U.S. President Donald Trump’s top envoy to the EU told POLITICO that overregulation is causing “real problems” economically and forcing European startups to flee to America. Andrew Puzder said businesses in the bloc “that become successful here go to the United States because the regulatory environment is killing them.” “Wouldn’t it be great if this part of the world, instead of deciding it was going to be the world’s regulator, decided once again to be the world’s innovators?” he added in an interview at this year’s POLITICO 28 event. “You’ll be stronger in the world and you’ll be a much better trade partner and ally to the United States.” Puzder’s remarks come as the Trump administration launched a series of blistering attacks on Europe in recent days. Washington’s National Security Strategy warned of the continent’s “civilizational erasure” and Trump himself blasted European leaders as “weak” and misguided on migration policy in an interview with POLITICO. Those broadsides have sparked concerns in Europe that Trump could seek to jettison the transatlantic relationship. But Puzder downplayed the strategy’s criticism and struck a more conciliatory note, saying the document was “more ‘make Europe great again’ than it was ‘let’s desert Europe’” and highlighted Europe’s potential as a partner.

BELÉM, Brazil — The Trump administration slammed the door on clean energy. China is sending the message it’s open for business. The signs are not hard to find in the sweltering, dimly lit convention center in the Amazon where delegates from nearly 200 countries are debating the Earth’s future. China’s section of the United Nations climate summit’s main hall features 5-foot-tall poster boards boasting of the country’s battery and electrical projects, from Egypt to Indonesia to Brazil. Corporate “partners” listed on the back wall include CATL, the world’s largest manufacturer of electric car batteries. BYD, the crown jewel of China’s world-leading electric vehicle empire, is an official sponsor of the summit, as is fellow Chinese electric carmaker GWM. Even Chinese President Xi Jinping’s personal brand is on display at the U.N. gathering, known as COP30, which is scheduled to end Friday. Visitors to the Chinese pavilion can find shrink-wrapped copies of books collecting his writings and speeches. Meanwhile, the United States is absent from the summit for the first time ever, as President Donald Trump disavows any participation in addressing a climate crisis that he calls a “hoax.” That’s not just a setback for the planet, climate supporters say. They say it also symbolizes a self-inflicted economic threat, as the U.S. abandons the growing worldwide market for EVs, solar panels, wind turbines and other clean technologies — and cedes it to China. “It’s not about electric power. This is about economic power,” said California Gov. Gavin Newsom, one of the few prominent American politicians at the summit, during a press conference here last week. He said Trump “simply doesn’t understand how enthusiastic President Xi is today that the Trump administration is nowhere to be found at COP30.” China does not yet show any signs that it’s trying to fill the role the U.S. has sometimes played at the annual climate talks: joining with the EU in pushing for all countries to make more ambitious climate commitments. While it has publicly lamented the U.S. exit from the U.N. dialogue, China still describes itself as a developing country and has proposed only modestly ambitious greenhouse gas reduction goals for its own economy. The Chinese are an undeniably major presence in Belém, however — Beijing’s 789 delegates make up the second-largest national contingent at the summit, behind the 3,805 people representing the host country, Brazil, and just ahead of Nigeria, according to an independent analysis of U.N. records. The official U.S. delegation has consisted solely of Sen. Sheldon Whitehouse (D-R.I.), who said the State Department set up impediments to his two-day visit that ended Saturday. Trump’s hostility to clean energy is a turnaround from former President Joe Biden’s administration, which pursued big-spending green policies — backed by protectionist tax rules that irked allies in Europe — in an attempt to compete with Chinese dominance. Some developing countries had welcomed Biden’s assertiveness, saying it offered an alternative to the onerous conditions that often come from accepting Chinese infrastructure and energy assistance. But that option is rapidly fading after Trump signed a Republican-backed law stripping away Biden’s green energy subsidies. “Most of the equipment, we are buying from China,” said an official from an East African government who was granted anonymity to avoid retribution from the Trump administration. “The market has been broken. Under Biden, people were motivated to buy things from the U.S.” Others attending the summit said they believe Trump’s policies will eventually leave the U.S. itself dependent on China as the global energy market shifts to cleaner products. That trend could hollow out the U.S. industrial core, said Nigel Topping, chair of the Climate Change Committee that advises the U.K. government. “It won’t be long before we have a queue of American governors begging BYD to set up electric car factories in the States,” Topping said. FOSSIL FUELS NOT DEAD YET Trump is articulating a starkly different vision: supplying the world’s growing energy demands with U.S. fossil fuels. He has backed up his talk with action, including using trade threats to undermine international climate agreements and pressure countries to buy more American oil and natural gas. The approach seizes on the fact that the U.S. is the world’s top oil and gas producer, a role it was already using for geopolitical advantage during the Biden era. Trump and his aides maintain that switching to green energy sources would only strengthen China’s stranglehold on wind, solar, battery, electric vehicle and rare earth supply chains. “President Trump wasted no time reversing Joe Biden’s Green New Scam, which significantly contributed to the worst inflation crisis in modern American history, drove up energy prices across the country, and stifled economic growth,” White House spokesperson Taylor Rogers said in a statement. “By unleashing American energy, we are strengthening our grid stability, making energy affordable for families and businesses, and protecting our national security.” The White House’s stance contains an inherent bet — that the world is not on the verge of a dramatic pivot to clean energy. “You will hear people go, ‘Well, the U.S. is peddling fossil fuels, and the Chinese are pushing renewables,’” said George David Banks, an international climate aide during