Washington Update - January 26
Last week, the House passed a bipartisan package of individual appropriations bills funding government through the balance of the fiscal year. Before the killing of another civilian in Minneapolis by ICE immigration officers, the Senate was poised to clear the package for President Donald Trump’s signature prior to Friday’s deadline to avoid another funding lapse. Senate Democrats now demand immigration enforcement accountability provisions to win their votes for the bill. Republican leaders will decide whether to compromise with Democrats, split off the Homeland Security portion of the bill, or enter another appropriations lapse. Any changes will require action by the House, which is on recess this week.
The leadership’s decision comes in the context of rising public opposition to ICE's tactics, even drawing resistance from prominent Trump supporters. Previously a top issue for President Trump, immigration has become a liability for Republicans going into the mid-term election cycle.
While in Switzerland last week, President Trump divided American allies, fostering international instability. Despite his decision to withdraw from invading Greenland, world political and business leaders see the President unpredictably splitting the globe into transactional spheres of influence, while seeming to name European nations as vassals of the U.S. In response, world leaders are exploring how to rapidly restructure relationships to minimize political, security and investment risks.
It is hard to imagine Canadian Prime Minister Mark Carney being successful in assembling middle-ranking nations into a new global power center, given the diversity of interests. But as the international order grows more multi-polar, it seems likely to enable the middle-power states to shape a series of shifting plurilateral initiatives, giving them new influence in the competition between the U.S. and China.
The Federal Reserve is expected to hold interest rates steady during its meeting this week, pausing after three consecutive rate cuts.
