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(1) PARTIAL SHUTDOWN LOOMS JANUARY 31, 2026, AS NINE SPENDING BILLS REMAIN UNFINISHED; the Senate may vote this week on finalizing a 3-bill package and appropriators released 2 more bills yesterday (Sunday).
Background: In November, the Senate passed 60-40, and the House passed 222-209, a spending bill enacting 3 of the 12 regular appropriation bills, (Agriculture, Legislative Branch, and Military Construction-Veterans Affairs), and providing stopgap funding through January 30, 2026 for agencies funded by the 9 unfinished appropriation bills.
The 9 unfinished appropriation bills are: Commerce-Justice-Science; Defense; Energy-Water; Financial Services-Gen. Govt. (FSGG); Homeland Security; Interior-Environment; Labor-HHS-Education; Nat’l Security-State; and Transportation-HUD.
Last Thursday, the House easily passed three bills: Commerce, Justice, Science; Energy and Water Development; and Interior-Environment, after Speaker Johnson quelled a last-minute revolt by conservatives over earmarks by promising future reforms. (Click on the bill names to access legislative text, plain English summaries, and report language for each of the 3 bills.)
Senate Majority Leader Thune indicated he is eying consideration of the 3 bills as soon as this week.
Politico reports that “the appropriations package advanced Thursday largely rejected the dramatic cuts requested by the White House, instead making more tailored spending reductions to energy and environment programs…. The EPA would see a 4 percent, or $320 million, cut, instead of the more than $4 billion reduction President…Trump had sought. The National Park Service would face a moderate reduction from current funding levels, much less than the 37 percent cut the White House asked for.”
Yesterday (Sunday) House and Senate appropriations negotiators released a two more bills:
Financial Services and General Government Bill: Text | Bill Summary (Sen.Dem.) | Bill Summary (Hse.Dem) | Joint Explanatory Statement
National Security – Dept. of State (previously called State-ForeignOps): Text | Bill Summary (Sen.Dem.) | Bill Summary (Hse.Dem) | Joint Explanatory Statement
This leaves the following 4 bills still awaiting action by negotiators: Defense; Homeland Security; Labor-HHS-Education; and Transportation-HUD.
The defense bill is complicated by contentious social and foreign‑policy issues including diversity initiatives, transgender services, abortion‑related restrictions, and Ukraine aid (and now, possibly, Venezuela and Greenland).
The homeland security bill is being slowed by disputes over immigration and border policy, funding levels, and now, deep concerns over the ICE killing in Minneapolis and at least 30 deaths occurring in ICE custody in 2025. The default may be a CR for the remainder of the year.
The Labor-HHS-Education bill is slowed by differences between the bipartisan Senate committee bill and the partisan House committee bill. The House bill contains deep cuts to student aid, public health, and medical research along with controversial riders on abortion and LGBTQ rights. For background, see the differences between the GOP and Democratic fact sheets on the House bill.
The Transportation-HUD bill is complicated by disagreements on funding levels for rental assistance, homelessness programs, transit, and Amtrak. See this CRS report for background.
A partial government shutdown will occur on January 31, 2026, if any of the nine bills have not been enacted into law by that date and additional stopgap funding has not been provided for the unfinished bills. Stay tuned to TrillionsWeekly.com for daily updates on appropriations bills and access to all bill text, report language, earmarks, and summaries as soon as they are released.
(2) LAST THURSDAY, 17 HOUSE REPUBLICANS JOINED ALL HOUSE DEMOCRATS TO PASS A BILL EXTENDING EXPIRED ACA (OBAMACARE) SUBSIDIES FOR 3 YEARS. ATTENTION IS NOW FOCUSED ON THE SENATE WHERE NEGOTIATIONS ARE ONGOING TO CRAFT A PACKAGE THAT CAN GARNER 60 VOTES FOR PASSAGE.
What Are “Enhanced ACA Subsidies?” The ACA (Obamacare) provides federal tax credits to subsidize the purchase of private health insurance for individuals and families who earn too much to qualify for Medicaid but do not have access to affordable private health insurance. Enrollees select private health insurance plans offered through “marketplace exchanges” administered by their state, or by the federal government (for states that do not have their own exchanges).
The original ACA subsidies were available for people who have incomes up to 400% of the poverty line.
In 2021, Congress enacted “enhanced” ACA subsidies to expand coverage during the pandemic—more than doubling the number of ACA enrollments to over 24 million Americans.
The enhancements were originally enacted for two years, but were later extended through December 31, 2025—but have now expired.
Due to the expiration of enhanced subsidies on December 31, ACA subsidies have now reverted back to the original, more limited, levels. Expiration of the enhanced subsidies is projected to more than double marketplace premium payments in 2026 (on average)—although the amount of increases will vary significantly depending on income, age, family size, and state—and an estimated 2.2 million to 4.8 million people could lose coverage this year.
