Weekly Washington Policy Pulse: Iran Conflict, Congress on Tariffs (March 2, 2026)

Summary

Podcast Summary: Balance of Power – “Weekly Washington Policy Pulse: Iran Conflict, Congress on Tariffs”
Bloomberg, March 2, 2026

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Episode Overview

This episode of Bloomberg’s Balance of Power features Washington correspondents Joe Mathieu and Kailey Leinz, joined by Nathan Dean (Senior Policy Analyst, Bloomberg Intelligence) and Wayne Sanders (Senior Defense Analyst, Bloomberg Intelligence and former US armed services member). The episode focuses on the rapidly unfolding US-Iran conflict following a series of significant military strikes, and what it means for defense contractors, US policy objectives, military readiness, and congressional developments on tariffs and banking regulation.

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Key Discussion Points & Insights

1. US-Iran Conflict: Military Operations and Implications

[02:16 – 08:23]

• Scale and Impact of Strikes

  • Unprecedented military action: the US and Israel together deployed over 320 aircraft, striking more than 1,000 Iranian military targets.
  • Decapitation of Iranian leadership: “Supreme Leader Ayatollah Khamenei as well as the IRGC commander, chief of the armed forces was killed as well as over 48 additional senior Iranian officials…”
    — Wayne Sanders ([02:40])
  • Focused on destroying Iran’s leadership, air defense, missiles, and command infrastructure to create a power vacuum in Iran.

• Operational Approaches & Platform Usage

  • Air superiority maintained by F22s, deep strike by F15s, and overall dominance with F35s/F16s; substantial naval air defense from RTX SM6s and SM2s.
  • “It’s also showing the proof in the mustard for those [defense contractors].”
    — Wayne Sanders ([03:30])

• Iran’s Response: Distributed Attacks, Resource Strain

  • Iran shifting to a “spray and pray” method, attacking diverse targets due to limitations in launchers and remaining missile stockpiles.
  • US intelligence estimates Iran has 100-150 launchers and ~1,500 missiles left ([04:26]).

• Proxy Activity & Broader Risks

  • No surge in proxy attacks from groups like Hezbollah or Hamas (yet), despite threats to the Strait of Hormuz.
  • Cyberattack potential remains uncertain.

2. US Policy, Endgame & Defense Industrial Base

[05:15 – 08:23]

• Official Timelines vs. Realistic Objectives

  • Both President Trump and Secretary Hegseth publicize a 4–5 week timeline, but real intent is for a much faster operation, “two weeks max.”
    — Wayne Sanders ([05:29])
  • Urgency driven by finite stockpiles and concern over readiness for other contingencies, notably China/Taiwan planning for 2027 and beyond.

• Defense Contractor Capacity Constraints

  • While DoD signals 2–4x production ramp, actual output constrained by facility capacity and lead time.
  • “They can only expand those production lines so fast … it’s more of a 2029, 2030 solution at this point.”
    — Wayne Sanders ([07:11])

• US Administration Objectives

  • White House seeking “complete annihilation” of Iran’s air defenses, missile stockpiles, and launchers to maximize future US leverage in diplomacy and non-proliferation.
  • “I think the administration’s looking for a complete annihilation of air defense capability as well as missile stockpiles … so that whatever government comes in and starts to work on the diplomacy side, the US is in a much better position from leverage…”
    — Wayne Sanders ([08:23])

3. Congressional Policy Moves: Tariffs & Banking Regulation

[09:38 – 13:00]

• Tariffs: Codifying Presidential Powers

  • Republican moves brewing to codify President Trump’s tariff authority, especially via reconciliation, and Section 122 tariffs (15% for 150 days).
  • Nathan Dean expresses skepticism that Congress would grant more authority: “I don’t think Congress is ever going to give President Trump author[ity] to do more tariffs and… I don’t think we’ll even see a section 122 vote come up in 150 days.” ([10:12])

• Basel III Endgame & Banking Capital Requirements

  • Upcoming Fed proposal to increase capital requirements for big banks by 3-7%, offset by a likely reduction from the G-SIB surcharge.
  • Estimated net impact: $40–$50 billion, though specifics pending.

