TRILLIONS National Weekly – Jan 20, 2026
Six Spending Bills Remain Unfinished as Shutdown Looms; Abortion Threatens Subsidies Extension; Trump’s Greenland Obsession Threatens NATO; Economy & Tariffs; National & International Developments
Welcome back from your long MLK weekend. Here’s a quick recap of last week’s major developments and issues on the front burner for this week.
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Estimated reading time of this week’s update: 15 minutes
(1) PARTIAL SHUTDOWN LOOMS JANUARY 31, 2026, AS SIX SPENDING BILLS REMAIN UNFINISHED
In November, Congress enacted 3 of the 12 regular appropriation bills (Agriculture, Legislative Branch, and Military Construction-VA), and providing stopgap funding through January 30, 2026 for agencies funded by the 9 unfinished bills.
Three more appropriation bills were completed last Thursday when the Senate passed a 3-bill package (HR 6938) 82-15, including Commerce-Justice-Science, Energy-Water, and Interior-Environment. President Trump is expected to sign the bill. Click on the bill titles for details.
The House passed two more bills last Wednesday as part of a 2-bill package (HR 7006) by a vote of 341-79, including Financial Services-General Govt and National Security-State. Click on the bill titles for details. The 2-bill package now awaits Senate action--but the Senate is out this week on recess.
This leaves the following four bills still awaiting action by House and Senate appropriations negotiators: Defense; Homeland Security; Labor-HHS-Education; and Transportation-HUD—which account for 90 percent of discretionary appropriations funding each year. Latest news on the negotiations:
Defense: The House passed its standalone FY 2026 defense appropriations bill last summer; and the Senate Appropriations Committee reported its own bill. Recent reports suggest negotiations are complicated by social and foreign‑policy issues including diversity initiatives, transgender services, abortion‑related restrictions, and Ukraine aid.
Homeland Security: 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. Democrats are split over whether to use the bill to place limits on ICE actions or hold up funding for the agency. Politico reported last week that House Republicans sent to the Senate a proposal that would order the department to fund body cameras for immigration enforcement agents — an overture intended to win bipartisan support. A handful of GOP lawmakers are also showing openness to Democrats’ demand that immigration officers get more training on de-escalation. (However,) Senate Majority Leader John Thune told reporters “if there were any candidate” for a continuing resolution, it would be the Homeland bill.
Labor-HHS-Education: 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 controversial cuts to student aid, public health, and medical research along with controversial riders on abortion and LGBTQ rights; and Democrats are trying to stop the Education Department from offloading its programs—such as special education-- to other agencies. For more details, see the differences between the GOP and Democratic fact sheets on the House bill.
Transportation-Housing: 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 unfinished 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.
As the spending bills near completion, a question on many people’s minds: Will the White House Office of Management and Budget follow Congress’ appropriations laws? The reason: OMB Director Russell Vought does not believe that the requirements of the Impoundment Control Act—enacted into law following the Nixon Administration—are constitutional, and he is deliberately flouting that law to get a Supreme Court determination.
(2) FOLLOWING HOUSE PASSAGE OF A 3-YEAR EXTENSION OF EXPIRED OBAMACARE SUBSIDIES, SENATE NEGOTIATORS ARE TRYING TO CRAFT A (2-YEAR) COMPROMISE BILL THAT CAN MUSTER 60 VOTES FOR SENATE PASSAGE—BUT ABORTION IS GETTING IN THE WAY.
Background: During last fall’s government shutdown, Democrats’ primary goal was to extend expiring ObamaCare (Affordable Care Act) subsidies. However, Republican leaders refused to include an extension in the November spending bill that ended the shutdown—instead, promising a December Senate vote on a Democratic proposal to extend the subsidies for three years.
The 3-year extension fell short of the required 60 votes in the Senate, and shortly thereafter, the House GOP Leadership advanced an alternative health bill (HR 6703, summarized in our Dec. 21 TRILLIONS) that did not extend the subsidies. However, at the same time, a small group of moderate House Republicans signed onto a House Democratic discharge petition which forced a January 8th House vote on a bill to extend the subsidies for 3 years; that bill passed the House 230-196. Details follow.
