Washington On One - January 19, 2026

THE LEDE:  Senate Republicans derail effort to rebuke Trump on Venezuela…State Department halts immigrant visa processing for 75 countries…Congress clears first funding bills since government shutdown ended…Trump announces new tariffs against Europe amid Greenland push (details still lacking from last week’s tariffs imposed on countries doing business with Iran)… UK rules out Trump Greenland tariff retaliation — for now…Macron to urge EU to use trade ‘bazooka’ in response to Trump’s tariffs…EU-US trade deal ‘on hold’ for now…Trump reaches deal with Taiwan to lower tariffs in exchange for tech investments…Trump doesn't 'think there’s any reason right now’ to invoke Insurrection Act in response to anti-ICE protests in Minneapolis…House passes bill to limit ESG factors in retirement investing…White House eyes 10 percent replacement tariff if Supreme Court strikes down his earlier tariffs…Trump suggests new hesitance over Hassett for Fed chair…A day after cutting them, HHS reinstates billions in substance abuse and mental health grants…Three different judges — including one appointed by Trump —allowed construction to resume on multibillion-dollar offshore wind projects off the coasts of New England, New York and Virginia that the Interior Department was trying to idle…Trump’s health plan puts the blame on industry for high costs…Trump signs bill allowing schools to offer whole milk…CFIUS to push forward with pilot ‘Known Investor Program’…Trump’s War Department rebrand could cost up to $125M, CBO estimates…CA’s Newsom sets August special election to fill LaMalfa’s House seat…

THE WEEK AHEAD:  Supreme Court to rule on Trump Tariffs?... Senate: The chamber is in recess until Jan. 26. House: The House returns Tuesday.   Legislation: The Rules Committee will consider two bills supporting organizations that promote alternatives to abortion and a resolution to overturn a Biden-era mining ban in Minnesota federal forests. Additionally, nine bills are slated for consideration under suspension of the rules, including measures to modify VA education benefits and expand small business support.   Wednesday Hearings: Homeland Security: Officials from CISA, TSA, and the Science & Technology Directorate will testify on agency oversight.  Financial Services: Oversight hearing on the Department of Housing and Urban Development.  Budget: Discussion on reversing rising health care costs.  Judiciary Subcommittee: Examination of embedded threats in transportation system technology.  Thursday Hearing:   Judiciary: Former Special Counsel Jack Smith is scheduled to testify.

NUMBERS:  National health spending soared for 2nd consecutive year in 2024, increasing by 7.2%...

VENEZUELA:  The Senate defeated legislation requiring congressional approval for military action in Venezuela, securing a major victory for the White House. Vice President JD Vance cast the tie-breaking vote to kill the measure after the chamber deadlocked 50-50.  The resolution’s collapse hinged on GOP Senators Josh Hawley and Todd Young, who switched sides after previously defying party leadership to advance the bill. Both cited last-minute assurances from Secretary of State Marco Rubio that the administration would consult Congress before any "major military operations" and confirmed no troops are currently deployed.  Republicans utilized a procedural maneuver to strip the resolution of its "privileged" status, arguing U.S. forces are not engaged in active hostilities. Democrats fiercely disputed this, with Sen. Tim Kaine pointing to ongoing naval strikes and asset seizures as clear evidence of military engagement. The razor-thin victory preserves Trump’s war powers for now, though Democrats vowed to pursue further votes, including on potential actions in Greenland.

APPROPRIATIONS:  The Senate voted 82-15 Thursday to send a three-bill spending package to President Trump, funding the Departments of Justice, Interior, Commerce, and Energy through the fiscal year. This marks a critical step toward averting another government shutdown before the Jan. 30 deadline, though most federal programs remain unfunded.  The legislation rejects the White House's steepest proposed cuts. For instance, the EPA faces a 4 percent reduction rather than the requested $4 billion slash. Conversely, trade agencies secured significant boosts, with the U.S. Trade Representative’s Office receiving an 18 percent increase.  Senators return next week to address a House-passed measure for Treasury and State. However, negotiations on major bills—including Defense and Labor-HHS—are ongoing. The Homeland Security package remains particularly contentious following recent fatal ICE shootings in Minnesota, leaving the path to a full spending deal uncertain.

