Congress

An update on the Senate as we head into the final months before the 2026 midterm elections.

There are several pivotal votes scheduled this week on Capitol Hill that will indicate whether there will be a government shutdown this fall and determine the future of funding for the military conflict with Iran. The first procedural test vote on whether to consider these bills is scheduled on Tuesday.

Today, the House Budget Committee will mark up a budget resolution that will kick off the third reconciliation process of the 119th Congress. The $95 billion budget reconciliation package has the support of the White House, which issued a Statement of Administrative Policy (SAP) in support of the bill. Speaker Mike Johnson (R-LA) has also suggested that Senate leadership was involved in designing the budget.

This week, leaders of the House Energy and Commerce Committee released a bipartisan bill that would create new federal rules meant to shield minors from unwanted contact, reduce compulsive usage, and block obscenity online. The bill focuses on new federal laws applied to social media platforms and material created by artificial intelligence (AI).

Now that a memorandum of understanding is in place and the Strait of Hormuz is open for business again, policymakers will start to assess the cost of the war in Iran and make plans for military spending.

GOP candidates endorsed by President Trump are winning in national primaries, but he is also ostracizing incumbent GOP senators, putting his legislative agenda at risk.

In light of concerns over economic headwinds from the conflict in Iran and blockade in the Strait of Hormuz, the White House is anxious to keep its economic agenda items moving. This is especially true with regard to the digital asset market structure bill (CLARITY Act) and the federal housing program reform bill (ROAD to Housing Act).

A brief overview of the policy options available to address gas prices in the wake of the Iran conflict.

Congressional Republicans are facing an uphill battle in the 2026 midterm elections. The president’s party has lost ground in the House in 90% of midterm elections since 1938. For Republican members of Congress running for reelection, the prospect of doing nothing in Washington for the next six months would give campaign fodder to their opponents. Vulnerable elected officials want more action in Congress, even if the chances are lower that the bill will be signed.

This week, the Senate is expected to vote on the Renewing Opportunity in the American Dream (ROAD) to Housing Act. That bill repurposes and redesigns a number of housing programs and has previously had strong support in the Senate. Yesterday evening, the Senate voted 84-6 to advance the legislation. The revised text of the legislation included language (Section 901) that will prohibit large “institutional investors” from purchasing certain single-family homes.

President Trump will deliver the annual State of the Union address on Tuesday. Having worked on State of the Union speeches for President Trump in the first administration, we’re predicting some of the big policies to watch during tomorrow’s address. Below are predictions on speech highlights, major policy goals, priorities for Congress, foreign policy, and the President’s political messaging heading into the midterm elections. Possible Legislative Priorities for Congress Odd

Funding for six federal agencies expired on Friday. The Senate passed those bills by a vote of 71-29 after Senate Minority Leader Chuck Schumer made a deal with Republicans. House Democrats, led by Minority Leader Hakeem Jeffries (D-NY), were not consulted on that deal. Now, House Democrats are delaying a vote on the bill and prolonging the shutdown.

The risk of another government shutdown increased over the weekend as Senate Democrats withdrew support for a bipartisan appropriations deal.

Three of the twelve FY 2026 annual funding bills have been signed into law. The other nine spending bills expire on January 30, 2026. If spending is not extended, the government faces another shutdown.

This evening, the House approved H.R. 6703 by a vote of 216-211. The Republican legislation (H.R. 6703) included a number of reforms and $36 billion in deficit reduction but did not extend expiring tax credits that lower the cost of health care premiums for roughly 23 million individuals insured through Affordable Care Act (ACA) exchanges. Amendments to extend subsidies were offered by Republican moderates in committee but were blocked by Republican leadership.

Tomorrow, the Senate is prepared to vote on two different health care proposals. Neither bill is expected to achieve the necessary 60 votes to proceed to the floor. Unless there are major concessions from Democrats or a dramatic change in posture from the President in the next week, Congressional Republicans are poised to let the enhanced tax credits expire on January 1, 2026.

The Senate voted to end the government shutdown, and the bill now heads to the House. We discuss what was in the final agreement and what will come next.