The US government is rushing to agree on how to handle the debt ceiling ahead of Memorial Day weekend, which marks the start of summer. The latest proposed agreement would increase the debt ceiling for two years, but leave a lot of issues unresolved, such as non-defence spending, raising taxes, as well as concerns that the US government continues to spend too much money. While investors are optimistic, there are concerns that economic and banking crises could be pushed aside, giving lawmakers time off from addressing these key issues.
The European Union risks difficulty in persuading members to relinquish control over export controls as it works towards an EU-wide system that includes monitoring outward investment, according to European Trade Commissioner Valdis Dombrovskis. The EU's proposed "Economic Security Strategy" is due to be presented next month and will seek to prevent China and other nations from accessing the most sensitive technologies. The plan may also include initiatives aimed at monitoring and controlling exports of certain equipment. Discussions on the subject will be held during the upcoming Trade and Technology Council meeting of senior officials next week in Sweden.
Kelly Meggs, Jessica Watkins, and Kenneth Harrelson, members of an extremist group, were sentenced to federal prison sentences after joining a mob inside the US Capitol on 6 January. Watkins got eight and a half years, Meggs got 12 years, and Harrelson was sentenced to four years in prison. During the riots, the group joined a mob in tactical gear and declared the group had "stormed the Capitol." So far, Stewart Rhodes has the longest sentence for treason-related charge of seditious conspiracy. Rhodes has been sentenced to an 18-year prison sentence.
Democrats and Republicans are still negotiating the conditions of raising the US government's debt ceiling as the deadline of June 1 approaches. Lawmakers were put on call after leaving Washington for the Memorial Day holiday, with any deal needing to pass the House and Senate which could typically take days to complete. The lead Republican negotiator, Garret Graves, said he was pleased with the progress made but significant issues remained to be addressed, chief among them work requirements for benefit programmes for low-income Americans. The package would raise the ceiling for two years and cap spending while agreeing on specific funding for the Internal Revenue Service and the military, while capping spending for other areas. The treasury secretary has warned the US will cease to be able to pay its bills on or about June 1 if the limit is not raised. A default is expected to cast the global economy into market chaos and probable recession.
Former Spice Girl Melanie Brown has spoken about how Tina Turner’s story of domestic abuse inspired her to become an advocate for victims. Writing exclusively for The Independent, Brown recounted how she grew up admiring Turner and how, after leaving an abusive relationship, she had come to see Turner as a role model. Brown said that, before Turner died, she had attended a stage show about the singer's life and was prompted by its portrayal of domestic violence to speak publicly about her own experiences. Brown is now a patron of the Women’s Aid charity. Turner died on Wednesday aged 83.
Two Los Angeles residents, John Chen and Lin Feng, have been charged with taking part in a Beijing-led scheme targeting the US-based Falun Gong group, which is banned in China. The US Justice Department said the pair backed Chinese efforts to end the tax-exempt status of a US entity run by Falun Gong practitioners. The complaint against the pair was filed in federal court in the Southern District of New York, said the department. It added that the alleged bribe was part of a broader campaign by China's government to target its critics in the US.
Distinguished economists believe that the official figures for Russia's wartime economy are one big "Potemkin village"; a false front created to make the situation look better than it really is. Many point to a set of "Potemkin indicators" that offer a masterclass in distorting the truth about Russia's economy. These include gross domestic product, unemployment, inflation, domestic investment, and the rouble's exchange rate. For instance, on unemployment, the chart below indicates that hidden unemployment is at a record high and way above the official jobless rate of less than 4%. The war appears to be squeezing Russian households considerably through data on Russian car sales. However, many Russian experts contend that the economy continues to display a certain resilience. Yet the militarisation of Russia's economy combined with Western sanctions is almost certain to lead to substantial inefficiency and a reduction in the amount of productivity. From Soviet times to today, GDP growth and state expenditure have always been linked to oil and gas exports, and western sanctions have impacted it.
Hong Kong's Civic Party, a prominent pro-democracy organisation, is to disband as its members were charged under Hong Kong's national security law. In the past, the party supported democratic institutions and civil society. At its peak, the Civic Party was the second-largest group in the opposition camp. However, democrats have been sidelined from local politics after Beijing imposed a national security law and an overhaul of the electoral system. The law made it easier to prosecute people on any related charges and lead to widescale censorship.
Elon Musk misquoted Voltaire on Twitter. The quote actually originated from Kevin Alfred Strom, a known neo-Nazi, in 1993. The same quote was also tweeted and then deleted by actor John Cusack in 2019.
Championship side Luton has secured promotion to the Premier League following a dramatic sudden-death penalty shoot-out win against Coventry. The fairytale rise will bring Luton to the top-flight of football for the first time since 1992, following a win that comes just nine years after ending a five-season stretch in the Conference Premier. The match finished 1-1 after extra time, before a famous 6-5 shoot-out victory. Both Luton and Coventry have gone through significant upheaval while away from the big stage over past decades.
