Congress Ends Record-Breaking Homeland Security Shutdown

Speaker Mike Johnson (Andrew Thomas/CNP/INSTARimages)
By Yuval Rosenberg

So much happening on this Thursday, so let's get right to it.

Record-Long DHS Shutdown Ends After House Approves Funding Bill

The House approved a bill Thursday to fund much of the Department of Homeland Security and President Trump quickly signed it, ending a partial shutdown that started 76 days ago, making it the longest in history.

By unanimous consent, the House approved the Senate-passed funding bill funding the Coast Guard, Federal Emergency Management Agency, Transportation Security Administration and Secret Service through September 30.

The vote comes after DHS, which has been using alternative funding to pay its workers, warned that those other sources would be tapped out at the end of the month, leaving it unable to cover employee paychecks. The White House had urged House lawmakers to fund the department before they leave for a planned recess next week.

More than 1,100 TSA agents have quit since the shutdown began, and the prospect of having workers go without pay yet again raised fears that airports could again be plagued by callouts and lengthy delays.

"It is about time," said Rep. Rosa DeLauro, the top Democrat on the House Appropriations Committee, who introduced similar legislation in February. "This has gone on far too long. This is no way to govern, this is no way to run a legislative body, it is a failure of leadership."

The DHS bill does not include money for the department's immigration enforcement agencies, which Republicans are looking to fund through a budget reconciliation process that bypasses the threat of a Democratic filibuster. Democrats have refused to provide funding for Immigration and Customs Enforcement and the border patrol without reforms to those agencies' tactics.

Johnson notches wins after a challenging week: The House vote capped a hard-fought series of legislative wins this week for House Speaker Mike Johnson and Republican leaders, who had to quell revolts from members on several issues along the way. The Republican infighting had held up the legislative process of passing the budget resolution as well as a farm bill that also passed today and an extension of a key surveillance tool.

"Despite unrelenting predictions from many of you today in the press that we would fail this week, we did exactly the opposite," Johnson told reporters, taking a victory lap. "I'm really glad to tell you that House Republicans pulled together and delivered some major pieces of legislation and huge priorities for the country in the last few days."

The vote on the funding bill came after the House last night adopted a Republican budget blueprint, taking another major step in the reconciliation process that the party is using to provide around $70 billion for immigration enforcement agencies. That vote was 215-211 along party lines. Rep. Kevin Kiley of California, an independent who left the Republican Party, voted "present."

As with so many House votes lately, this one involved some drama, as it was held open for more than five hours as GOP leaders tried to settle disputes, including a farm bill fight over the use of ethanol in gasoline, and wrangle the support needed for passage.

The Senate already adopted the same budget resolution, so the House vote allows Republicans to push ahead with their plan to fund Immigration and Customs Enforcement and Customs and Border Protection for the rest of President Trump's term. House Republicans had insisted on seeing the immigration funding was at least well underway before passing the spending bill for the rest of DHS, which the Senate approved weeks ago. Johnson and House Republicans sat on the Senate bill for weeks after the speaker initially called it a "joke" and then agreed to move ahead with it.

Johnson called the budget resolution the most important accomplishment of the week. "This is very, very important because that will ensure that border security and immigration enforcement will continue today and well into the future," Johnson said, criticizing Democrats for their opposition to the funding.

"Democrats got absolutely nothing for their political charades and shenanigans," he said.

Some Democrats urged Republicans to resume negotiations on immigration enforcement reforms. Rep. Jamie Raskin accused Republicans of "bankrolling Trump's violent Gangster State" and funding ICE without needed reforms instead of dealing "with the reality of what they've created - a monster here, with American citizens being shot down in cold blood at point blank range in Minnesota."

What's next: Senate leaders are reportedly aiming to hold a floor vote on their reconciliation bill the week of May 11 as they work to meet Trump's June 1 deadline for getting the measure to his desk. Republicans are also looking to pull together another reconciliation bill containing a number of other conservative policy priorities.

Key Inflation Measure Jumps to Near 3-Year High; GDP Grew 2% in Q1

A key inflation measure that is closely watched by Federal Reserve policymakers jumped last month to reach its highest level in nearly three years. As gas prices rose, the Commerce Department's personal consumption expenditures price index for March climbed 3.5% compared to the same month a year ago. On a monthly basis, the measure was up 0.7%. Excluding volatile food and energy prices, inflation still ran hotter than the Fed wants, up 3.2% from a year ago compared with a 3% rate in February.

The latest figures highlight ongoing affordability concerns at the heart of much political debate and call into question whether or when the Fed might see fit to lower interest rates. The central bank cut rates three times last year but has paused that campaign as it monitors the economy and evaluates the inflationary effects of President Trump's trade policies and now the war in Iran.

