Principals

1. Government shuts down
2. What’s affected
3. Shutdown politics
4. Trump’s pharma tariffs
5. Dim SCOTUS approval
6. Cruz’s NCAA moves
7. PepsiCo’s climate plans

PDB: Trump pressures Hamas to accept peace plan

Trump withdraws nominees to lead CFTC, BLS … EU leaders meet in Copenhagen … China celebrates National Day

Dems and GOP dig in on shutdown fight

Congress is about to learn that getting into a shutdown is easier than getting out of one, Semafor’s Burgess Everett, Eleanor Mueller and Shelby Talcott report. Everyone is waiting until the other side caves, which might take a while. Sen. John Cornyn, R-Texas, said Democrats won’t get anything — including their ACA subsidies — until the government reopens. Sen. Elizabeth Warren, D-Mass., said “there’s nothing here for Democrats to do except say, ‘If you want our votes, you got to come talk to us.’” With three Democratic defections on Tuesday evening, Senate Majority Leader John Thune is bullish he can crack the Democrats over time. And the pain might get worse: Sen. John Kennedy, R-La., told Semafor that OMB Director Russ Vought is likely to “punish [Democrats] for the rest of their natural lives for this or until, until the shutdown ends.”

What the shutdown means

The government officially shut down at 12:01 am, leaving hundreds of thousands of federal workers and scores of government programs in limbo. This is the first shutdown since 2019, during President Donald Trump’s first term, and unlike the last time this is a full government shutdown — not a partial one. It has federal government workers bracing for impact: Trump said he would use the shutdown to cut programs that Democrats favor, as well as “vast numbers” of government workers. The shutdown leaves “three-quarters of a million employees on furlough and others working without pay indefinitely,” according to The Washington Post, which has a handy breakdown of the agencies affected.

Shutdown not landing in key elections

The shutdown is unfolding just weeks before statewide elections in New Jersey and Virginia, with furloughs and layoffs set to hit just as voters are tuning in to the race, Semafor’s David Weigel and Eleanor Mueller write. Neither party expects to get an advantage from the resulting chaos, however. It’s a surprising reality that points to how little the shutdown has broken through with voters or outside-the-Beltway media. Democrats are confident that voters will associate layoffs and other consequences with the Trump administration, while Republicans are betting there are other, stronger issues they can lean on to close out these off-year races. “If you ask the average Joe or Jane at a diner what’s on their mind, I don’t think a shutdown is one of the first 10 things,” said Chris Russell, a strategist for Jack Ciattarelli, the GOP nominee for governor of New Jersey.

Trump’s pharma tariffs to take effect

Trump’s 100% tariffs on pharmaceutical products not made in the US are slated to take effect today — but it’s an open question how many companies will be affected. Companies that are “breaking ground” or already constructing plants in the US will be exempt, generic drug imports won’t be affected, and drugs made in the European Union will be subject to a lower tariff rate of 15%. To avoid the 100% levy, Pfizer agreed to a deal with Trump: The company will sell drugs at lower prices to Medicaid enrollees on a “direct to consumer” site called “TrumpRx,” the president said. Pfizer also said it will price new drugs more cheaply and invest in US manufacturing. Still, the tariffs are likely to further complicate the US’ already complex import system, and the administration will likely need to clarify exactly which brands will be hit.

— Shelby Talcott

More see SCOTUS as too conservative

The share of Americans who say the Supreme Court is too conservative is hitting a new high, as the justices wade into a myriad of Trump administration legal disputes. Forty-three percent of US adults say as much, according to new polling from Gallup. Independents and Democrats have mostly driven the increase, which is consistent with a trend that began following Amy Coney Barrett’s confirmation, solidifying the court’s 6-3 conservative majority. The institution is increasingly polarizing: Forty-two percent of Americans approve of the job the high court is doing, and there’s a massive 65-point gap between its approval rate among Republicans and Democrats. The percentage of Americans who say they have at least a fair amount of confidence in the federal judiciary is also at a near-record low of 49%.

Cruz pans Dem college sports bill

Sen. Ted Cruz, R-Texas, is sacking Senate Democrats’ new college sports legislation, saying it’s intended to scuttle bipartisan momentum to confront the huge problems in college athletics, Semafor’s Burgess Everett reports. “The chances of a bill like that passing are zero, and everyone who’s on that bill knows it,” Cruz said of Democrats’ proposal. The Senate Commerce Committee chairman plans to introduce his own bipartisan legislation as soon as he can — and he said he’s been talking to Democrats for months about it. With the House stalled on its own bill, the Senate could decide whether anything passes this Congress. A shutdown probably doesn’t help, but college sports are in such a state of upheaval that Cruz plans to make it a priority: “It means too much to too many people for us to allow it to be destroyed.”

PepsiCo sticks to climate goals

The Trump administration’s decision to jettison support for climate-friendly practices and clean energy isn’t influencing PepsiCo, which is sticking to its green goals, Semafor’s Tim McDonnell reports. The major food company’s chief sustainability officer, Jim Andrew, told Semafor that climate change has already significantly interfered with its supply chains. As a result, the company plans to implement regenerative agriculture practices across 10 million acres globally by 2030, and is hunting for partnerships with other retailers to pool their capital for new clean power deals. “We’re not doing these [things] out of ideological reasons,” Andrew said. “It was good for our business last year, it’s good for our business this year, and it’s still going to be good for our business next year and the year after.”

Blindspot: Cancer and AGOA

Stories that are being largely ignored by either left-leaning or right-leaning outlets, curated with help from our partners at Ground News.

What the Left isn’t reading: President Trump signed an executive order that the White House says will increase the use of AI to find cures for childhood cancers.

What the Right isn’t reading: The Tuesday expiration of the African Growth and Opportunity Act, a free-trade pact between African countries and the US, thrust thousands of workers into uncertainty. 

Beltway Newsletters

Punchbowl News: Utah lawmakers are poised to greenlight a congressional map that could see Democrats pick up two seats, potentially handing them a rare victory in the nationwide redistricting battle.

Playbook: Democrats are hoping for a breakthrough with President Trump himself on Affordable Care Act tax credits that could end the shutdown, given that he’s worried about cutting benefits before an election year.

WaPo: The Agriculture Department’s nutritional assistance program for women, infants, and children (WIC) could soon run out of money owing to the shutdown. While states could cover the shortfall, the Trump administration hasn’t said whether it will reimburse them for doing so, which “puts them in a very, very difficult position,” one expert said.

Axios: Pfizer’s deal with the Trump administration on drug prices blindsided the pharma industry, with lobbyists describing it as far more extensive than they had anticipated.

White House

• President Trump gave Hamas three to four days to accept a ceasefire proposal he rolled out at the White House alongside Israeli Prime Minister Benjamin Netanyahu earlier this week.

Congress

• Republicans punted on swearing in Rep.-elect Adelita Grijalva, who would give the House members pushing for the release of the Jeffrey Epstein files the final vote they need.

Outside the Beltway

• ICE agents in New York grabbed and shoved several journalists, leading one to be hospitalized.
• Nevada’s top federal attorney asked the FBI to probe unsubstantiated claims of voter fraud in her state, Reuters reported; a judge later disqualified her from taking cases.

Inside the Beltway