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, 2025 ACA subsidies have now reverted back to their original, more limited, levels.
Senate Bipartisan Negotiations: Although the Senate already rejected a 3-year extension in December, House passage of the extension—and the upcoming midterm elections—have 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.
However, Politico reported last week that the bipartisan talks are on “thin ice,” with Senate Majority Leader Thune saying “it doesn’t look like they’re close.” Sen. Lisa Murkowski (R-AK) indicated the negotiations are hung up on the so-called “Hyde amendment” that prevents the Obamacare subsidies (delivered as tax credits) from being used to fund abortion services. In addition, some Democrats are pressing to keep no-premium plans for low-income Americans.
Meanwhile, last Thursday, January 15, 2026, was the last day in most states to select Obamacare health plans, with reports that premiums increased by 21.7 percent on average; and the New York Times reported that initial Obamacare enrollment dropped by 1.4 million, with KFF Health News projecting that millions will drop their ACA plans due to skyrocketing premiums.
Even if a bipartisan compromise can be negotiated in the Senate, the bill would have to go back to the House for a final vote, and then to President Trump—who last week released a health reform “outline” that does not include extension of Obamacare subsidies. Read the Bulwark commentary that Trump’s ‘Great Healthcare Plan’ Is Not Great. It’s Not Even a Plan. And this is not what it looks like when you’re serious about lawmaking.
(3) THE ECONOMY, THE FED, TARIFFS, and AI
Trump Denies “Affordability” Concerns of Americans: Last week President Trump defended his economic policies at the Detroit Economic Club. He made a “series of false or dubious claims,” including that Americans weren’t paying the costs of his tariffs; that “inflation is defeated” even as BLS announced that the inflation rate in December remained at 2.7%; and insisting that affordability is a “fake word by Democrats.”
A report from Congress’s Joint Economic Committee last week found that the average American family paid an additional $310 for groceries last year.
See the CNN Fact Check of Trump’s economic speech finding numerous false claims about the economy.
Despite Denying that Affordability is a Concern for Americans, the Wall Street Journal reports that President Trump is proposing measures to address affordability including a 10% cap on credit care rates, and using tariff revenues for (election-year) payments to Americans. But consider that:
the President has no authority to impose a cap on credit card interest rates without legislation; and
the President has no authority to use tariff revenues for payments to Americans without a congressional appropriation.
The Fed: Politico reported last week that President Trump has told Kevin Hassett he will not become Fed Chair; and speculation is growing that Powell may stay on the Board of Governors after his term as Chair ends to provide a stabilizing influence.
U.S. Workers on the Losing End: Bloomberg reports that in the 3rd quarter of 2025, U.S. workers got the smallest slice of the economic pie on record.
Huge Losses for U.S. Automakers: A New York Times op-ed last week estimated that President Trump’s “gratuitous war against electric vehicles” has cost Detroit $25 billion.
U.S. Manufacturing Down: ending 2025 with the 10th consecutive month of contraction—shedding 63,000 jobs last year.
U.S.-Taiwan Tariff Agreement lowers tariffs on imports from Taiwan to 15% in exchange for $500 billion in financing and investments by Taiwanese semiconductor companies. (Fact Check: Taiwan’s entire GDP is under $900 billion.)
(4) MAJOR INTERNATIONAL DEVELOPMENTS
Iran—In the midst of the mass uprisings in Iran, President Trump vowed to intervene if the Islamic regime killed protesters; but thousands are now estimated to be dead, reports the Washington Post, without any U.S. response.
Greenland—Reuters reports that President Trump has linked his drive to take control of Greenland to his failure to win the Nobel Peace Prize. Over the weekend, Trump said he would impose 10% to 25% tariffs on EU nations that oppose U.S. acquisition of the island, and the EU is now readying retaliatory tariffs. The Wall Street Journal said Trump’s tariff threats risk “upending a landmark trade deal the president reached with the European Union last year” and The Economist said Trump’s hunger for Greenland is “tearing NATO apart.” Germany said it would join France, Sweden, Norway, and the UK in sending military personnel to protect Greenland. Background on Greenland’s history and why Trump wants it.
