Washington Update - January 20, 2025

Billy Moore    Dc2

On Donald Trump’s Inauguration Day, he will set into motion an abundance of policy actions involving immigration and the border, pardons, energy, climate, technology, healthcare, gender, and cryptocurrency. Many of his promised “Day One” actions, such as ending the Russian invasion of Ukraine, will take longer.

Early presidential success usually requires a focus on a handful of goals. The President’s promised mass deportation of aliens will top the list, beginning Tuesday. Like mass deportations in the 1930s and 1950s, the operation will focus on obtaining news coverage to prompt such a sense of panic among aliens they decide to leave on their own. One difference with prior mass deportations is the number of immigrant advocacy networks that may limit the effectiveness of an intimidation campaign, which could increase the cost of mass deportations compared to prior efforts.

The other top objective is a massive budget reconciliation bill to implement the President’s tax and spending policies. Congressional Republicans have made no progress resolving their conflicts on how to proceed with the legislation. Hardline House conservatives have joined with Senate Republicans in demanding a two-bill strategy, compounding the disorder that results from President Trump’s refusal to resolve the issue. Congress is poised to approve its first major bill, a bipartisan immigration enforcement proposal, that would confirm the value of the two-bill approach.

House Republicans floated a 50-page list of tax and spending options for reconciliation, including extension of the 2017 tax cuts. Revenue proposals include a border tax and elimination of the home mortgage interest deduction, prompting steep opposition. Not including revenue lost by way of extending tax cuts in cost estimates remains a dream of many Republicans.

Even without counting the tax cut extension, the Congressional Budget Office projects deficits over the next decade will add $21 trillion to the current national debt of $36 trillion.