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Trump has vowed agency overhaul
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This is Washington Edition, the newsletter about money, power and politics in the nation’s capital. Today, White House correspondent Hadriana Lowenkron looks at the debate within the administration over federal disaster relief. Sign up here and follow us at @bpolitics. Email our editors here.

In the Aftermath

Donald Trump traveled to Texas today to view the recovery efforts following deadly flooding as the future of the Federal Emergency Management Agency is up in the air. 

The president has long railed at FEMA over its response to disasters, particularly under his predecessor Joe Biden, casting the agency as ineffective and calling for its overhaul.

In March he signed an executive order to shift disaster preparations from FEMA to states and local governments, not long after the agency, which was already short-staffed, fired about 200 people. Homeland Security Secretary Kristi Noem on Wednesday called for FEMA to be “eliminated as it exists today.”

Trump, Texas Governor Greg Abbott and first lady Melania Trump meet with local officials. Photographer: BRENDAN SMIALOWSKI/AFP

But the president appears to have walked back from the idea of of abolishing the agency — at least until after the hurricane season, which some projections have shown could be particularly active and deadly this year. He said last weekend that FEMA’s future was “something we can talk about later, but right now they’re busy working, so we’ll leave it at that.”

More: Trump Says FEMA Phaseout to Begin After Hurricane Season

The Washington Post reported today that administration officials now say abolishing FEMA outright isn’t on the agenda, and that changes may just be a “rebranding“ that will prioritize state leaders’ roles in disaster response.

While in Texas, Trump praised the agency’s leadership and sought to draw a distinction with the Biden administration. “We have some good people running FEMA,” he said. “It's about time, right?”

Still, some changes are already evident. While FEMA and the US Coast Guard have deployed resources to assist state and local authorities and aid in the search and recovery efforts, Politico’s E&E News reported that acting FEMA administrator David Richardson hasn’t made the trip to Texas. The agency has also been rejecting requests for resiliency money for states hoping to better prepare for future storms.

The debate over FEMA’s fate is happening against the backdrop of the tragedy in Texas, which left at least 120 people dead and more than 170 missing. Abolishing or substantially shrinking FEMA would reshape disaster assistance. The agency currently allocates grants to state governments and direct payments to disaster survivors and oversees the deployment of staff and resources both immediately before and after a disaster. And it could be difficult for states to replace that work and funding.

For now, the president must confront a reality that at least some of his voters are expecting a federal response.  Hadriana Lowenkron

Don’t Miss

Trump threatened a 35% tariff on some Canadian goods and raised the prospect of increasing levies on most other countries, ramping up his trade rhetoric in comments that weighed on stocks and boosted the US dollar.

Federal revenue from customs duties this fiscal year surpassed $100 billion for the first time, reflecting higher tariffs imposed by the Trump administration.

US manufacturers secured the business tax provisions they’d hoped for in Trump’s budget megabill, but the president’s erratic trade policy risks tempering any pronounced pickup in capital investment.

The US is working toward an interim trade deal with India that may reduce its proposed tariffs to below 20%, putting the South Asian nation in a favorable position against its peers in the region.

One of the Trump family’s crypto ventures has received key behind-the-scenes help from the world’s largest digital-asset exchange, whose founder is a convicted felon now seeking a presidential pardon.

The Senate Armed Services Committee wants to increase the Pentagon budget by $30 billion more than the Trump administration sought, adding billions for ships and more F-35s than requested.

Treasury Secretary Scott Bessent told a room full of billionaires that Trump shares a personality trait with his former boss, famously liberal financier George Soros: Both are impatient dealmakers. 

Secretary of State Marco Rubio said a summit between Trump and Chinese leader Xi Jinping is likely after the top diplomats from the two countries met in Malaysia.

Watch & Listen

Today on Bloomberg Television’s Balance of Power early edition at 1 p.m., hosts Joe Mathieu and Kailey Leinz interviewed Democratic Representative Gwen Moore of Wisconsin about how her party is pushing back on Trump’s spending cuts, tariffs and immigration policy.

Photographer: Sobczyk, Joe

On the program at 5 p.m., they talk with Peter Navarro, White House senior counselor for trade and manufacturing, about the state of negotiations with other countries and the president’s latest pronouncements on tariffs.

On the Odd Lots podcast, Bloomberg’s Tracy Alloway and Joe Weisenthal speak with Kathy Wylde, the president and CEO of the non-profit organization the Partnership for New York City, about the phone calls and meetings she’s facilitating between Zohran Mamdani, the leading candidate in New York’s mayoral race, and the CEOs who are anxious about what his election would mean for the city. Listen on iHeart, Apple Podcasts and Spotify.

Chart of the Day

Interest rates on private-label credit cards issued by retailers or brands to cultivate loyalty are at a record high. Private-label cards are often a first step for many people to establish credit, but these new borrowers frequently are a higher credit risk. To compensate for that risk, issuers have jacked up the average interest up for such cards, which typically have looser underwriting practices. In the first quarter, data released by the Federal Reserve Bank of Philadelphia show that the average rate rose to 31.15%. That's the highest since the Fed bank started releasing the data more than a dozen years ago. General purpose credit cards carried an average rate of 24.6%, the lowest rate since the second-quarter of 2023. For borrowers who don't pay their credit card balances in full each month, the higher interest rates can add a substantial financial burden. — Alex Tanzi

What’s Next

The consumer price index data for June will be released Tuesday.

The producer price index for June will be reported Wednesday.

Retail sales in June will be reported on Thursday.

June’s import price index also is set for release Thursday.

Housing starts and building permits for June are out on Friday.

The University of Michigan’s preliminary reading of consumer sentiment in July will be released Friday.

Sales of existing homes during June will be reported July 23.

New home sales in June will be reported July 24.

Durable goods orders for June will be released July 25.

Seen Elsewhere

  • The number of people killed by law enforcement officers in the US has been growing, driven by more deaths of Americans in rural areas patrolled by sheriffs' departments, the Wall Street Journal reports.
  • The E-Verify system designed to help employers make sure workers have legal status in the US has vulnerabilities that can enable undocumented migrants to circumvent the checks, according to the Journal.
  • Missouri's governor signed a law that repeals a guaranteed paid sick leave measure that had been approved by the state's voters just eight months ago, calling it a burdensome mandate, the Associated Press reports.

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