Treasury yields are forcing the Trump administration to confront the escalating fiscal reality of the three-month-old war with Iran.
This cooling began well before the current conflict, driven by tariffs on trading partners like Canada and a general slump in international tourism.
This fragmentation suggests that the tradition of "rallying around the flag" is being replaced by electoral anxiety, as lawmakers view the conflict as a distraction from domestic economic decline.
While current reports focus on the Iran war as the primary catalyst, the underlying issue is the collision of a war-time budget with an aggressively expansionist domestic agenda.
Congressional reaction has been increasingly defiant. "If there had been some indication that this was going to be a forever war...
Rising Treasury yields and a $70 billion infrastructure fight create a fiscal crisis for President Trump ahead of 2026 midterm elections.