Senate Scrambles to Stave Off a Shutdown Amid DHS Funding Fight

Happy Tuesday. President Trump visited Iowa today to trumpet his affordability agenda and tout what he calls the greatest first year of any administration in American history. Back in D.C., the Senate was struggling to find a way to avoid a partial government shutdown later this week. Here's your evening update.

Senate Scrambles to Stave Off a Shutdown Amid DHS Funding Fight

The Senate is scrambling to come up with a plan to avoid a partial government shutdown after current funding expires for a broad range of agencies on Friday night. So far, there's little sign that a deal will come together in time as disagreements over a funding bill for the Department of Homeland Security threaten to derail a bipartisan appropriations package following the fatal shooting of Alex Pretti in Minneapolis.

Republicans are resisting Democratic demands to separate out a measure to fund Homeland Security from a House-passed bundle that includes five other spending bills. Breaking up or amending that package would require the House, which is out this week, to vote on the legislation again. Republicans reportedly worry that another DHS funding bill won't be able to get through the House. Leaders of the House Freedom Caucus said Tuesday that they would oppose an amended DHS funding bill. "We cannot support giving Democrats the ability to control the funding of our Department of Homeland Security," Freedom Caucus leaders wrote in a Tuesday letter to President Trump.

Democrats, meanwhile, are rejecting proposals that would have them pass the complete funding package and then have the Trump administration take steps to address concerns about its aggressive immigration enforcement.

"This fix should come from Congress," Senate Democratic Leader Chuck Schumer said on the Senate floor. "The public can't trust the administration to do the right thing on its own and the Republicans and Democrats must work together to make that happen."

In addition to the Homeland Security, the spending package sent over by the House would fund the departments of Defense, State, Treasury, Labor, Health and Human Services, Education, Transportation and Housing and Urban Development.

The bottom line: As of now, a Senate vote to move ahead with the House-passed six-bill funding package is scheduled for Thursday.

Noem's Policies Delaying $17 Billion in FEMA Funding to States: Report

Homeland Security Secretary Kristi Noem faces a firestorm of criticism and growing calls for her resignation or impeachment over her handling of the Trump administration's immigration enforcement crackdown and her responses to the fatal shootings of Renee Good and Alex Pretti by federal agents in Minneapolis. But Noem also faces continued scrutiny for her management of the Federal Emergency Management Agency. Scott Dance of The New York Times reports today that Noem's policies have led to a roughly $17 billion bottleneck in federal disaster funds for states, according to agency documents.

"The delays stem from a directive issued by Ms. Noem in June that said any expenditure of $100,000 or more must be approved by her office, which oversees the disaster agency, to root out 'waste, fraud and abuse'," Dance explains. "In many cases, state and local governments have already completed relief and recovery work at their own expense, often under significant budget constraints, based on a pledge from FEMA to reimburse a share of the costs. In other instances, work cannot begin until Ms. Noem allows the money to flow. Some of the outstanding aid owed to states dates as far back as Hurricanes Harvey and Maria in 2017."

Dance notes that states are also waiting for more than $1.3 billion in FEMA funding to help prepare for future disasters: "The list of pending grants included $300 million for projects to reduce flood risks, nearly $200 million to elevate or demolish flood-prone buildings, $100 million for emergency power generators and $75 million for community 'safe rooms' that offer protection from tornadoes and hurricane-force winds," according to documents obtained by the Times.

Trump Tries to Sell His Economic Record in Iowa

President Trump traveled to Iowa Tuesday in an effort to shift the national political conversation away from his aggressive and deadly immigration crackdown in Minneapolis and toward the economy and the midterm elections - and to convince voters that his policies are helping alleviate widespread concerns about affordability.

In a relatively brief speech at the Horizon Events Center outside of Des Moines before a crowd chanting "USA!" and waving signs reading "LOWER PRICES" and "BIGGER PAYCHECKS," Trump reviewed the 2024 election results and the accomplishments of his first year in office, with an emphasis on the tax cuts included in the "One Big Beautiful Bill" Republicans passed last summer.

Discussing the tax cuts for workers earning tips, Trump invited Erica Pirtle, the manager of a whiskey bar, onto the stage. After complimenting Pirtle for her looks - "Oh, she's so beautiful," he said - Trump claimed that her employees would earn "thousands and thousands of dollars extra because of the no tax on tips."

"Thank you, President Trump," Pirtle said. "No tax on tips is huge for everyone in the service industry. Thank you very much."

More broadly, Trump claimed he has slashed drug prices by a mathematically impossible 1,000% and reduced grocery prices, despite economic data showing otherwise, while repeating his complaint about the use of the word affordability, which he said is a made-up problem invented by his enemies looking to hurt him. "They come up with this word 'affordability,'" Trump said of Democrats.

Although the focus of the speech was largely on the economy, Trump did not shy away from talking about his lethal efforts to stem drug trafficking and to crack down on illegal immigration in Minneapolis and elsewhere. He asserted that most of the immigrants being detained are violent criminals and suggested that immigrants should have to prove that they are not going to "blow up our shopping centers, blow up our farms, kill people" before being allowed into the country.

