Washington Update - April 13
Congress returns to session this week as President Donald Trump blockades the Hormuz Strait following Vice President Vance’s failure to persuade Iran to accept U.S. terms to end the war in the Middle East. While Republican leaders seek to avoid a congressional role in the war, Democrats could force a War Powers Act vote to restrict miliary action by May. Also pending are extensions of the Foreign Intelligence Surveillance Act and Department of Homeland Security funding, not including elements of immigration enforcement.
In the U.S.-Israel war with Iran, a fragile cease fire holds while President Trump escalates the conflict. Israel is achieving some of its goals, including instability among its rivals in the region and continued combat with enemies in Gaza and Lebanon. The U.S. and Iran are both, for now, losers in the war with neither having achieved their goals and both competing to control shipping through the Strait of Hormuz.
Funding for the Department of Homeland Security remains lapsed. The Senate has approved funding, absent some immigration enforcement, but House action is uncertain. Republican leaders plan to fund immigration enforcement, plus $350 billion in war funding, through the reconciliation process that requires only 51 votes in the Senate. House leaders want to see the Senate pass a reconciliation bill before acting on the bobtailed DHS appropriation.
Congressional appropriators have scheduled action on fiscal year 2027 annual spending bills but the gulf between presidential and congressional priorities suggest few, if any, bills will be enacted prior to the November elections.
Inflation surged to 3.3 percent in March, driven by energy cost increases resulting from the Middle East war. The increased costs are consuming much of the tax refunds people are seeing from tax breaks enacted by last year’s reconciliation legislation, helping drive the University of Michigan Index of Consumer Sentiment to an all-time low.