4. Other Policy Catalysts: Housing & AI in Defense

[13:00 – End]

• Single-Family Homes & Corporate Ownership

  • President Trump’s proposal to ban corporate purchases of single-family homes is under debate; likely revision toward tax disincentives.
  • Unlikely to materially affect major private equity holders given current asset allocations.

• AI/Anthropic in Defense Procurement

  • DoD designates the AI company Anthropic a supply chain risk; legal challenge expected due to “flimsy” government case.
  • “His theory… is that he can likely bring a successful court challenge to the February 27th exclusion… probably too flimsy as a basis to support such a drastic action.”
    — Paraphrased from Matt Shettenhelm, via Nathan Dean ([13:48])

• Upcoming Events

  • War Powers Resolution vote expected in Congress this week (more analysis promised soon).

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Notable Quotes & Memorable Moments

• “This is these pre Iraq war numbers in terms of the buildup, 120 plus US aircraft, 200 Israeli aircraft over the weekend, over a thousand Military targets were struck… this was a fairly successful campaign by US and Israel…”
  — Wayne Sanders ([02:19])

• “They’re not going to allow Iran to take a breath… they need to do as much of this as possible right up front, just based off of our own US Stockpiles.”
  — Wayne Sanders ([05:29])

• “They can only expand those production lines so fast… I think the defense industrial base is going in the right direction to be able to fix this problem for the future, but I think it’s more of a 2029, 2030 solution at this point.”
  — Wayne Sanders ([07:11])

• “I think the administration’s looking for a complete annihilation of air defense capability as well as missile stockpiles… so that whatever government comes in and starts to work on the diplomacy side, the US is in a much better position…”
  — Wayne Sanders ([08:23])

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Timestamps for Key Segments

• US-Iran Conflict Overview & Strike Breakdown: [02:16–05:15]
• White House Endgame and Defense Stockpile Readiness: [05:15–08:00]
• Defense Contractor Production Limitations: [07:00–08:00]
• US Objectives in the Iran Campaign: [08:00–08:23]
• Congressional Tariffs & Section 122: [09:38–10:50]
• Basel III Endgame Updates: [11:04–12:15]
• Corporate Single-Family Home Ownership: [12:15–13:00]
• AI Contractor Anthropic & Defense: [13:00–13:48]
• Upcoming War Powers Resolution Vote: [13:52–End]

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Conclusion

This episode delivers a high-level yet detailed analysis of the US-Iran conflict, the strategic military and policy considerations underway in Washington, and what these mean for defense, banking, and key legislative actions. The tone is analytical and urgent, reflecting the momentous developments of the week while addressing key market and policy implications with clarity and expert perspective.

Transcript

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[Nathan Dean]

Bloomberg Audio Studios Podcasts, Radio News

[Podcast Host]

this is your weekly Washington Policy Pulse on the Balance of Power podcast. I'm Joe Matthew. Every Monday, Bloomberg Intelligence senior policy analyst and friend of the show, Nathan Dean shares his weekly call on upcoming catalysts in the nation's capital. Listen for the most recent and relevant policy research from our team at Bloomberg Intelligence. Now with today's installment, here's Nathan Dean.

[Nathan Dean]

Good morning and good afternoon everybody. My name is Nathan Dean. I'm a senior policy analyst at Bloomberg Intelligence here in the Washington D.C. bureau. Want to say thank you for joining the BI Washington Policy Pulse, especially here on March 2, a couple days after the United States and Iran and now are in conflict, open conflict. And thank you to those of you who are joining us via the Balance of Power podcast. We always appreciate you listening in and you know, if you ever have any questions or any comments or anything that we talk about in this call, you need a little deeper dive, feel free to reach out. My email is ndean10bloomberg.net so joining me on the call today is our senior defense analyst Wayne Sanders. Wayne just actually has spent many, many, many years in the U.S. armed services. So he will be a good person to talk to today. Please feel free. Our clients and friends use the chat function the, you know both the Q and A and or the chat if you'd like to ask questions, we'll get them to Wayne, can you just tell us what are your initial thoughts at a high level of what happened over the weekend with a focus I know that you're focusing on the defense contractors, you know, where do you see this conflict going? And you know, just essentially just lay it all down man. Just tell us what you're thinking.