According to the AP, 92 percent of ACA enrollees benefitted from enhanced subsidies last year.
House GOP Moderates Forced an Enhanced Subsidies Extension Vote: When House Republican Leadership last month barred moderate House Republicans from offering an amendment to extend the enhanced ACA subsidies, four House Republicans signed a Democratic discharge petition for a 3-year ACA extension—providing the 218 signatures required to force a House vote on the pending 3-year extension bill.
The bill (HR 1834) passed the House 230-196 last Thursday.
Ahead of the vote, the nonpartisan Congressional Budget Office estimated that a three-year extension of the enhanced subsidies would cost $80 billion and increase ACA enrollment by 6.2 million people.
For more background: House passes bill extending health care subsidies, bucking GOP leaders (WP); and What renewed ACA subsidies would mean for people facing more expensive health insurance (NPR).
While the Senate already rejected a 3-year extension in December, House passage of the extension—and the upcoming midterm elections—has put renewed pressure on moderate Senate Republicans to negotiate a bipartisan deal with Democrats for an extension.
Senate Majority Leader Thune said any such bipartisan package would have to include income limits, minimum out-of-pocket premiums, an expansion of health savings accounts and abortion restrictions.
A compromise package under discussion in the Senate would extend the subsidies for two years with new income limits and a $5 monthly minimum out-of-pocket premium, along with new penalties designed to discourage fraud. In addition, beginning next year, people who buy health insurance using the subsidies would be able to redirect money to a health savings account if they choose.
If a compromise bill passes the Senate—and again passes the House with the Senate changes—it is unclear whether President Trump would sign it. However, while he has been a vocal critic of Obamacare in the past, Trump last week urged “flexibility” on abortion restrictions—apparently reflecting his growing concern that the GOP may lose control of the House over spiraling health insurance premiums, a weakening jobs market, and continuing inflation.
(3) THE ECONOMY, TARIFFS, and AI
Assault on the Fed’s Independence: In a new assault on the Federal Reserve’s independence, the Justice Dept. has opened a criminal investigation of the Fed Chair over his Senate testimony about renovations to the Fed headquarters.
Supreme Court Trade Ruling: Reuters reported the Supreme Court may release its ruling on President Trump’s tariff actions this week. If the ruling comes this week, look for coverage on our TARIFF page.
Slowest labor market in years: The Wall Street Journal reports that the “slowest labor market in years leaves job seekers stuck.”
Damage to U.S. data collection: Bloomberg reports that DOGE’s damage “lingers in crucial data agencies” with some agencies experiencing staffing declines of 30%, 40%, or 50%.
GM has booked a $7.1 billion loss as it scales back battery and electric vehicle factories after Trump policies undercut demand for EVs.
The Congressional Budget Office released its demographic outlook projecting that “the U.S. population grows from 349 million people in 2026 to 364 million in 2056, and the average age rises. Starting in 2030, annual deaths exceed annual births, and net immigration accounts for all population growth.”
Trillions Comment: Consider what a Trump zero-immigration policy—which is where we are heading—would do to the U.S. economy, particularly with the worsening ratio of workers to retirees.
For real-time data, check out our “Real-Time Numbers” page.
(4) MAJOR INTERNATIONAL DEVELOPMENTS
Iran--Wall Street Journal reports that—in the wake of President Trump’s verbal threats against the Islamic regime—Iran is threatening to strike American military bases in the Middle East if the U.S. hits first. Trump’s threats follow massive public demonstrations in Iran against the repressive regime, with more than 500 reportedly killed.
Greenland--In the wake of growing threats by President Trump to forcibly acquire Greenland as a strategic necessity, Greenland’s party leaders have firmly rejected Trump’s push for U.S. control of the island; and the Danish Prime Minister has warned that a U.S. attack on the island would end the NATO alliance.
Venezuela—With President Trump openly admitting his abduction of Venezuelan dictator Nicolás Maduro and his wife was primarily to gain control of the country’s oil: the Trump team is working up plans to “control Venezuelan oil for years to come”; the Senate rebuked Trump last Thursday, advancing legislation that would force Trump to seek congressional approval before taking any new military action in Venezuela; economist Paul Krugman explained that while Venezuela may have the world’s largest known oil reserves, it is only because heavy oil was reclassified as “proved oil”; and the CEO of Exxon told Trump in a White House meeting last week that Venezuela is “uninvestible” for now.
Cuba--President Donald Trump and Secretary of State Marco Rubio have made clear that the collapse of Cuba’s communist government is not only a likely side benefit of Maduro’s ouster but a goal, reports the Washington Post.
Ukraine—With President Trump increasingly backing away from NATO and Ukraine, the UK and France have pledged to be part of a post-ceasefire deployment, however, Russia says foreign troops in Ukraine would be targets.
