A Step Toward Trump’s ‘Big, Beautiful Bill’

Happy Thursday! It turns out Duo, the owl mascot for the language-learning app Duolingo, faked its “death” earlier this month in what turned out to be an elaborate marketing ploy. That’s the last time we trust the word of a fictional green avian.

Quick Hits: Today’s Top Stories

• Hamas returned the bodies of four slain hostages to Israel early Thursday morning as part of the U.S.-brokered ceasefire deal. Forensic scientists confirmed that the group included Itzik Elgarat, Ohad Yahalomi, Tsahi Idan, and Shlomo Mantzur—the oldest hostage in Gaza at 86 years old at the time of his abduction. Meanwhile, Israel began the release of more than 600 Palestinian prisoners, 151 of whom had been serving life sentences or long prison terms, into the West Bank and Gaza. The exchange marked the final handover of the first phase of the three-phase ceasefire between Israel and Hamas. Negotiators have yet to agree to terms for a second stage of the deal.
• A new report by the International Atomic Energy Agency (IAEA)—the United Nations’ nuclear watchdog—indicated that Iran grew its supply of uranium enriched to close to weapons grade by 50 percent in the last three months. The confidential report, which was seen by several news outlets on Wednesday, found that Iran had increased its stockpile of uranium enriched to 60 percent from 182 kilograms to 274 kilograms in the last quarter. The country is now enriching enough uranium for one nuclear bomb each month. “The significantly increased production and accumulation of high enriched uranium by Iran, the only non-nuclear weapon State to produce such nuclear material, is of serious concern,” the report stated. 
• Texas health officials confirmed Wednesday that an unvaccinated school-aged child died this week from measles—the first death from the disease the country has seen in a decade. The death comes amid a measles outbreak in Texas, where at least 124 people—the vast majority of whom are unvaccinated children and teenagers—have been infected and 18 people have been hospitalized. Secretary of Health and Human Services Robert F. Kennedy Jr. tried to downplay the significance of the outbreak on Wednesday, saying the outbreaks are “not unusual” and that the hospitalizations were “mainly for quarantine.” Local hospital representatives said the patients were admitted for respiratory issues, not to quarantine. Kennedy also stated incorrectly that two people had died. 
• President Donald Trump said Wednesday that his administration is preparing to impose sweeping tariffs on the European Union (EU). “We have made a decision and we’ll be announcing it very soon,” the president said from the first Cabinet meeting of his second term. “It’ll be 25 percent generally speaking, and that will be on cars and all other things.” Meanwhile, the European Commission threatened to take retaliatory steps. “The EU will react firmly and immediately against unjustified barriers to free and fair trade,” it said in a statement. The bloc is reportedly preparing a list of U.S. goods to impose tariffs on in response. 
• Supreme Court Chief Justice John Roberts temporarily paused a federal judge’s order compelling the State Department and the U.S. Agency for International Development (USAID) to end their freeze on the disbursement of foreign aid by 11:59 p.m. ET on Wednesday. The Trump administration, meanwhile, indicated plans on Wednesday night to make sweeping cuts to U.S. foreign assistance programs, including ending nearly 10,000 grants and contracts awarded by the State Department and USAID. The changes, outlined in a court filing by administration attorneys and an internal memo, would save the U.S. government an estimated $58.2 billion, a State Department spokesman claimed Wednesday.
• The heads of the offices of Personnel Management and Management and Budget shared a memo with executive branch agencies on Wednesdays directing them to prepare for mass firings or “large-scale reductions in force.” Agency heads were directed to submit “reorganization plans” by March 13, with a “focus on the maximum elimination of functions that are not statutorily mandated while driving the highest-quality, most efficient delivery of their statutorily-required function.” The memo did not include a specific percentage of positions to be eliminated, but Trump said Wednesday that the Environmental Protection Agency is planning to cut its workforce by 65 percent. 

A Budget Bonanza

President Donald Trump has repeatedly said that he wants to see his tax and spending priorities passed in “one big, beautiful bill” this year. On Tuesday night, House Republicans took one big, beautiful stride toward that goal with the passage of a budget resolution calling for hefty spending and tax cuts. 

But it’s just the beginning of a long and bumpy road for budget negotiations. The resolution’s passage, on a near-party-line vote of 217-215, is just the first step in shepherding through a budget for the next fiscal year.

To see Trump’s single bill realized, House Speaker Mike Johnson will need to corral not only his narrow Republican majority in the lower chamber but also the Senate. GOP leadership is counting on the budget to pass as part of the reconciliation process later this year, allowing it to bypass a Senate filibuster by Democrats. But for that to happen, both chambers of Congress must agree on the eventual bill’s framework. 

