U.S. Treasury Secretary Scott Bessent said Sunday that American and Chinese officials had discussed establishing a U.S.-China AI dialogue and that Washington had proposed a notification mechanism for artificial-intelligence incidents that could rise to the level of a national-security concern.

The discussions took place in New York between Bessent and Chinese Vice Premier He Lifeng ahead of a planned September 24 meeting between President Donald Trump and Chinese President Xi Jinping in Washington.

The proposed mechanism would address a narrow but increasingly important problem: how the two countries communicate if an AI system contributes to an incident involving national security.

Bessent said greater transparency between the world’s two leading AI powers was important for identifying common threats and goals.

No detailed agreement establishing the notification system has been publicly announced.

Competition remains at the center of the relationship

The proposed safety dialogue does not signal an end to the broader technology rivalry.

Washington has imposed restrictions on China’s access to some advanced semiconductor technologies and AI computing equipment, citing national-security concerns. Beijing has responded by expanding domestic semiconductor and AI development while criticizing U.S. restrictions.

Chinese companies including Huawei, DeepSeek and Moonshot AI have continued developing AI systems despite constraints on access to some advanced chips. U.S. officials have also accused Chinese companies of attempting to obtain capabilities from American AI systems through methods including model distillation. Beijing has rejected such allegations.

The competition extends beyond individual models.

Both countries are investing heavily in computing infrastructure, semiconductor supply chains, data centers and AI research. Their governments increasingly view advanced AI as important to economic growth, national security and technological influence.

That creates a difficult backdrop for cooperation on safety.

Washington wants safety discussions without slowing development

The Trump administration has rejected calls for a broad slowdown in advanced AI development.

A June executive order on advanced AI innovation and security states that the United States intends to promote AI innovation while addressing national-security risks and protecting American technology from exploitation and theft. The order also calls for systems used in sensitive environments to be evaluated for advanced cyber capabilities.

Trump has separately argued that slowing U.S. AI development could allow China to close the technological gap.

That position has complicated calls from some U.S. technology leaders for stronger international coordination around frontier AI risks.

The disagreement is not simply over whether AI poses risks. It is also over how governments should respond without undermining technological development.

China says AI safety and development must advance together

Beijing has also presented AI development and safety as linked objectives.

China’s Foreign Ministry said September 15 that Beijing takes both AI development and security seriously and supports stronger safeguards against abuse and misuse. The ministry said China had released an updated AI Safety Governance Framework 3.0, including revised classifications of AI safety risks and recommendations for technical and governance measures.

Chinese officials have also called for international cooperation on AI governance.

Foreign Ministry spokesperson Mao Ning said September 9 that the United States and China, as major AI powers, should increase cooperation and described China’s approach as emphasizing open and inclusive AI development.

That position differs from Washington’s emphasis on maintaining American technological leadership while restricting certain strategic technologies from reaching China.

The safety concerns are increasingly concrete

The emerging dialogue is being driven partly by concerns about what happens when AI systems interact with critical infrastructure, cyber operations or other high-consequence systems.

U.S. and Chinese security experts participating in a separate dialogue have proposed safeguards for scenarios involving AI systems and nuclear command networks, autonomous cyber operations and other national-security risks.

Their recommendations have included maintaining human control over consequential cyber operations and creating direct communication channels for AI-related incidents.

Those proposals illustrate why AI safety is becoming a security issue rather than only a question of consumer technology.

An AI system used in a financial application can create economic problems if it fails.

An AI system involved in military or critical infrastructure operations could create a much more serious problem if its behavior is misunderstood by another government.

The central concern is therefore not only whether AI systems make mistakes, but whether governments can distinguish an AI-driven accident from a deliberate action quickly enough to prevent escalation.

Trust remains a major obstacle

The proposed dialogue faces the same strategic mistrust that affects other areas of U.S.-China relations.

Washington has raised concerns about China’s access to advanced computing technology, intellectual property and AI capabilities.

Beijing has accused the United States of using national-security restrictions to constrain China’s technological development and preserve American advantages.