Trump’s first term. “Well, yeah, that’s because that’s what we have, and that’s what they have.” Trump’s vision of a future flush with fossil fuels got some validation last week from the Paris-based International Energy Agency, whose recent track record of projecting massive increases in green energy has made it a target of conservatives in Washington. The IEA’s newest forecast includes a much different scenario based on nations’ existing laws that predicts worldwide oil and gas consumption will keep growing through 2050. But the IEA report also includes an alternative scenario — accounting for policies that countries plan to adopt — which envisions a future of rising renewable energy deployment, with fossil fuel use peaking before 2030. The energy think tank Ember said Thursday that wind and solar power expanded quickly enough during the first three quarters of 2025 to meet all the world’s new power demands, and it projected that fossil fuel power generation will not increase this year for the first time since the Covid-19 pandemic. A pledge that countries made at the 2023 U.N. climate summit to triple renewable energy capacity by 2030 appears within reach, Ember said. Wagering the United States’ economic future on the continued dominance of fossil fuels is foolish, former Vice President Al Gore said in an interview in Belém. “It’s a tragedy that Donald Trump has shot the U.S. economy in both feet and hobbled our ability to compete more effectively with China,” Gore said, pointing to Ember’s data showing that green technology exports from China exceed the value of all fossil fuel exports from the U.S. “One sector is an appreciating asset, the other is a diminishing asset, and the U.S. is on the wrong side of that equation.” During the two days of world leaders’ speeches preceding this month’s summit, Chinese Vice Premier Ding Xuexiang took a veiled shot at Trump’s trade and clean energy policies. “China is ready to work with all parties to unswervingly promote green and low-carbon development,” he said. ‘LARGE INVESTMENTS FIRST’ The United States still has a big footprint at COP30, of course — even if the federal government doesn’t. U.S. companies such as GE Vernova, Baker Hughes, Citibank and Bank of America attended the summit, noted Marty Durbin, president of the U.S. Chamber of Commerce’s Global Energy Institute. He said those businesses will pursue clean energy projects regardless of who occupies the White House or whether the president sends anyone to the talks. “Are we winning in that race?” Durbin said before a slight pause. “We’re in the race. And we’re going to continue to be part of that.” But others said they believe Trump’s policies will leave the U.S. in the lurch. While some foreign clean energy companies have exited the U.S. as an immediate response to Trump’s policy reversals, they will avoid the country altogether in the medium and long terms “if you cannot trust in it,” said Anne Simonsen, climate policy head of the business group Danish Industry. At the same time, China is going all in. China has poured huge direct investments into building clean technology and electric vehicle factories in emerging economies. In Brazil, Chinese investment in the electricity sector last year spiked 115 percent to $1.43 billion, with 69 percent of total Chinese-backed projects consisting of green energy and sustainability, according to the Brazil-China Business Council. Rich and poor nations have benefited from Chinese oversupply to buy cut-rate gear to meet clean energy goals. That approach and Chinese investments have transformed economies, said André Aranha Corrêa do Lago, president of the COP30 summit. China “added the elements that I believe were missing” from the world’s green energy transition, Corrêa do Lago said Nov. 10 at a press conference. “One of them is scale. The other is technology. And the other is the fact that as a developing country, it needs to bring solutions that are affordable to more people.” But he acknowledged in a separate interview with POLITICO that while China’s gusher of less-expensive technology could help address climate change more quickly, relying on one supplier creates other complications. China is “indisputably” the leader in all green technology, much of which is high quality, said Juan Carlos Monterrey Gómez, Panama’s climate envoy and chief negotiator. He said U.S. automakers are “shit-scared” that they won’t be able to catch up with Chinese models, a worry that Newsom also espoused in several public comments. As an economist by trade, Monterrey Gómez said he too worries about the world relying so much on one supplier. Still, he said he sees no major alternative at the moment. “They did fast investments, large investments first,” he said. “That’s why they’re benefiting from this.” Sara Schonhardt contributed to this report from Belém, Brazil.

Republicans got a series of warnings this week about President Donald Trump’s trade policies. But even the party’s biggest tariff skeptics doubt it will convince the White House to change course. Democrats can hardly contain their glee. Voters in Virginia, New Jersey and elsewhere flocked to Democratic candidates who hammered the president and his party for stubbornly high prices of everyday goods. It was an implicit — and sometimes explicit— rebuke of Trump’s use of tariffs, which are driving up the cost of coffee, cars, aluminum cans and other foreign imports Americans rely on. A day later, even Trump-appointed justices on the Supreme Court raised doubts about the president’s decision to raise levies, seemingly at will, on the country’s largest trading partners. Put together, it was validation for the retailers, free-market economists and old-school, business-friendly Republicans who have been warning about the potential long-term economic damage of Trump’s tariff regime and GOP prospects in the midterms. But few see much hope in pressing the White House’s self-described Tariff Man to pull back now. “Outside of a court order, he’s going to push the limits,” said Sen. Thom Tillis (R-N.C.), who was one of five GOP senators to vote against the 50 percent tariff Trump slapped on Brazil this summer over diplomatic disputes, which Tillis said outstripped presidential authority. The Supreme Court is now weighing that question vis-a-vis Trump’s moves to hike duties substantially on countries around the world, and Wednesday’s arguments raise the prospects they will strike at least some of them down. In theory, it could give the president an excuse to rein in some of his most controversial tariffs — and help Republicans defend against Democrats’ attacks on affordability. Along with the rest of the world, the U.S. economy has been struggling with inflation since the