Questioning the tariffs: Earlier in the day, Trump stopped at a restaurant, where he was asked about the historically high tariffs he has imposed on imports from trade partners around the world. Claiming the tariffs have raised $600 billion in revenues last year - more than twice the actual amount - Trump rejected the idea that the tariffs have hurt farmers, who have lost billions in sales to key customers overseas, most notably China. Instead, Trump cited the money his administration has given to farmers who have seen their foreign markets dry up.

"I gave the farmers $12 billion last week," Trump said with a bit of irritation. "I took them out of tariff money," he added, repeating a false claim that the aid money for farmers came from import revenues rather than the Depression-era program his administration actually used.

Consumer Confidence Falls to 12-Year Low

The Conference Board's consumer confidence index fell to 84.5 in January, the lowest level since 2014.

"Confidence collapsed in January, as consumer concerns about both the present situation and expectations for the future deepened," said Dana M. Peterson, chief economist at the business-oriented think tank. "All five components of the Index deteriorated, driving the overall Index to its lowest level since May 2014 (82.2)-surpassing its COVID-19 pandemic depths."

Peterson said that write-in responses from survey participants "skew towards pessimism," with references to high prices for food and fuel, as well as to concerns about tariff policy and the labor market.

The Conference Board's results vary a bit from another commonly cited index run by the University of Michigan, which last week showed a modest rebound in consumer sentiment in January. Nevertheless, both indices show that consumers are feeling a lack of confidence and heightened uncertainty compared to a year ago, with the University of Michigan index remaining near an all-time low.

US Population Growth Slows Sharply

Population growth in the United States slowed dramatically in 2025, due in large part to the anti-immigration policies rolled out by of the Trump administration. According to new data from the Census Bureau, immigration numbers plummeted by more than 50% between July 1, 2024, and July 1, 2025, to 1.26 million people, contributing to an overall population growth rate of just 0.5%, or 1.8 million people.

The 12-month population growth rate was the second lowest in U.S. history, ahead of only 2021, when the Covid pandemic closed borders around the world. If the current trend continues, this year should set a new record low, with just 321,000 immigrants entering the country during the year ending June 30, 2026.

"The slowdown in U.S. population growth is largely due to a historic decline in net international migration, which dropped from 2.7 million to 1.3 million in the period from July 2024 through June 2025," said Christine Hartley, assistant division chief for Estimates and Projections at the Census Bureau. "With births and deaths remaining relatively stable compared to the prior year, the sharp decline in net international migration is the main reason for the slower growth rate we see today."

Fiscal News Roundup

• Path to Averting a Shutdown Remains Elusive as Lawmakers Debate DHS Funding – Government Executive
• The Government Is Barreling Toward a Partial Shutdown Over DHS Funding. Here's What to Expect – CNBC
• Henry Cuellar Warns Against Shutdown, Handing DHS 'Blank Check' – Politico
• As Trump Heads to Iowa to Trumpet Economy, Many Residents Feel Pain – New York Times
• Health Insurers in Shock After Medicare Holds Line on 2027 Payments – Wall Street Journal
• Health Insurers Fall as Government-Backed Growth Grinds to Halt – Bloomberg
• Trump's High-Stakes Bid to Dole Out $100 Billion More in Tax Refunds – Wall Street Journal
• Work Will Stop on Critical Tunnel Project Unless Trump Restores Funding – New York Times
• Schumer Says Trump Pulling the Plug on $16B Tunnel Project Is 'Insane,' 'Absurd' – Politico
• The Dollar Is Sinking. Trump Thinks It's Great – Politico
• Carney Rolls His Eyes at US Treasury Secretary, Says He Told Trump He Meant What He Said at Davos – Associated Press
• Fed, Signaling Little Urgency, Prepares to Pause on Rate Cuts – New York Times
• EU and India Clinch 'Mother of All Deals' in Rebuff to Trump – Bloomberg
• America Officially Leaves the Paris Climate Agreement. For the Second Time – New York Times
• After Donations, Trump Administration Revoked Rule Requiring More Nursing Home Staff – New York Times

Views and Analysis

• Senate Talks on DHS Funding Paralyzed – David Dayen, American Prospect
• G.O.P. Congressman: We Need to Wake Up After Minneapolis – Rep. Mike Lawler (R-NY), New York Times
• If ICE Can Kill With Impunity, the Rule of Law Is Already Gone – Noah Feldman, Bloomberg
• Why 'TACO Trump' Can't Really Chicken out on Mass Deportation – Ed Kilgore, New York
• What Trump's Iowa Visit Reveals About the GOP Midterm Fight – Megan Messerly and Lisa Kashinsky, Politico
• 'The Biggest Act of Union-Busting in U.S. History': Trump's War on Federal Workers – Dan Kaufman, New York Times
• Record Debt in the World's Richest Nations Threatens Global Growth – Patricia Cohen, New York Times
• Trump's Fantasies Are Killing Us – Carlos Lozada, New York Times