Congress Considers Extra Defense Funding as Iran War Expands

Kay Nietfeld/dpa
By Yuval Rosenberg and Michael Rainey

Four days into the war in Iran and across the Middle East, President Trump said today that someone from within the decapitated Iranian regime might the best choice to lead the country once the military operation there is finished, but there might be challenges to that approach. "Most of the people we had in mind are dead," Trump told reporters in the Oval Office. "Pretty soon we're not gonna know anybody..."

Secretary of State Marco Rubio, Defense Secretary Pete Hegseth and other administration officials were scheduled to brief lawmakers on Capitol Hill this afternoon, ahead of expected votes on war powers resolutions in the Senate and House tomorrow and Thursday, respectively. Lawmakers are already questioning whether a supplemental defense spending bill will be needed.

Here's your evening update.

Iran War Has Congress Considering Extra Defense Funding: Reports

As members of Congress scramble to stake out positions on President Trump's decision to go to war with Iran - and prepare to vote on whether to formally push back on the president's war powers - some key lawmakers are reportedly also weighing the need for an emergency defense spending bill.

Republican Senate Armed Services Committee Chairman Roger Wicker told reporters Tuesday that lawmakers are considering whether the Pentagon will need more money.

"We're talking about that, and that will undoubtedly be discussed at the all-members brief this week, hopefully today, and if something is needed, and if they make a case for it, I'll be receptive to their arguments," Wicker said, according to Politico.

House Speaker Mike Johnson told reporters Monday that the potential need for additional funding was raised during a "Gang of Eight" briefing by administration officials for top lawmakers.

Some Democratic lawmakers have reportedly also expressed concern about the state of weapons stockpiles, including missile defense systems such as the Terminal High Altitude Area Defense system (THAAD).

"There is a potential desperate and disastrous shortage of THAAD and Patriot systems that are necessary to protect our embassies, our bases, our civilians, and that is truly a potential disaster in the making," Democratic Sen. Richard Blumenthal said.

Any supplemental funding bill would require bipartisan support to get through the Senate. That, as Aris Folley and Jacob Fulton note at Roll Call, "would give Democrats leverage that could affect the scope of future combat in Iran."

Democratic leaders have come out against the war, saying that, while they don't mourn the death of Iranian Supreme Leader Ali Khamenei, the American people don't want a war of choice pursued with no clear endgame or public debate.

"This is not what the American people want," Senate Minority Leader Chuck Schumer said Monday. "They don't want a war that leads to lost American lives and that costs billions and billions of taxpayer dollars. They don't want a war that raises the price of gas at the pump."

Some Democratic senators have already cautioned about the costs of war and have used the issue to hammer Republicans about domestic concerns, including the affordability crisis.

"Trump and Republicans: Sorry, no money for your grandma's healthcare. Also Trump and Republicans: Let's spend billions blowing up the Middle East," Sen. Ruben Gallego of Arizona wrote in a post on X. "They can always find money for war, just never for you."

Democrats have also rejected Republican pressure to end the Department of Homeland Security shutdown, now in its 18th day, because of the war. Democrats continue to push for reforms at Immigration and Customs Enforcement and Customs and Border Patrol. They argue that Congress could fund all other DHS agencies, such as the Transportation Security Administration and the Federal Emergency Management Agency.

House Minority Leader Hakeem Jeffries on Tuesday dismissed the idea of funding all of DHS now.

"Donald Trump launches an unauthorized war in the Middle East. He characterizes it as endless. He decides that he wants to spend billions of dollars to bomb Iran, rather than spend taxpayer dollars to lower the grocery bills that are crushing the American people. And then wants to use his unauthorized war as an excuse to continue spending taxpayer dollars to brutalize or kill American citizens by continuing to unleash ICE without restrictions on the American people," Jeffries told reporters. "The whole thing is insane. Make it make sense, because it does not."

Quote of the Day

"The president approved ahead of time you spending $220 million running TV ads across the country in which you are featured prominently? ... It's just hard for me to believe, knowing the president as I do, that you said, 'Mr. President, here's some ads I've cut, and I'm going to spend $220 million running them' that he would have agreed to that. I don't think Russ Vought at OMB would have agreed to that."

− Republican Sen. John Kennedy of Louisiana, questioning Department of Homeland Security Secretary Kristi Noem at an oversight hearing Tuesday about a controversial $220 million, taxpayer-funded national TV ad campaign that featured Noem thanking President Trump for securing the border and then warning undocumented immigrants to leave the country or face deportation.

DHS bypassed the usual competitive bidding process for the campaign and the largest chunk of money involved, a $143 million subcontract, went to a company called Safe America Media, which reportedly was formed just 11 days before the contract was awarded. A prime beneficiary of the deal was The Strategy Group, a firm led by the husband of Tricia McLaughlin, who had been Noem's chief spokesperson at DHS.

Noem told senators today that she did not have anything to do with picking the contractors involved. She said Trump has tasked her with "getting the message out" and that the campaign was "extremely effective."

Kennedy responded that it was "effective in your name recognition."

GOP Senators Push for $200 Billion Tax Cut Via Treasury Rule Change

Republican Sens. Ted Cruz and Tim Scott are reportedly sending a letter to Treasury Secretary Scott Bessent this week calling for a policy change that would deliver a roughly $200 billion tax cut to investors and homeowners, without the need for congressional approval.

The Washington Post's Jeff Stein reports Tuesday that Cruz and Scott are urging Bessent to allow asset owners to adjust their gains for inflation, thereby reducing tax bills, especially for those who have held assets for many years.

Conservatives have been pushing for the change for years - "It is wrong to tax inflation," anti-tax activist Grover Norquist wrote in 2019 - but it is not clear if the executive branch has the authority to index capital gains to inflation on its own.

Cruz's office has reportedly estimated that the inflation index would cost about $200 billion in lost tax revenues and would boost the housing market by making it less costly for long-time homeowners to sell.

"Using your executive authority to ... eliminate an unfair inflation tax on everyday Americans is the single most pro-growth economic action the administration can take unilaterally, and it would boost savings, spur investment, and create jobs nationwide," the letter to Bessent reportedly says.

Critics say the inflation adjustment would overwhelmingly benefit the wealthy. As Stein notes, the Penn Wharton Budget Model estimated that 86% of the benefits of indexing capital gains to inflation would flow to the top 1% of earners, while the bottom 80% would get just 1% of the benefit.

Kyle Pomerleau, a tax policy expert at the conservative American Enterprise Institute, said on social media that the proposed change would likely be illegal. In addition, Pomerleau dismissed the idea that it would have much of an effect on growth, saying it wouldn't "have much of an impact on the economy one way or another."

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