Covid-19 pandemic, a reality Republicans campaigned on relentlessly in 2022 and 2024. Now some conservatives fear voters are connecting those costs with tariffs — and their party. “I think people see that something’s driving up costs and tariffs are at the front of it,” said a Republican senator, granted anonymity to speak candidly about Tuesday’s election results. “The president is so enamored with tariffs that it’s clearly a Trump-Republican thing, so it has a consequence.” After their shellacking last year, Democrats say their election victories this week only energize plans to turn the table on Republicans in 2026 — making the election a referendum on Trump’s economic policies and how things like tariffs are making daily goods even more unaffordable. Michigan Democrats have been hammering former Republican Rep. Mike Rogers, who’s running for the state’s open Senate seat, for months over tariffs that have rocked their famed auto industry. In New Hampshire, another state that borders Canada, they’re accusing Trump of hurting small businesses. In Kentucky, they’re warning about how his tariffs are strangling the state’s bourbon industry. Nationally, Democrats are heralding Abigail Spanberger’s 14-point win Tuesday night in the Virginia gubernatorial race, in part because she gained support in deep-red central and western parts of the state where manufacturing and agricultural industries have been dented by Trump’s duties. “Tariffs are fundamentally one of the biggest reasons why costs are so high and Americans know that,” said Sam Newton, the communications director for the Democratic Governors Association. “So in many ways, whether candidates are talking about tariffs or not, they’re raising prices in a way that sets the groundwork for Democrats to go on offense on the economy and on affordability.” GOP strategists across battleground states, particularly in places like Michigan and Wisconsin that are home to manufacturing industries bearing the brunt of Trump’s tariffs, are warning that voters’ patience with his turbulent trade policies is wearing thin. “It’s baked into the electorate that doing these tariffs will have some sort of short-term pain, but that we’ll realize some long-term gain,” said Jason Cabel Roe, a Michigan-based GOP strategist and former executive director for the state’s Republican Party who worked on presidential campaigns for Mitt Romney and Marco Rubio. “I don’t know if we’ll realize the benefits the administration anticipates from those tariffs by election time.” The White House has maintained that Trump’s trade policy is ushering in a “golden age” for the U.S. and, even as the administration has acknowledged that there will be short term pain from the tariffs, Trump has spent the past few days dismissing criticism about high prices. “The Trump Administration remains committed to the President’s trade and tariff agenda — an agenda that in mere months has resulted in unprecedented trade deals and trillions in investment commitments to make and hire in America,” said Kush Desai, a deputy press secretary for the White House. “Our America First policies are simultaneously delivering economic relief from Joe Biden’s inflation crisis for the American people while laying the groundwork for a long-term restoration of American Greatness.” Most GOP lawmakers continue to give Trump a wide berth on tariffs, hesitant to publicly knock the president on his go-to policy. “They would say there’s been a benefit, as well, to American production,” said Sen. James Lankford (R-Okla.). “It takes longer because they’re bringing in new contracts and trade negotiations and new trade agreements, so those come along a little later.” But strategists see potential electoral risk in Tuesday’s voter backlash to rising costs and the possibility that the Supreme Court could kick control over tariffs back to Congress — and set Republicans up for more thorny votes that could cost them at the ballot box. Trump acknowledged in a speech in Miami Wednesday that the economy played a big role in this year’s elections — suggesting Republicans aren’t spending enough time talking about his economic success. But he doesn’t appear to be willing to back off the tariffs. “I think that they might be paying something, but when you take the overall impact the Americans are gaining tremendously,” Trump told reporters Wednesday. “They’re gaining through national security — look, I’m ending war because of these tariffs. Americans would have to fight in some of these wars. They are gaining in national security, they are gaining in economics, they’re gaining in so many different ways, and they are gaining self-respect for our own country.” Trump has portrayed his ability to impose tariffs as “life or death” for the economy, but the Supreme Court seemed skeptical that he could override Congress to impose a duty on nearly every country in the world with few guardrails. In oral arguments on Wednesday, several conservative justices questioned whether Trump’s national security argument for imposing tariffs justified his decision to take a core power from the legislative branch. But while a court ruling could make it more difficult to impose tariffs on a whim, Trump and top administration officials have pledged to find other legal routes to raise duties on foreign imports, even if it takes longer or is more cumbersome to enforce. In an interview Thursday on Fox Business Network, U.S. Trade Representative Jamieson Greer said the Trump administration has many other authorities it can use to impose tariffs but declined to say which ones it would use if the president’s authority under the 1977 International Emergency Economic Powers Act are struck down. Business groups and others hit by the tariffs are taking Trump officials at their word. “Obviously the Supreme Court decision is very important, but we also are realists, and we understand that … President Trump has probably several backup plans here,” said Gary Shapiro, the CEO of the Consumer Technology Association, which represents businesses like Amazon, Best Buy and Verizon that rely on complex global supply chains impacted by the tariffs. “This may be a battlefield victory, but I’m not sure … we’ll win [the war].” Stephen Moore, a former Trump economic adviser, said Thursday that Republicans quietly hoping the Supreme Court will offer an escape hatch on tariffs may be disappointed. “One of the problems with the tariff strategy is it’s been a lot of turmoil — uncertainty and turmoil,” said Moore. “And if he loses the court case, I think that would only add to the turmoil in the short term. So I don’t think it’s going to be necessarily a victory for the economy.” Megan Messerly and Caitlin Oprysko contributed to this report.