HHS:  The Department of Health and Human Services has reinstated nearly 3,000 grants worth approximately $2 billion, reversing a decision to terminate them just one day prior. The funding, managed by the Substance Abuse and Mental Health Services Administration (SAMHSA), supports critical initiatives including youth overdose prevention and medication-assisted treatment for substance use disorders.  Health Secretary Robert F. Kennedy Jr. restored the grants following immediate bipartisan pressure, including an inquiry from 100 House members. Rep. Rosa DeLauro (D-Conn.), ranking member of the House Appropriations Committee, confirmed the reversal late Wednesday. She emphasized that the cuts would have eliminated life-saving programs and reminded the administration that "Congress holds the power of the purse." Administration officials have privately confirmed the reinstatement.

GREENLAND:  President Donald Trump escalated his campaign to acquire Greenland on Saturday, announcing sanctions against eight European allies. Effective Feb. 1, the U.K., France, Germany, Denmark, Sweden, Norway, Finland, and the Netherlands will face a 10 percent tariff on exports to the U.S., increasing to 25 percent in June.  Trump declared the levies would remain “until such time as a Deal is reached for the Complete and Total purchase” of the island, which he views as vital for national defense.  The announcement follows the deployment of European troops to Greenland for NATO exercises—a move intended to deter Russian and Chinese aggression but viewed by Trump as a "dangerous game." A recent White House meeting with Danish officials failed to resolve the standoff.  Implementing these targeted tariffs may prove legally complex, given the European Union’s single market rules and existing 15 percent U.S. levies. The move also arrives as the Supreme Court weighs a pivotal case regarding presidential tariff powers.

SEMICONDUCTORS:  President Trump announced a 25 percent tariff on imported semiconductors Wednesday, specifically targeting chips that are not utilized for domestic production. The levy applies to semiconductors transshipped through the U.S. to other countries rather than those used to build American AI or computing infrastructure.  White House Staff Secretary Will Scharf confirmed the policy stems from a Commerce Department national security investigation. "The United States is getting 25 percent of the chips in terms of the dollar value," Trump stated at an Oval Office signing event.  Separately, Trump signed an executive order directing the U.S. Trade Representative to negotiate agreements to secure critical mineral supply chains. The order implies that if deals to mitigate vulnerabilities are not reached quickly, the administration may impose tariffs or establish minimum import prices—strategies recently discussed by Treasury Secretary Scott Bessent with G7 officials.

TARIFF CASE:  President Trump has a "solid" backup plan if the Supreme Court strikes down his use of emergency powers to impose tariffs, National Economic Council Director Kevin Hassett revealed Friday.  Hassett stated the administration could immediately leverage alternative authorities to levy a 10 percent tariff, likely referencing Section 122 of the 1974 Trade Act, which allows temporary duties to address balance-of-payments deficits. This would provide a window to "backfill" trade policies using other statutes, such as Section 301 or Section 232.  The remarks offer the first specific insight into the White House's strategy ahead of a potential Supreme Court ruling on the International Emergency Economic Powers Act (IEEPA), which could come as early as Tuesday.  While U.S. Trade Representative Jamieson Greer insists recent deals with the EU and Japan would remain unaffected, the business community remains concerned. U.S. Chamber of Commerce CEO Suzanne Clark warned that losing IEEPA power would eliminate Trump’s "biggest, broadest tariff authority," creating further market uncertainty. Clark urged the administration to prioritize permanent trade agreements—specifically with India and through the USMCA—over executive actions that can change "with the stroke of a pen."

