TRILLIONS National Weekly – Feb 3, 2026
Government Shutdown Day 4—Tuesday House Vote to End Shutdown is Possible; The Economy, the Fed and Tariffs; Major National & International Developments
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(1) TUESDAY IS SHUTDOWN DAY 4: HOUSE VOTE TO END SHUTDOWN IS POSSIBLE. WHAT YOU NEED TO KNOW.
Each year Congress has 12 annual sending bills to enact. Three were enacted on November 12, 2025; another three on January 23, 2026. See our appropriations status chart for details.
The House passed and bundled the other six bills into HR 7148 on January 22, 2026. However, in the wake of the ICE shootings in Minneapolis, Senate Democrats resisted passing the package until Homeland Security funding was dropped from the package.
President Trump and Senate Democratic Leader Schumer last week agreed to advance the other 5 bills (Financial Services-General Government; National Security-State; Defense; Labor-Health & Human Services-Education; and Transportation-HUD) along with two weeks of temporary funding for the Dept. of Homeland Security (DHS) to allow for negotiations on guardrails for ICE (Immigration and Customs Enforcement) operations. The Senate passed the 5-bill package, with temporary DHS funding, last Friday evening (71-29).
However, since HR 7148 has now been amended in the Senate by the Trump-Schumer agreement, it needs to be re-passed by the House of Representatives (since a bill cannot become law unless identical versions are passed by both chambers).
Shutdown Triggered last Friday at Midnight: The Trump-Schumer agreement came too late to avoid a shutdown. The temporary funding that had been keeping agencies open since November expired Friday, January 30 at midnight—triggering a shutdown of the Departments of Defense, Education, Health & Human Services, Homeland Security, Housing & Urban Development, Labor, State, Transportation, and Treasury, as well as the Judiciary and multiple independent agencies.
House Speaker Johnson had hoped to swiftly bring the amended package to the House Floor Monday, under suspension of the rules, but that requires a two-thirds vote for passage. However, over the weekend, House Democratic Leader Jeffries told Johnson he could not guarantee Democratic support for the spending package because some House Democrats do not want to vote for any funding of DHS without guardrails.
Johnson therefore has to bring the package to the Floor with Republican votes only. House Republicans will need to first pass a “rule” to advance the legislation. The House Rules Committee met late Monday afternoon to approve a “rule.” The earliest a vote will occur on the rule and spending package is Tuesday.
Speaker Johnson can only afford to lose one Republican vote on the rule, given the slim 218-214 majority in the House. (Losing two votes would lead to a 216-216 tie and the Republican rule would not pass.) Johnson is relying on pressure from the White House. President Trump said Monday in a social media post that “there can be NO CHANGES at this time” to the legislation. “We need to get the Government open, and I hope all Republicans and Democrats will join me in supporting this Bill, and send it to my desk WITHOUT DELAY.”
Despite the White House pressure, it is unclear if Johnson will have the votes to advance the rule on the spending package on Tuesday. Some conservative Republicans are miffed that Homeland Security is not fully funded in the bill, and other Republicans want a controversial “voter ID” provision, known as the SAVE Act, added to the package.
What You Should Know About the Shutdown--now in its 4th day:
Even though the shutdown was triggered by concerns over ICE conduct in Minneapolis, ironically ICE will be unaffected by the shutdown because it has $75 billion in multiyear resources to draw down from direct appropriations to the agency in President Trump’s huge spending and tax cut bill last summer (OBBBA).
Some federal workers have begun to receive furlough notices. “(T)he rollout of partial closures has been haphazard compared to the record-long shutdown last fall. Some agencies have given employees explicit instructions, while others have not issued general guidance as they determine whether swift action by Congress might let them avoid significant interruptions,” reports the New York Times.
With a partial government shutdown underway, the Office of Personnel Management has updated its shutdown guidance to remove references to the guarantee of back pay for furloughed federal employees once a funding lapse ends, reports FNN.
Social Security checks will continue to go out, but local offices will provide “reduced services.”
TSA (Transportation Security Administration) employees are expected to work without pay as are air traffic controllers.
The Internal Revenue Service will remain open this week (violating the statutory prohibition on operating without funding).
FEMA should still have sufficient funds to support winter storm response during the shutdown, reports the AP.
This week’s jobs report will be postponed due to the shutdown.
Check for unfolding appropriations developments Tuesday on TrillionsWeekly.com, or type into your browser Appropriations.com or the shorthand Approps.com. They all lead to real-time updates.
(2) THE ECONOMY, THE FED, TARIFFS, and FINANCIAL REGULATION
Interest Rates and Inflation: With the inflation rate sitting close to 3 percent, the Federal Reserve last week left interest rates unchanged despite ongoing pressure from President Trump.
