March Washington D.C. Preview

Quick Fix — The Federal Reserve’s rate-setting committee will meet in mid-March, and the Senate will vote on the nomination of Jonathan McKernan to lead the Consumer Financial Protection Bureau.   — The tax collector recently laid off around 6,500 workers, and the Trump administration has stressed that employees crucial to the current tax filing season weren’t swept up in the layoffs.   — Republicans in Congress are working to dismantle President Joe Biden’s climate agenda with a series of Congressional Review Act resolutions that will enable them to overturn regulations finalized late in his term.

Agriculture — Rollins takes charge: Brooke Rollins has taken the helm at the Agriculture Department and is supporting the Trump administration’s mission of overhauling the department’s workforce and spending. USDA has terminated thousands of probationary employees across units, including the Forest Service, rural development and the Animal and Plant Health Inspection Service, which is primarily responsible for driving the federal response to the bird flu outbreak at USDA. The department has also paused much of its spending on already-allocated grants, leaving some farmers and agriculture organizations without the money they were promised under federal contracts. Rollins has announced the unfreezing of $20 million and has promised to unleash more, but is studying ways to cut spending and eliminate DEI and climate programs.   — One of Rollins’ first policy moves was to announce a new strategy to respond to the avian influenza outbreak devastating producers and causing egg prices to skyrocket. A key aspect of her plan is to import more eggs from other countries to reduce domestic egg prices, something that’s already ruffling feathers among U.S. producers and GOP lawmakers. The secretary’s strategy also emphasizes biosecurity measures and financial relief for farmers, though it’s unclear whether the money is simply a continuation of funding announced during the Biden administration. USDA is also struggling to rehire some employees who were working on bird flu response but terminated during sweeping layoffs.   — Both chambers of Congress have passed budget resolution plans to jumpstart the reconciliation process, with some potential cuts to agriculture spending a key part of the process. The plan advanced by House GOP leadership calls for substantial reductions to the Supplemental Nutrition Assistance Program as part of $230 billion in agriculture spending cuts. Some House Agriculture Committee Republicans concerned about the budget resolution’s impact on SNAP benefits and farm bill discussions hope the $230 billion mark could be lowered during talks with the Senate, which is looking at closer to $1 billion in agriculture cuts.   — Powerful lobbying groups and voters are applying pressure to top Agriculture Committee lawmakers to hammer out a new farm bill deal this year. Farmers are grappling with high input costs, labor shortages and outdated policies due to Congress’ failure to pass a reauthorization since 2018. Agriculture groups and some farm-state GOP lawmakers are increasingly anxious about Trump’s plans for tariffs and mass deportations, which will threaten U.S. farmers’ international markets and workforce. — Grace Yarrow

Financial Services — Has the worm turned? President Donald Trump entered his second term with a solid labor market, an expanding economy and inflation seemingly under control. One month in, the uncertainty generated by his aggressive tariff threats and planned immigration crackdown — as well as still-elevated prices — has helped dampen consumer sentiment. The Labor Department’s February report on job market conditions, due March 7, will provide an early economic scorecard for the president.   — The Fed meets: The Federal Reserve’s rate-setting committee will meet in mid-March amid signs that inflation isn’t yet on a path back to the Fed’s 2 percent target, and investors expect policymakers to keep borrowing costs steady. Notably, central bank officials will gather after some of Trump’s tariff deadlines are scheduled to take effect, a move that could put further upward pressure on prices.   — Open regulatory seat: The Fed has a vacancy in its top regulatory post after Michael Barr stepped down from the job on Feb. 28, avoiding a potential legal clash with Trump. It’s not yet clear who, if anyone, Trump will nominate for the vice chair for supervision role. Fed Chair Jerome Powell suggested last month that he didn’t think the board needed a dedicated regulatory post, which was created by the Dodd-Frank Act.   — New consumer bureau leader: The Senate will vote on the nomination of Jonathan McKernan to lead the Consumer Financial Protection Bureau. The veteran regulator would be taking over an agency that has been at the center of Trump’s campaign to slash the federal bureaucracy. Advisers from Elon Musk’s Department of Government Efficiency embedded with the bureau in early February, and acting CFPB Director Russ Vought ordered staff to halt all work before culling probationary employees. The moves have alarmed some industry insiders who fear the bureau’s work could be upended in the chaos.   — Committee markups: The House Financial Services and Senate Banking committees will hold their first markups of the year prior to Congress’ March recess. Senate Banking Chair Tim Scott (R-S.C.) is hoping to mark up bipartisan stablecoin legislation during the week of March 17. Two Democrats have signed onto that bill, which is being led by GOP Sen. Bill Hagerty of Tennessee. House Financial Services is expected to vote on national security and bipartisan bills at a March 5 markup. Congress is also set to vote on resolutions that could roll back Biden-era regulations, including one that put new restrictions on bank mergers.   The National Flood Insurance Program reauthorization is also due March 14 and expected to be another temporary reauthorization, with lawmakers calling for an overhaul this Congress.   — SEC and crypto: The Securities and Exchange Commission will continue pulling back from cryptocurrency lawsuits and investigations, as it has already done with companies like Coinbase and Robinhood. It has yet to unveil its plans for other notable cases, including against Cumberland DRW, Kraken and Binance. As for the agency’s leadership, Paul Atkins — Trump’s pick to serve as chair — is finally nearing a confirmation hearing, with lobbyists expecting the Senate Banking Committee to hold one in early March.   — Crunch time for DOGE: Federal judges are set to more closely scrutinize the Treasury Department’s decision to allow DOGE access to the sensitive systems that control trillions of dollars in payments, which has provoked outrage among Democrats. Judges have already issued preliminary orders restricting that access. But the Treasury Department now faces court-imposed deadlines to turn over documents and other information about how Secretary Scott Bessent decided to allow DOGE to tap into the systems, which contain sensitive financial information of individuals and companies. — Sam Sutton, Katy O'Donnell, Michael Stratford, Jasper Goodman