CFIUS:  The Committee on Foreign Investment in the U.S. (CFIUS) is advancing a "Known Investor Program" to expedite transactions from allied nations. Assistant Treasury Secretary Chris Pilkerton announced Wednesday that the pilot, directed by a February 2025 executive order, will collect detailed data upfront to fast-track low-risk investments in strategic sectors.  Pilkerton expects to release a public request for information soon, initiating a 60-day comment period. Responding to Rep. Warren Davidson’s (R-Ohio) concerns about bureaucratic bloat, Pilkerton argued the program is essential for gathering the data needed to streamline national security reviews.  CFIUS is also implementing the COINS Act—codified in December’s defense bill—to scrutinize U.S. outbound investments and establish a confidential feedback process for investors.  During the hearing, House Financial Services Chair French Hill (R-Ark.) pressed officials on why close allies like Japan lack "excepted foreign state" status, a privilege currently limited to the "Five Eyes" nations (Australia, Canada, New Zealand, and the U.K.). Hill argued expanding exemptions is vital for critical mineral processing. Pilkerton indicated the Known Investor Program could serve as a pathway to reevaluating these status designations.

THE FED:  President Trump signaled hesitation Friday about nominating top economic adviser Kevin Hassett as Federal Reserve chair, citing reluctance to lose his most effective media advocate.  “I actually want to keep you where you are,” Trump told Hassett at a White House event, praising his television performances. “If I move him... I would lose you. It's a serious concern.”  Hassett, the National Economic Council director, is considered the front-runner to replace Jerome Powell. However, his potential nomination faces headwinds. Republican senators, notably Thom Tillis, have raised alarms about the Fed’s independence following a Justice Department investigation into Powell. Tillis has vowed to block any nominee until the probe is resolved.  Hassett remains the only contender to publicly support the investigation. Trump’s reluctance adds further uncertainty to a selection process already strained by political tensions over central bank autonomy.

ACA:  Senate negotiations to revive lapsed Obamacare subsidies are teetering as lawmakers depart for a one-week recess without a deal. Despite intensive talks, the bipartisan group missed its informal deadline to release text, and skepticism is mounting.  "Progress is sort of uneven," said Senate Majority Leader John Thune. "It doesn't look like they're close."  Republicans and Democrats are trading blame for the impasse. Sen. Lisa Murkowski (R-Alaska) cited disputes over abortion funding restrictions (the Hyde Amendment), while lead negotiator Sen. Bernie Moreno (R-Ohio) accused Minority Leader Chuck Schumer of obstruction—a claim Democratic negotiators deny.  Adding to the uncertainty, the Trump White House released a separate health care framework Thursday that notably excludes subsidy extensions. Murkowski acknowledged that any Senate deal requires White House buy-in, which now seems tenuous.  Time is critical. The subsidies expired on December 31, and 2026 insurance rates are already set. While Schumer pushed for a three-year extension during a meeting with President Trump, Republicans blocked his attempt to pass the measure via unanimous consent.  "I think we’re entering the final phase," said a Senate GOP aide.

TRUMPCARE!??:  President Trump unveiled a health care blueprint Thursday that breaks with traditional GOP orthodoxy, blending free-market concepts with aggressive government intervention to lower costs. The "Great Healthcare Plan" aims to cement executive actions into law, pressuring Congress to codify negotiated drug prices, fund insurer reimbursements, and enforce strict transparency.  A central—and controversial—pillar is drug pricing. Trump wants Congress to formalize his "most-favored-nation" deals, which use tariff threats to secure lower prices from manufacturers like Pfizer and Eli Lilly. While the administration touts its upcoming direct-to-consumer website, TrumpRx.gov, pharmaceutical groups warn that price controls could stifle innovation. Conservative critics, including the National Taxpayers Union, argue this approach departs radically from free-market principles.  The plan also addresses rising premiums following the expiration of enhanced Obamacare subsidies. In a reversal from his first term, Trump proposes using taxpayer funds to reimburse insurers for cost-sharing reductions—payments he previously labeled "bailouts." This move targets "silver loading," a tactic insurers used to offset lost federal payments, which inadvertently raised government costs.  Additionally, the proposal demands greater transparency. It would require insurers to publish denial rates, wait times, and medical loss ratios in plain English. While industry groups like the Blue Cross Blue Shield Association expressed willingness to cooperate on transparency, hospitals warn the plan fails to address the immediate crisis of millions losing coverage due to expired subsidies.  Political viability remains uncertain. Democrats previously rejected similar GOP proposals, and anti-abortion groups are already mobilizing against the plan for lacking specific prohibitions on abortion funding. Nevertheless, the administration insists the package offers a "forward-looking" path for bipartisan support.

