White House Halts Another Batch of Blue State Projects

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Imago Images
By Yuval Rosenberg and Michael Rainey

Good evening. President Trump today met with Ukrainian President Volodymyr Zelensky and expressed some hesitation about providing Kyiv with Tomahawk missiles that would allow it to strike deep into Russia. Trump later announced that he commuted the sentence of former Rep. George Santos, the Republican serving a seven-year sentence for wire fraud and identity theft. And he headed to Florida, where tonight he'll host a $1-million-per-person fundraiser for MAGA Inc. at his private club.

Here's what else you should know heading into the weekend.

How the Government Shutdown Is Making History

The ongoing government shutdown is now the third-longest in modern U.S. history, topped only by a 34-day funding lapse in late 2018 and early 2019 and a 21-day fight in 1995 - and this shutdown, now in its 17th day, is going to stretch into next week and possibly far beyond.

Senators left the capital on Thursday after a three-day workweek that produced no progress toward a deal to reopen federal agencies. Democrats continue to demand negotiations to extend expiring healthcare subsidies. Republicans continue to insist that any negotiations must take place only after the government reopens. And President Trump has shown little interest in getting more directly involved in finding some resolution to the standoff.

Republicans have suggested that Democrats want the shutdown to extend past the large-scale "No Kings" protests planned for Saturday, which are expected to draw millions of Americans. GOP leaders have branded those gatherings as "Hate America" rallies and Johnson suggested this week that some Democrats "will come to their senses" once the weekend protests are done.

"Tomorrow, this rally is not about freedom. It's about the opposite. For many of our Democrat colleagues, tomorrow is about creating really a spectacle," Speaker Mike Johnson told reporters Friday morning. "As the shutdown drags on, it's become increasingly clear that this spectacle is the reason the Democrats have refused to reopen the government."

Johnson also claimed again that Senate Democratic Leader Chuck Schumer is simply looking to appease his progressive base to protect himself politically. "You're holding the entire country hostage to protect your own political career," Johnson said of Schumer.

Democrats dispute the idea that they purposely stretched the shutdown to reach this date, and Schumer has repeatedly dismissed the suggestion that he's driving the shutdown for personal political gain. Schumer this week defended the protests as "an affirmation of what America is all about and said that he'll be joining the No Kings marchers. "These are love America rallies," Schumer said, urging peaceful protests. "There is nothing more American than exercising the right to free speech, especially the right to dissent and especially when our democracy is at risk because of what Trump and his Republican cronies are trying to do."

As the shutdown continues, its impact grows. Among the latest reported developments:

  • White House budget chief Russell Vought said Friday that the Trump administration will immediately pause more than $11 billion in "lower-priority" Army Corps of Engineers projects, including ones in Baltimore, Boston, New York and San Francisco, all cities run by and represented in the Senate by Democrats. "The Democrat shutdown has drained the Army Corps of Engineers' ability to manage billions of dollars in projects," Vought said in a social media post, adding that the projects would also be considered for cancellation.

The Trump administration had previously announced that it was freezing $18 billion for New York infrastructure projects, $2.1 billion for such work in Chicago and $8 billion for climate projects across 16 states represented by Democrats in the Senate.

  • ** **The Supreme Court expects to run out of funding tomorrow. The court will continue to conduct its work, including hearing oral arguments and issuing decisions, but the court building will be closed to the public. Federal courts are expected to see funding lapse beginning on Monday, October 20. "Federal judges will continue to serve, in accordance with the Constitution, but court staff may only perform certain excepted activities permitted under the Anti-Deficiency Act," the Administrative Office of the U.S. Courts said in a statement.

  • The Interior Department is planning to cut thousands of jobs at the National Park Service, Bureau of Land Management and Fish and Wildlife Service - but it reportedly said it halted some planned layoffs due to a recent court order blocking the administration from firing union workers during the shutdown. The department may still go ahead with layoffs of non-union workers and said in a court filing that these cuts are part of a preexisting plan and are not related to the shutdown.

