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April 7, 2025
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THE TOP
Chaos on tariffs. Doubts on Trump’s agenda. Welcome to this week.
Happy Monday morning.
Steel yourself for a week of chaos.
Dow Futures are down more than 3% as of around 5 a.m.. Global markets are selling off once again because of President Donald Trump’s tariff regime. A good point here: If the market closes where futures are now, this will be the biggest three-day market sell off in nearly four decades.
Upon arriving in Washington on Sunday, Trump was asked about the market drop.
“Sometimes you have to take medicine to fix something,” Trump said.
Senate and House Republicans are beginning to panic. Although A) We don’t think that Congress will pass a bill to take tariff power away from the president. And B) It’s an open question as to whether the Hill can have any influence at all with the president on trade policy. Speaker Mike Johnson privately urged Republicans to trust Trump’s trade policies and stick with him on tariffs.
Trump wants to eliminate trade deficits with the world. That’s his goal. It may be time to listen to what he says and believe it.
Meanwhile, Trump returned Sunday evening from Florida, where he played in the Trump National Golf Club Jupiter senior club championship. He said he won.
Israeli Prime Minister Benjamin Netanyahu landed in Washington last night for meetings with Trump. The pair will hold a news conference at 2:30 p.m. Trump will also honor the Los Angeles Dodgers for their World Series victory.
The Capitol Hill agenda. This is yet another humongous week for Trump’s agenda.
Johnson and his Republican leadership team are pushing to pass the joint House-Senate budget resolution on the floor this week ahead of the Easter-Passover recess amid growing opposition from hardline conservatives and budget hawks.
Could it be done? Sure. They don’t have the votes now – we’ll get into that in a minute – but we have rarely seen House or Senate Republicans do anything that goes against the president’s will. The leadership is arguing against amending this resolution because of the problems it will cause with the Senate.
So our base case is that there will be a lot of crowing and complaining, but eventually House Republicans will fall in line and pass this budget resolution.
And the same will go for the eventual reconciliation bill — though they still have major issues to iron out.
The GOP leadership plans to have the House Rules Committee consider the resolution today ahead of a floor vote on Wednesday. This is a Monday-to-Thursday week for the House. So the GOP leadership is giving itself Monday night through Wednesday to whip and get to 217.
There are also new fears in the House Republican Conference about the impact of moving too slowly on the president’s agenda. Rep. Frank Lucas (Okla.), a veteran House Republican, said that Congress needs to show momentum in passing the president’s agenda to send a positive signal to the slumping stock market.
The pitch. On a conference call Sunday afternoon, Johnson made the pitch that it’s necessary to pass the budget resolution in order to get Trump’s agenda moving. Johnson’s message was similar to the case he laid out Saturday in a Dear Colleague to Republicans.
White House officials have already been lobbying GOP lawmakers to support the budget resolution.
The doubters. At the moment, though, Republicans are short of the requisite votes to pass it. That’s not strange for a Monday morning. It will take a lot of work and whipping to get the resolution across the finish line.
The main problem right now is the House Freedom Caucus and budget hawks.
Intrinsic in their complaints is that the resolution includes two sets of spending-cut numbers — a low floor for the Senate and a much higher target for the House. Senate GOP leaders say this is by design, to allow for maximum flexibility during the negotiations and to prevent Byrd Rule issues down the line.
The Sunday conference call gave a sense of the problems ahead.
Rep. Lloyd Smucker (R-Pa.) said he can’t support the resolution because he fears it gives the Senate too much power.
House Budget Committee Chair Jodey Arrington (R-Texas) said that he wouldn’t go into details about his problems with the resolution on the call, but said the measure is not faithful to Trump’s agenda.
Remember: Arrington is the Budget chair, so this is a massive slap in the face to the leadership and the White House.
Rep. Chip Roy (R-Texas) said on the conference call that he was opposed to the resolution. Roy has been railing against it since Saturday:
The GOP leadership’s strategy this week will be twofold:
1) They will enlist Trump to talk to House Republicans to push them to vote for the budget. It’s one thing to talk smack on a House Republican Conference call. It’s another thing to say no to the president.
2) The leadership will also say that the two sets of spending cuts represent the House’s position and the Senate’s position. And passing this resolution allows the two chambers to begin working on a final package.