VISAS:  The State Department has suspended immigrant visa processing for 75 countries as it revamps rules determining whether applicants will burden the U.S. social safety net. The freeze, announced Wednesday, affects nations including Brazil, Nigeria, Cuba, Egypt, Iran, and Iraq. Officials stated the pause will persist until the U.S. ensures new immigrants will not "take welfare from the American people at unacceptable rates."  This action advances a November proposal to strictly define "public charge" inadmissibility. The new framework directs officers to consider potential reliance on non-cash benefits—such as Medicaid, SNAP, CHIP, and school lunch programs—and lowers the threshold for denial.  A State Department official confirmed the policy targets immigrant visas, leaving tourist and World Cup visas largely unaffected, though other travel bans may still apply. The rule is expected to be finalized later this year, likely triggering legal battles from advocates who argue it discourages eligible families from accessing essential services.

IRS:  The IRS issued guidance Wednesday on tax deductions for depreciable property acquired during the second Trump administration. The 20-page document clarifies that businesses can now immediately write off 100 percent of the cost for new equipment, crops, and eligible property, rather than depreciating assets over time.  Enacted through last summer’s GOP legislative package, this measure permanently extends a benefit from the 2017 Tax Cuts and Jobs Act that had been phasing out since 2022. The guidance notably expands "qualified property" to include sound recording productions.  Taxpayers retain flexibility to spread deductions over multiple years if preferred. Additionally, the rules allow for deducting fractions of self-constructed property, such as building components, enabling faster capital recovery. These changes are designed to lower upfront costs and stimulate business investment.

CRYPTO:  Nothing like a jurisdictional fight to bring the two parties together.  Senate Banking Chair Tim Scott’s cryptocurrency legislation has stalled following a challenge from Senate Judiciary leaders Chuck Grassley and Dick Durbin.  In a private letter to Scott, the bipartisan Judiciary pair objected to a provision exempting certain crypto software developers from financial licensing rules. They warned the language creates "dangerously broad" enforcement gaps that could shield money launderers and criminal organizations from prosecution, specifically citing concerns regarding decentralized platforms like Tornado Cash. Grassley and Durbin also asserted that such changes to criminal liability fall within their committee's jurisdiction, noting they were not consulted.  Scott’s team defends the provision—mirroring the "Blockchain Regulatory Certainty Act"—as necessary to protect developers who write code but do not control user funds. While Scott insists the bill balances innovation with law enforcement needs, the high-profile opposition and uncertainty over vote counts forced him to postpone the committee’s planned markup. The dispute underscores the ongoing tension in Washington between fostering crypto innovation and closing regulatory loopholes.

STUDENT LOANS:  The Education Department has unexpectedly paused efforts to seize wages and tax refunds from borrowers in default on student loans, reversing a plan initiated just weeks ago. Education Secretary Linda McMahon confirmed the suspension, citing confusion over repayment rules inherited from the previous administration.  Officially, the department stated the delay will allow time to implement new repayment plans included in the GOP’s recent domestic policy bill. However, industry insiders suggest political concerns regarding the upcoming midterm elections and rising living costs played a significant role in the decision.  This marks a sharp pivot from the department’s earlier announcement that it had already begun sending garnishment notices to 1,000 borrowers in early January. It would have been the first time in nearly five years that wages were withheld for federal student loan debt—a practice suspended since March 2020. Currently, over 5 million borrowers are in default. While the administration previously moved to withhold tax refunds, this latest pause halts a process that allows the government to seize up to 15 percent of a borrower’s disposable pay.

