Welcome back to World Brief, where we’re looking at the passage of a U.S. tax and spending bill, Labour Party discord spooking British markets, and political infighting in the European Union.
World Brief will be off on Friday for July Fourth.
Trump’s ‘Big, Beautiful Bill’
Lawmakers in the U.S. House of Representatives narrowly passed President Donald Trump’s “big, beautiful bill” on Thursday, ending a monthslong political fight and delivering a significant win for the White House. Despite Democrats issuing an eleventh-hour call to action and two Republicans breaking ranks, the $3.4 trillion tax and spending package passed in a 218-214 vote largely along party lines.
“Promises made, promises kept!” U.S. Vice President J.D. Vance posted on Truth Social on Thursday. Trump is expected to sign the bill into law on Friday.
The nonpartisan Congressional Budget Office estimates that the 887-page bill will add around $3.4 trillion to the federal deficit over the next 10 years and pull health insurance from nearly 12 million U.S. residents.
Among its key elements are tax cuts, particularly for wealthy individuals and corporations. The bill will make tax breaks first imposed under Trump in 2017 permanent as well as increase the deduction limit for state and local taxes. It will also remove any taxation requirements on income earned through tips, fulfilling a key Trump campaign promise.
To pay for these tax breaks, the bill slashes up to 18 percent in Medicaid funding while adding new restrictions on eligibility and reenrollment; it also cuts funding for food benefits by up to 20 percent, including for the Supplemental Nutrition Assistance Program, which more than 40 million low-income residents use. The bill also ends many student loan repayment plans and repeals several Biden-era clean energy benefits, such as tax credits for electric vehicles and clean energy production.
The bill prioritizes spending in other areas. It devotes around $175 billion to Trump’s immigration crackdown, with roughly $50 billion to support U.S. Customs and Border Protection and to finish constructing the border wall, $45 billion to expand capacity for detaining undocumented migrants, and $30 billion to bolster law enforcement. It also gives the U.S. military around $150 billion to help construct Trump’s proposed “Golden Dome” missile defense shield as well as aid in shipbuilding and munitions development.
The House passed an initial version of the bill in May by a single vote. But the legislation stalled once it reached the Senate, forcing lawmakers to make several changes and Vance’s tie-breaking authority to pass it on Tuesday. The bill was then sent back to the House, where several Republicans first keen on Trump’s proposal appeared hesitant. Among the holdouts included moderates and members of the conservative House Freedom Caucus, which opposes increasing the U.S. deficit.
Such Republican pushback forced Trump to make overnight phone calls to several Republicans who were on the fence. “Largest Tax Cuts in History and a Booming Economy vs. Biggest Tax Increase in History, and a Failed Economy,” Trump wrote on Truth Social early Thursday morning. “What are the Republicans waiting for??? What are you trying to prove??? MAGA IS NOT HAPPY, AND IT’S COSTING YOU VOTES!!!”
After several hours of delay, the House voted to advance the bill. But at the eleventh hour, U.S. House Minority Leader Hakeem Jeffries delivered a record-breaking “magic minute” speech of 8 hours and 44 minutes to call on lawmakers to reject the legislation.
Ultimately, though, Jeffries failed to sufficiently sway his Republican colleagues, and the bill passed.
Today’s Most Read
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- Israel Can’t Be a Hegemon by Stephen M. Walt
What We’re Following
Crying in the House of Commons. British markets were spooked on Thursday after Chancellor of the Exchequer Rachel Reeves teared up during a Wednesday parliamentary session. The pound dropped in relation to the U.S. dollar, and U.K. bond yields spiked, suggesting that investors were losing confidence in the British economy. After Prime Minister Keir Starmer backed Reeves’s job performance, though, markets appeared to calm down.
On Tuesday, Starmer passed a controversial welfare reform bill—but only after members within his own Labour Party forced him to back down on key elements of the package, including cuts to disability benefits. It was the biggest parliamentary rebellion among his allies since Starmer first took office last July.
The following day, lawmakers accused Reeves of being cruel for committing to self-imposed fiscal rules that they argue would hurt vulnerable members of society. Supporters of Reeves’s plan, however, maintain that scaling back welfare cuts would force London to raise taxes or cut spending elsewhere.
The intense debate ultimately resulted in Reeves appearing shaken and visibly crying. It is unclear what exactly caused her distress, though Starmer’s office said it was due to a personal matter. However, internal friction over the spending proposal—despite the Labour Party having one of its biggest parliamentary majorities in U.K. history—suggests weakness in Starmer’s government.
“Maximum pressure.” Denmark launched its six-month presidency of the European Union on Thursday by calling for Hungary to temporarily lose its voting powers. “We are still seeing a violation on fundamental values,” Danish European Affairs Minister Marie Bjerre said, referring to allegations that Budapest has violated EU laws, including by repeatedly blocking Ukraine’s accession bid. “That is why we will continue the Article 7 procedure and the hearing on Hungary,” she said.
Article 7 is often referred to as the “nuclear option,” as it allows EU members to vote to exclude or penalize another member for failing to abide by the bloc’s rules. Specifically, Bjerre said Denmark is looking into blocking Hungary from being able to access EU funds and stripping Budapest of its veto power over Kyiv’s membership request.
Moldova and Ukraine have moved in tandem over the past several years to join the EU. However, Hungary has repeatedly denied Kyiv’s bid, arguing that Hungarian citizens do not want Ukraine to join. Experts, though, suggest that Hungarian Prime Minister Viktor Orban’s close relationship with Russian President Vladimir Putin may be to blame.
“We will put maximum pressure on Hungary in order to lift its reservations,” Bjerre said. “And we are willing to do all that we can, politically and practically, in order to move forward with Ukraine and also Moldova.”
High-profile military death. Ukrainian forces recently killed a top Russian Navy commander, Kremlin officials confirmed on Thursday, delivering a strategic blow to Moscow in its war on Ukraine. Maj. Gen. Mikhail Gudkov, the deputy commander in chief of the Russian Navy, was killed while working in Russia’s Kursk region near the Ukrainian border. Last August, Ukraine launched a counteroffensive in that territory, and since then, Moscow has waged a monthslong campaign to win back the land; only a sliver of Kursk still remains under Ukrainian control.
Gudkov’s death is the latest in a string of high-profile killings of Russian officers since Russia’s full-scale invasion of Ukraine began in February 2022. At least 12 Russian major and lieutenant generals have been killed thus far, including Lt. Gen. Igor Kirillov, the head of Russia’s nuclear and chemical weapons forces, and Lt. Gen. Yaroslav Moskalik, the deputy chief of main operations. On Thursday, Ukrainian troops also took credit for killing Manolis Pilavov, a pro-Russian separatist and the former mayor of Luhansk, a Russian-occupied Ukrainian territory.
Odds and Ends
Astronomers have discovered something out of this world. On Wednesday, the European Space Agency detected an object hurtling through our solar system that may have originated from another star system. The size and shape of the object, named A11pl3Z, are unclear, as is whether it’s an asteroid or a comet. But its trajectory appears unlikely to bring it beyond Mars, meaning Earth won’t be getting a flyby anytime soon.