How Much Will Iran War Cost? Trump Budget Director Can't Say

OMB Director Russ Vought (Reuters)
By Yuval Rosenberg and Michael Rainey

Would it be weird to wish you a happy Tax Day? In any case, we hope you've filed your return and are enjoying a worry-free Wednesday. Here's what you should know this evening.

Trump Budget Director Says No 'Ballpark' Yet for Iran War Funding Request

White House budget director Russell Vought told House lawmakers on Wednesday that the Trump administration doesn't yet have a "ballpark" estimate of how much supplemental funding it will seek for the Iran war.

"We're not ready to come to you with a request," Vought said during testimony before the House Budget Committee about President Trump's fiscal 2027 budget request. "We're still working on it. We're working through to figure out what's needed in this fiscal year versus next fiscal year."

Defending a huge defense funding request: The president's budget asked for a massive $1.5 trillion in military funding for the coming fiscal year, an increase of 42%. (The budget proposal also called for a $73 billion, or 10%, cut in nondefense spending compared to 2026 levels.)

Vought defended that proposed military spending increase, explaining that it is intended to grow the defense industrial base and cover multi-year purchasing agreements that have to be accounted for in their first year. "It is meant for significant, paradigm-shifting investments," he said.

Sharp criticism from Democrats: Rep. Brendan Boyle, the top Democrat on the budget panel, slammed Vought for failing to appear before the House Budget Committee last year and criticized the Trump administration's economic policies.

"What's different about this economy, unlike the inflation crisis after the pandemic, unlike the Great Recession, unlike the recession of 2001, unlike the recession of 1992 - the economic downturn that we're experiencing, no jobs, record inflation, gas prices through the roof, consumer confidence plummeting - all of this is directly related to the policies of the Trump administration that you carry out, Mr. Vought," Boyle said.

Boyle noted that the One Big Beautiful Bill Act is projected to add more in debt and deficits than any piece of legislation passed by Congress in U.S. history. He also questioned Vought about projections that more than 15 million or 17 million Americans will lose healthcare coverage as a result of the 2025 Republican law.

"Really, you're going to sit here with a straight face and say they're all illegals, they're all defrauding the system? That's actually your position?" Boyle asked.

"Yes," Vought replied.

"That's laughable!" Boyle jumped in.

Vought clarified that some people will be returning to the workforce because they are able-bodied or should not have been in the system because of a bureaucratic inability to address fraud.

"The idea that all of those people who are about to lose their healthcare are defrauding the system or are illegal immigrants, that is not supported by any facts whatsoever," Boyle responded.

Protestors interrupt Vought's opening remarks: The hearing was delayed briefly by a group of AIDS activists and former USAID employees who reportedly chanted "PEPFAR saves lives - spend the money," referring to a federal program to combat HIV and AIDS in developing countries. Trump's 2027 budget request reportedly would eliminate HIV-specific and all disease-specific programming, though Congress rejected similar proposals for the current fiscal year.

What's next: Vought is set to testify before the Senate Budget Committee on Thursday.

Trump Threatens to Fire Fed Chief Powell if He Doesn't Step Down

President Trump said Wednesday that he will fire Federal Reserve Chair Jerome Powell if he fails to step down when his term expires on May 15. At the same time, Trump indicated that a federal investigation into Powell's management of a construction project at Fed headquarters - an investigation that threatens to derail the Senate's confirmation of Powell's replacement, Kevin Warsh - would continue.

Although Trump named Warsh as Powell's replacement in January, he has continued to pressure Powell to lower the Fed's benchmark interest rate in hopes of stimulating the economy, while freely expressing his irritation that Powell has failed to do so using an array of insults, including "numbskull" and "major loser."

The investigation: In what many have seen as a ploy to pressure the Fed chief, the Department of Justice in January launched a probe into Powell's handling of the renovation of the central bank's headquarters complex in Washington, a $2.5 billion project that has gone over budget. That investigation has rankled some lawmakers, including Republican Sen. Thom Tillis, who sits on the Banking Committee that will vet Warsh as Powell's replacement. Tillis has said that he opposes confirming anyone for the Fed "until this legal matter is fully resolved."

A few weeks ago, Powell said that he would continue to serve as Fed chair if his replacement is not seated by May 15, to maintain continuity and control at the central bank. Trump made it clear Wednesday that he will intervene if that happens, though it's not clear he has the legal authority to do so.

"I'll have to fire him, OK? If he's not leaving on time," Trump told Fox Business in an interview. "I've held back firing him. I've wanted to fire him, but I hate to be controversial."

Justice presses ahead: In another sign that the Trump administration remains intent on the Powell probe, a team of federal prosecutors visited the Fed's headquarters on Tuesday, though they were turned away after being told they need to formally request permission to tour the building site.

Jeanine Pirro, the former Fox News host who serves as the U.S. attorney for the District of Columbia, defended the visit by members of her team. "Any construction project that has cost overruns of almost 80 percent over the original construction budget deserves some serious review," she said in a statement Tuesday. "And these people are in charge of monetary policy in the United States?"