ESG:  The House voted 213-205 Thursday to pass the Protecting Prudent Investment of Retirement Savings Act, which restricts retirement fund managers from prioritizing environmental, social, and governance (ESG) factors. Sponsored by Rep. Rick Allen (R-Ga.), the bill overrides a Biden-era Labor Department rule that permitted fiduciaries to weigh ESG criteria when financially relevant.  The passage secures a win for GOP leadership after a difficult week for the Education and Workforce Committee’s agenda. Earlier, six Republicans joined Democrats to block legislation regarding overtime rules, and leadership was forced to shelve a separate bill tightening joint-employer standards after determining it lacked the votes to pass.

DEPT. OF LABOR:  President Donald Trump’s labor agenda is accelerating after a year of stasis. Bolstered by new appointees, the Equal Employment Opportunity Commission (EEOC) and National Labor Relations Board (NLRB) are moving to dismantle Biden-era policies and reshape federal workplace oversight.  The EEOC, led by Chair Andrea Lucas, is expected to approve procedures consolidating her power and limiting minority commissioners' influence. Lucas plans to roll back abortion protections under the Pregnant Workers Fairness Act and has signaled opposition to accommodations for fertility treatments. Additionally, she is aggressively targeting corporate DEI initiatives while encouraging discrimination claims from white men.  Meanwhile, the NLRB, newly staffed with members Scott Mayer and James Murphy, has begun clearing a significant case backlog. However, with the chair position currently vacant, it remains unclear how quickly the board can overturn major precedents, such as the ban on captive-audience meetings.  These moves signal a decisive shift. By purging Democratic appointees and eroding agency independence, the Trump administration has positioned these watchdogs to swiftly execute a conservative enforcement and rulemaking agenda.

