Washington, DC

1. Firestorm over Powell probe
2. Trump’s affordability problem
3. White House eyes Iran action
4. The Venezuela oil dilemma
5. ACA, funding deadline looms
6. Barrasso’s choice in Wyo.
7. Record no. of independents

Washington View: The scramble for a divided America’s 250th birthday

Trump meets with archbishop who criticized deportations … Dow Jones ⬆️ 0.5%, Nasdaq futures ⬇️ 0.85% … Gold hits $4,600 an ounce

Powell probe dials up Trump-Fed feud

Federal prosecutors in DC are investigating Federal Reserve Chair Jerome Powell over his June testimony on the ongoing renovation of the central bank’s headquarters, Powell said Sunday. In an uncharacteristically blunt statement, Powell linked the probe to the Fed setting interest rates independently “rather than following the preferences of the president.” He added that “this is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation.” The dramatic escalation of President Donald Trump’s ongoing campaign to pressure the central bank over rates is already pressing some swing votes for the next Fed chair nominee: Sen. Thom Tillis, R-N.C., said in a statement he would withhold votes from any Fed pick “until this legal matter is fully resolved.”

Friction for Trump’s affordability agenda

Trump’s newest proposals to tackle Americans’ anxiety about the cost of living are already proving difficult to enact. The president last week announced a pair of economic policies — banning institutional investors from buying single-family homes and capping credit card interest rates at 10% — that track closer to the GOP’s populist fringe than to its free-market core. But it’s highly likely that both will require Congress to pass legislation; that’s shaping up to be a heavy lift for both chambers, especially as private-sector heavyweights like Wall Street line up in opposition. “We were blindsided by it,” Rep. Ann Wagner, the Missouri Republican who chairs the House Financial Services Committee’s capital markets panel, said of the housing proposal. Tillis went further: “No,” he said when asked if it was a good idea.

Will Trump bomb Iran over protests?

Trump is weighing military options against Iran amid the country’s deadly crackdown on protests, and is expected to be briefed by top officials Tuesday, The Wall Street Journal reported. The president told reporters Sunday night that the Iranians “want to negotiate” and that a meeting is in the works, but that “very strong” US actions are also on the table. Reports suggest more than 500 people have been killed and thousands detained; Iranian Parliament Speaker Mohammad Baqer Qalibaf threatened to target Israel or US military bases should Trump choose military action. It’s already triggering fresh debate in Washington about war powers. “Bombing is not the answer,” Sen. Rand Paul, R-Ky., said on ABC, arguing it could cause Iranians to “rally around their own flag.” Iran “should take Trump’s warning literally” in the wake of Venezuela, former Trump envoy Jason Greenblatt argues.

— Shelby Talcott

Trump’s Venezuela oil dilemma

Oil is front and center in the Trump administration’s dilemma on Venezuela. Trump declared a national emergency late Friday aimed at preventing the seizure of Venezuelan oil revenue held by the government. That came after top oil executives signaled reluctance to invest in the country during a meeting with Trump late last week. Trump is also turning an eye to Cuba. On Sunday, he said the US would cut off Venezuelan “oil and money” to the country, and warned that they should “make a deal.” Meanwhile, Venezuela opposition leader María Corina Machado is moving forward with her effort to regain Trump’s confidence: She is expected to meet the president at the White House this week, though the exact timing has not yet been finalized.

— Shelby Talcott

Decisive week looms for shutdown, ACA

The clock is ticking down as lawmakers scramble to avoid a government shutdown and determine whether to extend the expired Affordable Care Act subsidies. The recent House passage of a three-year subsidies extension puts pressure on Senate negotiators to seal the deal soon so it could be ready to potentially attach to a must-pass bill (like government funding). But the Senate’s decision to advance a resolution limiting Trump’s military options in Venezuela could delay an effort to approve a package of three spending bills. After this week, the Senate will go on recess for a week, with the House set to follow at the end of the month — leaving little time for cross-chamber coordination. And Democrats’ rising anger over last week’s ICE shooting could further impact the funding fight ahead of the Jan. 30 deadline.

— Burgess Everett

Senate whip backs Hageman in Wyo.

If the race to be the next senator from Wyoming wasn’t over already, it is now. Senate Majority Whip John Barrasso, R-Wyo., is endorsing Rep. Harriet Hageman to succeed retiring Sen. Cynthia Lummis, according to details first shared with Semafor. In a video endorsement set to be released this morning, Barrasso says Hageman’s been “critical” to cutting regulations and taxes, increasing Wyoming energy production, and boosting rural health care funding. Trump has already endorsed Hageman, and Barrasso said she’ll be “a leader that you can trust to advance President Trump’s America First agenda” in the Senate. Hageman’s ascension is part of the domino effect from former Rep. Liz Cheney’s hard turn against Trump after Jan. 6; Hageman’s defeat of Cheney in 2022 put her in pole position for the next Senate seat.

— Burgess Everett

No. of US independents hits record

The share of American adults who identify as political independents hit a record high of 45% last year, according to Gallup polling released today, even as political polarization intensifies across the US. The increase over the past high of 43%, recorded in 2014, 2023, and 2024, was partially driven by younger Americans increasingly identifying as independent (56% of Gen Z adults describe themselves that way, according to the poll). In a year where Republicans controlled the White House and Congress, Democrats held an eight-point edge over Republicans in party identification and leaning — a reversal from 2024 that could buoy the minority party’s hopes ahead of the midterms. While independents have been the largest political group most years Gallup asked the question, the data nevertheless suggests that more Americans are tiring of both political parties.

Trump, somewhere between his seizure of the Kennedy Center and his assault on the Fed, recently considered adding another independent government body to his collection: the United States Semiquincentennial Commission, which is charged with celebrating America’s birthday this summer.

The takeover would have made Trumpian sense. The 250th anniversary festivities (semiquincentennial is half of 500, in case you don’t see that word a lot) are a presidential preoccupation and a major channel for corporate fundraising. The bipartisan commission was established under President Barack Obama. It’s led by figures from a lost age of American politics, and reflects a different ideological and aesthetic spirit than Trump’s. And MAGA figures on social media were calling for the head of its chairwoman. Trump suggested to aides before Thanksgiving that he’d replace the chair with his longtime adviser Kellyanne Conway, two Republicans familiar with those conversations said. But the president demurred.

In today’s fast-changing global environment, business leaders are responding by innovating and seizing opportunities in real time. Shifting dynamics, emerging technologies, and rising expectations demand leadership that is both decisive and forward-looking.

On Tuesday, Jan. 20, Semafor editors will sit down with global executives in Davos, including President & Chief Investment Officer of Alphabet and Google, Ruth Porat, and Aon CEO Greg Case to discuss agility, cross-border collaboration, and bold action in the next era of business.

Jan. 20 | Davos | Request Invitation

Beltway Newsletters

Punchbowl News: Two key groups supporting Senate Majority Leader John Thune — the Senate Leadership Fund and One Nation — raised $180 million in 2025, compared with $94 million in 2023.

Playbook: The New York state Senate is set to pass a bill authored by state Sen. James Skoufis that would move its April primary to Super Tuesday in 2028.

WaPo: As national security agencies prepare to brief President Trump on possible military action in Iran, Trump “doesn’t appear settled on which option he’ll take,” the paper’s Iran and Turkey correspondent reports.

Axios: Sixty-one percent of voters think Big Tech has too much influence over DC policy, according to a poll last month from Morning Consult and Tech Oversight Project, a nonprofit advocacy group.

White House

• President Trump said he may veto legislation to extend enhanced A