Was it taken off the table?
Sure looks like a capitulation right now.
My guess is that this was the plan all along—to bring it to the point of the government “closing down” or Trump funding it from the military. Certainly he both threatened a shutdown and said he’d fund it legally otherwise at the famous meeting with Chuck and Nancy.
I don’t really see how saying, “No matter, I’ll fund it out of the already funded military instead” is backing down. If anything it is moving the battle to the courts instead.