Trump Clashes With Zelensky in Oval Office Shouting Match

Trump and Zelensky got heated.
(Pool via CNP/INSTARimages.com)
By Yuval Rosenberg and Michael Rainey

Good evening. Purely fiscal matters are taking a bit of a back seat tonight because of a major break in U.S.-Ukraine relations and a major development in the war against Russia's aggression. We've got details on that, an economic update and more.

Trump, Vance Clash With Zelensky in Oval Office Shouting Match

Friday's high-stakes White House meeting between President Donald Trump and Ukrainian President Volodymyr devolved into a stunning, extraordinary scene: a heated Oval Office shouting match in front of news cameras, as the two leaders, egged on by a combative Vice President JD Vance, let their pent-up diplomatic frustrations and personal animosities burst into the open.

Ahead of a planned signing of a deal on rare earth minerals, Trump and Vance berated Zelensky and accused him of being disrespectful and not thankful enough for the aid the United States has provided.

Zelensky tried to argue in response that Trump and Vance were putting too much trust in diplomacy with Russian President Vladimir Putin and underestimating the threat that Russia could ultimately pose to the United States and globally. That set Trump off. "You don't have the cards right now," Trump told the Ukrainian leader. "You're gambling with the lives of millions of people. You're gambling with World War III."

Trump ended the session by laying down an apparent ultimatum. "I don't think you'd be a tough guy without the United States," Trump said. "You're either going make a deal or we're out. And if we're out, you'll fight it out. I don't think it's going to be pretty."

Trump then followed up with a lengthy statement posted to his Truth Social site:

"We had a very meaningful meeting in the White House today. Much was learned that could never be understood without conversation under such fire and pressure. It's amazing what comes out through emotion, and I have determined that President Zelenskyy is not ready for Peace if America is involved, because he feels our involvement gives him a big advantage in negotiations. I don't want advantage, I want PEACE. He disrespected the United States of America in its cherished Oval Office. He can come back when he is ready for Peace."

A planned joint news conference with Trump and Zelensky was abruptly cancelled, and the Ukrainian delegation was reportedly told to leave the White House without signing the minerals deal.

In a social media post after leaving the White House, Zelensky thanked Trump, Congress and the American people. "Ukraine needs just and lasting peace, and we are working exactly for that," he said.

What it all means: This was a diplomatic disaster that's likely to have historic repercussions. As Trump and Vance embrace Moscow's talking points and pivot away from Zelensky, future U.S. funding and support for the war against Russian aggression appear to be in grave doubt - Trump reportedly may halt all military aid to Ukraine.

The White House and its allies are trying to tout the clash as a sign of Trump's strength. European leaders, meanwhile, quickly expressed support for Ukraine. "We stand by Ukraine," wrote Kaja Kallas, the European Union's foreign policy chief and vice president of the European Commission, in one of many similar posts. "We will step up our support to Ukraine so that they can continue to fight back the aggressor [SIC]. Today, it became clear that the free world needs a new leader. It's up to us, Europeans, to take this challenge."

Zelensky and some European leaders will be holding a summit on Sunday to discuss their next steps, but for now Putin must surely be celebrating.

Federal Government's Annual Healthcare Bill: $1.9 Trillion

As Republicans look for ways to cut trillions from the budget, the focus inevitably turns to healthcare, one of the largest areas of spending for the federal government. As the old saying in Washington goes, the U.S. government is basically an insurance company with an army.

According to a new analysis of federal healthcare spending by KFF, a nonprofit focused on healthcare policy, the federal government spent $1.9 trillion directly on healthcare programs and services in the 2024 fiscal year.

Some highlights from the report:

  • Healthcare spending collectively accounted for 27% of all federal outlays, the largest single component.

  • Tax revenues lost to exemptions (known as tax expenditures) that are associated with healthcare, such as the exemptions for employee-sponsored health insurance, are significant, totaling $398 billion in 2024.

  • About 80% of federal support for healthcare goes to programs that provide or subsidize health insurance coverage.

  • Most healthcare spending is mandatory and includes "nearly all Medicare spending ($839 billion), federal spending on Medicaid and CHIP ($584 billion in federal funding), and the refundable portion of the health insurance premium tax credit for coverage through the ACA Marketplaces ($111 billion in federal funding)." Discretionary healthcare spending is much smaller and is dominated by veterans' healthcare.

Federal Employees May Start Getting Weekly Update Emails

Workers in the federal government may receive another email this weekend asking them to summarize their recent accomplishments, but the email and others like it going forward will vary in one key respect from the initial email that was sent out last weekend, The Washington Post reported Friday.

Last weekend's message came from the Office of Personnel Management and was to the point: "Please reply to this email with approx. 5 bullets of what you accomplished last week and cc your manager." The email came soon after DOGE leader Elon Musk announced on social media that federal workers would be required to provide within 48 hours summaries of their accomplishments in the last week, while threatening, "Failure to respond will be taken as a resignation."

However, the OPM lacks the authority to hire or fire agency workers, raising questions about who was authorizing the email and whether employees needed to respond. Compounding the confusion, some department and agency heads, many of whom were taken by surprise by the email, advised their employees to ignore the request, and President Trump was non-committal about whether jobs were really on the line.

The email that will reportedly be sent this weekend - which could be the first in a regular series arriving every week - will come from the individual agencies that have authority over their employees and will make it clear that replies are mandatory.

According to inside sources who spoke to the Post, "the eventual plan is for agencies to develop Microsoft forms to capture employees' five-bullet responses, that such replies will be mandatory and that the collected information will go to department heads across the government."

The new approach could make it easier to fire federal employees, which has emerged as one of the main goals of the new Trump administration. "The president of the United States cannot fire a career employee, because they are not reporting to him," Max Stier, president and chief executive of the Partnership for Public Service, a nonpartisan group that advocates for a stronger federal government, told the Post. "But if an agency head says this is what all employees need to do, there is fairly significant latitude."

Quote of the Day

"The Office of Personnel Management does not have any authority whatsoever under any statute in the history of the universe, to hire and fire employees within another agency. It can hire its own employees, yes. Can fire them. But it cannot order or direct some other agency to do so."

  • U.S. District Judge William Alsup, in ruling Thursday ordering the federal Office of Personnel Management to rescind "illegal" instructions to federal agencies regarding the termination of probationary employees. Alsup granted a temporary restraining order in a lawsuit brought by a coalition of unions representing government workers and several other organizations. The judge's ruling does not reinstate the fired workers.

Fed's Preferred Inflation Measure Cools Slightly

Inching closer to the Federal Reserve's 2% target, the Personal Consumption Expenditures price index rose 2.5% in January, slowing slightly from the 2.6% rate recorded the month before, according to government data released Friday.

The core measure, which leaves out volatile food and fuel prices and which the Fed sees as providing a clearer sense of the underlying trend, also improved in January, falling to a 2.6% annual rate from 2.9% in December.

The results met expectations and provide support for the view that inflation continues to moderate, albeit slowly, and still above target.

Some economists worry that it may prove difficult to reduce inflation further, especially as potentially inflationary policies such as tariffs and deportations are being rolled out by the Trump administration. But University of Michigan economist Justin Wolfers noted that recent annualized data - which show 2.0% inflation over the past month, 2.4% over the past three months and 2.5% over the past six months - suggest inflation is still on a downward path toward the Fed's target. "We're awfully close to being there," Wolfers wrote on social media Friday.

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