Principals

1. Epstein drama dominates
2. House passes crypto revamp
3. Vought makes waves
4. Positive econ data
5. Beshear in SC
6. EU’s new Russia sanctions

PDB: House sends spending cuts package to Trump’s desk

Trump to sign stablecoin bill today … Bessent in Japan … Bloomberg: Powell counters Fed renovation criticism

Epstein drama consumes Congress

House Republicans on Thursday shut down Democrats’ attempt to advance a bipartisan bill that would force the release of records on Jeffrey Epstein, in favor of leaders’ freshly drafted nonbinding resolution. The surprise skirmish, which delayed a vote on spending clawbacks for hours, served as the latest example of how President Donald Trump’s attempts to steer Washington away from the issue are doing anything but, Semafor’s Burgess Everett and Eleanor Mueller report. On Thursday, The Wall Street Journal reported Trump sent Epstein a “bawdy letter” for his birthday; Trump denied the report and called on Attorney General Pam Bondi to unseal testimony. Meanwhile, Sen. Ron Wyden, D-Ore., released a report on banking transactions linked to Epstein. And Senate Republicans were forced to block a legislative attempt by Sen. Ruben Gallego, D-Ariz., to urge the release of records.

— Eleanor Mueller

House clears crypto overhaul

The House on Thursday sent the Senate’s stablecoin bill to Trump — and its sweeping overhaul of how the US regulates cryptocurrency to the Senate, where Republicans hope the backing of 78 Democrats helps ease passage. The tally was a big win for the crypto industry, which had feared Trump’s crypto dealmaking could deter the bipartisan support they need to move the proposal through the Senate. Already, there are signs House holdouts’ deal with leaders to include a Central Bank Digital Currency ban in defense legislation could be in danger: Sen. Bill Hagerty, R-Tenn., told Semafor “all they need to do is look at the text” of the stablecoin bill, which “largely dealt with that” — making additional language unnecessary. “You can’t give anybody a 100% guarantee when human beings are involved and you’re talking about the legislative process,” House Majority Whip Tom Emmer told Semafor.

— Eleanor Mueller and Burgess Everett

Rough September ahead for Congress

The stage is set for a government shutdown fight this fall. And on Thursday, OMB Director Russ Vought added to the drama when he told reporters the spending process should be “less bipartisan” — an eyebrow-raising statement given the need for 60 Senate votes to fund the government. Senate Majority Leader John Thune gently pushed back, saying Vought’s comment “runs contrary to what the math tells us around here.” He said the Senate will soon take up funding bills and that Republicans hope Democrats will be there. But the minority is perturbed about the possibility Vought and the GOP will strip bipartisan spending decisions via rescissions. Senate Minority Leader Chuck Schumer says Trump should fire Vought and demanded stronger GOP pushback: “Where are our Republican colleagues? Are they going to let this guy run rampant in one of the most powerful positions in government?”

— Burgess Everett

Good economic news comes in threes

Retail sales rebounded in June while import prices barely rose, undercutting economists’ fears about the impact of Trump’s tariffs on the US economy. Retail sales increased 0.6% after two months of declines, according to Commerce Department data, beating consensus estimates. Meanwhile, import prices increased, but only slightly, following a decline in May. And the number of unemployment insurance applications fell last week to a three-month low, a signal that employers aren’t really cutting jobs — all welcome news for the Trump administration. A weakening dollar is still cause for concern; it “boosts the likelihood that firms pass on a larger share of tariffs,” one economist told Reuters. But it will also encourage Americans to buy domestically. Observers will get a better read on US consumer sentiment when the University of Michigan releases its latest report today.

Beshear: Let’s be normal

Kentucky Gov. Andy Beshear offered a taste of what his presidential campaign could look like as he toured South Carolina. At each stop over the course of two days, he’d ask a question designed to confuse his audience, Semafor’s David Weigel reports: Who or what is the “justice-involved population”? When onlookers would reply with raised eyebrows, Beshear would answer himself: “Those are inmates.” Beshear’s point, which he’s been making all year, is that Democrats need to “get back to talking to people like we talk to our friends.” He warned that using “advocacy language,” even with good intentions, makes it easier for the GOP to convince people that Democrats don’t work for them. And his argument has gotten some traction: One former DNC member was so impressed by Beshear’s pitch that he compared him to Bill Clinton.

EU moves on new Russia sanctions

The European Union agreed fresh sanctions on Russia over its invasion of Ukraine, intensifying efforts to force Moscow to the negotiating table. The latest penalties lower the price cap on Russia’s oil exports and further restrict the Kremlin’s “shadow fleet” of unregistered tankers used to evade energy sanctions, and came as Germany’s chancellor said Ukraine would receive new Patriot air-defense systems “very soon.” London, meanwhile, is considering following Berlin’s lead in purchasing US weapons to send to Ukraine, Bloomberg reported. Whether those moves hasten an end to the war is another matter: Reuters cited sources close to Russian President Vladimir Putin to say he was “unfazed” by Western threats and instead “intends to keep fighting.”

Ari Aster returns to theaters with Eddington — a film so online, it might’ve been written by Twitter itself. The director of Hereditary and Midsommar explores a modern Western set in the 2020 lockdown, where digital media becomes the true antagonist. This week on Mixed Signals, Ben and Max sit down with Aster to unpack why he ran toward a COVID-era story while Hollywood ran away, how his complicated relationship with social media shaped the film, and what he learned from exploring the world of conspiracy theories. Plus: the Marvel movie he turned down.

Blindspot: NEA and ‘Alligator Alcatraz’

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: Republican lawmakers are attempting to revoke the federal charter of the National Education Association, the largest teachers union in the US.

What the Right isn’t reading: Migrants housed at the immigration detention facility in Florida called “Alligator Alcatraz” filed a lawsuit claiming they have been denied access to attorneys.

Beltway Newsletters

Punchbowl News: A Senate vote next week on an appropriations bill for the Department of Veterans Affairs and military construction — which passed the Senate Appropriations Committee with bipartisan support — will offer clues about the likelihood of a government shutdown. “We’ll see if the Democrats want to play ball. I hope they do,” said Senate Majority Leader John Thune.

Playbook: Vice President JD Vance has been notably quiet since the Jeffrey Epstein drama started to bubble in Washington. Vance has been “following President Trump’s lead and focusing on celebrating the administration’s policy victories like the historic passage of the One Big Beautiful Bill,” one source said.

WaPo: The conservative Republican Accountability Project is launching a six-figure ad campaign calling on Trump to release the Epstein files.

Axios: It could cost up to $2 billion to convert Alcatraz back to a maximum-security prison.

White House

• President Trump has been diagnosed with chronic venous insufficiency, a condition that causes his legs to swell. Press secretary Karoline Leavitt attributed a bruise on his hand, observed by reporters and photographers in recent weeks, to “frequent hand-shaking” and a side effect of aspirin therapy.

Congress

• The House approved President Trump’s government funding rescissions package overnight, sending it to his desk.

Outside the Beltway

• Attorney General Pam Bondi and Interior Secretary Doug Burgum toured the historic prison on Alcatraz