Listen on * Spotify * Apple Music * Amazon Music Außenminister Wadephul sagt seine China-Reise kurzfristig ab. Ein Vorgang, der zeigt, wie sehr sich die Machtverhältnisse verschoben haben. Hans von der Burchard analysiert, wie China Deutschland die Grenzen aufzeigt, warum die EU zum Vermittler wird  und welche Folgen die Eskalation hat. Im 200-Sekunden-Interview spricht Markus Frohnmaier, außenpolitischer Sprecher der AfD, über Pekings Rolle in der Welt, deutsche Interessen und warum er die Regierung für „hypermoralisch“ hält. Danach: Innenminister Alexander Dobrindt will Deutschland besser gegen Cyberangriffe wappnen und erlaubt künftig auch digitale Gegenschläge. Rixa Fürsen erklärt, wie schwierig das Konzept der Abwehr ist und warum Zuständigkeiten zwischen Bund, Ländern und Bundeswehr so unklar sind. Zum Schluss: Ein Blick auf die SPD, die in Bielefeld gegen den Kanzler und damit die eigene Regierung demonstriert. Das Berlin Playbook als Podcast gibt es jeden Morgen ab 5 Uhr. Gordon Repinski und das POLITICO-Team liefern Politik zum Hören – kompakt, international, hintergründig. Für alle Hauptstadt-Profis: Der Berlin Playbook-Newsletter bietet jeden Morgen die wichtigsten Themen und Einordnungen. Jetzt kostenlos abonnieren. Mehr von Host und POLITICO Executive Editor Gordon Repinski: Instagram: @gordon.repinski | X: @GordonRepinski.

Nearly two years ago, Argentina’s newly appointed punk-haired President Javier Milei stood up on a podium in front of global elites in Davos and accused them of letting their societies drift into socialism and poverty. He went on to argue that the “main leaders of the Western world have abandoned the model of freedom for different versions of what we call collectivism,” and that all market failures were by-products of state intervention. This week, however, Davos had the last laugh: U.S. Treasury Secretary Scott Bessent threw Milei a $20 billion lifeline to help Argentina defend a currency that is collapsing despite nearly two years of shock therapy programs that had had supply-side economists and investors in raptures. “Argentina faces a moment of acute illiquidity,” Bessent posted on X. “The international community — including the IMF — is unified behind Argentina and its prudent fiscal strategy, but only the United States can act swiftly. And act we will.” The rescue act, which many have described as a country-to-country bailout, is an abrupt departure from the usual playbook of international financial diplomacy, an unusually direct intervention in a sphere normally reserved for multilateral institutions. In a strong signal that this was the result of political will, rather than financial apparatchiks just trying to keep the system stable, the money will be directly extended by the Treasury, rather than by the Federal Reserve, in the form of a currency swap. It stands to entangle the fate of the U.S. economy intimately with that of resource-rich Argentina, and tie the Trump administration directly to Milei’s shock therapy programs. At the same time, it reasserts U.S. influence in a region that China has increasingly penetrated through growing trade ties. For Europe, the corollary is that access to dollar liquidity, the essential backstop of the world financial system for nearly a century, is being politicized, and may increasingly depend on how closely its policies align with those of the U.S. “Europe should be concerned about the politicization of the swaps,” one former New York Federal Reserve official told POLITICO. The episode “underscores the need for the rest of the world to prepare for dealing with a dollar crunch without the Fed[to turn to],” added the official, who was granted anonymity to speak freely. CHAINSAW ECONOMIC MASSACRE Milei was explicitly elected in 2023 on the promise that he would take a chainsaw to Argentine government excesses. Positioning himself as the defender of freedom, once in office, he initiated a bold economic agenda focused on radical deregulation, welfare cuts, and liberalization. Within months, the country’s welfare bill had been slashed by nearly half, with the government balancing the books (before interest payments) for the first time since 2008. But it was Milei’s initial move in December 2023 to devalue the official peso exchange rate by nearly 50 percent that rocked markets the most. The hope was to better align the peso with its black market (i.e., real) rate before slowly introducing a floating exchange rate, with sliding bands. Throughout, the International Monetary Fund, the world’s lender of last resort for countries, championed Milei’s policies, which allowed Argentina to return to capital markets earlier than expected. “The agreed ambitious stabilization plan is centered on the establishment of a strong fiscal anchor that ends all central bank financing of the government,” the lender cooed in January 2024. EGG ON THE IMF’S FACE? Except things didn’t go exactly as planned. Rather than stabilize, the peso just kept depreciating, especially after Trump’s tariff announcement in April destabilized global markets. The declines threatened to make imports more expensive for ordinary Argentinians just as Milei’s disinflationary successes were beginning to become entrenched. The road to that point evolved predictably enough. In the immediate aftermath of Milei’s great devaluation, inflation hit 25.5 percent, spiking to 276 percent by February 2025. But, as social welfare cuts began to bite, inflation predictably turned into disinflation. By June 2024, monthly price rises had slowed to 5 percent, and by July-August, inflation had hit single digits for the first time in years. The International Monetary Fund (IMF) and independent observers were quick to credit Milei’s strict fiscal surplus, monetary tightening, and peso stabilization. But by April, the peso’s soft float was proving increasingly challenging to defend. Trump’s “Liberation Day” tariffs, which set a baseline rate of 10 percent for all countries, had hit Argentina’s export-dependent economy hard. Capital started to flow out amid fears that a global slowdown would crush demand for its agricultural and mineral exports. The Argentinian central bank moved to defend the peso, burning through scarce dollar reserves. Markets began to doubt that Milei’s agenda would survive, fearing that a sharp, uncontrolled depreciation would rekindle inflation just as prices were calming down. To avert a currency crisis, Argentina turned to the IMF and was granted $20 billion through the agency’s Extended Fund Facility (EFF). But despite an initial positive impact on the peso, the depreciation picked up speed again. From the perspective of both the IMF and the U.S., the failure of Milei’s reforms stood not just to unravel Argentina once again, but to delegitimize the ideological foundations of the free-market system he had touted as infallible if deployed correctly. PROXY ECONOMIC WAR WITH CHINA As confidence in Milei’s program faltered, focus shifted to whether the U.S. would make dollar support conditional on the cancellation of a pre-existing $18 billion swap line with Beijing. U.S. Special Envoy for Latin America Mauricio Claver-Carone publicly dubbed the facility “extortionate.” In September, Bessent