Washington Weekly: Iran Challenges

The Senate confirmed Trump administration nominees and began consideration on a voting reform bill (see below). It failed to pass an Iran war powers resolution and legislation to fund and reopen the Department of Homeland Security. The House passed two immigration-related bills and a bill to prohibit the Agriculture and Interior Departments from banning the use of lead-based hunting ammunition and fishing tackle on federal land and water.

The Senate will continue to confirm Trump administration nominees, including Senator Markwayne Mullin (R-OK) as the nominee for Secretary of the Department of Homeland Security, and will continue consideration on a voting reform bill. The House plans to vote on the reauthorization of an intelligence-gathering authority (see below).

Iran Challenges.

In a week that saw an escalation of conflict with Iran, lawmakers pressed Trump administration intelligence officials on the basis for the conflict and on whether risks like the effective shutdown of the Strait of Hormuz (a conduit for more than 20% of the world’s oil and gas supply) were adequately considered. President Trump also had to pivot earlier in the week by postponing an upcoming summit in China because of the ongoing war. With the war in Iran already costing tens of billions of dollars and counting, the Trump administration likely will need to soon request supplemental funding (the Pentagon reportedly has asked the White House to seek an additional $200 billion). Republican leadership is exploring the use of budget reconciliation as a potential vehicle for this large funding bill, but reconciliation is a complicated process and there may be challenges passing a bill on even a party-line basis, particularly in the House where Republicans can’t afford to lose more than one vote. Meanwhile, doing it through regular order would require Democratic support. Democrats have criticized the Trump administration’s lack of transparency and oversight and have signaled they will oppose any funding package absent meaningful concessions. Democrats this week forced another vote in the Senate on an Iran war powers resolution to curtail the ongoing military operations and will try to bring up another vote in the House. While Republicans generally continue to support the war, it will be very difficult to pass a potentially massive supplemental funding bill for a conflict without a clearly defined endgame.

DHS Shutdown Continues.

Negotiations continued on ending the more than month’s long funding lapse for the Department of Homeland Security (DHS), which continues to have a negative impact on air travel and other areas. Senate Democrats sent their latest proposal for immigration enforcement changes to the White House. The Trump administration responded with changes it is willing to make, including expanding body camera use for federal immigration agents, limiting enforcement in sensitive locations like hospitals and schools, requiring visible officer identification, and increasing oversight of DHS detention facilities. However, this proposal does not address two of Democrats’ core demands (restrictions on agents wearing masks and requirements for judicial warrants before entering private property). Meanwhile, President Trump’s nominee to lead DHS, Senator Markwayne Mullin (R-OK), had a bumpy confirmation hearing this week, after which his nomination advanced on a mostly party-line vote in committee. He is expected to be confirmed by the Senate next week. Senate Majority Leader John Thune (R-SD) has threatened to cancel the Senate’s upcoming recess to add pressure for a deal to end the DHS shutdown, but a resolution remains elusive.

SAVE America Act.

The Senate began debate this week on the SAVE America Act, a contentious bill that would require proof of citizenship to register to vote in federal elections and a photo ID to be presented at the polls. While President Trump has threatened not to sign any further legislation (aside from DHS funding) until this bill passes, his demands for additional controversial provisions curbing mail voting and targeting transgender rights only complicate efforts to do so. The mail-in ballot restrictions received significant pushback from several Republicans who hail from states with “no-excuse” mail-in voting (e.g. Arizona, Florida, Georgia, Iowa, Kansas, and North Carolina). President Trump also has pushed for changes to the Senate filibuster rules as a means to passing this bill, but Senate Majority Leader Thune has said that there is not enough support among Senate Republicans to do so. With these dynamics at play, the Senate continues to debate and spend time on a bill that currently has no realistic chance of passing.

Basel Endgame.

Federal banking regulators this week issued a long-awaited regulatory proposal (called Basel 3 since it is based upon standards developed by international banking regulators in Basel, Switzerland) that would make changes to banks’ capital requirements. A previous version of Basel 3 had been issued in the Biden administration, but that proposal was scrapped after lawmakers on both sides of the aisle expressed concerns about the potential impact of that proposal on the cost and availability of credit for consumers and businesses. The regulators have sought to address many of the concerns raised with the previous proposal and this latest iteration is on a much smoother path to finalization.

