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A delay in GOP’s tax plans could push up costs by hundreds of billions

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The price of extending Republicans’ tax cuts will surge by hundreds of billions of dollars if lawmakers dawdle, new government figures show.

The Treasury Department released numbers Friday showing that rolling over all of the soon-to-lapse provisions, as well as undoing other reductions in business benefits that were triggered by the 2017 law, would cost $5.5 trillion — substantially more than the $4 trillion the Congressional Budget Office has projected.

There’s a number of reasons why Treasury’s price tag is much higher but a big one is that its analysis begins in 2026, not 2025, like CBO’s.

That may not sound like a big deal, but when budget analysts estimate the price of legislation, they look at the anticipated expenses over a decade, and it makes a huge difference when the cost-counting clock starts.

Right now, the government is in its 2025 fiscal year, and so analysts look at years 2025 through 2034 — and expenses in 2025 are minimal because Republicans’ tax cuts are still on the books. About 40 provisions are due to expire at the end of the year.

But when the new fiscal year begins Oct. 1, analysts will begin tallying up costs between 2026 and 2035, as Treasury happened to do in its in analysis. That means the very cheap year of 2025 will fall out of the picture, and the very expensive year of 2035 — when costs are expected to run $600 billion — will suddenly be included.

House Speaker Mike Johnson (R-La.) has said he wants to get a bill including the tax provisions on President-elect Donald Trump’s desk by the end of April — an ambitious timeline given the size of the package and Congress’ tendency to dawdle. Some tax vets now expect lawmakers to take until their August recess to wrap up their plans, if not longer.

Republicans are off to a slow start, with lawmakers bogged down in an extended and so far unresolved debate over whether to tackle immigration first and put off taxes until later or combine them into a single bill.

The House and Senate intend to go their own ways, with competing approaches, which amounts to postponing critical decisions, like how much to spend on a tax bill, that have to be resolved before they can use the “reconciliation” procedure they’re depending on to get their plans through the balky Senate.

Treasury wasn’t trying to warn Republicans of the cost of delay; it was examining the cost and the biggest winners of renewing the provisions. Not surprisingly, the analysis says the super-rich would see the biggest benefits, with the top 0.1 percent reaping a 4.2 percent increase in their after-tax incomes compared to the roughly 1.2 percent increase for those in the middle of the income spectrum.

CBO is expected to release next week its own revised estimates of the cost of extending the provisions.

Last year, it put the price at $4 trillion or $4.6 trillion, including increased debt service.

It’s not like Congress to work far ahead of schedule, but had lawmakers taken up the extension of the Tax Cuts and Jobs Act in 2023, the price would have been easier to swallow. CBO pegged the cost then at a comparatively paltry $3 trillion, or $3.45 trillion including interest expense — because its estimate then included not just one but two cheap years, 2024 and 2025.

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Congress

Republicans confront the massive cost of Trump’s Middle East war

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Republicans on Capitol Hill are preparing to confront a staggering price tag for the war in the Middle East after closed-door briefings this week detailed the rapid consumption of expensive munitions and the lack of any firm deadline for the end of the military campaign.

Asked how much the Iran offensive would cost, House Appropriations Chair Tom Cole (R-Okla.) didn’t sugarcoat it.

“A lot,” he replied.

Senior Republicans privately expect President Donald Trump’s administration to request tens of billions of dollars for the Middle East conflict and other military needs from Congress in the coming days, with some GOP lawmakers hearing estimates that the Pentagon is spending as much as $2 billion a day on the war.

Three F-15E jets shot down by friendly fire in Kuwait are estimated to cost $100 million alone. But Trump officials in private briefings have declined to give lawmakers any specific numbers, according to six congressional Republicans granted anonymity to describe the internal discussions.

A White House request for supplemental funding could further balloon once it hits Capitol Hill, according to four other people with direct knowledge of the matter. Farm-state Republicans want an additional $15 billion in tariff relief for farmers, while others float adding tens of billions of dollars in wildfire aid to get enough Democratic support to pass the massive bill.

The prospect of a growing new spending measure has GOP leaders bracing for a messy internal fight, with fiscal hawks who have long decried “forever wars” and bloated Pentagon budgets deeply unsettled by some of the cost estimates flying around on Capitol Hill. At the very least, some are planning to demand offsetting spending cuts.

“I haven’t seen any specifics … but if it’s unpaid-for, I generally have an issue,” Rep. Russ Fulcher (R-Idaho) said.

