Senators Clash With Mullin in Fiery DHS Confirmation Hearing
Wednesday saw a couple of explosive hearings on Capitol Hill. One Senate panel took up the nomination of Sen. Markwayne Mullin to replace Kristi Noem as Homeland Security secretary, while another heard from the nation's top intelligence officials, who delivered their annual assessment of worldwide threats and danced around questions about whether Iran posed an "imminent threat" as President Trump has claimed in explaining his rationale for starting a war there. Also today, the Federal Reserve held interest rates steady while expressing some concern about the uncertain outlook for the U.S. economy and inflation.
Here's your evening update.
Senators Clash With Mullin in Fiery Homeland Security Confirmation Hearing
Sen. Markwayne Mullin, President Trump's pick to take over the Department of Homeland Security, sought to signal Wednesday that he would do things differently if confirmed to lead a sweeping federal organization that has been at the center of controversy over the administration's aggressive immigration crackdown and, as a result, remains partially shutdown because of a funding lapse.
Under intense grilling at a hearing of the Senate Homeland Security and Governmental Affairs Committee, Mullin said he hopes to have the department work better with municipalities and does not want the department's work to be in the headlines every day, as it has been for much of the year. "My goal in six months is that we're not in the lead story every single day," he said. "My goal is for people to understand we're out there, we're protecting them, and we're working with them."
Yet he also indicated continued support for Trump's immigration policies and mass deportation campaign as well as for calls by both the president and outgoing Homeland Security Secretary Kristi Noem that the Federal Emergency Management Agency should not take the lead in disaster response.
He also emphasized the need for the department to be fully funded and for the partial shutdown that began last month to end.
Questions about temperament and biography: Mullin, a former mixed martial arts fighter, faced questions from both Republicans and Democrats about his often pugnacious style and mysterious statements he has made suggesting past involvement in special security forces or overseas combat operations.
Republican Sen. Rand Paul, who chairs the committee, immediately challenged Mullin over personal attacks he had lobbed against him, including calling him a "freaking snake." And he played video of a famous incident in which Mullin challenged Teamsters President Sean O'Brien to a fight during a Senate hearing. Paul suggested that Mullin has "anger issues" and might not be the right person to lead DHS. "I just wonder if someone who applauds violence against their political opponents is the right person to lead an agency that has struggled to accept limits to the proper use of force," he said.
Sen. Gary Peters, the top Democrat on the committee, also raised doubts about Mullin's disposition. "This is a role where temperament matters, where judgment matters, and where experience matters," he said.
Mullin said he is direct in his interpersonal dealings and noted that O'Brien was sitting behind him at the hearing and that the two are now good friends. Mullin said he was asked to train for and take an official, classified trip in 2015 and 2016, while he was a member of Congress. He did not provide details, insisting that he can't discuss the dates, location and mission.
A call to end the shutdown: Democrats have blocked funding for DHS as they push for new limits on federal immigration enforcement tactics after at least three American citizens have been killed by federal agents. They have proposed to fund DHS agencies except for Immigration and Customs Enforcement and Customs and Border Protection.
Mullin praised DHS employees who have been working without pay and said that the shutdown must end. "We have to get DHS funded. We have to," Mullin said in his opening remarks. "We have to set the partisan side down, and we have to realize that we're putting our homeland and the peace of mind at risk for the American people."
Agrees to use judicial warrants: Mullin seemed to back away from a Trump administration policy that defended the use of administrative warrants to allow federal immigration officers to enter private homes to search them or arrest undocumented immigrants. Democrats have demanded that immigration agents obtain judicial warrants for searches of private property. Asked whether federal agents should be required to get judicial warrants, Mullin signaled a policy change: "We will not enter a home or a place of business without a judicial warrant unless we're pursuing an individual that runs into a place of business or a house," he said.
Ending a Noem review policy: Mullin said he would not be a micromanager and would end Noem's policy of personally reviewing every department expenditure of more than $100,000. That policy has been blamed for creating a multi-billion-dollar backlog of grants and disaster relief funding.
Restructuring FEMA: Asked if he would look to eliminate FEMA, as Noem has suggested, Mullin said he would seek to restructure the agency, not get rid of it. But he agreed that FEMA should defer to states for disaster response while ensuring that needed funding is delivered quickly. "FEMA was never designed to be the first responder," he said. "That's the states."