Withdrawal from multilateral cooperation: Last week President Trump announced the U.S. is withdrawing participation and funding in 66 multilateral bodies, most notably the Green Climate Fund—threatening a program that has provided $19 billion to help poor nations adapt to a warming world.
(5) MAJOR DOMESTIC DEVELOPMENTS
Anti-ICE Protests spread nationwide over the weekend after an Immigration and Customs Enforcement (ICE) agent in Minneapolis last Wednesday shot and killed Renee Nicole Good, a U.S. citizen, at the wheel of her car. Fueling the outrage, Homeland Security Secretary Kristi Noem again announced limits on congressional visits to ICE facilities—a policy virtually identical to one halted by a federal judge last month.
Judge temporarily blocks child care cuts: A federal judge on Friday temporarily blocked the Trump Administration from freezing $10 billion in federal funds for child care grants and family assistance headed for five Democratic-led states. The funding freeze was based on claims of widespread waste and fraud.
Cuts in Federal Agency Employees: In the most recent tally, the Washington Post reports that 335,000 federal workers left the government from January to November 2025, with a majority quitting (and taking buyouts) or accepting retirement offers. These workforce cuts include:
Nearly all of the U.S. Agency for International Development’s workforce;
50,000 employees of the Veterans Affairs Department;
About 40 percent of the Dept. of Education’s workforce;
29,000 employees at the Treasury Department (primarily from the IRS—reducing the capacity to collect amounts owed from tax cheats);
19,000 at the Dept. of Health and Human Services;
More than one third of Agriculture Dept. food inspectors;
Over one quarter of Social Security’s IT management; and
15,000 at the Interior Dept (including park rangers).
At the same time, Immigration and Customs Enforcement (ICE) hired about 12,000 ICE officers and agents for its mass deportation mission—funded by a massive infusion of multiyear funds by last summer’s budget law (OBBBA). You can track cuts in the federal workforce on our TrillionWeekly.com Cut-Tracker.
In a related story, Gov Exec reports that the State Department is moving forward with hundreds of layoffs after a judge ruled that a statutory moratorium on RIFs in last November’s spending bill does not require RIFs to be withdrawn entirely.
Massive defense spending and public debt increase: Last week, President Trump proposed a massive increase in FY 2027 defense spending, boosting Pentagon spending from less than $1 trillion to $1.5 trillion, citing “dangerous times”; the increase would add nearly $6 trillion to the public debt over the next decade, on top of the more than $4 trillion Trump has already added to the debt from his massive budget bill last summer (OBBBA).
More backsliding on vaccine protections: Reuters reports, “The CDC now recommends that U.S. children get a single dose of a vaccine against human papilloma virus at age 11, rather than the recommended two or three doses. It also ended longstanding guidance that children receive vaccines against the flu, rotavirus, meningococcal disease and hepatitis A. And more than 80% of the 310 measles cases reported in South Carolina are among unvaccinated people,” Politico reports that the downgrading of vaccines could be aimed at “driving manufacturers from the market.”
House failed to override presidential vetoes: Last Thursday, the House failed to muster the two-thirds votes required to override two “retribution vetoes” by President Trump. The first bill, the AVC Act, was a broadly supported major drinking water project in Colorado. The second was a measure to spend $14 million to protect an area known as Osceola Camp within the Everglades National Park that is inhabited by members of the Miccosukee tribe of Native Americans. The vetoes were pure retribution. Trump is angry because Colorado has not released his ally Tina Peters from prison (after being convicted on state charges for illegally tampering with voting machines), and he’s angry at the Miccosukee tribe for opposing his immigrant detention center in the Everglades.
FDA falls short on testing of generics: Investigation raises concerns about lack of FDA quality testing for generic drugs. By some estimates, about 90% of prescriptions in the U.S. are filled with generic drugs. The Food and Drug Administration says that all agency-approved generic drugs “have the same high quality” as brand-name drugs, but a ProPublica investigation found that the FDA rarely tests the quality of generic drugs. – PBS News Weekend
Cap on credit card interest rates? President Trump, attempting to address affordability as the midterms approach, has said he will impose a one-year cap on credit card interest rates of 10 percent. In response, Senate Banking Committee Ranking Democrat Elizabeth Warren (MA) said, “begging credit card companies to play nice is a joke. I said a year ago if Trump was serious I’d work to pass a bill to cap rates”—also pointing out that Trump is currently engaged in defunding the Consumer Financial Protection Bureau which is the only federal agency charged with protecting consumers from credit card company excesses.
Bipartisan Infrastructure Law: Some of the poorest communities in America are threatened by bipartisan infrastructure aid slashed by the Trump Administration.
Positive development: Trump says he wants to ban large investors from buying houses.
(6) SUGGESTED READS
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. Speaking engagements and press interviews can be scheduled by calling: (301) 509-5688. Email comments, suggestions, and questions to: info@capitolpublicpolicy.com.
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.