Trump says he is ‘not a big fan’ of USMCA, free trade agreement with Mexico and Canada he signed
Donald Trump told reporters in Paris on Wednesday that he is “not a big fan” of the US-Mexico-Canada Agreement on trade he signed in 2018, but was open to signing an extension of the pact known as the USMCA.
“I would rather not have the agreement, but I may sign it,” Trump told reporters at Paris Orly airport on his way to dinner at Versailles. “We do better as a country if we don’t have an agreement,” he said, without explaining why, then, he had directed officials in his first term to strike the deal, and in his current term to work on an extension.
“I’d rather have it terminated,” Trump added.
The US has to approve a renewal of the existing agreement by 1 July, or announce its intention to exit the pact, a process that would take 10 years.
US trade representatives are holding talks with Mexico this week in Washington on agriculture and another set of talks is scheduled for the week of 20 July in Mexico City.
US farmers are pressing Trump to extend the USMCA for another 16 years with duty-free farm products, ethanol access in Mexico and improved access to Canada’s largely closed dairy market.
US automakers also want an extension.
The six-year-old USMCA, which took effect in 2020, largely mirrored the North American Free Trade Agreement (NAFTA) in sustaining a highly integrated North American economy, with nearly $1.6tn in annual trilateral trade.
Key events
Democratic senator Chris Murphy says terms of Iran agreement leave US ‘in a fundamentally worse position’
Speaking on the floor of the US Senate on Wednesday night, Chris Murphy, a Connecticut Democrat, offered a blistering account of the terms of the US agreement with Iran, “negotiated by real estate developers cosplaying as American diplomats”.
“I knew it was going to be a humiliating agreement; I didn’t know it was going to be this humiliating”, Murphy said. “I want the war to end. I’m willing to stomach a bad deal, but this agreement exposes what a colossal mistake it was: the biggest foreign policy blunder of 20 years to start this war, and why every hawk who cheerled us into war with Iran was wrong. We didn’t get anything that you thought we were going to get out of this.”
“Iran is making no new commitments. They are agreeing to open the strait. The strait was open before the war began. They are promising that they will not develop or obtain a nuclear weapon. They had already promised that before the war began. And they are agreeing to talk about restraining their nuclear research program. They were willing to talk about that prior to the war beginning,” Murphy said.
“The United States is committing immediately to release all oil sanctions and to let Iran trade oil for free all around the world. That is billions, billions of windfall dollars to the Iranian treasury,” he added. “The United States is agreeing to free up frozen Iranian money. Could be around $24bn that will be going immediately.”
“Iran is making no commitments on reductions or controls on their missile program or their drone program or their support for terrorism”, the senator went on. “In fact, you can see a video today of Donald Trump saying, ‘I think it’s cool for Iran to have missiles. I think it’s kind of unfair to say that Iran shouldn’t have missiles if everybody else has it.’ He literally said this on TV today.”
“I’m glad the war’s over, but I’m furious that it has resulted in our nation’s humiliation, in Iran becoming stronger and America becoming weaker,” Murphy concluded.
Trump says he is ‘not a big fan’ of USMCA, free trade agreement with Mexico and Canada he signed
Donald Trump told reporters in Paris on Wednesday that he is “not a big fan” of the US-Mexico-Canada Agreement on trade he signed in 2018, but was open to signing an extension of the pact known as the USMCA.
“I would rather not have the agreement, but I may sign it,” Trump told reporters at Paris Orly airport on his way to dinner at Versailles. “We do better as a country if we don’t have an agreement,” he said, without explaining why, then, he had directed officials in his first term to strike the deal, and in his current term to work on an extension.
“I’d rather have it terminated,” Trump added.
The US has to approve a renewal of the existing agreement by 1 July, or announce its intention to exit the pact, a process that would take 10 years.
US trade representatives are holding talks with Mexico this week in Washington on agriculture and another set of talks is scheduled for the week of 20 July in Mexico City.
US farmers are pressing Trump to extend the USMCA for another 16 years with duty-free farm products, ethanol access in Mexico and improved access to Canada’s largely closed dairy market.
US automakers also want an extension.
The six-year-old USMCA, which took effect in 2020, largely mirrored the North American Free Trade Agreement (NAFTA) in sustaining a highly integrated North American economy, with nearly $1.6tn in annual trilateral trade.
Maryland Democratic senator Chris Van Hollen says he is ‘kicking the tires’ on a presidential run
Senator Chris Van Hollen, the Maryland Democrat who gained a national profile when he traveled to El Salvador last year to meet Kilmar Ábrego García, a resident of his state who was wrongly deported there by the Trump administration, said in an interview with NOTUS published on Wednesday that he recently visited New Hampshire because he is “kind of kicking the tires a little bit” on a possible 2028 presidential campaign.