[Wayne Sanders]

Sounds good. Thanks Nathan. Thanks for having me.

[Nathan Dean]

Yeah.

[Wayne Sanders]

So when you, when you look at this, the, the amount of military firepower that was brought forward during these strikes was, was, was very telling obviously. Right. This is these pre Iraq war numbers in terms of the buildup, 120 plus US aircraft, 200 Israeli aircraft over the weekend, over a thousand Military targets were struck. Most of the focus there was on leadership, air defense launchers, missiles, as well as military command and control killed. So far we know Supreme Leader Ayatollah Khamenei as well as the IRGC commander, chief of the armed forces was killed as well as over 48 additional senior Iranian officials were also killed. So from a, from a, a military power vacuum perspective and all that, this was a fairly successful campaign by US and Israel to be able to do that. The focus on air defense becomes very, very key obviously because it provided air superiority for US and Israeli aircraft, specifically F22s, which is a suppression of enemy air defense capability. You have F15 Strike Eagles, which are a deep strike capability, and then you have your air dominance with your F35s and your F16s from right there alone. You're really looking at the defense primes especially tied in with these aircraft platforms being key. It's also showing the proof in the mustard for those. You also have the buildup of the Navy which provided a lot of air defense capability as well with like RTX, SM6s and the SM2s that are onboard those as well. What we've seen from Iran coming back is more of a distributed attack methodology, unlike what they were doing in the Israeli Iran conflict, 12 day conflict specifically because they're now going out and hitting different targets instead of focusing specific volleys all on one targets. It's more of what the military refers to as a spray and pay spray and pray mentality. And the reason why they're doing part of that is because they're very limited on number of launchers that are left. US Centcom believes it's between 100 to 150 launchers left and potentially around 1500 missiles left within Iran's stockpiles. To be able to, to affect an. That becomes a key, key point then because that is the area where we're actually where the US and Israel are targeting. They are focusing on these specifically. We haven't seen as much on the proxies that over the weekend that we thought we would see. It's still something that's up there in terms of options for surges in proxy activities from Hezbollah, Hamas and IRGC backed militias in the region. For that we have seen threats to the Straits of Hormuz, but we have not seen any type of mining or anything of that nature those areas. And we have unconfirmed reports yet in terms of what Iranian cyber attacks are going to be able to do on that.

[Nathan Dean]

Have you heard anything from the White House or the Defense Department. That suggests about an end game of where the timing on this goes. Because President Trump was saying four to five weeks. You know, Secretary Hegseth said in his press conference this morning something similar. You know, what's your thought on the timing?

[Wayne Sanders]

Yeah, you know, they're putting out four to five weeks. And I, I, I would like to believe that they're actually pushing. You know, they're going to say that publicly. But where I think they're really pushing is they want to have this thing done two weeks max. And the biggest reason why is the farther it gets pushed, obviously the let you know, they're not going to take their foot off the gas. They're not going to allow Iran to take a breath. But they need to be able to do as much of this as possible right up front, just based off of our own US Stockpiles. You know, you still have readiness concerns for our number of munitions. You look at the replenishment rate for a lot of our capability and all that. Normally it's in the hundreds. If you look at PAC3 interceptors, somewhere between, you know, 5, 550 to 700 PAC3 interceptors per year, while if we use over 700 of those, you've now lost a year's worth of supply. So as we try and look forward to a potential China, Taiwan contingency in 2027 or beyond any other global contingencies, they want to make sure that they have as many of those as possible. But what they're not willing to do is they're not willing to take their foot off the gas here and allow Iran to breathe and look at somewhere else because they're not trying to put boots on the ground. This is going to continue to remain an aerial campaign as well as naval strike capability, which obviously puts def defense contractors that are tied in General Dynamics, Electric Boat, Huntington Eagles and others in their suppliers for a lot of the naval platforms and then obviously rtx, Lockheed, Northrop for not only their, the aerial platforms, but also then the munitions they're using in great numbers at this point.