The US Commerce Secretary, Gina Raimondo, has said the US "won’t tolerate" China's de facto ban on purchases of Micron Technology memory chips, and is working closely with allies to address this example of "economic coercion". The company said China's action would hit its annual revenue, and also warned that it might have to lower its outlook for the year due to the US temporarily banning exports to Chinese firm ZTE. The US said it was engaging with partners to address all challenges related to China's non-market practices.
US President Joe Biden and top Republican Kevin McCarthy have reached an agreement in principle to raise the federal government's debt ceiling by an unspecified amount over two years while capping spending over that period, offering hope that the US will avoid economically destabilising default before June 5 when the Treasury Department warned it could run out of money unless the ceiling is raised. The deal requires approval from a narrowly divided Congress before being passed into law. The rising debt ceiling included some extra work requirements for programs for poor Americans, while Republicans had demanded significant cuts in spending.
US President Joe Biden and Republican House Speaker Kevin McCarthy have reached a deal in principle to raise the country's $31.4tn debt ceiling, a move that will avert an economically destabilising default that had been expected on 5 June. The debt limit will be raised for two years, enough time for the country to avoid standoffs until after the 2024 presidential election. The deal must gain approval from the divided Congress, and it remains unclear whether McCarthy will receive support from Democrats.
Ukraine says preliminary operations have begun to pave the way for a counteroffensive against Russian occupying forces. Ukrainian commander Gen Valerii Zaluzhnyi increased expectations a major conflict was imminent after stating “the time has come to take back what’s ours”. Explosions shook Kiev on Sunday and the city’s defence systems had been downing air targets, mayor Vitali Klitschko said. Ukraine’s defence ministry claims Russia is planning to simulate a major accident at Zaporizhzhia nuclear power station to thwart its counteroffensive. Russia has also been intercepting UK cruise missiles supplied to Ukraine, according to a statement by the country’s defence ministry.
US President Joe Biden and House Republican leader Kevin McCarthy have reached a tentative agreement to raise the government's debt ceiling, which would end the months-long stalemate. The deal involves a cap on discretionary spending at 2023 levels for two years, as long as Democrats agree to a debt-ceiling increase over this time. Should this deal pass through the narrowly divided Congress before the US Treasury runs out of money to cover its obligations, it would avert an economically destabilising default. The US debt is now equivalent to the annual output of the American economy.
President Joe Biden and Republican House Speaker Kevin McCarthy are reportedly agreeing to lift the US debt ceiling by "trimming" the level of federal spending. The deal includes suspending the debt ceiling until January 2025, capping non-defence discretionary spending and increasing defence spending by 11%. Meanwhile, $80bn in new funding for the tax authorities will be moved back to "discretionary spending" to be allocated by Congress, while any unused COVID relief funds, estimated at between $50bn and $70bn, will be clawed back.
One person was killed and three others were injured when Russian military drones targeted Kyiv earlier today. Reports suggest that over 20 unmanned aerial vehicles (UAVs) were destroyed by defence forces, although further drones were expected to attack the city. One 41-year old man was killed by falling debris from a drone on a gas station in the city’s Solomyanskyi district. The West accuses Russia of escalating tensions in the region following numerous drone attacks and an increasing focus on military operations in the Black Sea and the Crimean borders.
The head of Russia’s embassy in London, Andrei Kelin, appeared on the BBC’s Andrew Marr show to warn that Russia has “enormous resources” and is not afraid of war with Ukraine. The comments followed a mass drone attack on the Ukrainian capital Kyiv on 29 May that saw dozens of drone missile attacks. The attack, which Ukraine called the “largest drone raid” since the conflict began in 2014, killed one person and injured another. Ukrainian authorities blamed the attack on Russia, which has consistently denied the accusations. Kelin told Marr that the war had been going on since 2014 in the Donbas, and that “crimes” had been committed on the Ukrainian army’s side. However, his denial of Russia’s responsibility provoked strong reactions on social media.
Italian Prime Minister Giorgia Meloni has said that good relations with China remain possible, even without being part of the country's Belt and Road Initiative (BRI) deal. Italy is currently the only major Western country signed up to the infrastructure spending scheme to connect China with Asia, Europe and beyond. Meloni stated that Italy was not the European or Western nation with the strongest economic and trade ties with China, so it was still possible to maintain good relations with the country without being part of the wider BRI project. Earlier this month, a senior government official said Italy was unlikely to renew its Belt and Road programme after 2024.
China has celebrated the maiden commercial flight of its domestically produced passenger jet, the C919, by taking 130 passengers on a journey from Shanghai to Beijing. The plane, developed by state-owned Commercial Aviation Corp of China, is set to compete with similar jets produced by Airbus and Boeing. The C919 has received around 1,200 orders, mostly from domestic airlines. However, it is unlikely to win orders abroad until it gains regulatory approval from the US or Europe. Multi-aisle widebody jet the CR929 is also being developed by Commercial Aviation Corp of China, in collaboration with Russia.