confirmed negotiations between the U.S. and Argentina for a direct dollar swap line, reinforcing speculation that the U.S. was trying to supplant Chinese influence in the region. The news had an immediate positive effect on the peso, breaking its fall. After peaking at over 1,475 pesos, the dollar was back at 1,421 by late Friday in Europe, helped by news that a dollar-support package from Washington was imminent. How long-lasting that effect will be is yet to be determined. For now, Bessent and the IMF appear resolute that it’s just a matter of time until Milei’s policies will deliver the stability they’ve been promising. Rather than framing the U.S. swapline as a bailout, Bessent is treating the intervention as a trading play. “This is not a bailout at all, there’s no money being transferred,” he told Fox News on Thursday. Under a swap line, two parties agree to exchange up to a certain amount of their currencies, on the understanding that it will be reversed at some time in the future. “The ESF has never lost money, it’s not going to lose money here,” Bessent went on, arguing that the peso is “undervalued”. He added that Milei remains a great U.S. ally who is committed to getting China out of Latin America, and said the U.S. was going “to use Argentina as an example.” Not everyone is convinced that Milei’s policies will deliver the goods. “They’ve done this over and over and over again,” said Steve Hanke, a professor at Johns Hopkins University and a veteran of various currency reform and stabilization packages. He argued that the package will provide “a little bit of a temporary band aid, but it won’t last very long.”

President Donald Trump on Friday said he will set a 100 percent tariff on Chinese goods starting on Nov. 1 and will “impose Export Controls on any and all critical software.” Trump’s announcement on social media came after he shared a post earlier in the day threatening “massive” new tariffs on China and hinted he might cancel an upcoming summit meeting with President Xi Jinping in response to a move by Beijing earlier this week to restrict exports of rare earth magnets and raw materials. “This was a real surprise, not only to me, but to all the Leaders of the Free World,” Trump said in a lengthy morning post on Truth Social. “I was to meet President Xi in two weeks, at APEC, in South Korea, but now there seems to be no reason to do so.” The 100 percent duty, which Trump said could come “sooner, depending on any further actions or changes taken by China,” would re-establish what was effectively an embargo on Chinese goods in the spring. The two countries reached a detente after negotiations in late May, but kept tariffs at a level much higher than before. The U.S. currently imposes duties averaging about 55 percent on Chinese goods. That includes a 10 percent reciprocal rate, a 20 percent duty linked to U.S. concerns about fentanyl trafficking and additional tariffs imposed during Trump’s first term. At a late afternoon White House event, Trump told reporters he still might go ahead with the meeting with Xi, which has been expected to take place in South Korea in late October, shortly before that country hosts the annual Asia-Pacific Economic Cooperation leaders summit. “I haven’t canceled, but I don’t know that we’re going to have it,” Trump said. “But I’m going to be there regardless, so I would assume we might have it.” Trump also indicated he could drop his tariff threat if China rolls back its plan to impose new export controls. “We’re going to have to see what happens. That’s why I made it November 1st,” Trump said. In his first Truth Social post, Trump wrote that China had been sending letters to countries throughout the world informing them of plans to restrict exports “of each and every element of production having to do with Rare Earths, and virtually anything else they can think of, even if it’s not manufactured in China.” “Nobody has ever seen anything like this but, essentially, it would ‘clog’ the Markets, and make life difficult for virtually every Country in the World, especially for China. We have been contacted by other Countries who are extremely angry at this great Trade hostility, which came out of nowhere,” Trump wrote. China should not be allowed to exert “monopoly” power over the exports of rare earth magnets, which are used in a number of high-tech, green energy and medical goods, Trump continued. But if Beijing follows that course, “the U.S. has Monopoly positions also, much stronger and more far reaching than China’s,” he added. During the late afternoon White House event, Trump said the United States could also restrict exports of aircraft parts and potentially other goods to China. “We have many things [China needs], including a big thing is airplanes. But they have a lot of Boeing planes, and they need parts and lots of things like that,” Trump said. Late last month, U.S. Ambassador to China David Perdue said the two countries were in the final stages of negotiations for a “huge” sale of Boeing aircraft to China but that deal now looks in doubt. The Chinese Embassy didn’t immediately respond to a request for comment. Trump’s Truth Social post could mark the decisive end to a fragile trade truce that the U.S. and China have sustained since May. It also suggests that Beijing’s tightening grip on its critical mineral supply has derailed the White House strategy of reducing trade frictions in the run-up to the long-anticipated meeting between Trump and Xi in South Korea at the end of October. “This week’s export-control expansion looks like a miscalculation — what Beijing sees as leverage, Washington views as betrayal,” said Craig Singleton, senior China fellow at the Foundation for Defense of Democracies. “Trump’s statement shows that even a deal-driven White House has limits, and China may have just crossed them.” “But the risk is clear,” Singleton continued. “Mutually assured disruption is no longer a metaphor. Both sides are reaching for their economic weapons at the same time, and neither seems willing to back down.” Earlier this year, Trump hiked his reciprocal tariff on China up to 125 percent, which Beijing matched in a series of tit-for-tat moves. That led to a meeting in May where the two sides agreed to scale back their tariffs for 90 days while talks continued. The two sides agreed in August to extend the reduced tariff rates for another 90 days, raising the stakes for the upcoming Xi-Trump meeting that has been expected to take place just before the annual APEC leaders meeting on Oct. 31 through Nov. 1. Trump’s trade moves have already significantly reduced trade with China, which was the United States’ third-largest trading partner in 2024. U.S. imports from the Asian heavyweight totaled $194 billion in the first seven months of 2025, compared with $239 billion in the same period last year. U.S. exports to China in January through July totaled $65 billion, compared with $82 billion in the same seven months in 2024. U.S. exports of agricultural products, particularly soybeans, to China have been hit particularly hard, prompting the Trump administration to consider ways to provide billions of dollars of subsidy payments to farmers. Phelim Kine contributed to this report.

