Mashadipati: Washington Edition: Texas sidestep

I'm Nancy Cook, Bloomberg's senior national political correspondent, and each weekday I'll be coming to you with inside-the-room reporting and insights that reveal what's really happening in Washington — and how it impacts you. Email me with feedback and comments here. If this newsletter was forwarded to you sign up here.

Battling It Out

The Republican infighting in Texas isn't going to die down anytime soon with President Donald Trump no longer expected to endorse either candidate in the state's increasingly nasty Senate primary runoff.

On one side of the fight is Senator John Cornyn, who's held his seat since 2002 and reliably voted for Trump's second-term agenda; on the other side is state Attorney General Ken Paxton, a darling of the MAGA movement who's been trailed by ethics issues in office.

By sidestepping an endorsement, Trump and his team are setting up a costly, fractious fight between two allies at a time when the war with Iran is already causing fissures in the MAGA base — and potentially giving an opening to Democrats.

US President Donald Trump speaks during a swearing-in ceremony in the Oval Office of the White House in Washington, DC, US, on Tuesday, March 24, 2026. Markwayne Mullin was confirmed Department of Homeland Security secretary, placing the Oklahoma senator in charge of a Trump administration immigration crackdown that has triggered a 37-day funding shutdown of the cabinet agency. Photographer: Graeme Sloan/Bloomberg — President Donald Trump.

It won't be settled until the May 26 runoff, consuming two more months of Republicans' time, energy and cash that could have been concentrated on Democrat James Talarico, who one recent poll shows is putting up a formidable challenge in the Republican-dominated state.

An upset in Texas in November — still something of a longshot — would increase the chances that Republicans could lose Senate control. Privately, many Republicans are already expecting to lose the House to Democrats, which will bring any legislative agenda Trump has to a screeching halt.

For some back story: Trump came close to endorsing Cornyn after the senator performed better than expected in the March 3 primary — a trial balloon that some Trump advisers floated to news outlets like the Atlantic.

Trump had indicated to allies and advisers that he was wary of Cornyn's low poll numbers and didn't want to back a loosing candidate, so Cornyn's advisers worked hard to outperform expectations. He edged out Paxton by about 1 percentage point.

But the pro-Paxton MAGA base launched a social media campaign against Cornyn. A West Wing aide showed the posts to Trump, giving the president pause about any quick endorsement, said Republicans familiar with the machinations.

Now, the deadline has passed for either candidate to remove his name from the runoff ballot and Trump has decided to stay out of it.

Paxton still has the MAGA base behind him, including some its loudest voices, like Steve Bannon who's taped his podcast from Texas. Cornyn has had to spend money on ads trashing Paxton and boosting himself.

A potential byproduct of all the attack ads flying back and forth is that independent voters could be turned off from both GOP candidates.

The Texas Senate race will get even more attention in early September when Republicans are weighing holding a midterm convention in Dallas, an event parties usually reserve for presidential campaigns.

Talarico hasn't been unscathed by Republican attacks amid the runoff battle. But he now has time to accumulate cash and woo supporters without a campaign opponent. Republicans think they will narrowly hold onto the Senate in November, but the GOP fight in Texas doesn't make that cheaper or easier.

War in Iran

Trump signaled that Iran had offered a "present" as a show of good faith in negotiations he says are ongoing to end a 25-day conflict that's upended global markets, even as he deploys more troops to the Middle East.

The Trump administration has ordered the 82nd Airborne Division to deploy about 2,000 soldiers to the Middle East, as the White House weighs options to ease Iran's chokehold on the Strait of Hormuz.

Iran's biggest Gulf Arab neighbors are considering joining the US-Israeli war against Iran, and could be pushed to if Tehran attacks their critical infrastructure, according to several people with knowledge of the situation.

The world economy's first signs of a synchronized shock emerged in business surveys revealing how the Iran war's fallout is crippling growth momentum and stoking prices.

Iran said foreign ships are allowed to cross the Strait of Hormuz, as long as they aren't supporting acts of aggression against the country and follow regulations put in place by Tehran.

