What to Expect From President Trump’s Domestic Agenda This Year

Summary

---

WSJ What’s News – What to Expect From President Trump’s Domestic Agenda This Year

Date: January 11, 2026
Host: Alex Osola
Guests: Natalie Andrews (WSJ White House reporter), Damian Paletta (WSJ Washington coverage chief)

---

Episode Overview

This episode breaks down President Trump's domestic agenda as he enters the second year of his second term. It explores the political and economic landscape—with emphasis on tariffs, affordability, private sector intervention, and immigration—and offers predictions for the 2026 midterms. WSJ reporters Natalie Andrews and Damian Paletta provide insider perspectives on voter sentiment, administration priorities, and political dynamics ahead.

---

Key Discussion Points and Insights

Mood in the White House and Washington

Timestamp: [01:40]-[01:59]

• White House Confidence:
  • Trump and his inner circle feel they had “a great year” in 2025, heading into 2026 with optimism despite growing concerns about affordability.
    • “They’re coming off of the first year and then looking forward to concerns that voters are having about affordability and how they confront that.” – Natalie Andrews [01:40]
• Broad National Sentiment:
  • Trump’s second-term impact is undeniable—whether popular or not, his agenda has made waves, especially on tax, tariffs, and immigration.
    • “He accomplished a tremendous amount… Whether voters supported it or didn't, no one could argue that he didn't have a huge impact.” – Damian Paletta [01:59]

The 2026 Midterm Outlook

Timestamp: [01:59]-[02:53]

• Trump’s direct influence looms, but historically he struggles to inspire voters in midterms when not personally on the ballot.
  • “He’s not typically a great midterm election campaigner because he’s not on the ballot… It’s harder for him to sell other people than it is for himself.” – Damian Paletta [02:20]
• Poor current polling means 2026 could be a test of whether his base holds or if tactics have alienated key independent voters.

Tariff Policy and Economic Pressures

Timestamp: [02:53]-[03:38]

• Tariffs remain central to Trump’s economic approach, despite legal constraints.
  • “He says his favorite word in English language is tariffs. I don’t expect that to change in 2026.” – Damian Paletta [03:10]
• The lingering question: if prices for consumers keep rising, will Trump feel political pressure to scale them back?
• There’s an undercurrent of risk for Republicans if affordability worsens by November.

Affordability & Voter Concerns

Timestamp: [03:38]-[04:50]

• Lowering prices is proving stubbornly difficult—“like putting the toothpaste back in the tube.”
  • “He believes if there's lower rates at the Fed, then that'll bring down the price of homes and other stuff. But... it's really difficult to get prices down everywhere.” – Damian Paletta [03:51]
• Voters blame the party in power for high costs; Democrats likely to intensify their focus on Trump’s tariffs, rising costs, and potentially higher health care costs.
  • “You don’t always deserve the credit you get for your wins and your losses, but Democrats are definitely going to make a lot of noise about it this year.” – Natalie Andrews [04:20]

Trump’s Relationship with the Private Sector

Timestamp: [05:46]-[06:53]

• The administration has taken a more hands-on approach: influencing corporate deals, bringing manufacturing home, and launching the “Trump Rx” direct-to-consumer drugs program.
  • “If Donald Trump sees a deal, it goes to, like, his inner psyche to want to involve himself on that.” – Natalie Andrews [06:19]
• There’s a watchful eye on whether the business community will eventually push back against growing White House involvement.
  • “The business community… felt it’s worth giving up some equity or a pound of flesh to get his blessing. But… is there a point when the White House goes too far?” – Damian Paletta [06:19]

Immigration Policy and Controversies

Timestamp: [06:53]-[07:54]

• Trump’s aggressive tactics have intensified, both at the border and with domestic deportations.
  • “So far, he’s been unapologetic and they’ve doubled down… even in the face of pushback from Democratic mayors and governors.” – Damian Paletta [07:10]
• Recent incidents (e.g., the shooting of Renee Nicole Goode in Minneapolis) spark public outcry and may influence Congressional funding for immigration enforcement.

