Ramped up tariffs discussions at the White House and the budget resolution in Congress captured everyone’s attention this week.
On the tariffs front, President Donald Trump paused much of his tariff program for 90 days, while talks continue with trading partners. The White House revealed that 70 nations have approached the administration about striking a deal. Trump said that several of the talks are close to being announced, which would obviously be a big win for policy and a boost for markets.
However, the trade war with China intensified with retaliatory actions by both the U.S. and China. In the past, Trump and Xi have had a good personal relationship, in fact, Xi has been a guest of the president’s at Mar-a-Lago. In the weeks ahead, this personal relationship may hold the key to future policy.
On Thursday, the House on a close vote of 216 to 214 passed the Budget Resolution that starts the Budget Reconciliation process, which will be the vehicle to approve much of Trump’s program. House Republicans lost the votes of two of their members, who voted no. However, of more concern for the Speaker Mike Johnson and the president, several others voted yes but are looking for large spending cuts in the final package if they are to maintain their support for the legislation.
The House and Senate are off for a two-week break for Passover and Easter. When they return, both the House and Senate will need to start work on the Budget Reconciliation Bill. The center piece of the bill is renewing the Trump 2017 tax cuts that expire at year end, money for the immigration programs, relaxing laws to permit more energy drilling, and more money for the Department of Defense.
The House and Senate did agree to put all the measures in “one big, beautiful” bill, which was the House plan, but what is in the bill will require a great deal of negotiations, and a central role for the president to get the package approved.