Van Hollen added that critics of his trip to meet Ábrego had been proven wrong, since that was a moment when it was clear that the inside conventional wisdom was just dead wrong, because a majority of the country, other than a small Maga segment, agreed that violating someone’s constitutional rights is a bad idea”.
The senator, who has been a critic of US policy in Israel and Palestine, also said that “any credible Democratic presidential candidate has to be willing to hold the government of Israel accountable when it is violating human rights, and violating international law and violating US interests”.
Van Hollen also said that Democrats should reject funding from the influential American Israel Public Affairs Committee (Aipac).
“What Aipac demands of candidates it supports is unconditional support for the actions of the government of Israel,” Van Hollen noted. “Unconditional taxpayer support of the government of Israel is something nobody should sign up for in my view.”
Oil prices rise after Trump suggests Iran ceasefire agreement might not be signed
Oil prices rose more than 1% on Wednesday after Donald Trump riffed at his news conference in France on the possibility that the US might not sign a new ceasefire agreement with Iran announced on Sunday.
“So the deal with reached with Iran on Sunday will be signed shortly. Tomorrow, maybe the next day … I think. You know, subject – deals, my whole life is all about deals. That’s all I ever did was make deals, and crazy things happen with deals,” the president said, referring to real estate transactions.
“I’ve gone into deals where, its a guarantee, no way it can not be signed, and it doesn’t get signed,” he added. “But we’re going to most likely sign a deal.”
Trump also suggested that the US could resume bombing Iran if the nation’s leaders did not “behave”.
GOP senator slams Trump’s Iran deal as ‘worst foreign policy blunder in decades’
The Republican senator Bill Cassidy has slammed the memorandum of understanding the Trump administration has reached with Iran – two days before both parties are set to sign it – as “the worst foreign policy blunder in decades”.
The Louisiana senator, who lost his primary last month to a Trump-backed challenger, wrote on X:
[Former president Ronald] Reagan is rolling over in his grave. Iran’s nuclear ambitions were not curbed, and they have learned that threatening the Strait of Hormuz works and will undoubtedly leverage it in the future. Now, Iran gets to build brand-new infrastructure under this deal.
Before the war, the strait was open, Iran was being crushed by sanctions, and 13 service members were still alive. Now, 13 Americans are dead, families have paid billions at the pump, sanctions will be lifted, and the bombing has stopped. This is the worst foreign policy blunder in decades.
Before the text was released, Cassidy had already been commenting on what was being reported, while cautioning that he hadn’t seen the details.
He told a phone press conference of Louisiana reporters on Tuesday: “This is a bad deal, if the details remain the same. The deal, as I’ve heard it, makes your allies weaker and Iran stronger.”
And this morning, he told a reporter with Nexstar: “The details I’ve seen so far look awful … This will go down as a tremendous foreign policy blunder”.
The day so far
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Donald Trump abruptly derailed the confirmation process for his own nominee as the US’s top intelligence chief, Jay Clayton, early this morning, in a move that will allow the US president’s controversial selection for acting director of national security, Bill Pulte, to assume the role and remain in place for at least several weeks until Clayton is confirmed. Tom Cotton, a Republican senator and chair of the intelligence committee, initially said on X that the hearing would go ahead as planned “unless the president directs [Clayton] not to appear or withdraws his nomination”. Trump later directed Clayton not to appear and the hearing was cancelled, which Cotton called “regrettable”. My colleague Cate Brown has the story.
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Trump also responded to criticism of his ceasefire deal with Iran, warning at the G7 summit that he was prepared to go back to dropping bombs and insisting the deal did not require the US to pay even 10 cents to Iran. Here’s Patrick Wintour’s report.
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Senior US officials dictated the memorandum of understanding with Iran to journalists after days of secrecy. According to the officials, the draft agreement includes a new “minimum” standard for down-blending of highly enriched Iranian uranium and has provisions to ensure the “territorial integrity” of Lebanon after Israel’s continued attacks against Hezbollah in Lebanese territory. In return, the US will move to waive, but not eliminate, some wide-ranging sanctions against Iran once the deal is signed. The US draft of the agreement also secures toll-free passage of the strait of Hormuz for only 60 days, and it does not preclude fees in the future, the officials said. The accord, which Trump said today is “not final”, is due to be signed on Friday in Bürgenstock, Switzerland.
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The Federal Reserve left interest rates unchanged for the fourth time this year after its first meeting under new chair, Kevin Warsh, a Trump appointee who has taken over the central bank during a tumultuous time for the US economy. Here’s Gaya Gupta’s report.
Fed begins Warsh era by keeping rates on hold, but sees hike later this year
Gaya Gupta
And we have that now. The Federal Reserve has left interest rates unchanged for the fourth time this year after its first meeting under new chair, Kevin Warsh, a Donald Trump appointee who has taken over the central bank during a tumultuous time for the US economy.
