MORNING REPORT

Tuesday, June 17 | By Alexis Simendinger & Kristina Karisch

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In today's issue:

▪ Senate tax details foreshadow GOP clash

▪ Trump departs G7 early over Israel-Iran conflict

▪ DNC disarray

▪ Supreme Court takes up abortion cases

UPI

Congress poised for clash over Trump agenda bill changes

President Trump's second-term legislative agenda is experiencing a Senate GOP makeover that puts Republicans on a collision course with their House colleagues.

The approach drafted by Republican members of the powerful Senate Finance Committee and introduced to colleagues during a private briefing Monday evening would raise the nation's borrowing authority to $5 trillion, higher than a House-proposed $4 trillion proposal, which deficit hawks in Congress have said could cost the narrow majority critical votes.

The Senate text would also include key changes for Medicaid and green energy tax credits, and keep the cap on state and local tax (SALT) deductions at $10,000 a year — provisions that risk upsetting various Republicans in both chambers.

The legislation would lower to 3.5 percent, down from the current 6 percent, by 2031 the health care provider taxes in states that expanded Medicaid, an explosive change expected to spark pushback in red states.

The existing tax adjustment, used in every state but Alaska, has allowed states to increase federal funding for their programs. Critics complain it's a form of "money laundering," but the reduction would mean significant holes in state Medicaid budgets, and could result in lower payments to hospitals or other cuts to state budgets.

And the committee's proposal would block states that previously did not expand Medicaid under the Affordable Care Act from increasing the rate of health care provider taxes as a way to hike their federal funding, The Hill's Alexander Bolton reports. Draft Senate language goes beyond House-passed language to tighten Medicaid eligibility requirements, two Republican aides said. The White House previously suggested this change could curb program "abuse," but would not conflict with Trump's pledge to protect federal health benefits.

The Senate's approach would make permanent the 2017 corporate tax cuts Republicans enacted during Trump's first term and phase out renewable-energy tax cuts enacted under former President Biden. It also includes Trump's campaign vow to shield certain workers' tips from federal taxes.

A group of moderate House Republicans from high-tax states who had secured a deal with House GOP leadership to raise the SALT deduction cap to $40,000 are seething over the Senate's proposal, The Hill's Mychael Schnell reports. (Read the Finance Committee text here).

LAWMAKER SECURITY ALARM: Separately, bipartisan lawmakers want input from House and Senate leaders, the U.S. Capitol Police and the Senate sergeant-at-arms about enhanced protection for members of Congress and relatives in the aftermath of the shootings of two Minnesota state lawmakers and their spouses, which resulted in two fatalities on Saturday and shocked elected officials and the public nationwide.

Senators will receive a security briefing today in the Capitol, along with a discussion about resources that would be required to protect rank-and-file lawmakers who do not currently receive around-the-clock protection.

Axios: Members of Congress fear any one of them could be the target of an unanticipated attack, particularly at home in their districts and while in transit.

The suspect in the Minnesota shootings, Vance Boelter, has been hit with with federal and state charges, including two counts of murder and two counts of attempted murder. Boelter allegedly researched and planned his attacks and posed as a police officer. A list of about 70 names was found in writings recovered from the suspect's vehicle, including names of elected officials. Authorities have not publicly identified a motive for the shootings.

Michigan Democratic Rep. Hillary Scholten on Monday postponed a town hall event after learning her name was listed. "Out of an abundance of caution and to not divert additional law enforcement resources away from protecting the broader public at this time, this is the responsible choice," Scholten said in a statement.

Some of Wisconsin's top Democrats were also among the politicians listed in documents recovered by authorities in Minnesota, including Sen. Tammy Baldwin and Reps. Mark Pocan and Gwen Moore, Milwaukee Journal Sentinel reported. The newspaper previously reported that 11 Wisconsin lawmakers were listed in a document recovered by police.

The Hill's Niall Stanage: What we know in the aftermath of the Minnesota shootings.

GOING VIRAL: Sen. Tina Smith (D-Minn.) on Monday was seen buttonholing Sen. Mike Lee (R-Utah) about his controversial social media posts over the weekend seeking to blame "Marxist" Democrats for the shootings of state lawmakers in Minnesota.