What's next: Paul reportedly said after the hearing that he will oppose Mullin's confirmation, and he continued to criticize the man who has been his Senate colleague since 2023 in posts on X. "The fact that he can't bring himself to say that, you know, really, we shouldn't settle political questions with violence, I think that would be a terrible example for ICE and for our border patrol agents," Paul told reporters.
That complicates the nomination's path out of committee. If Paul votes against Mullin, the nomination would need the support of at least one Democrat to advance. Democratic Sen. John Fetterman might provide that vote. He praised Mullin's "kindness and professionalism" and indicated he will have an open mind about the nomination.
Fed Holds Steady as Economic Uncertainty Grows
With one eye on the growing risk of an inflationary oil shock, the Federal Reserve held its benchmark interest steady between 3.5% to 3.75% at the conclusion of its most recent meeting Wednesday.
The vote by the Federal Open Market Committee to keep rates unchanged was 11 to 1, with only Stephen Miran, who was appointed to the Fed last fall by President Trump, voting to cut rates by a quarter of a point.
In a statement, the committee said the economy continues to expand at a "solid pace," with stable employment despite an anemic labor market and a "somewhat elevated" inflation rate.
The committee briefly nodded toward the major, potentially transformative news of the day - the closure of the Strait of Hormuz and the resulting spike in oil prices - but left the details largely unaddressed, saying simply: "The implications of developments in the Middle East for the US economy are uncertain."
Inflation expectations: At a news conference Wednesday afternoon, Fed Chair Jerome Powell said that it is too soon to know how the spike in oil prices will affect the economy. But he left no doubt that Fed officials expect to see an oil shock of some kind, with the question being how long it lasts and how great an effect it produces.
At the moment, Fed officials seem to think the oil shock will be relatively brief, though powerful enough to boost topline inflation to 2.7% on average in 2026, up from the 2.4% inflation level they projected in December.
The higher inflation projections come against a backdrop of rising inflation. The Labor Department reported Wednesday that wholesale prices rose 0.7% in February compared with the month before, and 3.4% over the previous year. The results were higher than expected and point to rising inflationary pressure even before an oil shock of unknown strength and duration hits the economy.
Powell noted that core inflation hit 3% in the most recent data, driven in large part by the tariffs Trump placed on imported goods last year. Fed officials are still waiting to see more progress in reducing goods inflation, Powell said.
At the same time, Powell said there is a tendency among economists to "look through" oil shocks because they are usually transitory, and the latest economic projections indicate that they are largely doing that. Fed officials now expect economic growth to be slightly stronger this year (2.4% GDP growth, up from a previous estimate of 2.3%) and the unemployment rate to hold steady at 4.4%. And officials still expect to cut rates one time this year, the same projection as before.
Overall, Fed officials are cautiously optimistic, though that could change depending on what happens in the Middle East. "The U.S. economy is doing pretty well," Powell said. "It's just we don't know what the effects of this will be and really no one does."
What analysts are saying: The highly uncertain nature of the burgeoning oil crisis led many analysts to join Fed officials in taking a cautious approach.
"The Federal Reserve ... once again held rates steady against a mixed backdrop of elevated inflation, a weaker labor market, and stable growth (for now)," Matthias Scheiber, a portfolio manager at Allspring Global Investments, said in a note to clients. "Amid rising geopolitical risk, time will tell how U.S. fundamentals are affected."
William English, a former senior Fed economist, said the risk appears to be on the inflation side of the equation. Fed officials still "had some elbow room to cut" interest rates when tariff-related inflation started showing up last year, English told The Wall Street Journal, but that's no longer the case. "There's at least a bit of a risk that they end up with policy that's easier than they're comfortable with, not because they cut, but because inflation went up," he said.
The most important fact about the Fed today, though, may be that its outlook changed so little. "The Fed wants to wait and see what's happening in the Middle East," said University of Michigan economist Justin Wolfers. "There's no point taking a strong view until reality becomes clearer. (Powell just described FOMC members as having 'no conviction' in their forecasts.)"
