And now, the hard part begins.
Campaign promises are one thing; governing is another. As the 2025 legislative session kicks into high gear, Republicans in Congress and President Trump face a daunting to-do list. From revising tax policy to managing immigration and balancing the budget, the stakes couldn’t be higher. The decisions they make—or fail to make—will set the tone for the next two years.
The SALT Debate: A Taxing Challenge
One major priority for Republicans is revisiting the cap on state and local tax (SALT) deductions, currently limited to $10,000 for single filers and $5,000 for married individuals filing separately. While this change was part of Trump’s own 2017 tax overhaul, it’s now a political flashpoint for Republican House members in high-tax blue states like New York and California.
Trump has signaled his openness to lifting the cap, with New York Republican Mike Lawler advocating for an increase to $100,000 for single filers and $200,000 for joint filers. While this proposal might appease constituents in high-tax states, it comes at a steep cost: an estimated $920 billion in lost revenue over the next decade, according to the Committee for a Responsible Federal Budget (CRFB).
The CRFB and fiscal conservatives are raising alarms about the ballooning federal deficit, projected to hit $1.9 trillion this fiscal year. Extending the expiring provisions of Trump’s 2017 tax cuts would add another $3.9 trillion to the deficit over the next decade. For a party that often touts fiscal responsibility, the numbers are uncomfortable—especially with House Republicans holding a razor-thin majority.
Immigration: Beds and Bills
On immigration, a rare bipartisan consensus is forming around the Laken Riley Act, which mandates that Immigration and Customs Enforcement (ICE) detain illegal immigrants charged with crimes such as burglary and theft. The bill cleared the House with strong support and is advancing in the Senate.
However, implementing this policy would require a dramatic expansion of detention capacity. ICE’s current funding supports 41,500 detention beds, but Trump’s incoming border czar, Tom Homan, argues that a minimum of 100,000 beds will be necessary. Meeting that goal would demand significant additional funding and potentially reliance on private prisons—an approach likely to spark heated debates.
Reconciling the Agenda
The legislative calendar is tight, and Congress is weighing whether to bundle its priorities into one massive reconciliation bill or split them into two. Speaker Mike Johnson leans toward a single bill to minimize procedural hurdles, while Senate GOP leader John Thune advocates for a phased approach, addressing defense, energy, and border security first.
Both options have risks. A single bill might delay progress until summer, while multiple bills could increase the chances of internal disagreements derailing the process. Senator Ted Cruz has voiced concerns that a one-track strategy “maximizes the chances of failure.”
Trump’s Role: A Balancing Act
As Congress grapples with these issues, Trump’s leadership will be critical. He’s indicated flexibility on strategy, stating, “One bill, two bills, doesn’t matter to me,” but his aversion to policy details may complicate negotiations. Trump’s ability to unify his party will be tested, particularly with factions in Congress holding divergent priorities on taxes, spending, and immigration.
The Time for Choosing
The decisions ahead are complex and politically fraught. How high should the SALT cap be raised? How much debt is Congress willing to accept to extend tax cuts? What’s the right balance between border security and fiscal responsibility?
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