“Economic activity is expanding at a solid pace despite elevated uncertainty that owes, in part, to the conflict in the Middle East,” the Fed’s open market committee said in a short statement. “Productivity growth and capital investment are strong. Job gains have kept pace with the workforce, and the unemployment rate has changed little.”
The Fed was widely expected to keep rates at a range of 3.5% to 3.75%, where it has remained since December.
The Fed also removed in its monthly policy statement the easing bias, which previously a signal that indicated that the central bank was looking for further opportunities to make a rate cut as their next rate change. Last month, three Fed governors dissented over the inclusion of this easing bias.
Warsh begins his four-year term as chair at a time when the US economy has been rattled by heightened inflation and geopolitical uncertainty.
A sharp spike in energy prices caused by Trump’s war on Iran has pushed inflation to 4.2% – the highest level the US has seen since 2023 and far from the Fed’s 2% target. Though the announcement of a ceasefire deal between the US and Iran sent oil prices tumbling to a three-month low, it will likely take months for energy prices to return to prewar levels.
Meanwhile, hourly earnings dropped to a seasonally adjusted 0.7%, indicating that price increases have stripped out wage gains over the past year.
But it’s unclear whether higher inflation will ever convince a majority of the Fed’s 12 voting members to call for a rate increase. Core inflation, which strips out volatile food and energy prices, has increased only mildly, to 2.9% from the year prior. The country’s labor market has also remained relatively strong, with the unemployment rate holding steady at 4.3%.
Even as Americans continue to balk at higher prices, Trump has continued to advocate for lower rates but said last week that he doesn’t “want to have a big influence” on Warsh.
“Kevin is fantastic, and I want him to do whatever he wants,” Trump said in an interview with Meet the Press on NBC News, while also reiterating his desire for a rate cut.
Kevin Warsh is due to hold his first news conference as chair of the Federal Reserve shortly, following his first federal open markets committee meeting in the role, where he is expected to announce where the Fed sees interest rates going.
Before that, we expect the Fed to release a policy statement alongside its rate decision, and economic projections for where policymakers see interest rates going over the coming years.
Senior US officials dictate US-Iran memorandum to journalists
Senior US officials have dictated the memorandum of understanding with Iran to journalists after days of secrecy.
The officials spoke on condition of anonymity to read the draft, which Iran has not released, ahead of a formal signing ceremony set for Friday in Switzerland.
According to the officials, the draft agreement includes a new “minimum” standard for down-blending of highly enriched Iranian uranium and has provisions to ensure the “territorial integrity” of Lebanon after Israel’s continued attacks against Hezbollah in Lebanese territory.
In return, the US will move to waive, but not eliminate, some wide-ranging sanctions against Iran once the deal is signed.
The US draft of the agreement also secures toll-free passage of the strait of Hormuz for only 60 days, and it does not preclude fees in the future, the officials said.
The accord is due to be signed on Friday in Bürgenstock, Switzerland. The Associated Press reports that it also envisions Iran receiving at least $300bn to rebuild after the war, citing leaked copies of an interim agreement that officials say broadly matches the document.
Trump’s Department of Labor claims without data that states defrauded government
Michael Sainato
Keith Sonderling sent letters to 53 states and US territories demanding action to “combat waste, fraud and abuse” within the unemployment insurance program, threatening to withhold administrative funds from states for the first time history.
“We are officially putting governors on notice,” said the acting US secretary of labor. “The American people will no longer tolerate the blatant waste, fraud and abuse of their hard-earned tax dollars – no state should allow it either. If states allow it, they will suffer the consequences. This department is no longer afraid to use every lever available to ensure taxpayer money is protected.”
The agency did not provide data on fraud or alleged fraud in unemployment systems, but highlighted three Democratic-led states – California, New York and Illinois – and made claims about each.
The agency says California owes $20bn to the federal government for a loan during the Covid-19 pandemic. California has struggled paying off the loan, as the state did with a similar federal loan received during the 2008 economic recession, due to the current setup of how employers are taxed to fund unemployment. The unemployment payroll tax system in California has been unchanged since 1984 at a taxable wage ceiling of $7,000 on a workers’ wages and maximum tax rate of 5.4%, leaving the state with insufficient funds to cover its unemployment reserve while legislators on both sides of the political aisle have been working to try to resolve the issue.
The Department of Labor also claimed that New York loses an estimated $2m per day in unemployment insurance fraud and improper payments, but did not differentiate between the two. They also cited that Illinois has improper payments of $320m, at a rate of 14%.
George Chidi
Legislators in the halls of the Georgia state capitol are saying that the Georgia house speaker has announced that the state will not engage in redistricting during the special session that began today.
