MORNING REPORT

Tuesday, February 18 | By Alexis Simendinger & Kristina Karisch

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In today's issue:

▪ Can the GOP plot one path to a bold budget?

▪ U.S., Russia face off over Ukraine

▪ What does Musk want with IRS data?

▪ As Trump threatens tariffs, the world pushes back

TRUMP FIRST 100 DAYS

©️ The Associated Press | J. Scott Applewhite

How to spend, where to cut: GOP counts the ways

Republican lawmakers have budget specifics to craft, a looming fiscal deadline next month and internal divisions galore over how to get President Trump's agenda woven into statute as soon as possible.

The House, which moved a GOP budget outline through committee last week, is out until next week while the Senate, still in session, seems intent on marking its own path.

Senate Republicans advanced through committee last week with a two-track blueprint, proposing a first measure that would address border security and defense and a second to extend the GOP's 2017 tax cuts. The measure is likely to hit the floor for a vote this week. A Senate vote-a-rama to barrel ahead within days would also open the door to Democratic pushback on the floor, which could slow Republican momentum.

House Republicans are trying to cram the president's priorities into a single bill. Last week in committee, the majority outlined a $1.5 trillion floor for proposed spending cuts spread across committees. House Republicans are preparing a plan that would put a $4.5 trillion limit on the size of the GOP's proposed tax cuts. It may not be enough to cover some of Trump's promises to voters.

The House also wants $300 billion for additional border security and defense spending and a $4 trillion increase in the nation's borrowing authority, which has reached its limit.

To succeed, both chambers ultimately have to come together.

▪ The Hill: The standoff between the House and Senate is escalating. A path forward seems murky and has the potential to be contentious.

▪ The Hill: Medicaid concerns threaten a House GOP budget resolution.

Simultaneously, the pressure on Congress by March 14 will be to avert a government shutdown by passing some version of legislation to continue federal funding. Lawmakers in both parties vow to avert a deadlock Americans have experienced before in Washington and criticized.

The problem? No plan. "We're trying to work to find some common ground," House Appropriations Chair Tom Cole (R-Okla.) told The Hill.

Programming note: Blake Burman's Smart Take will return later this week.

3 Things to Know Today

Delta's dramatic upside-down jet landing in Canada Monday, which injured 18 of 80 people on board but resulted in no casualties, is under investigation by the country's Transportation Safety Board (audio HERE; passenger accounts HERE). The runway at Toronto Pearson International Airport was dry and there were no crosswind conditions when the plane overturned, the fire chief said Monday.
Riverside County Sheriff Chad Bianco on Monday became the first prominent Republican to announce a bid to succeed term-limited California Gov. Gavin Newsom (D) next year. The gubernatorial contest is expected to be crowded. California's last Republican governor, Arnold Schwarzenegger, left office in 2011.
Many national journalists view recent White House friction with the mainstream press, including with The Associated Press, as an updated "flood the zone" element in Trump's practiced media strategy. Meanwhile, ProPublica, The New York Times, a special correspondent for Vanity Fair, The Baltimore Banner, Bloomberg Businessweek and The New Yorker were among winners Monday of esteemed George Polk journalism awards for excellence in reporting last year.

LEADING THE DAY

©️ The Associated Press | Evelyn Hockstein, Reuters

UKRAINE TALKS: Trump's top foreign policy advisers are in Saudi Arabia today for talks with their Russian counterparts about ending the war in Ukraine. U.S. officials are racing to advance Trump's bid to end the war and, potentially, reverse a diplomatic deep freeze with Russia. Secretary of State Marco Rubio leads the U.S. delegation and is joined by Middle East envoy Steve Witkoff and national security adviser Mike Waltz. Russian Foreign Minister Sergey Lavrov and foreign affairs adviser Yuri Ushakov represent Moscow.

The aim: Kick off peace talks to end the three-year war that began with Russia's full-scale invasion of Ukraine in 2022. Left out of the negotiations? Ukrainian officials, who were not invited to the talks in Riyadh.

Ukrainian President Volodymyr Zelensky on Monday said he "knew nothing about" the peace discussions in the Middle East until they were announced publicly. Over the weekend, he made it clear that he would not accept any deal made without Kyiv at the negotiating table.

"I will never accept any decisions between the United States and Russia about Ukraine. Never," he told NBC News's "Meet the Press."

▪ BBC: What key players want from the Ukraine war talks.

