Facing revolt, GOP spares ethanol in drive to cut spending

House Republicans are touting their debt limit package as a first step toward fiscal restraint, saying it's past time for Congress to reduce the swelling deficits that they warn are threatening the fiscal health of the country.

But when a group of Midwestern Republicans went marching this week into the office of House Speaker Kevin McCarthy, it wasn't spending cuts they wanted to talk about.

They were on a mission to preserve billions of dollars in federal support for biofuels and ethanol.

The bloc of lawmakers, with Iowa's four Republicans at its core, forced McCarthy to make revisions to the legislation in the hours before it headed to a floor vote, even after the speaker had insisted changes were off the table. The concession amounted to a $38.6 billion carve-out to safeguard the incentives for biofuels, carbon capture projects and the ethanol industry, and helped the bill pass by a narrow 217-215 margin.