Chinese officials have rejected recent U.S. allegations concerning Chinese AI companies and have called for greater cooperation rather than confrontation.

That makes the proposed notification mechanism potentially useful but also difficult to implement.

For such a system to work, each side would need to decide what qualifies as a reportable AI incident, how much technical information could safely be shared and how quickly the other government should be informed.

Those questions become especially sensitive when the same technologies have civilian, commercial and military applications.

The September 24 summit will test the political space for cooperation

The AI discussions between Bessent and He took place just days before Trump and Xi are scheduled to meet in Washington.

Bessent said the two countries had agreed to meet again on AI, suggesting that the proposed dialogue is intended to continue beyond the current negotiations.

The discussions are not limited to AI. The same U.S.-China meetings are addressing trade and other economic disputes.

But AI has become increasingly difficult to separate from the broader relationship.

The United States wants to preserve its technological lead while limiting access to selected advanced technologies.

China wants to continue closing technological gaps and building greater self-reliance.

Both countries also face risks from increasingly capable AI systems that neither government can fully control on its own.

That creates an unusual overlap between competition and shared vulnerability.

A narrow dialogue may be easier than a broad AI agreement

The proposed notification mechanism is narrower than a comprehensive agreement governing AI development.

It would not necessarily require either country to slow its AI industry, abandon national technology strategies or agree on a common regulatory model.

Instead, it could focus on communication when particularly serious incidents occur.

That distinction may matter because the two governments have sharply different approaches to technology policy.

A limited communication channel could address immediate security risks without resolving the much larger dispute over who should control advanced AI development.

Whether the two sides can establish such a mechanism in practice remains unresolved.

For now, the latest talks have created a channel where none previously existed at the same level.

The United States and China remain competitors for technological leadership. At the same time, both governments increasingly recognize that some AI-related risks could cross national borders faster than traditional diplomatic systems can respond.

The proposed AI dialogue is an attempt to address that problem without resolving the larger competition.

Reporting Credit: U.S. Department of the Treasury — statements from Secretary Scott Bessent concerning the proposed U.S.-China AI dialogue and notification mechanism; U.S. White House — June 2026 policy on advanced AI innovation and security; Ministry of Foreign Affairs of the People’s Republic of China — Chinese positions on AI safety, governance and U.S.-China AI cooperation; U.S. Department of Commerce, Bureau of Industry and Security — U.S. semiconductor and advanced-computing export-control framework.

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The pressures have not produced an immediate financial crisis. But the combination of rising state borrowing, elevated inflation and weaker growth is making it more difficult for Moscow to maintain high defense spending while also supporting the broader civilian economy.

Russia recorded a federal budget deficit of about 6.46 trillion rubles, or 2.8% of gross domestic product, during the first seven months of 2026, according to preliminary Finance Ministry data. That was well above the 1.6% deficit originally planned for the full year. President Vladimir Putin has said the deficit remains manageable and emphasized Russia’s relatively low government-debt burden.

The gap nevertheless illustrates how quickly wartime spending has altered the government’s fiscal position.

Military spending puts pressure on the budget

Russia has maintained exceptionally high government spending since launching its full-scale invasion of Ukraine in 2022. Defense-related procurement has been a major driver of expenditure, while the government has also expanded subsidies and other support for strategically important industries.

Earlier government budget data showed that federal spending could reach about 45.1 trillion rubles in 2026, compared with 44.1 trillion rubles in the budget law. That would leave a projected deficit of about 4.83 trillion rubles, substantially above the original 3.79 trillion-ruble target.

The higher spending comes as Russia attempts to preserve military production and maintain domestic economic activity at the same time.

That balance is becoming more expensive.

Borrowing is becoming a larger part of the financing equation

With the budget deficit expanding, Moscow has increasingly relied on domestic borrowing rather than drawing entirely on accumulated reserves.

The liquid portion of Russia’s National Wealth Fund has declined substantially since the beginning of the war, reducing one of the government’s traditional buffers against falling energy revenues and unexpected fiscal demands. Analysts at the Centre for Eastern Studies reported that the liquid assets had fallen by more than half after four years of war.