Remember: The GOP leadership’s only real goal at every phase of this process is to create maximum pressure to move onto the next stage. That’s what they’ll do again this week.
Problems in the Senate. The vote-a-rama that preceded the Senate’s passage of the budget resolution early Saturday underscored how difficult it’ll be for Senate Majority Leader John Thune to reflect his members’ concerns during the next phase of negotiations.
Sen. Susan Collins (R-Maine) joined Sen. Rand Paul (R-Ky.) in opposing the budget resolution after an amendment to strike the House’s Medicaid spending-cut instructions failed.
That amendment, from Sens. Ron Wyden (D-Ore.) and Josh Hawley (R-Mo.), gave leadership a lot of heartburn, we’re told, and they worked feverishly to defeat it. Hawley, Collins and Sen. Lisa Murkowski (R-Alaska) backed it. Sen. Dan Sullivan (R-Alaska) was also in play, multiple sources told us.
But if Sullivan voted for the amendment, it would have passed — a nightmare scenario for GOP leaders who would have then needed to get enough support for a “wraparound,” the mechanism for killing amendments adopted during vote-a-rama.
Among the rank-and-file, many believe they’re being hung out to dry with Medicaid-related votes that could come back to haunt them. A GOP senator who was granted anonymity to give a candid assessment said leadership’s message to “suck it up” and stick together on these votes isn’t a good long-term strategy.
“They’re just bad votes for us,” the senator said. “And the counter-messaging is nonexistent.”
Medicaid isn’t the only pressure point. Murkowski laid out additional concerns on Saturday, including the “current policy baseline” and the debt-limit hike. Before the vote-a-rama, Sen. Bill Cassidy (R-La.) railed against the baseline tactic.
— Jake Sherman and Andrew Desiderio
The Daily Punch 🥊 With new episodes every weekday morning, The Daily Punch brings you inside Capitol Hill, the White House and Washington all in less than 15 minutes. Listen to today’s episode now.
ECONOMY INCOMING
Tariffs put White House on collision course with the Hill
Top Trump administration officials continue to say President Donald Trump has no plans to pull back from his unprecedented global trade war. That’s making it increasingly difficult for Capitol Hill to stay out of the fray.
After a bruising two-day period for financial markets following Trump’s “Liberation Day,” investors don’t expect this week to be much better. That’s not pretty, especially when stocks have already lost $6 trillion in value since Thursday morning.
The administration is about to run headlong into a wall of opposition from Capitol Hill.
A few things to consider:
1) Sen. Maria Cantwell (D-Wash.) and Sen. Chuck Grassley (R-Iowa) have a bill to require Congressional approval of tariffs within 60 days. Rep. Don Bacon (R-Neb.) has a companion bill in the House.
Perhaps the slightly more independent Senate will move on this. But we can’t see this coming up in the House. At least not yet. And we would not expect the House to override a presidential veto if it came to that.
2) GOP moderates are already getting spooked. Expect the middle of the House Republican Conference and Senate Republican Conference to begin to express serious doubt about this trade war this week.
3) USTR Jamieson Greer is on the Hill this week for hearings. He’s going to get slammed.
4) The administration’s messaging here leaves a lot to be desired, according to Hill Republicans. Are they really trying to bring back manufacturing to the U.S.? Or are they simply trying to negotiate new trade deals with countries? It truly depends who you ask in the administration.
What they’re saying: The president’s advisers offered little comfort to the nation via cable television appearances this weekend.
– Peter Navarro, a key trade hawk inside the White House, joined Fox News on Sunday, promising a “broad-based recovery in the S&P 500,” and said that people should “just sit tight, let that market find its bottom.”
– Commerce Secretary Howard Lutnick told CBS News that tariffs “are definitely going to stay in place for days and weeks.” Lutnick also declined to rule out further retaliatory tariffs. “The tariffs are coming. He announced it, and he wasn’t kidding,” Lutnick said. “The tariffs are coming. Of course they are.”
– Treasury Secretary Scott Bessent dismissed the odds of a recession on NBC’s Meet the Press. “The market consistently underestimates Donald Trump,” Bessent said.
Enter the Hill: Democrats will continue to hammer Republicans over Trump’s trade policies. The longer the market’s rout continues, the more ammo the opposition party will have.
Republicans, meanwhile, are beginning to become worried. Rep. Darrell Issa (R-Calif.) said on a House Republican Conference call on Sunday afternoon that the leadership needed to organize a conference call with top Trump administration officials on tariffs.