Smith after the confrontation told reporters she wanted Lee to hear from her directly "about how painful that was and how brutal that was to see that on what was just a horrible, brutal weekend." Smith's deputy chief of staff ripped the Utah senator at length on X for lack of "grace" and "compassion." Lee declined to answer reporters' questions on Monday.

Blake Burman's Smart Take is off this week and will return next week.

3 Things to Know Today

The White House is considering expanding Trump's new travel ban to as many as 36 additional countries.
Trump's eldest son, Donald Trump Jr., underscored Monday that his father is not involved with the Trump Organization's new mobile phone business, Trump Mobile.
A Reagan-appointed federal judge accused the Trump administration of "appalling" and "palpably clear" discrimination against racial minorities and LGBTQ Americans.

LEADING THE DAY

TRUMP IS HEADING TO THE SITUATION ROOM later this morning to address the escalating situation in the Middle East, he told reporters aboard Air Force One while returning to Washington early Tuesday.

Trump left the Group of Seven (G7) summit in Alberta, Canada early to address the Israel-Iran conflict, but before departing for Washington he signed onto a statement reaffirming Israel's "right to defend itself" while calling Iran "the principal source of regional instability and terror."

The president initially declined to sign the group's statement, but reversed his position following discussions and changes to the initial draft, The Washington Post reports.

Trump told reporters early Tuesday morning that he was considering dispatching Vice President Vance and his Middle East envoy Steve Witkoff to meet with Iranians, noting it "depends on what happens when I get back."

"I'm not too much in the mood to negotiate" with Iran, Trump said, according to a White House pool report.

French President Emmanuel Macron told reporters that Trump indicated to fellow leaders at the G7 that an offer for an Israel-Iran ceasefire has been made. But Trump later posted on Truth Social that his early exit had "nothing to do with" working on a ceasefire between Israel and Iran.

"Much bigger than that," he wrote.

Iran has been urgently signaling it wants an end to hostilities and to resume talks with the U.S. for a possible nuclear deal, The Wall Street Journal reports. Tehran has been sending messages to Israel and the U.S. via Arab intermediaries, adding it is in the interest of both sides to keep the violence contained, as long as Washington doesn't join the attack.

Tehran's position, The Washington Post reports, is that "we never left the negotiating table, but no negotiations while we are under fire."

While the Trump administration said Israel's initial strikes were a unilateral action, the U.S. has assisted Israel in intercepting retaliatory strikes from Iran. The administration told several Middle Eastern allies on Sunday it doesn't plan to get actively involved in the war unless Iran targets Americans.

Defense Secretary Pete Hegseth announced Monday he has directed "the deployment of additional capabilities" to the Middle East amid escalating tensions.

As the administration has signaled more support for Israel, lawmakers from both parties have voiced concerns about the U.S. getting pulled into a protracted conflict.

In a rare bipartisan action, Reps. Thomas Massie (R-Ky.) and Ro Khanna (D-Calif.) plan to introduce a measure that would force Trump to get congressional approval to enter the conflict. Sen. Tim Kaine (D-Va.) filed his own war powers resolution in the Senate on Monday.

▪ NBC News: How Trump went from opposing Israel's strikes on Iran to providing reluctant support.

▪ The Associated Press: Israel appeared to be expanding its air campaign on Tehran as Trump posted an ominous message warning residents of the city to evacuate.

Israel is on the way to ending Iran's nuclear capabilities with its attacks, Prime Minister Benjamin Netanyahu said on Monday. He added that his country's missile strikes in the past five days set Tehran's nuclear program back a "very, very long time."

"It's impossible to predict, but it could be the result of our mighty action," Netanyahu said. "We are changing the face of the Middle East, and this could lead to far-reaching changes within Iran itself."

Netanyahu told ABC News that targeting Iran's Supreme Leader Ayatollah Ali Khamenei would end, not escalate, the ongoing conflict. Asked if Israel would target the supreme leader, Netanyahu said Israel was "doing what we need to do."

▪ Axios: Regime change emerges as an unstated goal of Israel's war in Iran.

▪ The New York Times: Here's why Israel's war with Iran may last weeks rather than days.

▪ NPR: Russia struck Kyiv with drones and missiles overnight, killing at least 15 in Ukraine's capital. The attacks came as Ukrainian President Volodymyr Zelensky prepared to attend the G7 summit.

WHEN & WHERE

The House will convene at 11 a.m.
The Senate will meet at 11:30 a.m.
The president returned to the White House this morning from Canada. He has no public schedule.

