The Situation Room - February 25th

Good morning everyone,

I’m Atlas, and welcome to The Situation Room! We cover the most high impact geopolitical developments every Wednesday!

Today’s topics:

• Trump Delivers The 2026 State Of The Union

• German Chancellor Heads To China, Trade & Security Talks Commence

• Pentagon Delivers Ultimatum To Anthropic

Trump Delivers The 2026 State Of The Union

_{By: Atlas}

President Donald Trump stood before a joint session of Congress on Tuesday night and delivered what became the longest State of the Union address in American history, clocking in at roughly one hour and 47 minutes. The speech covered immigration enforcement, tariffs, the economy, foreign policy, prescription drug costs, and a series of new domestic proposals — a list long enough that Trump had warned the audience beforehand: "It's going to be a long speech because we have so much to talk about."

His previous longest address, delivered last year in what was technically not a State of the Union but a joint address to Congress, ran about one hour and 39 minutes. None of the four speeches from his first term exceeded one hour and 22 minutes.

The chamber was not entirely full. More than 50 congressional Democrats had already announced they would boycott the event. During the speech itself, more than 10 additional Democrats walked out, including Reps. Rashida Tlaib of Michigan and Ilhan Omar of Minnesota, both of whom heckled the president directly from the floor, shouting that he was lying over comments he made about immigration and corruption. Reps. Madeleine Dean of Pennsylvania, Lauren Underwood of Illinois, and Lloyd Doggett of Texas were among those who also left before the speech concluded. When Trump finished, the remaining Democrats exited quickly while Republicans gave a standing ovation.

What Trump Said on the Economy

Trump framed the speech around what he called a "transformation like no one has ever seen before, and a turnaround for the ages." He pointed to economic indicators his administration considers favorable — rising wages, lower gas prices, falling core inflation, declining interest rates, and the stock market reaching all-time highs during his second term.

He announced that the federal government would match Americans' 401(k) contributions by up to $1,000 for one year, a new initiative he did not detail further beyond the announcement. He also called on Congress to permanently ban Wall Street investment firms from purchasing single-family homes in bulk. "Homes are for people, not corporations," Trump said.

On prescription drugs, Trump said his administration had acted where others had not: "I am ending the wildly inflated cost of prescription drugs. Other presidents tried to do it, but they never could. I got it done."

He highlighted the One Big Beautiful Bill Act's elimination of taxes on the first $25,000 of tip income, citing a waitress named Megan Hemhouser, one of his invited guests, as a direct beneficiary. He also introduced what he called "rate payer protection pledges" — agreements with major technology companies building AI data centers to cover their own electricity costs, which he said would help prevent utility price increases for consumers.

Immigration and Border Enforcement

Trump devoted substantial time to the border, declaring it "the strongest and most secure border in American history, by far." He cited the drop in catch-and-release of illegal immigrants, which regularly exceeded 100,000 per month under the previous administration and has been at zero for at least eight consecutive months, according to the Department of Homeland Security.

Border encounters fell to fewer than 31,000 in December 2025 — a 92 percent decline from the same period a year earlier. Trump attributed the reduction to his administration's declaration of a border emergency, which blocked new asylum claims and removed the primary incentive for illegal crossings.

"We will always allow people to come in legally, people that will love our country and work hard to maintain our country," he said, drawing a distinction between legal and illegal immigration.

He also used the speech to address what he described as fraud in the welfare system, calling out cases in Minnesota involving dozens of Somali immigrants who had been convicted or charged.

On crime, Trump said his administration had overseen the largest reduction in homicide rates on record. Violent crime fell across major cities, with robberies down 20 percent, murders down 19 percent, and aggravated assaults down 10 percent compared to 2024. He announced that Vice President JD Vance would lead what he described as "the war on fraud" going forward.

Tariffs, Foreign Policy, and the DHS Shutdown

The speech came days after the Supreme Court struck down Trump's use of the International Emergency Economic Powers Act as the basis for his tariff regime. Trump signed an executive order imposing a 10 percent global tariff under separate statutory authorities before delivering the address. He defended his approach directly, saying, "Countries that were ripping us off for decades are now paying us hundreds of billions of dollars."

Four Supreme Court justices attended the speech, including three who had voted against the tariffs. Trump shook hands with each of them as he made his way into the chamber.

On foreign policy, Trump addressed ongoing tensions with Iran — where his administration has assembled the largest U.S. military presence in the Middle East in decades — and the Russia-Ukraine war, which entered its fifth year this week. He did not announce a resolution to either situation.

He also called on Congress to fully restore funding for the Department of Homeland Security, which has been caught in a partial government shutdown. "Tonight, I am demanding the full and immediate restoration of all funding for the border security and homeland security of the United States," he said.

The Democratic Response

Virginia Governor Abigail Spanberger delivered the Democratic response following Trump's address. She argued that the administration's economic policies were not delivering the relief working families needed, and pushed back on Trump's characterizations of his first year in office. She did not offer a detailed alternative policy platform, focusing instead on healthcare costs, housing affordability, and what she described as the administration's approach to governance.

The boycott by more than 50 House Democrats before the speech and the mid-address walkouts by others reflected a party still sorting out how to respond to Trump's second term. At roughly 30 million viewers expected to watch the speech, the State of the Union gave Trump one of his largest audiences outside an election year — and one his party used to make the case directly to independent and working-class voters that will again be central to the November midterms.

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