Tax — The latest on tax cuts: Both the House and the Senate have passed budget resolutions that will allow them to move forward on passing big fiscal packages without Democrats’ assistance in the Senate.   That step wasn’t easy for the House, but now comes the real hard part: Figuring out the details.   Republicans generally agree on the broad strokes of what they want to do on taxes this year, which includes extending the portions of the 2017 Trump tax cuts that expire at the end of the year — including all the current individual rates, an increased standard deduction, a more robust Child Tax Credit and a special deduction for pass-through businesses. Trump also has his own priorities for the tax portion of the package, like eliminating taxes on tipped income.   And all things equal, Republicans generally would like to make all the tax cuts permanent.   — The struggle for Republicans will come in trying to flesh out those bigger-picture ideas. One of the most pressing questions the GOP faces right now is also one deep in the policy weeds — which budget baseline to use as they press ahead with a fiscal package or two that would also seek to boost border security, among other priorities.   Lots of top Republicans prefer a more forgiving baseline known as current policy, which assumes it would cost nothing to extend the temporary parts of the Tax Cuts and Jobs Act — making it easier to do without a new expiration date.   But even some GOP lawmakers who want permanent tax cuts believe such an approach is a gimmick and that Republicans should stick with the traditional current law baseline, which finds that it would cost at least $4 trillion to keep the expiring tax cuts.   — Other legislative happenings: The House Ways and Means Committee passed a measure in late February that would roll back a rule on cryptocurrency reporting requirements that was finalized late in the Biden administration.   The rule, which covers decentralized finance brokers, is just one of a number of recent regulations that Republicans want to repeal through the Congressional Review Act, which allows them to avoid a Senate filibuster. The repeal legislation now heads to the House floor, while companion legislation awaits action in the Senate.   — Some bipartisan tidings: Ways and Means also has passed around a half-dozen noncontroversial bills on tax administration already this year, dealing with issues like disaster relief and electronic filing.   Top tax writers in the Senate have released a bipartisan draft bill that would include those measures and other tax administration updates, raising the chances that Congress could enact broader legislation on that topic sometime in the next two years.   — DOGE and the IRS: The tax collector recently laid off around 6,500 workers, just part of a range of firings engineered by Musk’s government downsizing effort. The Trump administration has stressed that employees crucial to the current tax filing season, which began in late January and extends until mid-April, weren’t swept up in the layoffs. Most layoffs were said to have hit the divisions that seek to boost tax compliance among small and large businesses.   Still, Democrats and taxpayer advocates say they’ll be closely watching return and refund statistics from the filing season to see whether there’s any drop-off from previous years. They also have questions about DOGE’s access to IRS systems, even as Trump administration officials assert that Musk’s team cannot see individual taxpayer data. — Bernie Becker