Another House Republican granted anonymity to describe the conversations among GOP hard-liners said, “It’s not a ‘hell no,’ but it should be offset somehow.”

The topic is now looming over next week’s House Republican policy retreat, which kicks off Monday with a speech from Trump at the president’s resort in Doral, Florida. If the administration sends its formal funding request in the coming days, House GOP leaders will be forced to confront the issue head on.

At least some are expressing unqualified early support for any administration request. House Foreign Affairs Chair Brian Mast (R-Fla.), for instance, said in an interview this week he is ready to support an emergency funding bill spending tens of billions of dollars on the Iran operation alone.

That sentiment could be challenged by the congressional Republicans who are privately wary of the open-ended timeline and shifting rationales for the war. One House Republican recently remarked that Trump’s pledge to do “whatever” it takes, including entertaining boots on the ground, sounded like “President Lyndon Johnson going into Vietnam.”

Rep. Ryan Mackenzie, a vulnerable Pennsylvania Republican, noted that “as much as we need to neutralize their capabilities to continue to attack us, we do also need to make sure that we don’t get dragged into a forever war.”

Asked in an interview if Congress is ready to approve a $50 billion Pentagon funding package, Speaker Mike Johnson replied that he didn’t know the specific number yet but Congress would pass the bill “when it’s appropriate and get it right.”

“We’re waiting on the White House and [the Pentagon] to let us know, but we have an open dialogue about it,” Johnson said.

House Majority Leader Steve Scalise, who is attuned to the spending concerns among the fiscal hawks inside the GOP ranks, demurred when asked about the potential for a $50 billion package.

“We’re still just in the first few days of this conflict, and there’s no ask yet from the Department of War for a supplemental,” Scalise said in an interview Wednesday.

He referenced the laborious talks ahead: “When that time comes, we’ll obviously have very serious conversations, because it’s important that the Department of War have the tools they need to keep America safe.”

A bigger potential headache is brewing for Johnson as members of his conference debate whether additional military funding should go in a much-discussed but long-shot budget reconciliation bill. That could move to Trump’s desk along party lines without Democratic support, but only if Republicans are almost completely unified.

House Budget Chair Jodey Arrington (R-Texas) said in an interview this week he expected the chamber to move forward on an initial emergency funding bill but that a second filibuster-skirting megabill could contain additional Pentagon spending, along with some possible offsetting cuts.

“It’s not just for the current conflict,” Arrington said. “There are things that need to be retooled fundamentally at the Defense Department, and the president’s team is making a really good case for that.”

Rep. Ralph Norman, one GOP hard-liner who has objected in the past to big Pentagon budgets, now says he would “absolutely” support a $50 billion bill without offsets.

“I don’t like it, but with what this president’s doing with income — the GDP is increasing, the money he’s bringing in for other investments — to handicap him on that, that’s a problem,” said Norman, who is running for South Carolina governor and seeking Trump’s support.

In the Senate, some GOP appropriators are cautioning that any war funding bill will be a big lift — and warning the administration to get specific, and fast.

Sen. Lisa Murkowski (R-Alaska), a senior member of the Defense Appropriations subcommittee, said the “administration should not be taking anything for granted.”

“If they come to us at the end of the month and say, ‘This is what we want, and basically, deliver the votes’ … it’s not a winning strategy, in my view,” she said. “You’ve got to start making the case.”

Katherine Tully-McManus and Jennifer Scholtes contributed to this report.

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GOP fundraiser with Hegseth scrapped amid Iran War buildup

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Rep. Zach Nunn has postponed a planned “Top Gun” themed fundraiser with Defense Secretary Pete Hegseth that had drawn criticism over its timing — at the start of a war that has already resulted in U.S. casualties.

The Iowa Republican announced the postponement Thursday on social media.

Nunn had said Hegseth would appear at the fundraiser on Saturday, hours after the initial U.S.-Israeli airstrikes in Iran. The event, called “Top Nunn” and billed as a “salute to the troops,” was scheduled for later this month in a Des Moines suburb.

On Tuesday, the Pentagon publicly identified the first U.S. deaths in the war, troops who were killed by an Iranian drone strike in Kuwait. The six soldiers were assigned to an Army Reserve command based in Nunn’s district, and two of them were from Iowa.

The announcement of the fundraiser drew strong condemnation from Democrats, who accused Hegseth of leveraging the war for political purposes. Democratic Congressional Campaign Committee spokesperson Katie Smith attacked Nunn’s event as “callous and disqualifying” in a statement on Wednesday.