▪ The New York Times: Russia released another American held on drug charges on Monday, in what the Kremlin acknowledged was a good-will gesture on the eve of the talks.

Meanwhile, European leaders are playing catch-up on Trump's first moves to end Russia's war in Ukraine, shocked to find themselves on the outside of high-stakes talks about the continent's security and grappling with a likely retreat of U.S. forces from Europe. Rubio said "real talks" with the Kremlin will involve Europe and Ukraine, but that follows a slew of mixed messages from Trump's top officials and an initial meeting in Saudi Arabia between U.S. and Russian officials.

"I think Europe is realizing that they have to come up with a plan, quickly, and on their own to be ready for whatever comes next," said Sudha David-Wilp, vice president of external relations and senior fellow with the German Marshall Fund.

Top European leaders met Monday in Paris to forge a strategy for their own security, in a meeting pulled together hastily after Vice President Vance and Defense Secretary Pete Hegseth's trip to Europe last week for the Munich Security Conference, which left European leaders alarmed by both the tone and message of the new Trump administration and what it might hold for the continent.

French President Emmanuel Macron called the emergency meeting on Monday, inviting the leaders of Germany, the United Kingdom, Italy, Poland, Spain, the Netherlands, Denmark and the European Union. U.K. Prime Minister Keir Starmer proposed sending British troops to Ukraine as postwar peacekeepers, responding to Trump's calls for Europe to take more responsibility for its security.

Zelensky lectured Europe against being treated "like a pushover" and called for the European Union to nominate an envoy to any peace talks.

"The mood was turning from bad to worse," one European foreign policy expert who attended the Munich conference, granted anonymity to speak candidly, told The Hill. "There will probably be a series of announcements by Europeans in the upcoming days to signal to the Americans that they are to be taken seriously — but also to reassure each other."

▪ The Washington Post: Europeans explore troops for Ukraine ceasefire — and want U.S. support.

▪ The Wall Street Journal: European leaders are scrambling for a seat at the negotiating table.

WHEN & WHERE

The House will convene briefly at 1 p.m.
The Senate meets at 3 p.m.
The president is at Mar-a-Lago where he will sign executive orders at 4 p.m.
The secretary of State is in Riyadh, Saudi Arabia.

ZOOM IN

©️ The Associated Press | Patrick Semansky

DOGE: Top Democrats in Congress want to know what Elon Musk's Department of Government Efficiency (DOGE) plans to do at the Internal Revenue Service (IRS) after multiple outlets reported the advisory unit sought access to sensitive IRS systems. Senate Finance Committee members Ron Wyden (D-Ore.) and Elizabeth Warren (D-Mass.) wrote to IRS acting Commissioner Douglas O'Donnell on Monday, requesting to see any agreements the IRS had signed with DOGE, information on whether DOGE has already been granted access to any IRS taxpayer information and a list of DOGE members who've been working on getting access to IRS information.

The Democrats' letter comes after DOGE had accessed sensitive payment systems at the Treasury Department, leading attorneys general in Democratic states to get a restraining order put in place against the advisory unit.

▪ The Washington Post: Michelle King, the acting commissioner of the Social Security Administration, left her job this weekend after a clash with DOGE over its attempts to access sensitive government records.

▪ NBC News: The Trump administration is preparing to fire hundreds of high-level Department of Homeland Security employees this week as part of a move to rid the country's third-largest agency of people deemed to be misaligned with the administration's goals.

Musk has been encouraged to bring DOGE to Fort Knox, operated by the Treasury Department, to audit the massive gold reserve stored there. Critics have called for greater transparency regarding the stash after it was revealed the top-secret locations are not subject to a yearly audit. With gold valued at just less than $2,900 per troy ounce, according to the foreign exchange service Xe, the gold in Fort Knox could be worth up to $426.3 billion. On Monday, Musk posted a mischief-making cartoon on the social platform X, which he owns.

In The Memo, The Hill's Niall Stanage explores the five biggest DOGE controversies thus far.

CFPB: Warren is also fighting to defend the embattled Consumer Financial Protection Bureau she helped create.

"The banks see themselves having a more profitable future if they can get rid of the CFPB," she said in an interview with The New Yorker. "This little agency has helped millions of people. Letting an unelected billionaire, who's figured out one more way to grift off the public, knock it out is not a popular move."

▪ The Hill: The consequences of DOGE firing environmental employees could range from slower response to pollution to less access at national parks.