At the very least, budget negotiations now have momentum. Following dramatic scenes in which congressional leadership, believing they lacked enough support, canceled a planned Tuesday night vote only to abruptly call lawmakers back to the Capitol 13 minutes later, Republicans are relieved. “A lot of work yet to be done, but we’re going to celebrate tonight, and we’ll roll up our sleeves and get right back at it in the morning,” Johnson told reporters after the vote.

In addition to calling for $4.5 trillion in tax cuts and $2 trillion in spending cuts over the next decade, the budget resolution asks for a $4 trillion increase in the debt ceiling. The package will effectively extend the Tax Cuts and Jobs Act (TCJA), Trump’s main legislative achievement from his first term, for 10 years. But Manhattan Institute Senior Fellow Jessica Riedl pointed out earlier this month in our pages that the net effect will be to add more than $3 trillion to the national deficit over the next decade.

Passing a budget through reconciliation has certain requirements, laid out in the 1974 Congressional Budget Act. Both the House and Senate must pass a budget resolution setting tax, spending, and debt limit targets, which are then turned into specific proposals by congressional committees. Once the legislative specifics are hammered out and both chambers agree, the House and Senate Budget committees work to combine the two into a single “omnibus” bill, which can then be passed under normal House voting rules and by a simple majority in the Senate, getting around the delays posed by a filibuster (which requires 60 votes to break). However, reconciliation is usually only used once per year, cannot affect Social Security spending, and cannot increase the deficit outside a 10-year window. 

Even under this streamlined framework, the politics of the proposed budget are iffy, with Social Security off the table, boosting defense spending a priority, and some Republicans, including Trump, saying they refuse to touch Medicaid. But last week Trump endorsed the GOP plan even though the resolution would instruct the House Energy and Commerce Committee, which oversees Medicare and Medicaid, to find $880 billion in spending cuts. A few hundred billion can be found by reversing Biden-era regulations and cutting in other areas, but the bulk of the savings will almost certainly have to come from the $839 billion annually spent on Medicaid, despite Trump’s previous promises.

These cuts threatened to upend Johnson’s budget plan in the lead-up to its passage. “I’m really concerned about this,” Rep. David Valadao, a moderate Republican who represents a swing district in California, said last week. More than 60 percent of Valadao’s constituents are Medicaid recipients, according to health data compiled by New York University’s Grossman School of Medicine. And a review by Politico found that at least 10 other Republicans representing competitive districts are in similarly tight positions.

Meanwhile, some fiscal conservatives had argued the resolution’s spending cuts didn’t go far enough. “We promised the people we’re gonna have cuts, and then we’re just gonna turn right around and spend the money at the Pentagon,” Rep. Tim Burchett, a Republican from Tennessee, said Tuesday. “The war pimps will get theirs no matter what anyway.” Reps. Victoria Spartz of Indiana, Warren Davidson of Ohio, and Thomas Massie of Kentucky also voiced concerns that the budget plan would add to the federal deficit. 

GOP leaders reportedly assuaged the fears of moderates concerned by possible cuts to Medicaid during a closed-door meeting on Monday. “There’s a lot of space to address the issue without hurting beneficiaries,” such as “hundreds of billions” spent on waste, fraud, and abuse, said Rep. Nicole Malliotakis, a Republican from New York. 

That left the fiscal hardliners. Calls from Trump were reportedly enough to flip Spartz and Burchett. “This is the best I could get to,” Burchett said Wednesday. “I’ve often said you’re either at the table or on the menu, and I needed to be at the table.” Davidson also told reporters that he had “received assurances” that the final bill would include sufficient spending cuts. In the end, Massie provided the only GOP vote against the resolution, citing his concerns about the debt.

But now the question is what happens in the Senate. On Wednesday, Republican senators were blunt: as currently constructed, they won’t accept the proposed framework, which is why last week the chamber passed a fallback bill written by Sen. Lindsey Graham, a Republican from South Carolina, that avoids the question of tax cuts. The measure includes $175 billion in new funds for immigration enforcement and $150 billion to strengthen military supply chains. It also directs Senate committees to find spending cuts to offset the costs. 