[Nathan Dean]

Can, and this is a simple question, but can the defense contractors increase production to the point where things will change for them, or are they sort of sticky in terms of how many they can produce per year?

[Wayne Sanders]

Yeah, they're definitely sticky with how many they can produce per year. You've already seen a ramp up right now. The DoD has put the demand signal out there for 2x to 4x from a munitions production perspective. You saw Lockheed get the $9.8 billion munitions deal for PAC3 interceptors. But from the ramp up perspective, they can only do that based off of the production lines. They can only expand those production lines so fast. And if you're looking at it right now in terms of we're one year out or even less than a year out from a potential contingency within 2027, it really asks the question as to how many do you want to expend now at the expense of military readiness for a 2027 scenario. I think the defense industrial base is going in the right direction to be able to fix this problem for the future, but I think it's more of a 2029, 2030 solution at this point in time in terms of what we can actually throw at them now.

[Nathan Dean]

So the last question I'm going to ask you to take your Bloomberg hat off and put on your former army hat. And this is a loaded question. So obviously if there's no good answer here, just say, we don'. Have a good answer. But I'm curious, what do you think the White House's objectives are for this? Because President Trump spent some time over the weekend talking about objectives. And I was just curious, what do you think those objectives are?

[Wayne Sanders]

Yeah, I would say, you know, if I was, if I'm putting my military commander hat back on, I would look at it in terms of what are considered my high value targets that are remaining, that are tied to center of gravity. And then I would also look at the high value individuals that are also tied into this. So I would continue everything that I possibly could. And I think the administration's looking for a complete annihilation of air defense capability as well as missile stockpiles and the launchers that are capable so that whatever government comes in and starts to work on the diplomacy side, the US Is in a much better position from leverage to be able to say, hey, all right, I'm not going to let you guys do your missile stockpiles anymore and I'm not going to let you guys pursue nuclear proliferation. And so I think that becomes a key piece of it. But in order to do that, you have to maintain the pressure on that. I think the Trump administration is going to look for somebody, the remaining part of the power vacuum, leadership within Iran, and then say, who are the people that we can most likely work with? And then continue to do a press to make sure those individuals that are are in place. Much more difficult to do when you don't have boots on the ground. So it does end up being a lot more on the diplomatic front. And behind the scenes, you know, intelligence community work and all that stuff, as well as frontline messaging as the military continues to bombard.

[Nathan Dean]