Borrowing, however, comes with a significant cost.

Russia’s central bank has kept interest rates high to contain inflationary pressures. On Sept. 11, the Bank of Russia held its key rate at 14%, saying price pressures had increased significantly during the preceding months. Annual inflation stood at 6.3% as of Sept. 7, while the central bank estimated underlying price growth at an annualized 5% to 6%.

High interest rates raise financing costs for businesses and the government. They can also discourage private investment at a time when Russia needs additional productive capacity outside the defense sector.

Growth has slowed as wartime stimulus loses force

Russia’s economy expanded rapidly during the earlier stages of the wartime spending surge, supported by defense orders, government expenditure and rising wages.

That momentum has weakened.

The Bank of Russia said economic activity was still growing at a moderate pace in the third quarter, but consumer demand was slowing. It also said labor-market tightness was gradually easing.

The central bank’s assessment reflects an economy that remains active but is operating under increasingly difficult monetary and fiscal conditions.

The pressure is also visible in business financing. High borrowing costs make investment more expensive for companies that do not benefit directly from state defense contracts, creating a wider divide between military-linked industries and parts of the civilian economy.

Oil revenues remain an important buffer

Energy exports continue to provide Russia with a crucial source of government revenue.

That has helped Moscow avoid the kind of immediate fiscal crisis that might otherwise accompany a rapidly expanding deficit. Putin said Sept. 17 that Russia expected higher oil prices to increase oil and gas revenues in the coming months and said additional income could help replenish the National Wealth Fund. He also said the government expected the economy to grow by up to 1% in 2026.

The dependence on energy revenue, however, leaves the fiscal outlook sensitive to oil prices and export conditions.

Russia has also faced continuing restrictions on access to Western technology and investment because of sanctions imposed after the invasion of Ukraine. Those constraints can weigh on productivity and long-term investment even when the government has sufficient revenue to maintain current spending.

No immediate collapse, but pressure is accumulating

The current picture is therefore more complicated than either a claim of economic collapse or a claim that Russia faces no meaningful financial problems.

The government continues to pay for the war, and the economy continues to function. Russia retains access to substantial energy revenues, domestic financial institutions and state-controlled economic resources. Putin has publicly argued that the country can manage its deficit without creating a critical threat to economic stability.

At the same time, the fiscal deficit is substantially above its original target, reserve buffers have weakened, interest rates remain high and inflation is still above the central bank’s target.

Those pressures constrain the government’s choices.

The Bank of Russia has warned that fiscal policy is an important factor in monetary-policy decisions. Its current baseline assumes a gradual reduction in the structural primary budget deficit toward zero by 2029, but the central bank said a larger structural deficit could require tighter monetary policy than currently anticipated.

For now, Russia’s wartime economic model continues to function through a combination of military-driven demand, energy income, taxation, borrowing and state intervention.

The emerging question is not whether that model has already failed. It is how much fiscal and monetary pressure can accumulate before the costs of sustaining the war begin to impose more visible constraints on the rest of the economy.

Reporting Credit: Ministry of Finance of the Russian Federation — federal budget deficit and fiscal data; Bank of Russia — key interest rate, inflation, economic activity and monetary-policy assessment; Russian government — 2026–27 fiscal and economic projections.

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The plan, jointly issued by China’s National Development and Reform Commission (NDRC) and the Ministry of Transport, sets a target of reducing total social logistics costs to 13.1% of GDP by 2030, 0.8 percentage points below the level at the end of 2025.

The strategy places logistics among six major national infrastructure networks prioritized during China’s 15th Five-Year Plan for 2026–2030, alongside water systems, power grids, computing infrastructure, next-generation communications networks and urban underground pipelines.

A more integrated logistics system

China’s government wants logistics hubs to become more closely connected with manufacturing and other industries, while improving links between major transportation corridors.

The plan identifies 17 key tasks across seven areas, including improving logistics hubs, strengthening freight corridors, addressing gaps in urban and rural logistics facilities, expanding international logistics networks and improving information sharing.