Reporting on President Trump’s Nomination of Kevin Warsh to Chair the Fed:
Trump Picks a Reinvented Warsh to Lead the Fed - Bloomberg
Who is Fed chair nominee Kevin Warsh? - AP
Meet the Federal Debt, the Fed’s Actual New Boss - NYT op-ed
Warsh will shift from Powell’s data-dependent approach to policy - FT
Warsh has a problem in the Senate. GOP Sen. Thom Tillis is vowing to block the nomination until investigation into Powell is “resolved.” - Politico
Hedging Against Trump’s Tariff Chaos: Reuters reports that the world is discovering it can hedge U.S. trade risk. For example, consider the new India-EU trade deal.
Trump’s Trade War with Canada: Reuters reports that President Trump has threatened Canada with aircraft tariffs and decertification over Gulfstream approvals.
Trump’s Trade War with South Korea: Vowing Higher Tariffs, President Trump rattles South Korea months after a trade deal, saying Seoul is not moving fast enough to implement the agreement, which calls for South Korea to invest billions in the United States. – NYT
Another Round of Financial Deregulation? Politico reports that “financial regulators spent the first year of President Donald Trump’s second term relaxing oversight of lenders and beginning to usher digital assets into the banking system. This year, there’s a bigger project underway: a major rewrite of rules put in place after the 2008 financial crisis. Treasury Undersecretary for Domestic Finance Jonathan McKernan told (Politico) that his department is seeking a “fundamental reset of financial regulation.”
Trillions Weekly: This is something to watch very closely. Many analysts have tied the 2008 financial crisis to earlier deregulation actions. In addition, one of the key regulators created by the Dodd-Frank law—the Consumer Financial Protection Bureau—is on track to be shut down by the Trump Administration this year.
The Weakening Dollar: President Trump last week said the value of the dollar is “great,” as it hit a 4-year low. Politico points out that “a weakening dollar causes concern because it diminishes the purchasing power of U.S. businesses and consumers and can lead to higher inflation.” And the Wall Street Journal counsels that voters may not be happy about weaker purchasing power.
(3) MAJOR INTERNATIONAL DEVELOPMENTS
United Nations—The UN Secretary General said last week that the global body is at risk of financial collapse and the U.S. owes nearly $2.2 billion in overdue and current assessments. President Trump’s response to reports that the UN could be forced to scale back operations and shut its New York headquarters: “The U.N. is not leaving New York, and it’s not leaving the United States… If they came to Trump and told him, I’d get everybody to pay up, just like I got NATO to pay up, right? All I have to do is call these countries. If the head of the U.N. would call the president of the United States, I would make the appropriate phone calls and they would send checks within minutes,” he said.
Ukraine—The Financial Times reports that the U.S. continues to link security guarantees for Ukraine to that country ceding territory to Russia.
Trillions Weekly: This stance rewards Putin for his bloody aggression that has left several hundred thousand dead, with nearly 2 million casualties.
Mexico and Cuba—President Trump is threatening to impose tariffs on Mexico if it delivers oil to Cuba, aiming to squeeze the Cuban regime.
Greenland—The U.S. Embassy in Denmark has removed 44 flags honoring fallen Danish soldiers for their service in the Afghanistan war due to Trump’s anger over Denmark not ceding Greenland to the U.S.
Gaza “Board of Peace”—The so-called Board of Peace would hand over to Trump sweeping powers over Gaza according to draft documents.
NATO—The NATO Secretary General warned last week that Europe must stop “dreaming” about defense without the U.S., saying the continent cannot afford to replace the American security umbrella.
(4) MAJOR DOMESTIC DEVELOPMENTS ACROSS GOVERNMENT
Violations of Law by President Trump’s Office of Management & Budget:
President Trump Failed to Submit FY 2027 Budget Proposal to Congress: U.S. law requires the President to submit a budget proposal for the upcoming budget year (FY 2027) “not later than the first Monday in February.” Budget Director Russell Vought failed to do so without explanation.
Last week, the District Court for the District of Columbia ruled that Budget Director Vought and the Office of Management and Budget (OMB) are violating the law requiring public disclosure of the administration’s use of appropriated funds (known as apportionments).
Expiration of Enhanced Obamacare Subsidies: CNN reported that Obamacare enrollment dropped after the expiration of enhanced premium subsidies; CBS reports that six states (CA, CO, CT, MD, MA, NM) are trying to offset some of the increased insurance costs; NBC reports that some enrollees are switching to cheaper “bronze” plans; Wall Street Journal reports that health insurance is now more expensive than mortgage payments for some Americans; and Senator Angus King (I-ME) says he remains optimistic about a bipartisan deal to extend enhanced subsidies, but other reporting says the effort has stalled. The latter is more likely.
Moratorium on Firings Ends: Last Friday, a statutory moratorium blocking the Trump Administration from mass firing of federal employees ended.
Another Party-Line Budget Reconciliation Bill? The House Republican Study Committee is continuing to lobby House Republicans to initiate a 2026 budget reconciliation bill, reports Politico.
Climate and Energy: America officially left the Paris Climate Agreement last week for the second time; and a federal judge struck down the Administration’s freeze on EV charger funds.