The Venezuela Factor: Immigration and Politics

Timestamp: [07:54]-[08:49]

• The U.S.-led ouster of Venezuelan President Maduro might affect migration flows; chaos could mean more arrivals in the U.S., but a stabilized Venezuela may entice migrants to return home.
  • “If what President Trump has done stabilizes the country, creates a better economy, it might make a much more attractive place for Venezuelans…” – Damian Paletta [08:06]
• The disposition of Venezuelan oil resources is likely to be a policy flashpoint in 2026.

Predictions & Political Theater: The 2026 “Trump Bingo Card”

Timestamp: [08:49]-[10:17]

• Endorsements and the Election:

  • Will Trump lean into influencing the midterm races? Does he begin to hint at a possible successor or even joke more about a third term?
    • “Does he want to open it up completely for 2028, or does he try to run for a third term, as he sometimes jokes about?” – Natalie Andrews [08:58]

• America’s 250th Birthday:

  • The nation’s semiquincentennial is forecast to become a grand, distraction-filled, highly “theatrical” celebration, with Trump leveraging the mood.
    • “There’s going to be parades and parties… and Trump’s going to make the most of it in a way that only he can. It’s going to give him a huge advantage because Americans love to have fun… I would anticipate a really theatrical, probably slightly zany 2026 for Americans.” – Damian Paletta [09:36]

---

Notable Quotes & Memorable Moments

• On tariffs’ persistence:
  “He says his favorite word in English language is tariffs. I don’t expect that to change in 2026.”
  — Damian Paletta [03:10]

• On the challenge of lowering prices:
  “Making prices lower can feel like putting the toothpaste back in the tube.”
  — Damian Paletta [03:51]

• On political blame:
  “The party that is in power, voters tend to blame them for anything they feel is wrong.”
  — Natalie Andrews [04:20]

• On spectacle in 2026:
  “It’s going to be a really theatrical, probably slightly zany 2026 for Americans.”
  — Damian Paletta [09:36]

---

Timestamps for Important Segments

• [01:40] White House mood and affordability concerns
• [01:59] Presidential impact and 2026 midterm stakes
• [03:10] Trump's continued focus on tariffs
• [03:51] The struggle to reduce prices and voter frustration
• [05:46] Administration’s deals with the private sector; “Trump Rx” coming in 2026
• [06:53] Aggressive immigration actions and controversy
• [07:54] Venezuela intervention’s impact on immigration and resources
• [08:58] Speculating on Trump’s moves, endorsements, and the 250th anniversary
• [09:36] The anticipated spectacle and political theater of 2026

---

Summary Takeaway

2026 promises continued turbulence and spectacle in American domestic politics. With Trump’s policies reshaping tariffs, corporate involvement, and immigration, major test points lie ahead—both economically and electorally. Voters’ concerns about affordability and national mood around the country’s 250th birthday will shape not only Trump’s legacy but also the balance of power after the midterms. Expect a year of political drama, economic maneuvers, and relentless news cycles.

Transcript

[Alex Osola]

As AI transforms work, forward looking leaders are reimagining roles, empowering teams and shaping a more connected and adaptive workforce. Learn more on a new episode of techfluential, a podcast from Deloitte, and custom content from WSJ. Hey, what's news, listeners? It's Sunday, January 11th. I'm Alex Osola for the Wall Street Journal. This is what's New Sunday, the show where we tackle the big questions about the biggest stories in the news by reaching out to our colleagues, the newsroom to help explain what's happening in our world. On today's show, what we can expect this year from the Trump administration's domestic agenda.

[Damian Paletta]

Protect and defend the Constitution of the United States. The Constitution of the United States. So help me God. So help me God. Congratulations, Mr. President.

[Alex Osola]

Since starting his second term, President Trump has been busy. His policies have upended global trade and relationships with foreign leaders. Trump kicked off the year with an aggressive operation in Venezuela that resulted in the capture of its president, Nicolas Maduro. But for many Americans, it's Trump's domestic agenda that's top of mind. They're worried about a softening job market and high prices, which could play a major role in this year's midterm elections. So what does 2026 have in store? I chatted with WSJ White House reporter Natalie Andrews and Washington coverage chief Damian Paletta and about the president's domestic priorities and their political predictions for the year ahead. Natalie, what was the mood in the White house wrapping up 2025?