Legislators were called to the capitol by Governor Brian Kemp to manage a legal problem with QR codes on ballots that lingered over from the regular session, and tacked on redistricting as an additional effort.
That effort appears to have been quashed after Republican lawmakers questioned the political risks ahead of what is expected to be a bruising general election in a swing state.
More to follow.
Why did Trump delay Clayton’s nomination? He wants the controversial Save America Act passed
Going back to Jay Clayton’s postponed nomination, Donald Trump said he would not approve the renewal of Fisa section 702 without passage of his Save America Act, which would require Americans to provide proof of citizenship when registering to vote, a provision critics say would strip millions of Americans of their right to vote, the Associated Press reported.
Trump has previously said the controversial act would deliver his Republicans a “guaranteed” win in November’s midterm elections.
With Trump’s approval rating dropping, polls show that his party will struggle to keep their slim control of the House and Senate when Americans head to the polls this year.
Jakub Krupa
Trump says he is looking forward to a “very special” dinner with Macron as he wants to see the Palace of Versailles, because it “has a lot of gold”.
He then says he hopes Europe will “find its way”, as it is “having a lot of hard times” with energy and immigration.
And curiously, Trump also thanks Russia’s Vladimir Putin and China’s Xi Jinping for staying neutral on Iran, saying otherwise “they could have made it much more difficult for us”.
‘I think they both want to do something,’ Trump says after talking to Zelenskyy and Putin
Jakub Krupa
Meanwhile at the G7 press conference, Trump has moved on to Ukraine.
He says he had “a productive conversation” with Ukraine’s Zelenskyy and then Russia’s Putin on the phone.
He suggests “something is going to happen”, as he says Russia is losing more soldiers than Ukraine.
He says he had “a very good conversation” with Putin and “a very, very good conversation with Zelenskyy”.
“I think they both want to do something. They just don’t know how to do it.”
He then swiftly moves on to international aid and the Ebola outbreak in Africa.
What’s at stake with Clayton’s delayed nomination? An expired powerful surveillance power
The Associated Press has succinctly summarized the stakes of the intelligence director nomination, and why even Republicans are wary of Trump’s interference in today’s hearing:
Hanging in the balance is not only the director of national intelligence, but also section 702 of the Foreign Intelligence Surveillance Act (Fisa), which permits spy agencies to collect without a warrant the communications of targeted foreigners located outside the United States.
National security officials across both major political parties have for years described section 702 as vital for gathering intelligence that can disrupt terror attacks and espionage operations, though some lawmakers and civil liberties advocates have raised concerns over the government’s use of information about Americans that is incidentally collected through the program.
Clayton’s Senate confirmation hearing was expected to be fast-tracked because of the program’s lapse. Democrats had said they would not renew Fisa until Trump withdrew the selection of Bill Pulte.
Trump’s post suggested that debate to revive section 702 could be indefinitely postponed.
GOP senator: ‘mistake’ to cancel Clayton hearing, blames administration for not ‘dialing the president in’
The Republican senator Thom Tillis, who is retiring from his North Carolina seat at the end of his term in 2027, told Punchbowl reporter Laura Weiss that Jay Clayton was on track to have a good hearing before Donald Trump interfered with the proceedings.
“Now we’re in a posture where it may be the reason 702 doesn’t get reauthorized,” Tillis said. “That’s a mistake.”
But Tillis also doesn’t think Trump is intentionally creating an issue. “I think somebody’s not dialing the president in to the complexities of what he’s done.”
Jakub Krupa
It’s worth noting a slight sense of Trump’s frustration with Israel’s Benjamin Netanyahu as he says he “gets a little excited sometimes”, and they “have a little dispute over Lebanon”.
“Bibi, you don’t have to knock down a building every time somebody walks into it that’s from Hezbollah,” he says.
Jakub Krupa
Meanwhile, Trump is still on Iran.
He says the deal will be signed shortly; maybe tomorrow, maybe Friday.
Jay Clayton’s nomination hearing canceled after Trump directs him not to appear
We’re going to quickly pivot from Trump’s press conference to share that Jay Clayton’s nomination hearing has officially been canceled for Wednesday, according to the Senate intelligence committee chair, Tom Cotton.
Trump directed Clayton to not appear at the hearing scheduled for this afternoon, according to Cotton. The Republican senator, a staunch ally of the president, called the order “regrettable” in rare public criticism of Trump.
In a post on X, he wrote:
It’s regrettable that the president has directed Jay Clayton not to appear at his confirmation hearing today. Mr Clayton is a patriot and a highly qualified nominee, as the president has said repeatedly. While today’s hearing is now unfortunately postponed, I look forward to proceeding with his confirmation in the near future.
