Happy Monday! Now that President Donald Trump has signed into law his so-called big, beautiful bill, the fiscal focus shifts to tariffs, the spending bills needed to avoid a government shutdown, rescissions packages and, unfortunately, the horrific flooding disaster still unfolding in Texas. Trump today is also hosting Israeli Prime Minister Benjamin Netanyahu as the United States pushes for a ceasefire in Gaza and a nuclear deal with Iran.
Trump Announces New Tariffs and a New Deadline
President Trump announced Monday that he would impose 25% tariffs on imports from Japan and South Korea starting on August 1. In letters to the leaders of those major U.S. trading partners, Trump also threatened that any retaliation on their part would be punished with higher tariff rates.
The announcement came amid a flurry of trade-related activity at the White House ahead of a July 9 deadline for the imposition of Trump’s “reciprocal” tariff plan, which was announced in April but delayed until this week to give countries time to negotiate trade deals. The delay left a 10% tariff rate temporarily in place instead of the punitively high rates set out by Trump. The White House said Monday that Trump will again delay the deadline for dozens of countries, giving them until August 1 to secure new trade agreements.
The import duties on Japanese and South Korean goods announced Monday are close to the levels defined by Trump’s reciprocal tariff plan.
Trump also announced tariffs on five less significant trading partners: Malaysia, Kazakhstan, South Africa, Laos and Myanmar. Those tariff levels are mostly lower than in the reciprocal plan, though still high relative to historical norms. The tariff on goods from Kazakhstan dropped from 27% to 25% relative to the April plan, Laos from 48% to 40%, and Myanmar from 44% to 40%. The tariff on South African imports remained the same at 30%, while the tariff on Malaysian goods rose a percentage point to 25%.
White House Press Secretary Karoline Leavitt said Monday that more announcements should be coming shortly, and toward the end of the day, Trump released letters to the leaders of Bosnia and Herzegovina (30% tariff), Tunisia (25%), Indonesia (32%), Bangladesh (35%), Serbia (35%), Cambodia (36%) and Thailand (36%).
Declarations over negotiations: The tariff announcements come amid mixed results from the trade negotiations, which, to the extent they exist, have produced little by way of new agreements. In place of complex trade deals, a handful of countries including the U.K. and Vietnam have agreed to general terms for an overall framework, with details to be spelled out later.
Speaking to CNN’s Dana Bash over the weekend, Treasury Secretary Scott Bessent defended the administration’s track record on trade deals. “Many of these countries never even contacted us,” Bessent said, contradicting Trump’s assertion that the phone was ringing off the hook at the White House as trade partners scrambled to secure new agreements.
In place of negotiated agreements, it appears that Trump is simply declaring what the tariffs will be. Bessent said he expects the White House to send 100 letters to trade partners this week, fulfilling the administration’s pledge to conclude many trade agreements quickly. “That’s the level, that’s the deal, if you want to trade with the United States,” Bessent said.
The Treasury Secretary told CNBC Monday that the letters announcing the unilaterally-imposed U.S. tariff rates would be “pretty standard,” and suggested that countries could continue (or begin) to negotiate in the future. “It’s just, ‘Thank you for wanting to trade with the United States of America. We welcome you as a trading partner. And here’s the rate, unless you want to come back and try to negotiate,’” he said.
Schumer Calls for Probe Into Weather Service Cuts in Texas
As the death toll from the catastrophic flooding in Central Texas has climbed to more than 100 and the desperate search for survivors continues, officials are also facing questions about the warning systems in place and how the disaster could have become so deadly. Senate Democratic Leader Chuck Schumer on Monday demanded that the Commerce Department’s acting inspector general investigate whether cuts and local staffing shortages at the National Weather Service contributed to the losses from the flooding.
In his letter, Schumer pointed to a New York Times report that said that key forecasting and coordination positions at the weather service’s offices for the region were vacant at the time of the storm and that the vacancy rate at many such offices nationwide has roughly doubled under the Trump administration because of its push to reduce staffing. Among those who reportedly accepted an early retirement offer from the Trump administration was Paul Yura, who had been the warning coordination meteorologist at the National Weather Service’s Austin/San Antonio office.
