The Archive

IN THIS EDITION

Washington runs on Trump’s will

Tariffs to shake up the tech world

Dems eye ways to sue Abbott over vacant Texas seat

The Vault: Inside the House’s marathon stablecoin markup

NRSC memo: N.H. political environment is favorable ahead of ‘26

THE TOP

Washington runs on Trump’s will

Happy Thursday morning.

President Donald Trump showed again on Wednesday that he’s the answer to pretty much every problem for Hill Republican leaders — and that it’ll take a whole lot to stir up any resistance to his will.

First, Trump helped unlock Senate GOP votes for a compromise budget resolution designed to kick-start his legislative agenda. Trump then unveiled broad tariffs against dozens of U.S. trading partners — including key allies — with little real pushback from the party.

Tariffs. Just a few hours after Trump’s Rose Garden announcement, the Senate — with the help of four Republicans — narrowly voted to terminate Trump’s declaration of a national emergency for fentanyl trafficking, which he’s using to justify 25% tariffs on Canadian imports.

But the measure isn’t going anywhere in the House, where GOP leaders have prohibited such disapproval resolutions from even getting floor time. Plus, the four Republicans who backed it — Sens. Mitch McConnell (Ky.), Susan Collins (Maine), Rand Paul (Ky.) and Lisa Murkowski (Alaska) — are among the few willing to buck Trump on anything.

More importantly, the overwhelming majority of Senate Republicans — from the leadership down to rank-and-file senators who have made no secret of their unease with Trump’s tariff posture — voted with the president. That’s despite the wave of economic uncertainty Trump’s tariff policies have unleashed.

Equity futures are down between 2% and 3% today on Trump’s tariff announcement. He’s causing a major economic and political challenge for the GOP. And Republicans are mostly silent.

“What I want to do is see if we’re going after some jurisdictions where we have relatively fair balance of trade — it’s like, why are we doing that to begin with? That’ll be the first thing I’ll be looking to see,” Sen. Thom Tillis (R-N.C.) said before Trump’s announcement.

Senate Majority Leader John Thune has talked openly about his reservations with across-the-board tariffs like the ones Trump unveiled Wednesday. But Thune argued on the Senate floor that backing the resolution would harm efforts to combat fentanyl trafficking.

The bottom line: Rebuking Trump on tariffs could backfire given how much GOP leaders need him for budget reconciliation.

The budget resolution. On Tuesday, Thune indicated that he didn’t yet have the votes for a compromise budget resolution. The biggest problem was the group of hardline deficit hawks who weren’t sold on the lower spending-cut number outlined in the Senate’s instructions, designed to ensure flexibility. Senate and House Republicans are hundreds of billions of dollars apart on proposed spending cuts.

But a meeting with Trump on Wednesday morning, which Thune also attended, changed everything.

Suddenly, deficit hawks were warming to the plan. Thune and other Republicans attributed the difference to Trump.

“The meeting at the White House helped a lot. A lot of reassurances that we’re serious about deficit reduction as a part of this process,” Thune said in an interview.

During that session, Republicans told Trump he’ll need to play a very active role to get the package across the finish line, per attendees. Trump responded by saying he’d make a public statement to reassure skeptical conservatives over spending cuts.

“I was pleased with the commitment we got from the president,” Sen. Ron Johnson (R-Wis.) responded when asked if he’d back the budget resolution.

The group also requested that Trump send Congress a rescissions package to codify Elon Musk’s proposed spending cuts.

Here’s Sen. John Kennedy (R-La.):

Trump followed through. During his tariff announcement, Trump threw his “complete and total support” behind the compromise budget resolution, saying he’d work to get federal spending back to “where it should be.” Trump backed up his endorsement in a post Wednesday night.

So the release of legislative text on Wednesday was a sign not only of GOP leaders’ eagerness to show progress on Trump’s agenda, but also a clear signal that they have the votes to pass it.

The Senate is expected to take an initial procedural vote today, with a vote-a-rama likely to begin Friday evening. That puts final passage at some time early Saturday morning. House Republicans hope to take up the measure next week, pending how their rank-and-file members react to the text. The House GOP leadership also needs to solve its impasse over proxy voting.

Let’s talk taxes. Senate Republicans are plowing ahead using an untested scorekeeping method to make the 2017 tax cuts permanent.

GOP leaders added the “current policy baseline” to the budget resolution, which zeroes out about $3.8 trillion of the cost of those tax-cut extensions. That would mean Republicans can avoid needing huge offsets to pay for permanence.

Here’s what Speaker Mike Johnson said on this:

News: Senate Majority Whip John Barrasso will talk about the need to make the 2017 tax cuts permanent on the floor today.

“By making the tax cuts permanent, businesses and families will get the stability and certainty they need to thrive,” Barrasso will say, per planned remarks. “Ninety percent of Americans saw their taxes go down because of tax reform. It would be disastrous for tax-and-spend Senate Democrats to choke off the chance for Americans to keep more of their hard-earned money.”