Immigration and ICE deportations:
As ICE arrests increased, a higher portion had no U.S. criminal record; in January, nearly 43 percent of those detained had no convictions or charges, according to publicly available ICE data.
ICE has begun buying “mega” warehouse detention centers across the U.S.
Trump aides declared 16 DHS shootings since July “justified”—before probes were completed.
Read about the tools ICE is using to track suspects and protesters: biometric trackers, cellphone databases, and drones.
Medicare Advantage Insurers Face New Limits: Medicare Advantage insurers face new curbs on overcharges, as reported by NPR, Politico, Wall Street Journal, and Bloomberg.
Media and the First Amendment: The Washington Post reports that President Trump is ramping up his lawsuits against the media.
Tax Filing Season Could Falter: Last week, the annual report of the National Taxpayer Advocate said, “among the reasons the 2025 filing season went well was that the IRS had its largest workforce in many years and faced no major tax law changes… Entering 2026, the landscape is markedly different. The IRS is simultaneously confronting a reduction of 27% of its workforce, leadership turnover, and the implementation of extensive and complex tax law changes…”
Threats to the U.S. Election System:
Not only was National Intelligence Director Tulsi Gabbard at the scene of the Trump administration’s shocking raid on a Georgia county’s election center last week, but the New York Times reports she put FBI agents on a call with Trump himself, during which he gave them a “pep talk” – all in the service of advancing his relentless lies about the 2020 election.
Today, President Trump called on Republicans to “nationalize” federal elections. The Elections Clause in Article I, Section 4, Clause 1 of the U.S. Constitution authorizes states to regulate the “Times, Places and Manner” of elections for Congress, subject to Congress’s power to “make or alter” those rules.
Ethics: Article I of the U.S. Constitution states that no U.S. official can accept, without the consent of Congress, emoluments “of any kind whatever, from any King, Prince, or foreign state.” An emolument is a benefit an official receives because of a public office. Now consider this report from the Wall Street Journal:
Four days before Donald Trump’s inauguration last year, lieutenants to an Abu Dhabi royal secretly signed a deal with the Trump family to purchase a 49% stake in their fledgling cryptocurrency venture for half a billion dollars… The buyers would pay half up front, steering $187 million to Trump family entities. The deal with World Liberty Financial… was signed by Eric Trump, the president’s son. At least $31 million was also slated to flow to entities affiliated with the family of Steve Witkoff, a World Liberty co-founder who weeks earlier had been named U.S. envoy to the Middle East…
The Journal explains that the above “came months before U.A.E. won access to tightly guarded American AI chips.”
Other ongoing conflicts of interest:
President Trump has sued the IRS—an agency over which he has executive authority—to pay him at least $10 billion over the unauthorized disclosure of his tax returns during his first term (NYT);
President Trump has promised to make the U.S. the world’s crypto capital, while his family amasses crypto assets of $1 billion (Politico); and
The Trump Administration revoked a regulation requiring more nursing home staff after executives who donated to the President’s super PAC met privately with him urging repeal of the rule (NYT).
Closing the Kennedy Center for the Performing Arts and the Arch that will dwarf the Lincoln Memorial: After illegally renaming the Kennedy Center for the Performing Arts the “Trump-Kennedy Center,” numerous performers have refused to book engagements and attendance has dropped sharply. President Trump is now declaring that beginning this summer the Center will close for two years for renovations. When asked Monday by reporters whether he would demolish the building, President Trump said, “I’m not ripping it down. I’ll be using the steel. ... We’re using some of the marble and some of the marble comes down.” At the same time, another American treasure is at risk: President Trump is aiming to build a 250-foot-tall arch, that would “dwarf the Lincoln Memorial.”
(5) SUGGESTED READS
Trump’s expansion of state power undermines the West’s core achievement: limits on authority. – WP / Zakaria
Crony Socialism and Rare Earths. Government stakes in companies is the wrong way to beat China. – WSJ
Speaking engagements and press interviews can be scheduled by calling: (301) 509-5688. Email comments, suggestions, and questions to: info@capitolpublicpolicy.com.
About the author: Charles S. Konigsberg served as Assistant Director at the White House Office of Management and Budget for three successive Budget Directors; General Counsel at the U.S. Senate Finance Committee, where he had principal responsibility for managing federal budget and debt limit legislation; Minority Chief Counsel at the U.S. Senate Rules & Administration Committee where he advised the ranking member on budget, appropriations, trade, and tax legislation; Staff Attorney at the U.S. Senate Budget Committee where he had responsibility for federal fiscal law issues including the Impoundment Control Act and drafted the first explanation of the congressional budget process; Director of Congressional Affairs at the Consumer Financial Protection Bureau and AmeriCorps; and staff director of a national bipartisan budget task force.
Charles S. Konigsberg is also author of the book, Trillions: A Primer on Federal Spending, Taxes, the U.S. Debt Ceiling, and Fiscal Law. Click here to purchase.