The objective is to move beyond isolated transportation facilities toward a more integrated system in which roads, railways, ports, waterways, warehouses and digital platforms operate more efficiently together.

Ports and railways receive greater attention

China is also focusing on connections between major ports and inland transportation networks.

The program calls for stronger rail connections to coastal ports, expanded multimodal-transfer facilities and improvements linking railways, roads, inland waterways and port infrastructure.

It also promotes smarter logistics hubs and ports, including greater use of artificial intelligence, intelligent sensing equipment and automated systems.

These improvements could reduce reliance on less efficient transportation routes while allowing goods to move more quickly between China’s manufacturing centers and export gateways.

Digital technology becomes part of logistics infrastructure

Digitalization is another major component of the plan.

China wants greater interoperability among logistics information systems and wider use of digital technologies to coordinate transportation, warehouses and cargo flows.

AI-powered scheduling, smart facilities and automated equipment are expected to play a growing role. The government also plans to expand driverless logistics vehicles in controlled environments such as ports and logistics parks.

For manufacturers and exporters, better digital coordination could help reduce delays and improve the ability to track and manage goods throughout the supply chain.

Supply-chain resilience is increasingly strategic

The logistics push comes as governments and businesses worldwide seek greater control over critical supply chains.

Trade restrictions, geopolitical tensions and disruptions to shipping routes have encouraged companies to diversify production and transportation networks.

For China, maintaining an efficient domestic logistics system is particularly important because of the country’s enormous manufacturing and export base.

A stronger logistics network could help Chinese companies move goods more efficiently inside the country while maintaining connections with international markets.

International connectivity remains important

The plan does not focus exclusively on domestic transportation.

China is also seeking stronger international logistics connections, including infrastructure capable of supporting external trade and cross-border supply chains.

That could reinforce China’s position as a major manufacturing, export and distribution hub at a time when other economies are attempting to develop alternative supply-chain centers.

China’s goods trade reached 30.13 trillion yuan in the first seven months of 2026, according to data cited by Xinhua Silk Road, underscoring the scale of the trade flows supported by the country’s logistics system.

Green logistics is also a priority

The government is incorporating environmental goals into the infrastructure program.

The plan calls for greener logistics facilities and equipment alongside digital and intelligent upgrades.

That could increase investment in energy-efficient warehouses, cleaner transportation equipment and technologies designed to reduce fuel consumption and emissions.

A test for China’s manufacturing competitiveness

Reducing logistics costs could have a direct effect on Chinese businesses.

Lower transportation and distribution expenses can improve manufacturers’ margins, reduce the cost of moving goods between production centers and ports, and make exports more competitive.

The government therefore views logistics not simply as a transportation issue but as part of improving the efficiency of the broader real economy.

The challenge will be implementation. China’s network is already extensive, but gaps remain in multimodal connections, information sharing and integration between different transportation systems.

What Happens Next

Beijing’s focus through 2030 will be on connecting logistics hubs and industrial centers, expanding freight corridors, improving port and rail links, and accelerating digital and green technologies.

The most important measures to watch will be logistics costs, infrastructure investment, multimodal transportation, port connectivity, digital adoption and international freight capacity.

If successful, the strategy could lower the cost of China’s domestic economy while strengthening the country’s ability to withstand disruptions and compete in increasingly contested global supply chains.

Key Facts

• Country: China
• Plan: National logistics network development through 2030
• Target: Social logistics costs at 13.1% of GDP by 2030
• Main agencies: NDRC and Ministry of Transport
• Priority areas: Logistics hubs, freight corridors, ports, digitalization and green technology
• Planning period: 2026–2030
• Strategic objective: Lower costs and strengthen supply-chain connectivity
• Status: DEVELOPING — BUSINESS & GLOBAL TRADE

Reporting Credit: National Development and Reform Commission of China — national logistics strategy and economic targets; Ministry of Transport of China — transportation infrastructure and logistics-network development; General Administration of Customs of China — trade data and international goods flows.

