Washington, DC

1. Vance’s economic critics
2. Trump personnel messaging
3. China’s Iran support
4. Beyond Hormuz
5. Liberia deal questions
6. Pennsylvania House clash

PDB: Progressive wins special election for Swalwell’s seat

Trump in South Carolina, Vance in Ohio … US-South Korea military drills end … Deadline looms for Canada trade deal

Vance takes first economic punch of 2028

Economic historian Phillip Magness wasn’t expecting to go viral last week when he posted a 2023 clip of Vice President JD Vance criticizing the US dollar’s status as global reserve currency. Now, “it’s all over the place,” he told Semafor’s Eleanor Mueller. Vance’s allies perceive a growing campaign by free-market Republicans to discredit his economic policies ahead of a potential 2028 presidential bid — even as they double down on their critiques of the dollar’s reserve-currency status, which former Trump White House Council of Economic Advisers Chair Stephen Miran later embraced. “The fact that you still have this bizarre kind of rump-libertarian right that thinks it’s … absurd mostly just speaks to how far behind the contemporary issues they really are,” Oren Cass, the populist economist who founded American Compass, told Semafor.

White House’s messaging sidetracked by drama

As the midterms get closer, the White House is confronting another topic instead: internal drama. From speculation about press secretary Karoline Leavitt’s replacement, to coverage of Defense Secretary Pete Hegseth’s wife getting unusually involved at the Pentagon, to further talk about President Donald Trump’s executive assistant, Natalie Harp, this week has underscored the administration’s difficulty controlling its message. Trump aides are engaging and even hitting back on the staff stories, including a subtweet from Dan Scavino that made the rounds among DC Republicans. Some of Trump’s allies see this week as proof that press relations are ready for a reboot. “A press secretary can only help so much, this is a personnel issue and a press issue,” one person close to the White House told Semafor. “Maybe more turnover and fresh faces is just what the White House and administration needs.”

Iran sanctions test Trump on China

Trump faces a high-stakes choice ahead of next week’s announcement of new Iran economic penalties: How hard to go after China? Beijing is the main buyer of Iranian oil, purchasing roughly 90% of Iran’s crude exports. After Treasury Secretary Scott Bessent urged China to “get with the program” while teasing the sanctions plan yesterday, a Chinese foreign ministry spokesman said “sanctions and pressure” would not resolve the US-Iran war. Any move to target China could result in blowback ahead of Trump’s planned meeting with Chinese leader Xi Jinping in Washington next month. The two countries have largely adhered to a trade truce in recent months, but sanctioning China over Iran could change that. Broadly, the Trump administration’s latest threats are an “admission that the US is running out of options,” one analyst told Bloomberg. They’re also a sign Trump is pivoting away from military pressure.

Hormuz ‘isn’t really the problem’

A big hiccup is moving through the global oil trade that’s likely to cause another surge in prices, especially in Asia, in the coming weeks. With tanker traffic out of the Persian Gulf constricted over the past six months, higher exports from other countries, especially the US, have helped keep prices relatively in check. There was also the extra burst of shipments out of the Gulf during the brief June ceasefire. Now the tankers that sprang out at that moment are reaching ports in Asia. But other factors are conspiring to drive down the volume of crude “on water” faster over the past two weeks than any point during the war, according to data from the market intelligence firm Vortexa. So despite the US Navy’s efforts to push oil out along the Omani coast, “Hormuz is currently not really the problem,” said Vortexa’s chief economist.

Mystery surrounds US deportations to Liberia

Liberia’s agreement to accept up to 1,200 deportees from the US remains shrouded in mystery a day after the first 20 arrivals landed in Monrovia, leaving many wondering what Liberia is getting in return. The Liberian government has insisted the deal is “not a transaction with a quid pro quo,” but that claim has failed to quiet the questions. “It’s very hard to imagine that [claim] is true,” said Robert Blair, a Brown University professor who studies Liberian politics, adding that Monrovia likely expects “some sort of favorable treatment” from Washington down the line, even absent explicit terms. A State Department spokesperson called implementing Trump’s immigration policies a “top priority” but declined to offer details of the arrangement with Liberia. “As a general matter, we do not comment on the details of our private diplomatic communications with other governments,” the spokesperson said.

— Adrian Elimian

Heels and drag in a Pennsylvania House race

A Pennsylvania House race is turning into a fight over drag, Semafor’s David Weigel reports. It began when Republicans went after Paige Cognetti, the Democratic mayor of Scranton, over a photo in which she poses with a drag queen at a Pride event and attacked her over support for an anti-discrimination policy covering transgender people. Then, opponents of incumbent Rep. Rob Bresnahan discovered a video of him working out in pink heels. Republicans insisted the difference was that Bresnahan wore heels for breast cancer awareness, not as a pro-drag statement; Democrats countered that the congressman was being hypocritical, given he also attended a fundraiser for a theatre company in which the drag queen was a member. (The drag queen in the GOP ad, meanwhile, is exploring legal action.) It’s another example of Republicans deploying gender-centric rhetoric that paid dividends in 2024 — and has proven less successful since.

Are we seeing the death of the social media follower? Rachel Karten thinks so. On this week’s episode of Mixed Signals, the social media consultant and Link in Bio newsletter author joins Max and Ben to talk about how the shift from follower-based to algorithm-driven distribution broke the contract between platforms and creators, why brands are quietly building their own shows without telling anyone they’re behind them, and what the regulatory gap around paid content is actually doing to the feed.

Blindspot: Voting and FDA

Stories that are being largely ignored by either left-leaning or right-leaning outlets, curated with help from our partners at Ground News.

What the Left isn’t reading: Federal prosecutors accused a Chinese man living in Massachusetts of impersonating another Chinese national to vote and then reporting him to immigration authorities.

What the Right isn’t reading: Sen. Bill Cassidy, R-La., who leads the Senate’s health committee, sharply criticized President Trump’s nominee to lead the FDA. 

White House

• The Trump administration has a habit of “withholding certain documents” when it declassifies materials it says illuminate deep-state coverups. — NYT
• The White House announced a new policy meant to increase the number of space launches on US soil.

Congress

• Democrats are angling to investigate President Trump’s and Commerce Secretary Howard Lutnick’s personal ties to major critical minerals deals, should they win control of Congress. — Politico
• A trio of Senate Democrats pressed the Pentagon on leadership changes at the Stars and Stripes.

Campaigns

• California state Sen. Aisha Wahab defeated Melissa Hernandez in the special election for former Rep. Eric Swalwell’s seat.
• Rep. Mike Rogers, R-Mich., called for a one-year moratorium on data center construction, a pivotal issue in his closely watched Senate contest with Democratic nominee Abdul El-Sayed.

Business