President Donald Trump this week insisted Americans are experiencing the “best economy we’ve ever had.” Privately, White House officials acknowledge people just aren’t feeling it. The economy grew faster in the second quarter than initially anticipated, productivity was revised upwards, inflation hasn’t surged despite new tariffs and gas prices have fallen to levels not seen in decades. Republicans also avoided what would have amounted to a major tax increase with Trump’s One Big Beautiful Bill earlier this year. But polls show Americans remain anxious about high prices, and there are signs the economy’s resilience is starting to fray, making it harder for the administration to close the delta between how the economy looks on paper and how people feel. The Congressional Budget Office also said Friday that the megalaw will have little effect on economic growth before the 2028 election, its gains blunted by the president’s tariffs and immigration crackdown. “That’s a thing that I know the White House political team is nervous about because there’s a reality and there’s a perception. And the reality is the economy is doing fine and the perception is people are still worried about things like grocery prices, which are still high, and still growing,” said Stephen Moore, an outside economic adviser to Trump who the president featured in an impromptu Oval Office press conference last month. Trump, in an interview on “Fox & Friends” Friday, pointed to the trillions of dollars of investments in the U.S. that companies have promised since he took office and the record high stocks hit on Thursday, insisting that Americans are experiencing the “best economy we’ve ever had.” Trumpeting positive economic statistics in the face of sagging sentiment is a political trap that has ensnared many administrations, including, most recently, the Biden White House. During former President Joe Biden’s term, the president and his aides insisted that economic statistics vindicated their policies even as that data failed to move frustrated voters. Republicans could face a similar problem as they head into what is expected to be a difficult fight for control of the House. “There’s a new recognition certainly among White House folks, some GOP folks on the Hill, and elsewhere that we have a problem, and that lecturing the American people and telling them, ‘No, things are actually fine,’ is just not going to work,” said Steve Cortes, a former Trump campaign adviser. “Trust us, trust the plan. Trump’s done it before, he’s doing it again — all that would be good, but don’t dismiss their concerns.” Privately, White House aides are clear-eyed about the reality of Americans’ economic anxieties. But they believe their policies will turn things around by next fall. “Inflationary cycles don’t erase themselves in six months or a year,” said a senior White House official, granted anonymity to share the administration’s thinking. “You’ve got to turn the ship around, and I think we are making progress on that.” A recent CBS News poll found that just 36 percent of Americans say the economy is “good,” while the New York Federal Reserve said Monday that people believe there is a 45 percent chance they can find a new job if unemployed — the weakest reading since the survey began in 2013. Together, the numbers sketch a picture of an American electorate more jittery than jubilant. The August jobs report also came in weaker than expected, inflation remains above the Fed’s target and jobless claims just hit their highest level since late 2021. “I think the economy is weakening,” JPMorgan Chase CEO Jamie Dimon told CNBC on Tuesday. “Whether it’s on the way to recession or just weakening, I don’t know.” White House officials continue to blame Biden for handing over a weak economy, pointing to Tuesday’s jobs revisions from the Bureau of Labor Statistics revealing that U.S. hiring from April 2024 to March 2025 was overestimated by 911,000 jobs — the largest downward revision on record — as the latest example. Allies hope those Tuesday numbers give the White House additional cover as it works to address voters’ perceptions. The Federal Reserve is poised to lower interest rates at its meeting next week — a move made more likely after wholesale prices ticked down in August, even as consumer prices have begun creeping up under tariff pressure. Inflation was decreasing early this year but has been steadily increasing since May, with the latest numbers putting inflation roughly where it was in January. The interest rate reduction, which Trump has called for for months, makes it cheaper for consumers and businesses to borrow and spend, which, in theory, stimulates the economy. White House aides expect multiple rate cuts before next year’s election and believe those along with continued increases in real wages and the effects from the megalaw’s tax cuts will give people a sense that their economic situations are improving. “If anything, we feel bullish, relatively, because we got the tax cuts done so early, we got them retroactive, we’re going to enter a rate cut cycle,” the senior White House official said. “Now we’re in what I call the grind.” Still, the White House has struggled to message its signature domestic policy legislation, with a Pew survey last month finding that 46 percent of Americans disapprove of the law, while 32 percent approve. In an attempt to reverse those figures, as well as economic concerns, the White House has rebranded its so-called One Big Beautiful Bill as the “Working Families Tax Cut.” Aides acknowledge it’s less about reality than voters’ perceptions. They’re paying less attention to economic indicators and more to voter sentiment, whether that’s shaped by the stock market, consumer prices or inflation headlines. “Right now, people know the price of gas is down, they know some things are down and more stable, but it’s going to take some time before they really feel the benefit, because you’re going to have to grow your way out of this,” said Trump pollster John McLaughlin. “It’s going to take some time, but as those policies percolate, it’ll be a sense of relief compared to what the last four years were like.” Aides say inflation-adjusted wages aren’t back to where they were before the cost of living spike at the beginning of Biden’s presidency and they don’t expect them to catch up by Election Day. But they do believe Americans’ economic situations will improve enough by November 2026 that voters feel the economy is headed in the right direction. “Most voters are pretty sophisticated. They understand that there’s not a magic wand here,” the senior official said. “If there’s a sustained directionality of people