkansas. And Bill, this is just going to be fascinating I think, because a lot of times we have these counterfactual public policy debates, a job is created or saved, and we're arguing about models. And it looks to me like we're going to get a real test here at States that decided to keep the enhanced unemployment and States that didn't and we might find out whose right.

Bill McGurn : Right. That will be the test of Joe Biden statement. That it's not really happening. I think Jen Psaki said, maybe on an anecdotal level. Plainly the States, which is roughly a quarter of the States now are saying, that's not true. And they're having different ways of going about it. Some are receding from the program I believe is it Montana? One of them giving a bonus to people that go back to work, one-time bonus and so forth. So, yes, I think it's a good thing. Let's see the experimentation. Let's see who does better. And let's answer the question empirically.

Kyle Peterson : Thank you, Kim and Bill. Thank you all for listening. We'll be back later this week with another edition of Potomac Watch.