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ZOOM IN

DNC SHAKEUP: The departure of two major union presidents from their posts at the Democratic National Committee (DNC) is raising questions about lingering internal divisions over the party's future as the party seeks to regroup in the second Trump administration.

Randi Weingarten, president of the American Federation of Teachers Union (AFT), and Lee Saunders, president of the American Federation of State, County, and Municipal Employees (AFSCME), are declining to be reappointed as at-large DNC members, citing internal disagreements.

"It shows that we're not united," said Douglas Wilson, a North Carolina-based Democratic strategist. "Everytime we have a situation where prominent people are exiting their posts, not the party but their posts at the DNC, that becomes the narrative as opposed to what the Trump administration is doing."

Weingarten and Saunders's exits come as the DNC holds a re-do of its vice-chair elections following controversy over gun-control activist David Hogg, who stepped down from his post. Hogg faced backlash from Democrats for launching his organization, Leaders We Deserve, which would primary incumbent House Democrats in an effort to bring about generational change within the party, all while he was serving as a vice chair. Meanwhile, Hogg has ramped up his efforts. On Monday, reacting to speculation of greater U.S. involvement in the Middle East, he wrote on X: "any Democrat who supports this war with Iran needs to be primaried."

Pennsylvania state Rep. Malcolm Kenyatta regained his position during a Saturday election, and the DNC will choose a second vice chair tonight from a candidate pool of three women.

VIRGINIA PRIMARY WATCH: Democrats are counting on tonight's primaries for lieutenant governor and attorney general to act as a barometer for voter enthusiasm ahead of November's elections. Republicans already have their statewide nominees locked in, while former Rep. Abigail Spanberger (Va.) easily earned the Democratic gubernatorial nomination in April.

The remaining races stand to give Democrats some insight into voter enthusiasm as they seek to maintain their narrow hold on the House of Delegates and flip the state's executive branch in the fall. The Hill's Julia Manchester has three things to watch out for tonight.

ELSEWHERE

ABORTION: A lower court must take a second look at a religious challenge to a New York requirement that employers provide health care plans that include abortion coverage, the Supreme Court ordered Monday.

The court also agreed to consider reviving the bid of a faith-based operator of a New Jersey "crisis pregnancy center" to block the state attorney general from investigating whether it deceived women into believing it offered abortions.

▪ NPR: The Supreme Court faces new headwinds with roughly two weeks left in the term.

▪ The Hill: Former Illinois Democratic lawmaker Michael Madigan was sentenced to more than seven years in prison following a federal corruption trial in Chicago.

DEPORTATION WHIPLASH: The Department of Homeland Security on Monday told staff it was reversing guidelines from last week telling agents not to conduct immigration raids at farms, hotels and restaurants, The Washington Post reports. The decision went against Trump's calls for mass deportations, and came after lobbying from Agriculture Secretary Brooke Rollins and the farming industry to scale back raids at those locations.

▪ Politico: Trump's vow to focus mass deportations on cities led by Democrats reveals a crack in his plans to carry out a top campaign priority.

▪ The Wall Street Journal: Trump struggles to press deportations without damaging the economy.

HEALTH RESEARCH: A federal judge on Monday ruled the Trump administration's canceling of federal health grants over their connections to "gender ideology" and "diversity, equity, and inclusion" was unlawful and void. U.S. District Court Judge William Young, a Reagan appointee, ruled on Monday that targeting research funded by the National Institutes of Health (NIH) based on certain topics was unlawful and arbitrary.

In February, the NIH issued directives terminating grants relating to LGBTQ issues; gender identity; and diversity, equity and inclusion (DEI). The government has now been directed to immediately make the funds available to grant recipients again.

OPINION

Political violence is rising. This is what we can do to stop it, by Robert A. Pape, guest essayist, The New York Times.
President Trump should embrace stronger, smarter mental health parity, by Ryan Hampton, opinion contributor, The Hill.

THE CLOSER

And finally … On this day in 1972, Washington, D.C., police apprehended five burglars at the DNC office in the Watergate complex, setting in motion a scandal that engulfed former President Richard Nixon and key White House lieutenants following anonymously sourced, prize-winning investigative reporting; federal probes; and live, televised congressional hearings that riveted the nation. Nixon resigned effective Aug. 9, 1974, to avoid what GOP senators warned him would be his impeachment.