feeling like their economic situation is improving between now and a year from now, then we’ll be in pretty good shape.” Worker pay, adjusted for inflation, is up from where it stood before the pandemic and has been increasing since early 2023, according to Labor Department data. White House officials also believe there are reasons to think they are starting from a better position than other recent administrations heading into midterm elections, though they understand the situation could change. The gap between the percentage of people who think the nation is headed in the right direction instead of the wrong direction is about 15 percentage points today, compared to about 31 points at the same point in Biden’s 2022 cycle and nearly 28 percent at this point in Trump’s first term, according to Real Clear Politics. Republicans’ voter registration advantage is also expanding nationwide, while Democrats’ favorability remains 27 points under water compared to 13 percent for Republicans. Privately, they are also eyeing a silver lining should the Supreme Court strike down the president’s tariffs: Market analysts may hail such a move as a win for the economy as billions of dollars collected in recent months are infused back into businesses. And, if the court upholds them, aides believe price increases are mostly baked in and that markets will respond positively to any deficit reductions the government makes as a result of the tariffs. And, if all else fails, Trump can pivot to other issues like crime and immigration. The National Guard and other federal law enforcement officials have spent the last month cracking down on crime in Washington, and Trump announced on Friday that his next target will be Memphis, Tennessee. The shift is deliberate: broadening the voters’ aperture so the economy isn’t the only focus. “If all you’re thinking about is the economy, then you live by the sword, die by the sword,” said Sean Spicer, former White House press secretary. “They’re talking about crime. They’re talking about tariffs. There’s so much going on that they’re making sure that it’s not just one issue.” Victoria Guida contributed to this report.

A slim majority of EU citizens think European Commission President Ursula von der Leyen should resign, a survey published Tuesday shows. When asked about von der Leyen’s future, 39 percent said they were “very favorable” to her resignation, 21 percent “somewhat favorable,” and just 8 percent “very against.” Much of the criticism stems from the EU-U.S. trade agreement finalized this summer. The deal came after U.S. President Donald Trump threatened to impose 30 percent tariffs on European exports if no agreement was reached. While the final compromise capped tariffs at 15 percent — far below Trump’s threat but still much higher than the previous average of 1.47 percent — the outcome left many Europeans disillusioned. According to the survey, 52 percent of respondents said they felt “humiliated” by the deal, with the sentiment particularly strong in France (65 percent) and Spain (56 percent). Three-quarters believe von der Leyen failed to defend European interests, while only 19 percent gave her a positive rating. A further 77 percent said the trade agreement primarily benefits the U.S. economy, and 42 percent think European companies will be hit hardest. The Eurobazooka survey was conducted by Cluster17 between late August and early September across five major EU countries — France, Spain, Italy, Germany and Poland — representing more than 60 percent of the EU’s population. The poll surveyed around 1,000 people in each country.

JACKSON HOLE, Wyoming — Federal Reserve Chair Jerome Powell hinted Friday that the Fed might cut interest rates soon but added a subtle bit of context: It’s not because President Donald Trump is pressuring him. Powell, delivering a closely watched speech at the central bank’s annual conference in Grand Teton National Park, said the U.S. economy faces two competing risks: that inflation could get worse, which would call for more elevated rates, and that the labor market could weaken, which would call for lower rates. It’s “a challenging situation,” he said. But he indicated that he’s more worried about economic weakening than a sustained increase in inflation and then used key central banker wording to suggest that he’s leaning toward a rate cut: “The shifting balance of risks may warrant adjusting our policy stance.” The decision, though, will be “based solely on [Fed officials’] assessment of the data and its implications for the economic outlook and the balance of risks,” he said. “We will never deviate from that approach,” he added. Those comments are an oblique acknowledgment of the political firestorm that Trump and his fellow officials have sparked for the central bank in recent months. The president has called Powell a “numbskull” and a “total and complete moron” for refusing to lower interest rates. Earlier this week, Trump called on another Fed board member, Lisa Cook, to resign after the president’s housing finance regulator referred her to the Justice Department on allegations of criminal mortgage fraud, saying she had named two different properties as her primary residence on loan applications in 2021. If Cook were to depart from the board, it would give Trump another opening to nominate an ally to the central bank to implement his vision of lower rates. Two board members, Christopher Waller and Michelle Bowman, called for rate cuts at the Fed’s most recent rate-setting meeting in July, dissenting from the broader decision to hold borrowing costs steady. But the president’s sweeping tariffs on all U.S. trading partners have led most Fed officials to hesitate on easing borrowing costs for fear that the levies could lead to a series of price increases. Now though, Powell suggested he sees this scenario as less likely than economic weakening. Workers facing higher prices could demand higher wages, leading to a spiral where prices and income push each other up, but in his speech, the Fed chair said “that outcome does not seem likely” because hiring has slowed, giving employees less wage-setting power. He also expressed confidence that investors and households still understood that the Fed’s intention over the long term is to return inflation to its 2 percent target. To help clarify how the central bank approaches inflation and the labor market, Powell also announced updates to the Fed’s framework document, designed to be a durable, high-level explanation of how the Fed intends to set policy over time. Those updates underscore the Fed’s commitment to price stability. The Fed makes its next rate decision in mid-September.