Hoping to move on: The Senate Banking Committee said yesterday that it will hold a hearing on Warsh's nomination next week, despite Tillis's pledge to delay any confirmation until the Powell investigation concludes.

Although it continues, that investigation has recently faced setbacks, with a federal judge rejecting Pirro's request for subpoenas last month. "There is abundant evidence that the subpoenas' dominant (if not sole) purpose is to harass and pressure Powell either to yield to the president or to resign and make way for a Fed chair who will," the judge wrote.

Republican leaders seem to prefer that Trump drop the matter. "It's in everybody's best interest to wrap up the investigation," Senate Majority Leader John Thune said Wednesday. Tillis also chimed in, mockingly posting a picture of the Three Stooges on social media with the comment, "The U.S. Attorney's Office for D.C. at the crime scene."

Republicans Struggling to Sell Their Tax Cuts Try a Tax Day Pitch

The White House and GOP lawmakers have struggled with economic messaging in the face of affordability concerns that have only increased as the Iran war continues, causing gas prices to surge above $4 a gallon on average. With November's midterm elections rapidly approaching, Tax Day provided a rare opportunity for the Trump administration and congressional Republicans to try to make some political hay by touting the trillions of dollars in tax cuts they passed last year in the One Big Beautiful Bill Act, which Republicans now prefer to call the Working Families Tax Cuts.

"President Trump's Working Families Tax Cuts have put a historic amount of money back into the pockets of the American people this year," White House press secretary Karoline Leavitt said Wednesday. "With Tax Day officially here, the numbers prove these tax cuts have been nothing short of extraordinary."

The tax season numbers so far: The IRS says that, as of the week ending April 3, nearly $242 billion in tax refunds were sent out, with an average refund of $3,462, up 11% from 2025. (That's less than the increase of $1,000 or more that the White House had projected early this year.) The Treasury Department says that more than 53 million filers claimed at least one of President Trump's signature new tax cuts, including more than 25 million who took advantage of the break for overtime wages (for an average deduction of more than $3,100) and more than 6 million who claimed the break for tip income (average deduction of more than $7,100).

Still, Americans' views of their tax bills are increasingly negative. A recent Fox News poll found that a record 70% of voters think their taxes are too high, up 11 percentage points from March 2025, the largest annual increase since that poll first asked the question in 2004.

"The legislation is so revolutionary because it is permanent," House Speaker Mike Johnson said at a news conference to tout the Republican tax law. "For the first time since 1986, Americans' tax rates are permanently reduced. Permanently."

While the lower tax rates first enacted in 2017 were made permanent, some of the key provisions of the law were only temporary, including Trump's tax breaks for tips, overtime pay and certain auto loans as well as the new tax credit for seniors, which expire after 2028, and the raised $40,000 deduction limit for state and local taxes, which reverts to $10,000 after 2029. The federal government's $1,000 contributions to "Trump accounts" are limited to certain children born between January 1, 2025, and December 31, 2028.

Democrats have their own Tax Day message: "Hardworking families are watching as the Trump administration spends billions to bomb Iran, yet they can't seem to find any funding for health care, housing or food for hungry children," said Rep. Pete Aguilar of California, the Democratic caucus chair.

Not a lot of talk about the fiscal impact: GOP messaging largely ignores Congressional Budget Office projections that the One Big Beautiful Bill Act will add some $4.2 trillion to the national debt through fiscal year 2034 (or $4.7 trillion after factoring in dynamic effects on the economy.)

"The central fiscal effect of the Act is clear: Despite substantial reductions in health, nutrition, and education spending, the Act substantially increases federal deficits and debt because of the magnitude of the tax cuts," a recent Tax Policy Center report concluded. "Although most analyses find a short- or medium-term boost to economic activity, the resulting growth is not nearly large enough to offset the law's substantial revenue losses."

What's next: The White House hopes to keep hammering the tax messaging this week; President Trump will head to Nevada tomorrow to tout the One Big Beautiful Bill Act. But Trump himself has a habit of overshadowing economic messaging by making other headlines (such as threatening to fire the Fed chair). We'll see if he does it again on Thursday.

Number of the Day: 14%

About 14% of Americans who signed up for Affordable Care Act plans this year did not pay their first monthly bill for coverage after enhanced federal subsidies were allowed to expire, causing premium costs to jump. The drop-off rate, reported by The Wall Street Journal based on a new analysis by actuarial firm Wakely Consulting Group, is reportedly higher than the mid-single-digit range normally seen early in the year - and in some states, the falloff was higher, a quarter or more.

"ACA enrollment was already declining," the Journal's Anna Wilde Mathews reports. "Sign-ups fell to 23 million in 2026, from a peak of more than 24 million last year. This new data shows that millions more are at risk of losing ACA insurance. Some enrollees have a grace period, allowing them to retain their plans for three months even if they don't make a payment."

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