Powell says he'll stay on until DOJ investigation is done: The Fed chair said he has "no intention" of leaving the bank until an investigation into his testimony before Congress about ongoing renovations to Fed headquarters is closed. A judge last week blocked the Justice Department's attempt to subpoena Fed records, but U.S. Attorney Jeanine Pirro, the former Fox News host appointed as the top federal prosecutor in D.C. by President Trump, has said she will appeal.
Number of the Day: $39 Billion
The national debt topped $39 trillion for the first time on Tuesday, according to figures released by the Treasury Department. The new milestone comes less than five months after the debt reached $38 trillion. Debt held by the public, which excludes intragovernmental borrowing, is now more than $31 trillion.
"No matter what metric one chooses to examine our fiscal trajectory, we are clearly headed in the wrong direction," said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, which promotes deficit reduction. "Higher debt exacerbates inflationary pressures, squeezes out investment in our economy, allows interest costs to dominate our defense spending, leaves us vulnerable to emergencies and geopolitical turmoil, and could even provoke a fiscal crisis."
Fatima Hussein of the Associated Press notes that the record debt total "highlights competing administration priorities, from passing a massive tax law and boosting defense spending and immigration enforcement to chipping away at the debt itself - the latter of which Donald Trump promised to do as both a candidate and as president."
Quote of the Day
"In about a year from now, the Postal Service would be unable to deliver the mail if we continue the status quo."
– David Steiner, the postmaster general, warning lawmakers at a Tuesday hearing that the U.S. Postal Service will be "out of cash in less than 12 months" unless they let it raise postage rates and increase its borrowing authority.
As Adam Sella reports at The New York Times, the postal service posted net losses of $9.5 billion and $9 billion in fiscal years 2024 and 2025. It lost almost $1.3 billion in the first three months of the current fiscal year.
Fiscal News Roundup
- Gabbard, Ratcliffe Dodge Questions About Trump's Iran War Planning – The Hill
- Intel Chief Gabbard Declines to Say if Iran Posed an 'Imminent Threat' to US – NBC News
- Mullin Makes His Case as a Steady Hand for DHS but Faces Senate Pushback Over His Temperament – Associated Press
- Mullin Says FEMA Should Be 'Restructured' and That He'll End Noem's Controversial $100K Expense Reviews – The Hill
- Fed Holds Rates Steady, Powell Vows to Stay Amid DOJ Probe – Bloomberg
- Oil Prices Jump Following First Attacks on Iranian Production Facilities – CNN
- Trump Waives Jones Act Shipping Rules for 60 Days to Steady Oil Market – CNBC
- US Wholesale Prices Rose by a Surprisingly Hot 3.4% Last Month, the Most in a Year – Associated Press
- GOP Tempers Flare Over How to Pass SAVE America Act – The Hill
- Housing Bill Backed by Senate GOP, Trump Hits Roadblocks With House Republicans – The Hill
- Postmaster Says Service Will Be 'Out of Cash' in Under a Year – New York Times
Views and Analysis
- Trump Promised the 'World's Lowest' Drug Prices. We Checked the Numbers – Rebecca Robbins, New York Times
- TrumpRx Isn't Doing Much for Drug Prices. What Would It Take to Change That? – Berkeley Lovelace Jr., NBC News
- Why This Jump in Gas Prices Feels Different – Francesca Paris, New York Times
- The Fed's Powell Just Delivered a New Blow to Warsh's Plans for Swift Rate Cuts – Matt Peterson, CNBC
- Trump's Tariffs Are Hurting American Manufacturers Instead of Helping Them – Josh Boak, Associated Press
- If You Hate Trump's Economy, I Have News for You – Jason Furman, New York Times
- The Cost of the A.I. Boom: A Trade Deficit the President Detests – Ana Swanson, New York Times
- Democrats Must Strike a Sharp Blow Against Economic Royalists and Win Back Middle America – Brad Bannon, The Hill
- The Nation's Accelerating Self-Assassination – George F. Will, Washington Post
- We're Bringing Families More Healthy Foods in a SNAP – Brooke Rollins and Robert F. Kennedy Jr., Fox News
- Courts Should Stop Taking the President at His Word – Noah Feldman, Bloomberg