“The roles left unfilled are not marginal, they’re critical,” Schumer wrote. “These are the experts responsible for modeling storm impacts, monitoring rising water levels, issuing flood warnings, and coordinating directly with local emergency managers about when to warn the public and issue evacuation orders. To put it plainly: they help save lives.”
In an interview with CNN on Sunday, Democratic Rep. Joaquin Castro of Texas also called for an investigation. “When you have flash flooding, there’s a risk that you won’t have the personnel to make that — do that analysis, do the predictions in the best way,” he said. “And it could lead to tragedy. So I don’t want to sit here and say conclusively that that was the case, but I do think that it should be investigated.”
The Times also reports that local officials in Texas’s Kerr Country had discussed and debated the need for a flood warning system in 2017 but rejected the idea as too expensive. In a recent interview with the Times, Rob Kelly, the top elected official in Kerr County, said local residents are resistant to the expense of a flood warning system. “Taxpayers won’t pay for it,” Kelly told the Times.
Trump and Musk Escalate Their Feud Over New GOP Law
President Trump and Elon Musk have ramped up their on-again-off-again feud, with the tech mogul announcing that he has launched a new party, the America Party, after criticizing Trump’s tax and spending package as a “disgusting abomination.”
Trump said in a social media post Sunday that Musk had gone “off the rails” and criticized the attempt to start a third party. “I am saddened to watch Elon Musk go completely ‘off the rails,’ essentially becoming a TRAIN WRECK over the past five weeks. He even wants to start a Third Political Party, despite the fact that they have never succeeded in the United States,” Trump wrote. “The one good thing Third Parties are good for is the creation of Complete and Total DISRUPTION & CHAOS...”
Trump also claimed that Musk’s opposition to the new law stemmed from its elimination of tax credits for electric vehicles and from the withdrawn nomination of Jared Isaacman, a friend of Musk’s, to run NASA.
Musk and his defenders on X, his social media platform, tended to focus their comments more on the larger deficits that the new law is projected to create and the $5 trillion increase in the debt limit that it included. “When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy,” Musk wrote in announcing his new party. He later posted: “What the heck was the point of @DOGE if [Trump]’s just going to increase the debt by $5 trillion??”
Musk also bashed Trump in more personal terms, again raising allegations about Trump’s ties to convicted sex offender Jeffrey Epstein. But Musk said his new effort wasn’t going to focus on fielding a presidential candidate, at least not yet. “Backing a candidate for president is not out of the question, but the focus for the next 12 months is on the House and the Senate,” Musk wrote on X on Sunday.
The bottom line: The bromance between Trump and Musk ended a while ago, but they each could now pose a significant threat to the other. Trump’s control over the government could present problems for Musk’s companies, many of which rely on government contracts or incentives — and could be trouble on a personal level as well. Musk, meanwhile, has the bankroll to grow his party into enough of a force that it could undercut Republican candidates with certain voters.
Timeline of the Day
The budget reconciliation bill President Trump signed into law last week contains a huge array of specific provisions that touch on everything from clean energy tax credits to new work requirements for Medicaid recipients. Not all provisions take effect immediately, however, and the table below shows how some of the key elements are staggered across the calendar.
Critics of the bill say the timing has everything to do with politics, with tax cuts starting immediately and painful benefit cuts coming later, after the midterm elections. “They want to try to get past elections and try to hide the ball on the damage they’re imposing on health care and food assistance,” Alex Jacquez, who served in the Biden administration and is now with the liberal advocacy group Groundwork Collaborative, told The New York Times.
Number of the Day: 22
The Senate returns on Tuesday, but House lawmakers are out until next week. Congress will be working on appropriations bill for fiscal year 2026, with a shutdown deadline lurking just 12 weeks away and no indication of cooperation between Republicans and Democrats. The House is also scheduled for a summer recess from July 25 to September 2, leaving just 22 days on the legislative calendar between now and the end of the fiscal year on September 30. “That's right. There are 22 scheduled days of legislative business over the next 12 weeks,” writes congressional reporter Jamie Dupree. “That might not be enough to pass 12 funding bills through the House - let alone through the House and Senate.”
