Speaker Johnson steps aside as GOP leader, setting up a Scalise vs. Jordan fight on Nov. 10

House Speaker Mike Johnson, R-La., told his staff on Wednesday morning that he will not stay on as Republican leader in the new Congress, according to NBC News, which cited four sources on the call. The Associated Press, citing two people familiar with the decision, reported the same. Johnson is expected to keep his seat as a rank-and-file member after winning an eighth term from his Shreveport-area district, AP said.

The calendar

• Nov. 10: House Republicans are scheduled to hold an internal election for their leader, NBC reported.
• Jan. 3, 2027: The speaker's election is among the first votes of the new Congress, AP said. The gavel is expected to pass to Democrats, who are preparing to nominate Democratic Leader Hakeem Jeffries of New York.

Who is running

Majority Leader Steve Scalise of Louisiana announced his bid in a letter to colleagues on Wednesday. "Last night's election was far worse than any of us expected," he wrote, NBC reported. Judiciary Committee Chairman Jim Jordan of Ohio told colleagues he is running too. In his letter, Jordan said he is "battle-tested on the oversight front" and knows "the Democrats' playbook," according to NBC.

AP noted that both men reached for the speaker's gavel in 2023, after Kevin McCarthy was ousted, and both failed to win a majority, splitting the vote. Johnson emerged then as the consensus pick. AP described Scalise as having long courted the conservative wing, "particularly business and energy sector lawmakers," and Jordan as the longtime preference of the hard right, including some Freedom Caucus members.

Why it matters beyond the caucus

CNBC's live coverage reported that the Democratic majorities are expected to launch investigations with subpoena power, and Senate Finance Committee ranking member Ron Wyden, D-Ore., said his committee's priorities will include a billionaire tax, CEO accountability, healthcare and trade policy. So the Republican who leads the minority will be the one coordinating the response to those fights. Jordan is pitching oversight combat; Scalise is pitching unity and experience. We have not seen either one publish a policy platform on taxes or trade, so we are not guessing at one.

A separate CNBC analysis argued the next debt-limit fight is the one place the new majority has real leverage over a president who has signaled he is ready to veto its bills, and that it could add volatility to the bond market. That is the outlet's analysis, not a scheduled vote. Our earlier coverage: Democrats projected to win the Senate and Vance blames the Iran war for the losses.

What to watch

• Whether anyone else enters the Nov. 10 race, and how the vote splits.
• Whether the Democratic Senate and House majorities finish out the uncalled races. CNBC said two Senate races remained uncalled on Wednesday.
• Committee chair announcements, which decide who writes the tax, trade and oversight agenda.

Sources: NBC News, The Associated Press, CNBC live updates. This is news reporting, not investment advice.