Venezuela—Last week Venezuelan opposition leader Maria Corina Machado met with President Trump at the White House, but Trump said he didn’t believe she had “support” or “respect” in Venezuela. Fact check: In the Unitary Platform opposition primary held on 22 October 2023, Machado received roughly 93% of the votes. Also, last week, Senate Republican leaders succeeded in pressuring fellow Senators to back off from a measure aimed at limiting Trump’s military authority in Venezuela.
Gaza—Trump plans to charge $1 billion for a permanent seat on his “Board of Peace.” The Washington Post reports that details about the Trump-led board have prompted speculation that it could be a U.S.-led U.N. alternative.
(5) MAJOR DOMESTIC DEVELOPMENTS
Soldiers with the Army’s 11th Airborne Division have been placed at the ready for deployment in Minnesota, reports the Washington Post, following President Trump’s threat to invoke the Insurrection Act; and top U.S. prosecutors in D.C. and Minneapolis have resigned over pressure to investigate the widow of the woman slain by an ICE officer.
Speaker Johnson is “bullish” on prospects for another filibuster-proof party-line budget reconciliation bill, reports Politico. He made the comments last Wednesday, after the conservative Republican Study Committee released a blueprint including: a zero-to-low downpayment option for mortgage shoppers (unclear whether this would be a new unfunded mandate on lenders); shifting Obamacare health insurance subsidies into health savings accounts (trading valuable insurance coverage for limited cash); and accelerating energy project permitting (claiming that would reduce energy prices, apparently ignoring the economic realities of supply-and-demand). A second reconciliation bill is likely to face an “uphill climb” with this year’s slimmer GOP House majority.
Several public health organizations filed suit against RFK Jr’s new vaccine guidance on the grounds that he has packed key advisory committees with vaccine skeptics.
The Environmental Protection Agency last week announced weaker emission standards for new power plants and said it will no longer consider health impacts of some of the deadliest pollutants, reported the Washington Post. At the same time, U.S. carbon emissions increased 2.4% in 2025, reversing a downward trend. In a related story, a judge ruled last week that Administration illegally cancelled $7.6 billion in clean-energy grants to states that had voted for Kamala Harris in 2024.
A Weaker Department of Justice: The Associated Press reported last week that “terminations and a larger voluntary exodus of lawyers (at DOJ) have erased centuries of combined experience and left the department with fewer career employees to act as a bulwark for the rule of law at a time when Trump… is testing the limits of executive power.”
The Congressional Budget Office says Sec. Hegseth’s name change from “Department of Defense” to “Department of War” could cost as much as $125 million. Fact check: The name change itself is illegal and requires a statutory change by Congress. Unfortunately, this Administration routinely violates the law (see our webpage on illegal presidential impoundments and the New York Times recent summary of judicial rulings against the Administration).
New CNN Poll says 58% of Americans call Trump’s first year a “failure” and a majority say he is focused on the wrong priorities.
Ethics: ICYMI, late last month the New York Times published an investigative report, “Hundreds of Big Post-Election Donors Have Benefited From Trump’s Return to Office. The Times analyzed more than half a billion dollars in contributions from 346 donors. Some have received pardons, jobs, access to the president and other valuable gains.” The Financial Times reported that Donald Trump’s first Venezuela oil sale went to a megadonor company. And President Trump issued more pardons last week, “again rewarding allies and those who had funneled money to his associates or donated to his political operation.”
(6) SOLUTIONS
In a rare moment of bipartisanship, the Trump Administration and Governors have jointly committed to an effort to stop A.I. from inflating consumer energy bills by requiring Big Tech to foot more of the bill. The average electricity bill jumped by 5 percent in October 2025 compared with the same month one year earlier. However, a cautionary note from the New York Times: the plans are “unlikely to lower prices quickly because it may take time to address the matter through regulation. Even then, it could be years before (new) investments actually translate into greater electricity production, lowering consumers’ bills.”
(7) SUGGESTED READS
America has coped with worse things than Donald Trump: Lessons from history for the next three years – The Economist
Congressional Republicans might finally jump off the hamster wheel – George Will
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.