Speaker Mike Johnson said he would work to do so. But the speaker added that Republicans need to trust Trump because he created the world’s strongest economy once and is poised to do so again. Johnson also told Republicans to stay committed to the president’s agenda.
Here’s some news: Democrats on the Senate Banking Committee sent a letter last night to Chair Tim Scott (R-S.C.) demanding a hearing on the impact of Trump’s trade war.
The letter, signed by all eleven Democrats on the Banking committee and led by Sen. Elizabeth Warren (D-Mass.), told Scott the panel ought to examine the president’s use of the International Emergency Economic Powers Act to impose tariffs.
– Brendan Pedersen and Jake Sherman
THE AIRWAVES
The Shreveport ad boom
It’s a good time to be in television in the Shreveport, La., market. It has quickly become a hotbed for national political advertising.
The goal? To reach Speaker Mike Johnson and his constituents.
Shreveport is the 91st biggest market in America – sandwiched between the Paducah-Cape Girardeau-Harrisburg area and the Champaign-Urbana and Springfield-Decatur areas in Illinois. But a wide variety of groups, from corporations to foreign governments, are now spending money in northwest Louisiana to reach Johnson and his voters.
Much like the advertising bonanza in Palm Beach, Fla., seeking to sway President Donald Trump, ad buyers are increasingly training their sights in the speaker’s home market. Here’s a sense of what’s on the Shreveport airwaves, thanks to our friends at AdImpact:
Just in the opening months of 2025, TikTok has run eight separate spots in the Shreveport market advocating for the benefits of the app. As the embattled platform seeks to avoid being shut down, TikTok is reminding viewers in the speaker’s home base that the platform can boost small businesses.
Meta is another corporation that is up in Shreveport, airing an ad informing viewers of the social media company’s parental control features.
As Canada nervously waited to see the impacts of any potential tariffs, the government of Ontario ran a minute-long ad in Shreveport touting how “this ally to the north has been by your side.”
The Foundation to Combat Antisemitism has also run two spots in Shreveport this year.
The American Hospital Association, Seniors 4 Better Care, NextEra Energy and more advocacy groups are also running ads in Shreveport.
Plus, we reported last week how an outfit called World is running an ad in Shreveport. The group is urging Congress to protect a provision that lets health care providers who serve low income patients buy drugs at lower costs.
— Max Cohen
PRESENTED BY WALMART
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📆
What we’re watching
Monday: The House Rules Committee will meet at 4 p.m. to prepare legislation for the floor.
Tuesday: The Senate Finance Committee will hold a hearing with USTR Jamieson Greer. The Senate Foreign Relations Committee will hold a hearing on a number of ambassadorial nominees.
Wednesday: Greer will be in front of the House Ways and Means Committee. The House Financial Services Committee will hold a hearing entitled “American Innovation and the Future of Digital Assets Aligning the U.S. Securities Laws for the Digital Age.”
The Senate Homeland Security and Governmental Affairs Committee will hold a confirmation hearing for OPM and OMB nominees, including Eric Ueland. The Senate Judiciary Committee will hold a hearing on Meta’s foreign relations and representations to the United States Congress.
Thursday: The Senate Commerce Committee will hold a hearing on seasonal time change. The Senate Banking Committee will hold a hearing on a number of nominees, including Andrew Hughes to be deputy secretary of HUD.
– Jake Sherman
… AND THERE’S MORE
Emmer’s massive quarter
News: House Majority Whip Tom Emmer raised $10 million in the first quarter, another piece of evidence that the Minnesota Republican is cementing his role as a big fundraiser for the GOP.
The sum is more than Emmer raised in all of 2023 and, according to Emmer’s team, the most a whip has ever raised in a single quarter.
Emmer raised $2 million for the NRCC, candidates and members. He has raised $42 million since becoming majority whip in 2023.
First in Punchbowl News: Americans for Tax Reform is launching a new ad campaign pressuring Republicans not to limit businesses’ state and local taxes deductions. It’s a striking sign of just how seriously conservative groups and businesses are taking the possibility of a new SALT cap.
ATR, the Grover Norquist-run group opposed to raising taxes, is shelling out $500,000 to run the ad across the country with plans to spend more.
— Jake Sherman and Laura Weiss
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