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The DHS Shutdown Continues and a War Abroad
The Department of Homeland Security has been without funding for over five weeks, air travelers are standing in hours-long security lines during spring break, and the president has rejected the most viable path to a deal — insisting instead on tying a funding resolution to a sweeping elections overhaul bill with no realistic path to passage. All of this is unfolding against the backdrop of an active U.S. military conflict with Iran that is already reshaping global energy markets and threatening to impose serious economic pain on American households. The compounding effect of these two crises — one manufactured in Washington, one ignited abroad — has economists and policy watchers deeply unsettled.
The DHS Shutdown
The DHS shutdown began on February 14, after Congress failed to fund the agency. The impasse is fundamentally a dispute over immigration enforcement. Senate Democrats have demanded an array of policy changes as part of any funding bill, including requiring ICE agents to get a warrant from a judge before forcefully entering homes. The shutdown’s political origins trace back to ICE’s role in the deaths of two American citizens in Minneapolis in January, which galvanized Democratic demands for greater oversight. Republicans, who control the White House and both chambers of Congress, have rejected the Democratic approach of funding TSA and other DHS divisions separately while continuing to negotiate over ICE — insisting on funding the entire department as one package.
That leaves the TSA, FEMA, the Secret Service, and the Coast Guard working without pay. At least 366 transportation security officers have quit since the start of the shutdown, and lines at security checkpoints have stretched for hours at airports across the country. The real-world consequences have been impossible to ignore.
For a brief window last weekend, a resolution appeared within reach. According to Punchbowl News, Senate Majority Leader John Thune approached the president with a compromise shaped by pressure from Senate Republicans and some White House officials. Thune told Trump that Democrats would accept an arrangement that would keep airport security running and ensure TSA agents are paid, while leaving the ICE dispute to be resolved later through a party-line reconciliation bill. It was, by Washington’s standards, a reasonable off-ramp.
Cracks are beginning to show in Senate GOP unity as the shutdown stretches into its 38th day, with some Republicans worrying that the strategy of blaming Democrats won’t produce a deal and could politically boomerang back on their own party.
A Second Front: Iran and the Economic Overhang
Washington’s dysfunction is playing out against an economic backdrop already under significant stress. The U.S.-Iran conflict has put the Strait of Hormuz on a knife’s edge, with the United States striking Iran and triggering an active military conflict with direct implications for global energy supply. The conflict has already led to the suspension of about a fifth of global crude and natural gas supply, as Tehran targets ships in the vital Strait of Hormuz and attacks energy infrastructure across the region.
The price effects have been swift and severe. Oil prices rose as much as 50 percent to nearly $120 a barrel before falling and still remain about 17 percent higher than before the strikes on Iran on February 28.
Higher prices for oil and gas increase costs for gasoline, electricity, fertilizer, food, and more — many parts of the U.S. economy remain dependent on fossil fuels.
Air travel — already disrupted by the DHS shutdown — faces a double hit. Many airlines no longer hedge or lock in jet fuel prices, and since the start of the conflict, some jet fuel prices have doubled.
The Compounding Problem
A weakened TSA apparatus strains the aviation sector; an unresolved DHS shutdown signals governing dysfunction at a moment when markets are already skittish; and an active conflict in the Gulf is injecting inflationary pressure into an economy that had only recently made progress bringing prices down.
Senate Majority Leader Thune has threatened to cancel the two-week Easter recess unless DHS funding is resolved. Whether that pressure produces a breakthrough or simply adds another deadline that Washington blows through remains to be seen.
What is clear is that the costs of inaction are rising — at the airport security line, at the gas pump, and in the broader economy. Washington’s self-inflicted wounds rarely heal quickly, and this one is being sustained by both parties at a moment when the country can least afford the distraction.
Meet The Author:
As Vice President for Government Relations and Public Affairs, I work to explain how actions on Capitol Hill can impact the self-employed. I love D.C. and have made my home in Capitol Hill, where I live with my husband and black Labrador, Coltrane. We love playing volleyball and softball on the National Mall.
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