Some senators, echoing House moderates, are concerned about slashing Medicaid the way the House’s bill directs. “I realize it’s just a broad instruction to that committee, but I think there will be concerns about that and what that may lead to,” said Sen. Josh Hawley, a Republican from Missouri. Others pointed out that even if all of the cuts envisaged in the bill were enacted, it would still increase the deficit. “Acquiescing to a $4 trillion increase in the debt ceiling is for me a non-starter,” said Sen. Rand Paul, a Republican from Kentucky. Sen. Roger Wicker, a Republican from Mississippi, also told reporters that the resolution did not reduce spending by enough. 

Others, including Senate Majority Leader John Thune, a South Dakota Republican, are insisting that the new budget make the 2017 Tax Cuts and Jobs Act permanent—something the House resolution does not do. It all could come down to the technical way those cuts are measured, as Charles Hilu explained in a piece for the site earlier this week. 

A Wednesday White House meeting between Treasury Secretary Scott Bessent, National Economic Council Director Kevin Hassett, and congressional leaders may have produced enough common ground to get over that hurdle, but much remains to be negotiated over the coming months, with Johnson aiming for the ambitious deadline of April. Congress must also find a way to avert a looming government shutdown in March. But for now, the one-two punch of Trump and Johnson, working to bring together disparate factions of the House, has prevailed. It’s a sign that almost no Republican, whether in the Senate or the House, is yet willing to buck Trump’s agenda. 

But eventually, tough talk and bluster will run into concrete fiscal realities. “Big First Step Win for Speaker Mike Johnson, and AMERICA. Now let’s start to BALANCE THE BUDGET. IT CAN BE DONE!!!,” Trump wrote on his Truth Social account Thursday morning. We’ll find out soon if he’s right.

Worth Your Time

• Thousands of mourners lined the streets of Israel on Wednesday to watch the funeral procession of Shiri Bibas and her 4-year-old and 9-month-old sons, Ariel and Kfir, who were taken hostage by terrorists on October 7, 2023, and murdered in Gaza. Yarden Bibas, who was kidnapped separately and released earlier this month, delivered a heart-breaking eulogy for his wife and children yesterday. “Mishmish, who will help me make decisions now?” Yarden said, addressing his wife. “How am I supposed to make decisions without you? Do you remember our last decision together? In the safe room, I asked if we should ‘fight or surrender.’ You said fight, so I fought. Shiri, I’m sorry I couldn’t protect you all. … Shiri, people tell me they’ll always be by my side, but they’re not you. Shiri, this is the closest I’ve been to you since October 7th, and I can’t kiss or hug you, and it’s breaking me! Shiri, please watch over me… Protect me from bad decisions. Shield me from harmful things and protect me from myself. Guard me so I don’t sink into darkness. Mishmish, I love you!”

Presented Without Comment

Jeff Bezos in a note to Washington Post employees on Wednesday: 

We are going to be writing every day in support and defense of two pillars: personal liberties and free markets. We’ll cover other topics too of course, but viewpoints opposing those pillars will be left to be published by others.

Also Presented Without Comment 

Politico: Gavin Newsom Is Launching His Own Podcast—And Inviting MAGA Favorites

Also Also Presented Without Comment 

Rep. Joe Wilson, a South Carolina Republican, made the following announcement on Tuesday: 

Grateful to announce that I am drafting legislation to direct the Bureau of Graving and Printing to design a $250 bill featuring Donald J. Trump. Bidenflation has destroyed the economy forcing American families to carry more cash. Most valuable bill for most valuable President!

In the Zeitgeist

We were sad to learn of the death Wednesday of Oscar-winning actor Gene Hackman at the age of 95. Hackman—who starred in Bonnie and Clyde, The French Connection, Mississippi Burning, and several other classic films—became known as a veritable Hollywood everyman over the course of his four-decade career. It was an unforgettable performance as Sheriff “Little Bill” Daggett in Clint Eastwood’s 1992 revisionist Western, Unforgiven, that secured Hackman his second Academy Award.

Toeing the Company Line

• In the newsletters: Scott Linciccome unpacked the false assumptions underlying fears of a “retail apocalypse,” Jonah Goldberg argued that not considering Donald Trump’s motives misses the forest for the trees, and Nick Catoggio explored the strange decline of pro-Palestinian activism. 
• On the podcasts: Jonah is joined by Christopher Scalia on The Remnant to discuss the value great books can offer the conservative movement, and Sarah Isgur is joined by Judges Charles Eskridge and Brantley Starr on Advisory Opinions to discuss executive powers and all things Texas. 
• On the site: Kevin Williamson reports from Dallas on the current strange moment for oil and gas industries. 

Let Us Know

What’s your favorite Gene Hackman film and why?