Fiduciary Fight.

There have been many twists and turns to efforts by the Department of Labor (DOL) over multiple administrations to apply fiduciary standards of care to retail retirement accounts as those efforts have elicited concerns from industry and Congress about the potential negative impact on retirement savers’ access to and choice regarding investment advice. A fiduciary rule issued by the Obama administration in 2016 was struck down by a federal court in 2018. The SEC during the first Trump administration subsequently issued its Regulation Best Interest (Reg BI) standard, which established a unform standard of care for brokers to act in their clients’ best interests when making an investment recommendation. The DOL (in 2020) also issued its own regulation for retirement accounts with requirements intended to be consistent with Reg BI. In 2024, the DOL under the Biden administration finalized revisions that sought to revive some of the requirements in the 2016 rule. This week, a federal court struck down the 2024 rule changes in what could be the final chapter in this long-running saga.

FISA Reauthorization.

Congress faces an upcoming deadline to renew a contentious intelligence-gathering authority, Section 702 of the Foreign Intelligence Surveillance Act (FISA). This authority allows the government to surveil foreign nationals located overseas, but that can result in the collection of communications of Americans interacting with those targets. It is set to expire on April 20. The surveillance tool has been subject to significant congressional scrutiny in recent years, especially from civil libertarians in both parties. The last reauthorization in 2024 included several reforms addressing those concerns. The Trump administration and Republican leadership are pushing for an 18-month extension without changes to the current program. House Speaker Mike Johnson (R-LA) has signaled he wants to put this extension on the House floor next week. However, some Republicans want to add additional privacy guardrails to the existing program. House Democrats have said they will not offer any support on a clean extension vote, leaving Speaker Johnson only able to lose one Republican vote. Getting FISA reauthorization done before the deadline will be complicated.

Gas Tax Holiday?

In previous instances of rapid gas price increases we have seen lawmakers propose a gas tax holiday from the 18.4 cent federal tax on every gallon of gasoline at the pump. Right on cue, a trio of lawmakers introduced a bill last week to suspend the gas tax until October 1. This bill, which was introduced by Senator Mark Kelly (D-AZ), Senator Richard Blumenthal D-CT), and Rep. Chris Pappas (D-NH), will gain attention if gas prices continue to rise, but that is likely as far as it will go. As we look back at the numerous proposals over the years to suspend the gas tax, we could not find an instance when Congress approved such a measure and we expect this time to be no different.

Shaky Ground for Bondi?

Attorney General Pam Bondi is facing an unusual and politically sensitive rebuke from Capitol Hill Republicans after the House Oversight Committee voted to subpoena her over the Justice Department’s handling of the Jeffrey Epstein files. A handful of GOP members voted with Democrats on the measure. This reflects mounting frustration with what some lawmakers describe as the slow and incomplete release of records that Congress had mandated be made public. While the White House has publicly reaffirmed President Trump’s confidence in Bondi and defended her stewardship of the Justice Department, the episode underscores growing tensions between congressional Republicans and the administration over transparency and accountability, particularly on an issue that continues to animate the party’s base. With Bondi now compelled to testify, Republican leaders face the awkward task of balancing loyalty to the administration with pressure from their own ranks to demonstrate thorough oversight. President Trump has resisted calls for change among his cabinet, but it’s possible that the departure of former Secretary Noem could be just the first domino.

The Independent Gamble.

California Rep. Kevin Kiley’s recent decision to run for re-election as an Independent raised eyebrows in Washington. However, it seems unlikely to make a long-term impact. Rep. Kiley was quick to note that he still planned to caucus with Republicans. The underlying rationale for the move is that he doesn’t believe that a Republican can win his seat following California’s redistricting, but that the appetite for an independent might be higher. Historical precedent suggests this tactical shift rarely is viable over the long term. Members who abandon their major party banner have found that voters generally are unwilling to vote for an independent when a candidate with their party’s label is on the ticket. For every Senator Joe Lieberman (I-CT), there are dozens of failed independent campaigns.