President Trump rallied House Republicans to save his big beautiful bill, but he also took an early loss on his attempt to eliminate the Education Department.
In a late-night marathon, the House voted to send Trump’s major domestic policy bill, including his latest round of tax cuts, to the Senate. The reconciliation bill passed 215-214. Thomas Massie (R-KY) and Warren Davidson (R-OH) voted against the bill while Andy Harris (R-MD) voted “present.”
As of Saturday afternoon, CFTC-regulated prediction market platform Kalshi gives the Senate just a 35% chance of passing the reconciliation bill by July but a 91% chance of passing it by August. The House vote was a preview of the battle lines. Republicans are split between deficit hawks and Trump loyalists, and Democrats oppose the bill entirely.
But prediction markets suggest loyalty to Trump’s agenda will override other considerations.
Trump’s setback in his Education Department fight
One of the long-standing goals of the conservative movement was to eliminate the Department of Education under the banners of states’ rights and smaller government. Despite Trump’s enthusiasm for that goal, Kalshi traders only give him a 8% chance of eliminating the Education Department this year, down from the Feb. 4 high of about 50%.
A federal judge blocked Trump’s dismantling of the Department of Education on Thursday. The judge also ordered the Trump administration to rehire “thousands of fired employees” who were let go after his executive order directing his education secretary to begin shutting down key functions of the Education Department.
Trump has also gone after private organizations like universities and law firms that have displeased him personally. The Department of Homeland Security blocked Harvard from enrolling international students on Thursday, a massive escalation in Trump’s campaign against Ivy League universities. Trump’s other targets include green energy incentives from President Biden’s infrastructure bill and some Medicaid beneficiaries.
The beneficiaries of Trump’s domestic agenda are a smaller group: wealthy Americans and fossil fuel interests.
Trump favors fossil fuels, reversing Biden’s priorities
One of the policies Trump wants to implement is to increase domestic energy production through fossil fuels. Among his day one executive orders was one stating his intention to:
- Review permitting processes for various energy processes
- Change the methodology for conducting environmental reviews
- Rescind environmental protection executive orders and regulations
The reconciliation bill ended EV and home-based efficiency tax credits. It also ends tax credits on green energy infrastructure parts over the next several years. Royalty rates that fossil fuel companies pay were also cut in Trump’s bill.
Trump’s musings about “bringing back coal” could be months away from becoming American policy. How long those policy priorities last after his second term remains to be seen.