WHAT YOU MAY HAVE MISSED OVER THE LAST YEAR:  Donald Trump returned to the presidency determined to exceed the impact of his first term. While headline-grabbing executive orders dominated the news cycle, the administration quietly enacted significant changes across the federal government. As the anniversary of his inauguration approaches, POLITICO highlights 25 moves that may have flown under the radar but fundamentally reshaped policy. Energy & Environment Coal Life-Support: Utilizing emergency powers, the DOE blocked the scheduled retirement of aging coal and gas plants in Michigan, Washington, and Pennsylvania to ensure capacity. Critics argue this artificially sustains uneconomic, high-pollution facilities.  Federalizing Oil Oversight: The Department of Transportation seized regulatory authority over California’s Sable Offshore pipeline, stripping the state fire marshal of oversight. The move bypassed state-level blockers, causing Sable’s stock to jump 56 percent.  Immigration The "Data Lake": DHS began consolidating data from the IRS, HUD, and HHS into a massive repository to locate unauthorized immigrants. Privacy advocates warn this exposes the data of millions of U.S. citizens to potential cyberattacks.  Mass Detention Reclassification: ICE quietly reclassified all immigrants as "applicants for admission," a legal designation denying them the right to bond. This has led to a spike in detentions for immigrants previously living freely on parole.  Health Care Restrictions: Congress stripped Obamacare subsidies for lawfully present immigrants, while the administration revived the "Public Charge Rule." The CBO estimates 300,000 immigrants will lose coverage next year, potentially raising premiums for the general population.  Dreamers Losing Coverage: A rule change excluded DACA recipients from the definition of "lawfully present," barring them from Obamacare marketplaces in 18 states. In California alone, 2,300 "Dreamers" lost private insurance in August.  Finance & Economy Crypto Integration: The bipartisan GENIUS Act established a regulatory framework for stablecoins. Consequently, major institutions like Bank of America and Goldman Sachs are exploring stablecoins tied to G7 currencies, potentially mainstreaming crypto payments.  Death of the Penny: Citing production costs, the U.S. Mint ceased penny production in November 2025. While saving the government $85 million annually, the move forces businesses to round prices, potentially costing consumers an aggregate $6 million per year.  Tariff Loopholes Closed: The administration eliminated the "de minimis" tariff exemption for shipments under $800. This effectively raised prices on direct-to-consumer goods from retailers like Shein and Temu, causing shipment volumes to drop from their 2024 high of 1.36 billion packages.  Defense & Foreign Policy Confederate Base Names: Reversing 2023 changes, Trump ordered nine Army bases to return to their Confederate names. For example, Fort Cavazos reverted to Fort Hood. The original renaming cost $40 million; the cost of the reversal remains undisclosed.  Dismantling Aid Agencies: The administration moved to dissolve the U.S. African Development Foundation (USADF). Operations are currently frozen pending legal battles regarding the executive branch's power to fire leadership at independent agencies.  Elections & Law Voter Roll Showdown: The DOJ sued states refusing to turn over full voter registration lists, including sensitive data like driver’s license numbers. While 23 states resisted citing privacy, the administration frames the demand as essential for "election integrity" ahead of the 2026 midterms.  Campaign Finance Deregulation: The DOJ refused to defend federal limits on coordination between candidates and political parties. If the Supreme Court sides with the GOP, it could unleash unlimited party spending and reduced ad rates for candidates.  Pardon Power Expansion: Trump expanded Jan. 6 pardons to cover unrelated crimes committed by defendants, such as gun offenses. This broad interpretation of clemency is currently being challenged in federal courts.  Health & Society Psychedelics Fast-Tracked: The FDA and HHS are accelerating research into psychedelic therapies like MDMA. The move signals a GOP cultural shift toward "natural" medicines, though insurance coverage and safety protocols remain significant hurdles.   AI Guardrails Removed: HHS rescinded Biden-era AI safety strategies to spur innovation. While promising efficiency, the lack of regulation has sparked concern among medical professionals regarding patient safety and data privacy.  Homelessness Funding Shift: HUD reallocated over 50 percent of "Continuum of Care" funds from permanent housing to transitional housing. Advocates estimate this could destabilize 170,000 people currently in permanent supportive housing.  Education Accreditation Overhaul: The Department of Education appointed conservatives to the committee overseeing college accreditors. Experts anticipate a shift toward recognizing new accreditors focused on cost-cutting rather than traditional educational oversight.  DEI Data Probes: The administration demanded colleges submit detailed data on applicant race, gender, and test scores. Universities fear this data will be used to launch investigations into diversity, equity, and inclusion (DEI) practices.  Workforce Pell Grants: The "Workforce Pell" program expanded financial aid eligibility to short-term credential programs (8–15 weeks), bolstering trade and workforce training options outside traditional four-year degrees.  Space & Science Lunar Nuclear Power: To compete with China’s 2035 lunar base plans, NASA expedited the development of a fission power system. The agency issued industry directives for a 100-kilowatt reactor—double previous specifications—targeting a 2030 launch.  Animal Testing Phase-Out: Aligned with the "Make America Healthy Again" agenda, the NIH allocated $87 million to develop alternatives to animal testing, while the CDC plans to shutter primate labs. Researchers warn that moving too quickly could hinder complex neuroscience advancements.  Administration & Culture Budget Impoundment: The White House utilized "pocket rescissions" to cancel $4.9 billion in foreign aid without Congressional approval. The Supreme Court upheld the tactic, significantly expanding presidential control over federal spending.  Federal Sports Policy: Trump established a White House World Cup Task Force, marking the first time the U.S. has dedicated high-level federal infrastructure to sports policy, setting a precedent for the 2028 Olympics.  DC Golf Takeover: The administration terminated the National Links Trust’s lease of D.C.’s public golf courses, moving to place the properties—including the historic Langston Golf Course—under direct federal management.