Energy — GOP lawmakers pull the plug on Biden regs: Republicans in Congress are working to dismantle President Joe Biden’s climate agenda with a series of Congressional Review Act resolutions that will enable them to overturn regulations finalized late in his term.   The first resolution to reach Trump’s desk is a measure to eliminate the EPA rule implementing the Inflation Reduction Act’s fee on methane emissions, long a target of Republicans. He is expected to sign it, though GOP lawmakers still plan to repeal the underlying IRA provision through the reconciliation process.   The House also voted to overturn a rule that tightened energy efficiency standards for gas-fired water heaters, while the Senate cleared a measure to quash a rule requiring oil and gas companies to submit archaeological reports on shipwrecks and other cultural resources before they begin drilling.   Lawmakers are also expected in the coming weeks to take up a CRA targeting California’s waiver authority to set its own auto emissions standards. Additionally, Republicans are looking to overturn EPA emissions standards for rubber tire manufacturing and a DOE rule on energy efficiency certification and labeling for certain commercial and consumer equipment.   The Biden administration had finalized most of its consequential climate regulations before the “look back deadline” that subject them to the CRA.   — Clean energy on the chopping block: The rollbacks are an early preview of the larger fight coming later this year as Republicans eye clean energy tax credits and unspent climate funding as pay-fors for their massive reconciliation package.   The subsidies have launched a massive wave of private sector investment in clean energy manufacturing and deployment nationwide. Industry groups are gearing up to defend the credits, which will likely create difficult votes for some GOP lawmakers whose districts have benefited from the dollars. — James Bikales

Employment and Immigration — Slow moving on the labor front: The Labor Department might soon shift out of its holding pattern as Trump’s picks to lead the agency make their way through the Senate confirmation process.   Former Oregon Rep. Lori Chavez-DeRemer cleared the Health, Education, Labor and Pensions Committee at the end of February, and Keith Sonderling, the nominee to serve as her deputy secretary, is set to follow suit Thursday. Both could receive floor votes sometime in March, barring any last-minute snags.   To date, DOL has done relatively little outside of effectuating Trump executive orders that apply across the board, such as ordering staffers back to in-office work, stripping diversity-related language as part of the administration’s wide-ranging crusade against DEI — diversity, equity and inclusion — and culling agency headcount by firing workers on so-called probationary status who lack civil service protections.   The arrival of Chavez-DeRemer and Sonderling could portend big changes since they’ll need to quickly comply with a Trump administration directive to initiate a substantial shrinking of the agency and a move away from aspects of its operations not statutorily required. Already, DOL’s enforcement arm that deals with federal contractors has floated a blueprint to cut as much as 90 percent of its employees, leaving just 50 people in place to police thousands of companies that collectively employ about one-fifth of the U.S. workforce.   Some labor unions and Democratic lawmakers are expressing hope that Chavez-DeRemer could be a bulwark for workers’ interests against corporate power, though any overhaul to DOL could quickly erase any goodwill on that front. — Nick Niedzwiadek

Education — Education funding in limbo: Congress is lurching toward a government shutdown on March 14 if lawmakers don’t continue funding federal programs for the remainder of fiscal 2025. A lapse in funding would pause major functions at the Education Department such as civil rights investigations and grantmaking activities.   In the backdrop of a possible shutdown, the Education Department has cut millions of dollars in grants and contracts at the behest of Musk’s DOGE service. Those slashes to funds have congressional lawmakers concerned about whether the Education Department will distribute dollars appropriated by Congress. The president’s Education secretary pick, Linda McMahon, has said Congress would continue its appropriation duties but has stopped short of saying that the department will maintain its role in distributing funds for various programs as Trump looks to dismantle the agency. — Mackenzie Wilkes

Health Care — One of the most consequential health care stories continues to be Republican efforts to cut Medicaid — a longtime target of conservatives who say the government’s insurance program for low-income and disabled Americans spends too much.   House Republicans may need hundreds of billions in cuts to the program to pay for Trump’s agenda on tax cuts, border security and energy. Beyond doing a better job rooting out fraud in the program, Republicans are considering two policy changes:   Work requirements: Requiring some Medicaid recipients to hold jobs could reduce the rolls substantially by cutting those able to move onto employer-provided insurance and those unable to find work.   State provider taxes: Limiting taxes that states now impose on providers to pay for their share of Medicaid costs would also drive down the federal match.

— What’s ahead: House Republicans adopted their budget resolution last week. That is a first step toward fashioning a reconciliation bill that Senate rules allow to bypass a filibuster. The bill must focus on fiscal matters and might not increase the deficit over a 10-year window. House GOP leaders have asked the Energy and Commerce Committee to find $880 billion in savings, and it will be hard to do that without major cuts to Medicaid. The Senate also plans changes to the House budget resolution that could drive up the cost further. — Pro Health Care Team