[Natalie Andrews]

The White House folks around Donald Trump, they feel like they've had a great year. So they're coming off of the first year and then looking forward to concerns that voters are having about affordability and how they confront that.

[Alex Osola]

Damian, what's your sense of the vibe in Washington more broadly and of how voters are feeling?

[Damian Paletta]

Well, it was an incredibly consequential year for President Trump. He accomplished a tremendous amount. Whether voters supported it or didn't, no one could argue that he didn't have a huge impact, whether it was on tax cuts and tariffs he imposed and immigration changes that he was able to get through without much from Congress. So what we'll be watching for in 2026 is whether he is going to be able to sell this to voters in the mid terms. He's not typically a great midterm election campaigner because he's not on the ballot. It's harder for him to sell other people than it is for him to sell himself. And so we're going to be watching really closely to see whether these kind of poor poll numbers that he has right now can improve in 2026, or whether the way he's been running his presidency turned enough voters off and enough independent voters off that Republicans really feel the brunt of it as we get later into 2026, one of the things.

[Alex Osola]

That Trump did in 2025 was, of course, tariffs. He made this a key part of his economic policy. And at least so far, it seems like the economic impact has been less than what a lot of people had feared back at Liberation Day in April. Damian, what can we expect from Trump this year on tariffs?

[Damian Paletta]

Well, he says his favorite word in English language is tariffs. I don't expect that to change in 2026. He might not have all the tools legally that he had in 2025, but he still will find ways to impose tariffs because it just gives him a tremendous amount of leverage over other countries. The question is, if prices are going up for consumers in 2026, does he feel pressure on his own to kind of dial it back? Otherwise, you know, Republicans could be really in for it in November.

[Alex Osola]

Damian, Natalie mentioned affordability. It sounds like it's unsettling voters. And at the end of 2025, Trump made a couple of speeches addressing this. What can he actually?

[Damian Paletta]

Well, making prices lower can feel like putting the toothpaste back in the tube. I mean, it's just really difficult to do. He believes if there's lower rates at the Fed, then that'll bring down the price of homes and other stuff. But I think he's really finding it difficult to get prices down everywhere. And so affordability is going to be a key theme in 2026, and it's only going to get more intense as we get closer to November.

[Alex Osola]

Natalie, has this come up at all in your reporting about the impact of affordability on the midterms? Like, how are voters feeling?

[Natalie Andrews]

Yeah, the party that is in power, voters tend to blame them for anything they feel is wrong. And so as costs rise, the Democrats will ramp up the noise on pointing to Donald Trump's policies and saying, hey, he imposed tariffs that resulted in prices going up, or they'll point to health care costs that may go up. You don't always deserve the credit you get for your wins and your losses, but Democrats are definitely going to make a lot of noise about it this year.

[Alex Osola]

Coming up, President Trump's relationship with the private sector and what to expect on immigration this year. That's after the break. Want to break free from the AI frenzy and truly transform your marketing With Adobe, the path to ROI is clear and the opportunity is all around you. Let's turn AI's promise into your marketing reality. It's starts with Adobe. One of the other things that's been really striking about President Trump's second term has been his relationship with the private sector. The administration has taken a stake in companies, and Trump himself has taken credit for trillions of dollars in investment in the US and is weighing in on big corporate deals. Natalie, what might we see in the year ahead? Are there any companies or sectors that the White House seems to have its eye on?

[Natalie Andrews]

This is a place where the Trump administration feels as though they've had a lot of success, right, in intervening in corporate deals and in talking to corporations and getting them to move manufacturing back to the U.S. the Trump Rx program is supposed to start in 2026, and they want to see more drug companies sell drugs direct to consumers through this government website. Probably will see more. If Donald Trump sees a deal, it it goes to, like, his inner psyche to want to involve himself on that.

[Damian Paletta]

So my big question on this is how far does he push the envelope? So far, the business community has gotten out of his way, and they've felt like it's worth giving up some equity or a pound of flesh in order to get his blessing. But the question is, is there a point when the White House goes too far where it becomes actually problematic for the White House to be having this much of a grip over, whether it's industrial policy or tech policy or just corporate America? And we're clearly not there yet. But there's going to be a point when corporate America might push back, and that's what we're going to be watching for really closely in 2026.