— Andrew Desiderio and Laura Weiss

TODAY: Join us at 8:30 a.m. ET for a conversation with Punchbowl News Founder Jake Sherman and Rep. French Hill (R-Ark.). They’ll discuss the news of the day, digital payments and small business. We have a few spots left, RSVP here!

Tariffs to shake up the tech world

President Donald Trump’s newest round of tariffs is set to send much of the tech industry into a tailspin.

Trump announced reciprocal tariffs on virtually every country in the world Wednesday, with a baseline set at 10%. But the rates for some Asian countries that are critical for tech supply chains are much higher. China is at 54%, combining both reciprocal levies plus the ones related to fentanyl, while Vietnam and India are at 46% and 26%, respectively.

This spells trouble for consumer electronics titans like Apple, Google and Microsoft that produce most of their smartphones, laptops and video game consoles in those countries. Amazon is also expected to take a hit.

You can expect many tech companies to ramp up their lobbying on Capitol Hill and the White House, asking for exemptions.

Apple, in particular, is in a tricky spot as the company is very dependent on its electronics business. The tech giant had been moving much of its supply chain away from China in recent years to countries like Vietnam and India as the U.S. government has taken a more muscular trade posture against Beijing.

Stock futures for all four companies tumbled Wednesday night as the tech-heavy Nasdaq index took a big hit.

But the impact of these tariffs goes beyond consumer electronics. Trump’s tariff hikes on dozens of countries will impact the broader tech economy.

Imported raw materials used for the building of data centers that power artificial intelligence are likely to go up. Trump already imposed steep tariffs on steel and aluminium imports critical for construction, and costs for other imported goods may rise.

Items used to power the telecommunications industry may also go up as many routers, modems, antennas etc. are imported from abroad.

What happens to semiconductors, which are used in everything from cars to AI model training, is unclear. Trump raised tariffs on Taiwan, the world’s leading producer, to 32%.

According to the White House, semiconductors are exempted from the reciprocal tariffs, so theoretically this wouldn’t apply to them. But there may be a special rate coming for chips as Trump has often talked about imposing high tariffs on them.

Stock futures for the Taiwan Semiconductor Manufacturing Company Limited, the leading producer of computer chips, and Nvidia, which designs AI chips, also took significant hits following the tariff news.

Tech trade groups in Washington were quick to sound alarms following the dubbed “Liberation Day” announcements.

The tariffs “threaten America’s ability to lead in key technology areas like AI and manufacturing, ” said Sean P. Murphy, executive vice president for policy at the Information Technology Industry Council.

The Consumer Technology Association took an even harsher tone.

Here’s their CEO Gary Shapiro:

– Diego Areas Munhoz

LONE STAR STATE

Dems eye ways to sue Abbott over vacant Texas seat

Democrats are ratcheting up their threats of legal action over Texas Gov. Greg Abbott’s delay in calling a special election in a deep-blue Houston district to replace the late Democratic Rep. Sylvester Turner (D-Texas).

Members of the Texas congressional delegation have privately discussed ways to take action against Abbott to ensure Turner’s seat can get filled quickly. On Wednesday, House Minority Leader Hakeem Jeffries said House Democrats will “very likely” pursue a lawsuit against Abbott, although they’re still figuring out how to do that.

Harris County attorney Christian Menefee, who is a candidate in the race, said he’s “weighing his legal options” while accusing Abbott of breaking state law.

“It’s abundantly clear that if the governor refuses to call [the election] for this November, he would be violating the law,” Menefee said.

The Texas Democratic Party is threatening legal action as well, warning Abbott to “call an emergency election or lawyer up.”

Texas’ 18th District has been without a representative for nearly a month now. Turner died on March 5.

State law grants Abbott the sole authority to call a special election. The law doesn’t specify a deadline for the governor to set an election date, but the state’s election code requires a vacancy that must be filled by a special election to “be ordered as soon as practicable after the vacancy occurs.”

Abbott has already missed the deadline for the election to take place on May 3, which is the next scheduled election in Texas.

The Republican governor is also highly unlikely to call an emergency special election, which means the next election a new House candidate could be voted on won’t be until November.

Abbott’s office didn’t reply to several inquiries for this story.

But having a Democratic House seat vacant could benefit Republicans, who are grappling with a razor-thin majority

Some Democrats have pointed to Abbott’s history of calling other special elections much earlier. But Democrats also acknowledge the loose timeline in Texas law puts Abbott without a deadline to meet.

A group of Texas Democrats has been circulating a chart noting Abbott’s timeline for other elections.

For example, Abbott called an election to replace the late GOP Rep. Ron Wright 16 days after he died. There were 83 days between the vacancy and the election.