  • Republican Rep. Mike Rogers, chairman of the House Armed Services Committee, warned Friday that the National Nuclear Security Administration, which oversees the country's nuclear weapons stockpile, is planning to furlough some 80% of employees as its carryover funding runs out. About 1,400 employees will reportedly be furloughed with just 375 continuing to work. "These are not employees that you want to go home," Rogers told reporters at the House GOP leadership's morning news conference. "They're managing and handling a very important strategic asset for us. They need to be at work and being paid."

The bottom line: See you next week for more of the same.

Obamacare Enrollees Starting to See New, Higher Prices

Some Americans who get their health insurance under the Affordable Care Act are beginning to learn about the higher prices they will be asked to pay in 2026 if the pandemic-era subsidies are allowed to expire as scheduled at the end of the year.

As The New York Times's Reed Abelson and Margot Sanger-Katz report, Obamacare participants in about a dozen states have started to receive notices of 2026 pricing ahead of open enrollment on November 1. People in states including California, New York and Maryland can now see the prices they will pay in the absence of the enhanced subsidies.

Some examples of price increases cited by Abelson and Sanger-Katz:

  • A family of four in Maine with a $130,000 annual income will pay $16,100 more per year for coverage;

  • A 60-year-old couple in Kentucky earning $85,000 will pay $23,700 more per year for coverage;

  • A 60-year-old couple in Minnesota earning $85,000 will pay $15,500 more per year for coverage.

Not all Obamacare participants can see their 2026 pricing yet, including those in the 28 states that rely on Healthcare.gov, the federal exchange established by the ACA, to get their insurance. When the federal exchange publishes its prices in the next few weeks, health experts expect to see a significant drop in participation if the subsidies are left out. Analysts at the Congressional Budget Office estimate that about 2 million people will go without coverage next year due to the higher prices.

As lawmakers continue to battle over the subsidies that lie at the heart of the ongoing government shutdown, health experts worry that big losses in coverage are already baked in. "The ship has sailed," Ingrid Ulrey, CEO of the Washington State Health Benefit Exchange, told Politico. "Congress missed the opportunity to make this decision early enough for us to reset our markets for open enrollment, and to make it clean and easy for people to come in and see premiums that include the savings from the enhanced level of premium tax credits."

Unaffordable health insurance: Few Americans obtain their health insurance directly from insurers, with most receiving some kind of subsidy from employers or the government. Axios's Caitlin Owens points out that without those subsidies, health insurance is downright unaffordable for just about everyone.

"Without any form of subsidization, a single person making $60,000 would spend 10% of pretax income on an ACA plan, and 15% on an employer plan," Owens writes. "Now let's say that $60,000 income is supporting a family of four. The average premium without subsidies would cost that family 43% of its pretax income."

The harsh reality is that virtually no one can afford health insurance without some kind of subsidy. The question is what to do about that: Keep pushing subsidies higher as insurance prices continue their seemingly unstoppable rise? Or take steps to lower prices overall for everyone through widespread reforms?

Either way, lawmakers have some very tough decisions to make as they look for a way out of the current shutdown stalemate.

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Trump Tariffs to Cost Companies $1.2 Trillion in 2025: Report

The tariffs imposed by President Trump will cost businesses about $1.2 trillion this year, with most of the cost passed to consumers in the form of higher prices, according to a new report from S&P Global.

"The sources of this trillion-dollar squeeze are broad," S&P analyst Daniel Sandberg said in the report, per CNBC. "Tariffs and trade barriers act as taxes on supply chains and divert cash to governments; logistics delays and freight costs compound the effect."

As a general rule, the cost of tariffs is spread out along the supply chain, from suppliers to wholesalers to consumers. In the case of Trump's tariffs, the S&P analysts estimate that about a third of the cost will be borne by businesses, both exporters and importers. The largest share, about two-thirds, will be paid by consumers - and that could be a conservative estimate.

"With real output declining, consumers are paying more for less, suggesting that this two-thirds share represents a lower bound on their true burden," Sandberg said.

In the long run, following a period of lower profits, the analysts expect businesses to recover the profit margins they were earning before the tariffs. In the meantime, consumers must adjust to higher prices.

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