[Alex Osola]

Shifting now to immigration. It's been a really central focus for the Trump administration with the aggressive tactics in a number of cities across the US and now with the shooting of Renee Nicole Goode in Minneapolis. Damien, will Trump keep forging ahead with these tactics, or could this be a moment where he kind of reconsiders some of that?

[Damian Paletta]

He was very effective in his first year of the second term in sealing off the southern border. And there has been a real focus in the past few months, as you mentioned, about, you know, increasing deportations in the United States. Mostly he's been unapologetic, and they've doubled down, even in the face of pushback from Democratic mayors and governors saying that these tactics are necessary to deport illegal immigrants to the United States. But there have been incidents, including the one you Just mentioned where there has been quite a lot of public outcry. And so we're still waiting to see how this is going to play out. I think, in particular, we need to watch Congress to see if Congress might attach some new restrictions on funding for ICE operations or for deportations, because that might be a sign that they're starting to feel the heat from constituents about the White House's tactics.

[Alex Osola]

Without getting too far into foreign policy, I feel like we'd be remiss to not talk about the ouster of Venezuelan President Nicolas Maduro and how that fits into President Trump's approach to immigration.

[Damian Paletta]

Sure. Obviously, a lot of immigrants to the United States have come from Venezuela because of the horrible economic situation that was there for many years. What happens to Venezuela next I think, will depend on what happens in the next few months. If there's a lot of chaos there, and because there's not really an existing government, so to speak, there could be more people, more immigrants from Venezuela trying to get in the United States. However, if what President Trump has done stabilizes the country, creates a better economy, it might make a much more attractive place for Venezuelans to build businesses and invest. Obviously, there's going to be a lot of debate in Washington and around the world about what President Trump has done in Venezuela. And what should happen with oil money and oil resources is gonna be a huge focus of his agenda in 2026.

[Alex Osola]

I have one more question, and hopefully it'll be a fun one. All right, 2026. What is on your Donald Trump bingo card?

[Natalie Andrews]

I am watching how much he weighs in on various midterm elections. Does he make the Trump endorsement? Does he start leaning toward JD Vance being his successor? Or does he start talking about other folks? Does he want to open it up completely for 2028, or does he try to run for a third term, as he sometimes jokes about? Does he take different swings to get some of the voters that he has maybe lost back, such as Latino voters or farmers that are getting frustrated? So what does he do policy wise there in order to bring some of those folks back to fold that he may have lost?

[Damian Paletta]

This is going to be a controversial opinion. I think 2026 is going to be fun. The 250th birthday of the United States, there's going to be parades and parties and festivals, and Trump's going to make the most of it in a way that only. And I think Americans are going to love it, and there's going to be red, white and blue everywhere you look. And what are Democrats going to do, like say I don't like parades and flyovers and Uncle Sam. It's going to give him actually a huge advantage because Americans love to have fun. They love distractions from the stresses of their daily life. And so I would anticipate a really theatrical, probably slightly zany 2026 for Americans. And there's going to be one thing after another and it's going to start like pretty much now.

[Alex Osola]

Well, cheers to more parades in 2026. Damian Poletta, Natalie Andrews, thank you both so much.

[Damian Paletta]

Take care.

[Natalie Andrews]

Thank you.

[Alex Osola]

And that's it for what's new Sunday for January 11th. By the way, Damian Poletta has a daily politics newsletter. If you want to check it out or subscribe, we'll leave a link in the show notes. Today's show is produced by Anthony Banci and Pierre Bienname with supervising producers Tali Arbel and Jana Herron. I'm Alex Osola and we'll be back tomorrow morning with a brand new show. Until then, thanks for listening.

[Reba]

Nearly Home Isn't home where we all want to be? Reba here for realtor.com, the Pro's number one most trusted app. A dream home isn't a dream home if it comes with a nightmare commute. That's why realtor.com has real commute, so you can search by drive time. Download the realtor.com app today cause you're nearly home. Make it real with realtor.com pro's number.

[Alex Osola]

One most trusted app based on August 2025 proprietary survey.