The governor waited just four days to announce an election to fill Democratic Rep. Filemon Vela’s seat in 2022, which got a new representative just 82 days later.

And after the late Democratic Rep. Sheila Jackson Lee died last year, Abbott called an election two weeks later. Jackson Lee’s seat was vacant for 108 days before being taken by Turner.

Setting special-election dates for vacant House seats has taken on added political significance with such a tight margin of GOP control.

In Florida, Gov. Ron DeSantis immediately scheduled special elections to replace former Reps. Michael Waltz (R-Fla.) and Matt Gaetz (R-Fla.). In New York, Gov. Kathy Hochul, with Jeffries’ urging, tried to change state law to deny Rep. Elise Stefanik’s (R-N.Y.) district a timely special election if she resigned. Hochul eventually backed away from the change, and Stefanik has never left the House.

Amanda Edwards, who is also running for the seat, said she hopes Abbott will “do the right thing” and hurry the process along.

“Having 800,000 people with no representation is not the right thing,” Edwards told us.

– Mica Soellner

The Vault: Inside the House’s marathon stablecoin markup

The House Financial Services Committee advanced legislation to regulate stablecoins after an arduous markup that stretched more than 13 hours on Wednesday.

Democrats pounded Republicans with a steady toll of amendments to the STABLE Act that we wrote about in the PM edition. Ultimately, none of those amendments were adopted.

And despite enormous opposition from some of the panel’s senior Democrats, six of of their members joined Republicans to advance the measure towards the floor. Those Democrats were Reps. Jim Himes (Conn.), Gregory Meeks (N.Y.), Janelle Bynum (Ore.) and bill co-sponsors Ritchie Torres (N.Y.), Sam Liccardo (Calif.) and Josh Gottheimer (N.J.).

The markup took a brief, strange turn shortly after Republican Rep. Warren Davidson (Ohio) told us he had his own amendments to the STABLE Act. Republicans who’d complained hours earlier about Democrats’ time-burning tactics began to gently filibuster, waxing about the general benefits of innovation while Davidson, Hill and others negotiated in the committee’s back room.

Ultimately, Davidson brought up two amendments. One hinged on the ability of state regulators to supervise “commodity-backed” stablecoins, pointing to a company approved by the New York Department of Financial Services to offer that product back in 2019.

Ranking Member Maxine Waters (D-Calif.) expressed some interest in Davidson’s first amendment. Chair Rep. French Hill (R-Ark.) had reservations, gesturing to concerns that had apparently been expressed by the House Agriculture Committee. Davidson acknowledged them and withdrew the amendment.

The second Davidson amendment would implement changes to the self-custody of stablecoins. This time, Hill said he was opposed, arguing the policy was a better fit for market structure reform.

Later in the hearing, Davidson told Waters that Hill didn’t want self-custody changes in the legislation because “he fears that he will lose support from Democrats.” Hill didn’t comment on the suggestion.

So, yeah, kind of a weird day for the committee. Davidson’s self-custody amendment failed 1-47.

Otherwise: The panel also advanced House Majority Whip Tom Emmer’s Anti-CBDC Surveillance State Act, Rep. Roger Williams’ (R-Texas) 1071 Repeal to Protect Small Business Lending Act and Rep. Andy Barr’s (R-Ky.) Promoting New Bank Formation Act.

Correction: A previous version of this story misidentified the sponsor of the 1071 Repeal to Protect Small Business Lending Act.

– Brendan Pedersen

THE CAMPAIGN

NRSC memo: N.H. political environment is favorable ahead of ‘26

News: The NRSC is doubling down on its vow to seriously compete for the open New Hampshire Senate seat, telling donors in a memo that Republicans enjoy “a favorable political environment” in the state ahead of 2026.

Republicans feel emboldened to compete in the Senate race following longtime Sen. Jeanne Shaheen’s (D-N.H.) decision to retire instead of seeking reelection next fall.

The Senate GOP campaign arm commissioned a survey of 600 likely New Hampshire voters last month that found Republicans leading the generic ballot by one point. New Hampshire voted for Kamala Harris by three points in 2024, and the state hasn’t elected a GOP senator since 2010.

The NRSC survey also showed that 31% of independent voters identified “inflation, jobs, and cost of living” as their primary concern. These are issues the GOP hopes will drive voters toward the party.

On the Republican side, former Massachusetts Sen. Scott Brown is seen as a likely contender for the Senate seat. Former New Hampshire GOP Gov. Chris Sununu has also flirted with a run, but has also trashed serving in the Senate in the past.

Rep. Chris Pappas (D-N.H.) is likely to enter the race soon and is holding an event Thursday in Manchester. Freshman Rep. Maggie Goodlander (D-N.H.) is also mulling a run.

Fundraising news: The Congressional Hispanic Caucus BOLD PAC raised $3.8 million in Q1. This tally is the group’s largest ever in the first quarter of an off year.

— Max Cohen

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