“The U.S. will default on its $31.4 trillion debt this year if Congress doesn’t raise the nation’s borrowing cap. But when, exactly? That’s harder to answer.
While Congress sets the nation’s annual budget, the Treasury Department actually manages trillions of dollars beyond that, with millions of payments flowing in and out of the government’s accounts each day. And just like an everyday checking account, cash flow varies: Sometimes the government gets a flood of dollars from tax receipts, and other times it needs to pay the bills. Those dips and surges add another wrinkle to a political drama that threatens to tank the global economy.
By this summer or early fall, unless Congress acts before then, the U.S. government will be so cash-strapped it won’t be able to pay interest and principal to the country’s lenders. But before the nation reaches that point of default, it could come alarmingly close several times over the next few months as spending and revenue rise and fall — a fluctuation that could spook Wall Street, escalate pressure on negotiations between congressional leaders and President Joe Biden, and potentially force a short-term fix.”
“Even if McCarthy is able to push his debt limit bill to House approval, the legislation is dead-on-arrival in the Democratic-controlled Senate. Instead, the GOP debt bill is effectively a messaging tool for Republicans in their push for talks with President Joe Biden, who has thus far insisted on a no-strings-attached increase of the debt limit.
The Treasury Department has already been using “extraordinary measures” for months to hold off a default while an unclear “X-date” looms. But there could be more clarity soon: The Congressional Budget office and the Bipartisan Policy Center are planning to release updated projections the second week of May.”
“Indiana’s governor signed a bill banning all gender-affirming care for minors…joining at least 12 other states that have enacted laws restricting or banning such care.”
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“Opponents of the legislation said the types of care the bill would ban, such as hormone therapy and puberty blockers, are vital and often life-saving for transgender kids. Medical providers say most of the procedures banned in the bill are reversible and safe for minors. Transgender medical treatments for children and teens have been available in the U.S. for more than a decade and are endorsed by major medical associations.
But supporters of the legislation have contended such care is not reversible or carries side effects that only an adult — and not a minor’s parent — can consent to.
Lawmakers also banned gender-transition surgeries for minors in the state, though hospital representatives in Indiana told lawmakers doctors do not perform genital surgeries for minors or provide them surgery referrals.”
“Negotiators from Brussels and Washington are scrambling to solve a five-year dispute over steel and aluminum dating back to former U.S. President Donald Trump’s decision to slap tariffs on European imports. They have until October to get a deal but are still so far apart that European officials now fear the chances of an agreement are slim.
Without a deal, both sides could reimpose billions of dollars worth of trade tariffs on each other’s goods — potentially spreading well beyond steel to hit products including French wines, U.S. rum, vodka and denim jeans.”
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“Officials in Brussels see the ongoing negotiations as just another push from the U.S. to force them into taking a harder line against China. “The language just seems written to tackle one country specifically,” said one of the European officials.
Discussions only recently picked up pace through the exchange of a U.S. concept paper and then an EU response. Those texts showed how far apart the two sides are on key issues, the officials said.
Washington wants to impose tariffs on imported steel or aluminum products, which would increase progressively based on how carbon-intensive the manufacturing process is, according to the proposal seen by POLITICO. Countries that join the agreement, which would be open to nations outside the EU, would face lower tariffs, or none at all, compared to those that do not.
The EU’s response — also seen by POLITICO — does not include any form of tariffs, according to the officials. Brussels fears the American plan for tariffs goes against the rules of the World Trade Organization, which is a no-go for the EU.
But a senior Biden administration official, who spoke on the condition of anonymity to discuss ongoing negotiations, told POLITICO that tariffs should not be off the table.
“That’s a pretty powerful tool for driving the market both to reduce carbon intensity as well as to reset the playing field to counteract non-market practices and excess capacity,” the U.S. official said. “What we’ve been trying to understand and respond to, in part, is what are those reasons that the EU has to have concerns about a tariff-type structure.””
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“Several officials said Washington is also seeking an exemption from the EU’s carbon border tax, which imposes a tax on some imported goods to make sure European businesses are not undercut by cheaper products made in countries with weaker environmental rules.
Such an exemption for the U.S. is another no-go for Brussels. A European Commission spokesperson said giving the U.S. a pass on the carbon border tax would constitute a breach of WTO rules and “cannot be compared with” the U.S. steel and aluminum measures.”
“Saudi Arabia and Iran restarted diplomatic relations after seven years of high tensions and violent exchanges between them. Within two months, they will reopen embassies and have both pledged “respect for the sovereignty of states and noninterference in their internal affairs.” The two countries have been engaged in a proxy war in Yemen over the past eight years that has calmed down until recently, and have been on opposite sides of conflicts throughout the Middle East, in Lebanon, Syria, and Iraq. While normalization may not mean a cessation of violence throughout the region, the pause in outright hostilities between the two should be welcomed by all. The breakthrough builds on several years of talks in Iraq and Oman.”
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“That China played a role shows where global power is shifting — and a meaningful change in how Chinese President Xi Jinping conducts Middle East policy. Thus far, Beijing has been cautious in taking an active role there; this diplomacy, while significant, doesn’t mean China is trying to displace the US security role in the Middle East, Freeman explained. Instead, China is “trying to produce a peaceful, international environment there, in which you can do business,” he told me.”
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“China is the largest trading partner of the Gulf and most of the Middle East, and it has a real stake in an easing of tensions. Looking ahead, Saudi Arabia made a strategic choice here and elsewhere — it’s looking to join the BRICS grouping of developing countries and take on observer status at the Shanghai Cooperation Organization.
“It indicates that the kingdom wants to focus on domestic economic development over geopolitical conflicts at present, particularly as conflicts in Syria and Yemen settle into stalemate and Iran’s leaders are preoccupied by domestic unrest,” says Andrew Leber, a political scientist focused on Saudi Arabia at Tulane University.”