PRESTWICK, Scotland — The handshake trade deal between the EU and the U.S. has come under a lot of fire, but EU officials insist it’s the best the bloc could do if it wanted to avoid a damaging tariff war with Donald Trump. European countries were also in a weak position thanks to their own past decisions. Slashing defense spending after the end of the Cold War left them dependent on the U.S. military for security, while cutting off Russian energy exports left the bloc reliant on American liquefied natural gas. “It was never going to be between a good and a great deal, but between a bad and less bad one — we certainly believe this is less bad,” said a European Commission official, granted anonymity to speak freely, who called Brussels’ approach “strategic realism.”  Commission President Ursula von der Leyen’s negotiation space with Trump was always much smaller than many in Europe would have liked. The still-vague EU-U.S. deal took a lot of flak for political reasons, with complaints rife about how the bloc — despite its economic clout — submitted to a Trumpian worldview on trade. The power differential was even on display in how the leaders got to Scotland. Von der Leyen and her team flew in on two small chartered business jets; Trump arrived on Air Force One with an escort of U.S. fighters, while his sons and their families were in a black-and-gold Boeing 757 belonging to the Trump family empire. Politicians have been scathing about the deal — although national capitals weakened the EU’s position by lobbying fiercely against any Brussels retaliation to Trump’s tariffs in order to protect their domestic industries. French Prime Minister François Bayrou called the agreement “submission,” while German Finance Minister Lars Klingbeil denounced it as “weak.” Former Trade Commissioner Cecilia Malmström said the EU effectively condoned Trump’s bullying, cementing “a new trading order where tariffs are accepted as a geopolitical cudgel.” “Just the way [Trump] made von der Leyen come to his golf course in Scotland and then put up his thumb almost like a Roman emperor — that says it all,” Karel De Gucht, Malmström’s predecessor as the bloc’s trade chief, told Belgian daily De Standaard. But if politicians gnashed their teeth at the perceived unfairness of the one-sided tariffs, analysts breathed a sigh of relief.  “We believe that the EU-US trade deal was the best available for Europe,” read one note from investment bank Goldman Sachs. “The agreement puts the EU at the more favourable end of the international spectrum despite the EU’s comparatively large goods trade surplus and the US’s geopolitical leverage over Europe.” A comment from Deutsche Bank struck a similar tone, noting that with the deal, “the worse outcomes are avoided.” PAIN THRESHOLD Brussels is also cheering itself up by pointing out that London’s deal with Trump is even worse. Despite the U.K. getting a 10 percent tariff rate — better than the EU’s 15 percent — the U.K. rate is not a ceiling, said the EU official. Cheese is an example where the EU gets a 15 percent tariff but the U.K. faces 10 percent plus another 14.9 percent that the U.S. charges on cheese imports.  Commission President Ursula von der Leyen’s negotiation space with Trump was always much smaller than many in Europe would have liked. | Olivier Matthys/EPA “The 15 percent rate has caught the EU precisely at its pain threshold,” said senior researcher David Kleimann at ODI Global. It keeps the EU relatively competitive compared to the rates facing other economies. Kleimann also pointed out that the American economy has a very “limited ability” to replace highly innovative European products as the existing capacity is low and investments in new factories would be hard with a tight labor force. The Commission official also stressed that the EU avoided an escalating tariff war like that between China and the U.S. “We’re playing the long game,” they said, adding that such a retaliation ladder is “hard to retreat from.” According to Dan Mullaney, a former U.S. assistant trade representative for Europe, the EU couldn’t have hoped for a better outcome. “It’s not clear that following the tougher China course of immediate retaliation would have been successful.” China faced steep consequences for its retaliatory approach. While tariffs of over 100 percent may have dropped to 30 percent, ongoing negotiations risk triggering a return to those higher rates. Canada is also being penalized for retaliating against Trump’s tariffs. “It’s hard to see how that’s a better outcome than 15 percent all-in tariffs,” Mullaney said, calling the Commission’s approach the right one. He also added that Trump voiced “unprecedented public recognition … of the value and importance of the U.S.-EU relationship. That may prove transitory, but it’s significant.” IT’S THE ALLIANCE, STUPID The reasoning in Brussels is that avoiding a trade war is about more than just trade or even the economy; it’s also about preventing Trump from withdrawing from the transatlantic alliance and ending support for Ukraine. Von der Leyen pointed at NATO’s new and higher defense spending targets minutes after announcing the deal in Scotland. “Just a few weeks after the NATO summit, this is the second building block for reaffirming the transatlantic partnership,” she told a handful of Brussels-based reporters before heading back to the EU capital. EU trade chief Maroš Šefčovič, after his plane had landed back in Brussels, told POLITICO that the handshake at Trump’s golf course was about keeping the alliance alive.  At a press conference a day later, he again stressed: “It’s not only about … trade: It’s about security, it is about Ukraine, it is about current geopolitical volatility.” Brussels is keenly aware it can’t risk the trade dispute spiralling into the military sphere, where European countries are not currently prepared to mount a credible defense against Russia and to continue arming Ukraine without U.S. help. In Malmström’s words: “Maybe this was the only deal possible.” De Gucht also admitted that more is at stake than trade. “Imagine if there would be no deal and a trade war — do you really believe Trump would still keep supporting Ukraine, then?” he said. “Or rather: that he’d still sell weapons to Ukraine?” Koen Verhelst reported from Prestwick and Brussels. Antonia Zimmermann, Carlo Martuscelli and Jakob Weizman reported from Brussels. Hanne Cokelaere contributed to this report.