Fiscal News Roundup
- Trump Announces New Tariffs of Up to 40% on a Growing Number of Countries – CNN
- Trump Pushes Global Trade War Back to the Top of His Agenda – Wall Street Journal
- Deals Made by Trump Since Pausing His ‘Liberation Day’ Tariffs Remain Sparse – Associated Press
- ‘Big Beautiful Bill’ May Help Some Seniors on Social Security. But It Doesn’t Eliminate Taxes on Benefits – CNBC
- That Social Security Email About the "Big, Beautiful Bill," Explained – Axios
- Former Social Security Official Pitched an Investment Strategy to Keep Fund Solvent. It Went Nowhere – Wall Street Journal
- Fatal Floods in Texas Draw Howls From Dems Over Trump Cuts – The Hill
- Schumer Wants Probe of National Weather Service Response in Texas – Reuters
- GOP Turns Toward DOGE Cuts and a Shutdown Cliff – Politico
- Summers: No Economist 'Without a Strong Political Agenda' Says Trump Bill Good for Economy – The Hill
- ‘Tears My Heart to Pieces’: North Carolina Braces for Medicaid Cuts – New York Times
- Spending Law’s Medicaid Limits Spur Planned Parenthood Suit – Bloomberg
- Major Medical Associations Sue Kennedy, Trump Administration Health Leaders for Covid-19 Vaccine Changes – CNN
- Trump Administration Ends Deportation Protections for Hondurans and Nicaraguans – New York Times
- ICE Raids Derail Los Angeles Economy as Workers Go Missing – Bloomberg
- Musk Forms New Party After Split With Trump Over Tax and Spending Bill – NPR
Views and Analysis
- The Economic Consequences of the Big Odious Bill – John Cassidy, New Yorker
- Race to Define Trump’s Legislation to Voters Is Next Political Test – Dan Balz, Washington Post
- Ten Bizarre Things Hidden in Trump’s Big Beautiful Bill – Ryan Cooper and David Dayen, American Prospect
- Congress Throws More Money at Removing Immigrants than Most Countries Spend on Their Armies – Josh Kovensky, Talking Points Memo
- ICE Doesn't Need Another $100 Billion – Patricia Lopez, Bloomberg
- ‘Tariff Man’ Is Back for More ‘Liberation’ – Wall Street Journal Editorial Board
- America, This Isn’t How You Lower Interest Rates – Bill Dudley, Bloomberg
- How Trump’s Very MAGA Tax Cuts Break with GOP Tradition – Victoria Guida, Politico
- In Today’s GOP, There Is No Choice at All – Jonathan Martin, Politico
- Republicans Just Cut Medicaid. Will It Cost Them Control of Congress? – Lisa Kashinsky, Andrew Howard and Elena Schneider, Politico
- Trump’s Megabill Will Hurt the Health of His Own Voters – Juan Williams, The Hill
- Trump Bill's Health Effects Won't Be Felt Until After Midterms – Maya Goldman, Axios
- Republicans Now Own America’s Broken Health Care System – Dylan Scott, Vox
- Why the GOP’s Medicaid Cuts Are Less Than Meets the Eye – Ramesh Ponnuru, Washington Post
- The Next Megabill Congress Needs to Worry About – Benjamin Guggenheim, Politico
- Why Some See the Dollar's Drop as a Sign America Is Losing Its Financial Might – Rafael Nam, NPR
- Trump’s $5 Million ‘Gold Card’ Visa Might Never Happen – Meryl Kornfield and Hannah Natanson, Washington Post
- The Limits of Using Taxes to Improve Health and Reduce Harmful Consumption – Adam Hoffer, Tax Foundation
- Jerome Powell Is Competing to Be the Worst Fed Chair in History – Peter Navarro, The Hill
- Feel Like Congress Doesn’t Care What You Want? You’re Right – Theodore R. Johnson, Washington Post