Gas prices soaring again: Gas prices jumped in March, after the Iran war began, and have surged again after edging lower for a period of almost two weeks. With oil prices climbing well above $100 a barrel again, the national average price of a gallon of regular gasoline has soared 27 cents in one week, reaching $4.30, up from $2.98 before the war began, according to AAA. The national average is now $1.12 higher than it was at this time last year, bringing gas prices to their highest level in almost four years.

In remarks to reporters in the Oval Office today, President Trump downplayed the increase in gas prices, promising they would drop "rapidly" once the Iran war ends. "Gas will go down the minute the war is over," Trump said. That's unlikely, though, given that prices tend to rise far faster than they come down.

Economy rebounds to start 2026: The Commerce Department also said Thursday that the economy grew at a 2% annual rate over the first three months of the year, slightly below economists' consensus expectations but an improvement over the 0.5% growth rate over the last quarter of 2025. The faster growth was fueled in part by government spending that rebounded after a six-week shutdown late last year.

That boost from government spending isn't expected to continue in the months ahead, putting a sharper focus on consumer spending that has held up well so far, despite dismal readings on sentiment. Personal consumption grew 1.6% over the first quarter, a bit better than expected, but perhaps not enough to allay fears for the coming months. "The U.S. consumer's momentum is fading amid deteriorating sentiment and renewed inflation pressure," economist Kurt Rankin of the PNC Financial Services Group wrote in a note to clients.

The government report is just the first estimate for the quarter, and revisions could produce a different picture.

National Debt Tops 100% of GDP

Based on the new economic data released by the Commerce Department on Thursday, the national debt topped 100% of GDP at the end of last month.

The publicly held debt was $31.265 trillion as of March 31, while GDP totaled $31.216 trillion over the preceding year, as The Wall Street Journal's Richard Rubin points out.

That leaves the debt-to-GDP ratio at 100.2% - reaching a symbolic milestone as the United States approached the 106.1% record seen after World War II and is expected to surpass it before long. The ratio briefly touched the triple-digit mark as the economy cratered and government spending surged during the Covid-19 pandemic, but structural deficits are now expected to continue driving the debt ratio higher.

"By itself, the milestone doesn't mean much," Rubin writes. "There isn't a special level where debt goes from problematic to catastrophic. And the ratio might bounce around in coming quarters as tax receipts come in, tariff refunds go out and GDP fluctuates in response to inflation and revisions."

The trajectory is more troubling to some economists than the actual level of the debt-to-GDP ratio. "If you told me 20 years from now that the debt-to-GDP ratio was going to be 100%, I would be ecstatic," William Gale, an economist at the Brookings Institution, told the Journal, adding, "If you just saw the economic forecast and you had confidence that political leaders could get together and solve this problem, it would calm everybody down."

Rubin notes that just holding the ratio around 100% would require some combination of spending cuts and tax hikes totaling about $10 trillion.

Pentagon's $25 Billion Cost Estimate for Iran War Faces Questions

Defense Secretary Pete Hegseth was back on Capitol Hill Thursday for another round of testimony on the Iran war and the president's $1.5 trillion Pentagon budget request for 2027, among other topics.

His appearance before the Senate Armed Services Committee was somewhat less contentious than his combative turn on the House side yesterday, though he repeated his claim that the biggest adversaries the U.S. faces are the "reckless naysayers and defeatist words of congressional Democrats and some Republicans."

As he sparred with lawmakers, Hegseth faced new questions about the Pentagon's estimate of the cost of the Iran war to date.

CNN's Natasha Bertrand and Zachary Cohen report that the $25 billion estimate provided to lawmakers yesterday by Acting Pentagon Comptroller Jules Hurst III "is a lowball figure" that does not include the cost of repairing U.S. bases in the Middle East that have been damaged in the war.

Once source reportedly told CNN that the true cost of the war is closer to $40 billion or $50 billion once the costs of rebuilding and replacing destroyed assets are included.

Sen. Jack Reed, the ranking member on the committee, challenged Hegseth on the lack of funding for Ukraine and military pay adjustments in the president's budget request and said that the $25 billion estimate for the Iran war suggests that the administration doesn't need the large amount of supplemental funding it is expected to request. "If nothing else, that helps clarify that we certainly do not need a supplemental anywhere near $100 billion much less $200 billion," he said.

Democratic Sen. Richard Blumenthal asked whether the $25 billion estimate includes all the costs of repairing damaged U.S. bases and replacing equipment and munitions as well as injuries to service members.

Hurst said repair costs are hard to estimate because of the uncertainty surrounding future needs and plans for the bases.

Blumenthal said he was skeptical of the estimate provided so far. "I think $25 billion is probably less than half, maybe less than a quarter of the total cost of war, which is a reason why the supplemental request is much higher. I think you owe it to the American people to give us the straight talk about what the costs have been."

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