Futures for oil and stocks worth billions of dollars changed hands just 15 minutes before a social media post from Trump about postponing strikes against Iran's energy facilities sent crude prices tumbling and equities soaring.

Today's Top News

Senate Democrats have rejected the latest offer from Trump and Republicans to fund most of the Department of Homeland Security and end a lengthy shutdown that has snarled airport security checkpoints.

NASA plans to invest $20 billion over the next seven years to develop a base on the surface of the moon, the latest major strategy shakeup aimed at enabling humans to live on the lunar surface long-term.

A system designed to help air-traffic controllers monitor vehicles and airplanes on the ground failed to alert personnel at LaGuardia Airport before an Air Canada Express jet collided with a fire truck late Sunday evening.

Minnesota sued the Trump administration for blocking state law enforcement from investigating shootings involving federal immigration officers, including the killings of Renée Good and Alex Pretti.

Investors have lifted odds that the Federal Reserve is on the verge of raising interest rates, but lingering labor-market fragility and the risks to growth from surging oil prices make that a long shot, at least for now.

Treasury Secretary Scott Bessent regularly says his motivation to enter public service was concern about growing US debt. Developments over the past several weeks have those alarms ringing even louder.

The USS Gerald R. Ford aircraft carrier arrived at a port in Crete after it had to leave the Middle East — and the war against Iran — when a fire broke out in its laundry area. But the massive ship's problems run a lot deeper than that.

Some $3.5 billion worth of Bitcoin was taken from its owner in December 2020 in what's been called the biggest crypto hack ever. Almost five years later, the new holder of the hoard revealed itself. It was the US government.

Must Reads From Bloomberg Government

Democratic Senator Edward Markey is calling on the executives at five of the largest oil and gas companies to lower their own pay and put the savings toward lower gas prices for US consumers.

Oklahoma Governor Kevin Stitt announced energy executive Alan Armstrong will fill the Senate seat vacated after Markwayne Mullin was confirmed to serve as Homeland Security secretary.

Senate Majority Leader John Thune pushed back on Trump's demand to link funding for the Department of Homeland Security to passage of Republicans' voter ID legislation, calling the plan "not realistic."

Watch & Listen

Today on Bloomberg Television's Balance of Power early edition at 1 p.m., hosts Joe Mathieu and Kailey Leinz interviewed Daniel Fried, an Atlantic Council senior fellow and former US diplomat, about the prospects for a negotiated end to the Iran war and the president's foreign policy.

On the program at 5 p.m., they talk with Democratic Representative Jake Auchincloss about negotiations to end the standoff over Homeland Security funding and the latest developments in the Middle East.

On the Odd Lots podcast, Bloomberg's Tracy Alloway and Joe Weisenthal talk with political consultant David Shor, founder of Blue Rose Research, and Byrne Hobart, writer of TheDiff newsletter and general partner at venture capital firm Anomaly Fund, about the prospects for the labor market getting upended by AI, what polling says about the public view and potential policy solutions. Listen on iHeart, Apple Podcasts and Spotify.

Chart of the Day

The US population is aging, and our homes are getting older too. Roughly half of all houses in America were built more than 45 years ago — in Washington, DC, half were build before 1960. Many people see charm in older homes, but they can be less affordable because they may require more home maintenance and are less efficient. The housing stock in Washington is older than the US average, but relatively strong population growth in recent decades means that the Capital area has a greater share of homes built after 2010 than average. Generally, Sun Belt states like Nevada and Arizona that have seen the sharpest population growth in recent years have the lowest median home ages. — Alex Tanzi

What's Next

Import and export prices in February will be released tomorrow.

G-7 foreign ministers meet Thursday in Paris for two days.

The University of Michigan's index of consumer sentiment in March will be published Friday.

The Conference Board's measure of consumer sentiment and expectations in March will be released March 31.

Job openings and layoffs in February will be reported March 31.

Retail sales in February will be released April 1.

The jobs report for March will be released April 3.

Washington Edition: Texas sidestep