Okay, sounds good. Thank you very much, Wayne. We'll let you get back because I know you're extremely busy. Thanks for attending. And if you can ever have questions for Wayne or for the defense team, you can find all of our information that we're writing about at BI Irango. You can go on there. And it's not just defense, but it's also commodities, currencies, you name it. Some ESG stuff is in there already. So, you know, BI Iran is where everything is. So thank you again, Wayne. Real quickly, just a couple of other things. You know, we talked about the, the energy exchange call that's happening right now. Just real quickly. I put out a note this morning on congressional tariffs. Essentially. This note, which was going to be widely read before the conflict this weekend, essentially said that you're going to hear probably not this week or next week due to the conflict, but you know, in the next few weeks you're going to hear statements from Republicans essentially say they either want to codify President Trump's authority to do tariffs via reconciliation or for the Section 122 tariff, which would need congressional authorization, 150 days. My point is, is that A, I don't think that Congress is ever going to give President Trump author to do more tariffs and B, I don't think we'll even see a section 122 vote come up in 150 days. Just as a reminder, section 122 allows up to a 15% tariff for 150 days. Then you need congressional authorization. I don't think President Trump's plan is to ever get to that point. I think they'll convert it from a section 122 to a section 301. So great. Just the last thing to talk about. Just an update on the Basel 3 endgame for those of you who are in the banking space. Last week Fed Vice Chair Michelle Bowman testified to the Senate Banking and she confirmed that the Basel III endgame proposal will be out before the end of March. She also said that there is going to be a G SIB surcharge proposal. Just as a reminder, the Basel III endgame, according to our friends over at Bloomberg News, is going to increase capital requirements somewhere between 3 to 7%. What the Fed will want you to do is to actually look holistically to this together. And when you take the G Sib surcharge proposal into account, while we don't know the specifics of it. I think the thinking here is is that that proposal is going to dramatically decrease capital requirements so that any increase is well negated in our back of the n math is showing around 40, 40 to $50 billion in total in terms of the, you know, the impact. But again, that's still to be determined. Last thing is is that I should have mentioned is that we are going to see a I'll get to the question in a second. I will say that we're going to see a war powers resolution vote come up in Congress this week. I will have my thoughts out on that tomorrow. So if you have any questions on the war powers resolution, feel free to reach back to me tomorrow. The housing stuff is still going forward. This is President Trump's idea of banning corporations from purchasing single family homes. Right now there is this bipartisan bill we've talked about in the past called the Road Act. It's a housing bill, it's bipartisan and honestly it's not all that exciting for those of us who look at it from the market's perspective. But this idea of banning corporations from owning single family homes is getting thrown into that debate last I heard over the weekend. And there's been some reporting to this is that rather than banning corporations, they're talking about changing some tax codes to make corporations less inclined to buy single family homes. And remember, this is really exposuring the single family REITs like AMH and imitation homes, the folks, the private equity folks like Blackstone. I mean we're talking like 0.5% of their total assets. So single family homes isn't all that much. I think this actually is going to get postponed this week. They may push that to next week, but I will be keeping an eye on it. And then lastly to the question about, you know, anthropic was used in the initial strikes. My colleague Matt Shettenhelm actually just put out a note. This talking about anthropic in greater detail and specifically the decision by the Department of Defense over the weekend to label it a supply chain risk. His essentially his theory, and this is what I'll just say right here, is that he can likely bring anthropic can likely bring a successful court challenge to the February 27th exclusion from all work for military related contracts if the US Defends its actions. We believe that the rationale by the Department of Defense focused on anthropological refusal to change the terms of its delight defense contract. It's probably too flimsy as a basis to support such a drastic action. So Matt Shettenhauman to the client there. Matt Shenhelm is our anthropic expert, so he will be the one to talk to you in greater detail. So I'm going to say thank you very much. We really appreciate your time. As always, if you ever have any questions, please feel free to reach out and we will talk soon. Thank you.

[Podcast Host]

Our thanks to Nathan Dean, Bloomberg Intelligence Senior Policy Analyst, bringing you the latest installment of his weekly Washington Policy Pulse. For more from BI or to join this call live each week you can email [e-mail] that's n d e a [e-mail] and come back to the podcast later today for the latest edition of Balance of Power.

[Wayne Sanders]

This is Special Agent Riegel, Special Agent Bradley Hall.

[Nathan Dean]

The time is approximately 11:15am about to start consensual telephone call with Dr. Daiwa Tsang. China's Ministry of State Security is one of the most mysterious and powerful spy agencies in the world. But in 2017, the FBI got inside. Wait.

[Wayne Sanders]

I'd never seen that much evidence in my entire career, and I don't think we'll ever see that much evidence again. I now have several terabytes of an MSS officer, no doubt, no question of his life. And that's a unicorn. This is a story of the inner workings of the MSS and how one man's ambition and mistakes opened its vault of secrets. Listen to the sixth Bureau from Bloomberg Podcasts starting on February 13th on the iHeartRadio app, Apple Podcasts, or wherever you get your podcast.