▪ The Hill: A federal judge Monday evening declined to block DOGE from gaining access to Education Department data on student borrowers.

CULTURE WARS: Trump and his advisers are embracing the culture wars one month into the new administration, targeting media outlets, cultural institutions, sports and more. While Trump has followed through on plans to crack down on immigration and reorient U.S. foreign policy since taking office, he has increasingly leaned into the kinds of cultural issues that animated his supporters on the campaign trail. The Hill's Brett Samuels reports the president's allies and advisers view the actions as a way to rack up wins that resonate with the Republican base, as well as some independents who embraced Trump's promise to return to "common sense."

The Hill: Former GOP presidential candidate and entrepreneur Vivek Ramaswamy, who has never held elective office, on Feb. 24 will launch a campaign to be Ohio governor. Ohio Attorney General Dave Yost (R) also is a candidate in the GOP primary race to succeed term-limited Republican Gov. Mike DeWine. Ramaswamy, 39, could become the frontrunner. He hired some of Vice President Vance's top political advisers and has forged ties with Trump and his team.

The New York Times: Four New York City deputy mayors resigned to protest Mayor Eric Adams's (D) outreach with the Trump administration on immigration policy and migrant arrests.

ELSEWHERE

TARIFF THREATS: Economic broadsides are flying back and forth between the U.S. and Canada. Pierre Poilievre, the leader of Canada's Conservative Party, pledged on Saturday to respond forcefully to tariffs imposed by Trump to squeeze the Canadian economy. Poilievre, seen as a likely contender to become the next prime minister, laid out his "Canada first" policy approach at a rally Saturday, warning the U.S. could lose a friend if it continues with what he calls its "unprovoked attack on our economy." Trump last week signed a presidential memorandum proposing reciprocal tariffs that he maintains would crack down on unfair and discriminatory tariffs aimed at the U.S.

"We will carefully target American goods that we don't need, can produce ourselves or we can get elsewhere, to maximize the impact on Americans while minimizing the impact on ourselves," Poilievre said.

Trump is threatening reciprocal tariffs on goods imported to the U.S., as well as 25 percent blanket tariffs for goods coming from Canada and Mexico. Economists warn the plans could upend the global economy — and increase inflation, running counter to Trump's campaign promises.

Foreign Policy: What makes Trump's tariffs different this time around?

GAZA CEASEFIRE: Israel's security Cabinet met Monday to discuss the second phase of the government's ceasefire deal with Hamas, even as Israeli Prime Minister Benjamin Netanyahu voiced his support for Trump's plan to take over Gaza. Netanyahu's office dispatched an Israeli negotiation team to Cairo to discuss the "continuation of the implementation" of the first stage of the deal that has brought a pause to deadly fighting in Gaza. The negotiating team would receive "instructions for the continuation of negotiations on Phase B issues" after the Israeli security Cabinet's discussion on the matter.

▪ NPR: Rubio is discussing Trump's displacement and redevelopment plans for the Gaza Strip while in Saudi Arabia.

▪ The Washington Post: Israel said Monday that its troops would remain in southern Lebanon past a Tuesday deadline for their full withdrawal as part of a U.S.-brokered ceasefire deal.

China on Monday accused the U.S. of a "serious regression" in its position on Taiwan, after the State Department updated the Taiwan section of its website. The department's fact sheet on U.S.-Taiwan relations continues to state Washington's opposition to any unilateral changes to the status quo from either China or Taiwan, but the phrase "we do not support Taiwan independence" appears to have been removed in what the State Department says was a routine update.

Taiwan's government in a statement welcomed the move but didn't specifically mention the language.

OPINION

Trump keeps score with Gulf of America word games, by Chris Stirewalt, political editor, The Hill.
California's EV mandate goes to Congress for repeal under the Congressional Review Act, by The Wall Street Journal editorial board.

THE CLOSER

And finally … 🚀 Homeward bound, at last? Maybe. NASA's two stuck astronauts may end up back on Earth a little sooner than planned after some major issues, The Associated Press reports. The space agency announced Tuesday that SpaceX will switch capsules for upcoming astronaut flights to bring Butch Wilmore and Suni Williams home in mid-March instead of late March or April. That will shave at least a couple weeks off their prolonged stay at the International Space Station. Their original itinerary was supposed to be a weeklong flight demonstration. They hit the eight-month mark last week.