Nunn, a former intelligence officer for the Air Force, explained the postponement in a social media post while offering condolences to the families of the troops who were killed.

“Operation TOP NUNN is postponed. We will have more to share about the event soon, and all ticket holders will be notified of the new date,” Nunn said. “Our prayers are with the families and our action is with our troops on the frontlines.”

Nunn said he plans to attend the arrival of the remains of the six soldiers at Dover Air Force Base on Saturday along with President Donald Trump.

Nunn paid his respects to the six soldiers in a speech on the House floor Thursday and led a moment of silence.

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Markwayne Mullin faces a straightforward path to confirmation as DHS secretary

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In replacing ousted Homeland Security Secretary Kristi Noem, Donald Trump is opting for one of the more reliable strategies to guarantee a quick Senate confirmation — nominating a senator.

Trump’s choice of Sen. Markwayne Mullin of Oklahoma sets up a relatively straightforward process, with some Senate Democrats already indicating they are open to voting for him.

“We’ve been successful at whipping everybody the president has nominated, and I expect the same for Markwayne Mullin,” Sen. John Barrasso of Wyoming, the No. 2 Senate Republican, said Thursday.

Senate Majority Leader John Thune separately told reporters that he wanted to move Mullin’s nomination “quickly.” Trump did not indicate in his Truth Social post when he would send Mullin’s nomination to the Senate, but said he would take over “effective March 31.”

“He’s obviously pretty well-vetted around here, so hopefully we can get the process going,” Thune said.

Mullin thanked Trump for the nomination in a statement Thursday and said, “I look forward to earning the support of my colleagues in the Senate and carrying out President Trump’s mission alongside the department’s many capable agencies and the thousands of patriots who keep us safe every day.”

Noem was confirmed 59-34 by the Senate, but she lost the confidence of many of the lawmakers who voted to confirm her more than a year ago. Republican Sens. Thom Tillis of North Carolina and Lisa Murkowski of Alaska both called on her to step down after DHS agents killed 37-year-old Alex Pretti in Minneapolis and she labeled him a “domestic terrorist” without evidence.

Both Tillis and Murkowski praised Mullin Thursday in the immediate wake of Trump’s announcement.

“He’s a man of his word. I think he’ll go in, get experts in there, and prove to be an executive with the right kind of skills, and get things squared away quickly,” Tillis said, adding that the decision was good for Trump’s “legacy.”

Tillis noted separately that Mullin “likes dogs,” an apparent reference to a story Noem included in her memoir about killing a misbehaving dog named Cricket.

Murkowski said she had a “great deal of respect” for Mullin.

“He has been a really good liaison between the Senate, actually the whole Congress, and the White House,” Murkowski said. “I’ve got strong respect for the guy, so I think he’ll do a good job

Sen. James Lankford of Oklahoma, a member of GOP leadership, acknowledged that Mullin’s nomination is unlikely to be unanimous, but he thought he would be treated “fairly” by his Senate colleagues.

It’s rare for current or former senators to see their nominations to administration posts derailed, but it has happened — most famously in 1989, when the Senate rejected John Tower’s nomination as Defense secretary amid charges of alcoholism and womanizing. More recently, Sens. Tom Daschle (D-S.D.) and Judd Gregg (R-N.H.) withdrew their nominations under then-President Barack Obama in 2009.

Republicans can confirm any of Trump’s nominees on their own as long as most of their own members stay united. But they’ll get at least a little help: Sen. John Fetterman (D-Pa.) said Thursday he will support Mullin’s nomination — a nod that could be especially important because he’s on the committee that must advance Mullin’s nomination to the full Senate.

Other Senate Democrats, including Minority Leader Chuck Schumer, are telegraphing they will oppose Mullin as they also blockade DHS funding over the department’s aggressive immigration enforcement tactics.

“The Senate should not consider any DHS Secretary nominee until DHS and ICE are reined in,” Schumer wrote on X Thursday, saying he would vote against Mullin.

But other Democrats, including Sen. Chris Coons of Delaware, left the door open to supporting the eventual nomination.

“I’m open to it, but he’s going to have to make real changes,” Coons said.

There is one potential pitfall: Mullin reportedly recently called Sen. Rand Paul (R-Ky.), the chair of the DHS-overseeing committee, a “freaking snake.” Paul has broad latitude to schedule and advance the director’s nomination.

Spokespeople for Paul didn’t immediately respond to a request for comment on Mullin’s nomination.

Katherine Tully-McManus, Meredith Lee Hill and Calen Razor contributed to this report.

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