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The discussions come as Southeast Asian economies seek to strengthen supply chains, attract investment and accelerate digital integration amid a more uncertain global trading environment.

Digital economy moves to the center

Thailand and Singapore agreed to step up digital-economy cooperation, including through the renewal of their memorandum of understanding covering the sector.

Singapore also welcomed Thailand’s interest in joining the Digital Economy Partnership Agreement (DEPA), a framework designed to establish common rules and cooperation for digital trade.

The two governments also backed the signing of the ASEAN Digital Economy Framework Agreement (DEFA), which is expected to strengthen digital connectivity and interoperability across the region.

Trade and investment remain central

Singapore has become an important source of investment for Thailand. Thailand’s Foreign Ministry said Singapore was the country’s largest foreign investor in 2024, highlighting the depth of the two economies’ commercial relationship.

The partnership covers investment, manufacturing, services and emerging industries, with both governments seeking to expand cooperation into future-oriented sectors.

For Thailand, stronger ties with Singapore can help attract capital and technology while supporting the country’s ambitions to develop higher-value industries.

For Singapore, closer economic links with Thailand provide access to one of Southeast Asia’s largest economies and strengthen connections with the wider mainland ASEAN market.

Supply-chain resilience becomes more important

The two countries are also seeking greater resilience in trade and supply chains.

Thailand has emphasized the importance of maintaining open trade while strengthening supply-chain security and connectivity. Its broader regional agenda includes logistics, food and energy security, areas that have become increasingly important as geopolitical tensions disrupt global commerce.

Singapore, meanwhile, remains a major regional logistics and financial hub.

Closer coordination between the two economies could help businesses diversify supply chains and improve connections between manufacturing centers, ports and digital services.

Cooperation extends beyond technology

The relationship is not limited to digital industries.

Thailand and Singapore are also strengthening cooperation around food security, energy and the green economy, areas where both governments see opportunities for greater resilience and investment.

The cooperation reflects a broader effort by Southeast Asian governments to combine economic growth with greater resilience against external shocks.

A deeper ASEAN connection

The Thailand-Singapore relationship also has significance for ASEAN.

Both countries are active participants in efforts to develop regional rules for digital trade and economic integration. The planned DEFA framework could eventually make it easier for businesses to operate digitally across ASEAN by improving interoperability and establishing common approaches to digital commerce.

Thailand’s interest in DEPA could further connect its digital economy with international digital-trade standards.

That could benefit companies operating across borders, particularly in e-commerce, financial technology, digital services and technology.

Strategic partnership enters a new phase

Thailand and Singapore celebrated 60 years of diplomatic relations in 2025, and both governments have emphasized expanding the relationship into new areas.

The current push therefore represents an evolution of an already established partnership rather than a new diplomatic alignment.

The emphasis is increasingly shifting toward practical economic cooperation, digital transformation and resilience.

What Happens Next

The two governments are expected to continue implementing agreements covering digital cooperation, investment, trade and economic connectivity.

The key indicators will be new investment commitments, digital-economy agreements, progress on DEPA and DEFA, and cooperation on energy, food security and supply chains.

For Thailand and Singapore, the objective is increasingly clear: build a more connected and resilient economic partnership while strengthening their position within the evolving ASEAN economy.

Key Facts

• Countries: Thailand and Singapore
• Main areas: Trade, investment, digital economy, energy and food security
• Digital cooperation: Renewal of bilateral digital-economy MOU
• DEPA: Singapore supports Thailand’s interest in joining
• Regional framework: ASEAN Digital Economy Framework Agreement
• Investment: Singapore was Thailand’s largest foreign investor in 2024
• Diplomatic milestone: 60 years of relations marked in 2025
• Status: DEVELOPING — BUSINESS & SOUTHEAST ASIA

Reporting Credit: Government of Thailand — bilateral talks, trade, investment and digital-economy cooperation; Ministry of Foreign Affairs of Singapore — bilateral relations and economic cooperation; ASEAN — regional digital-economy integration and DEFA framework.

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Under current projections, Social Security’s retirement trust fund could become depleted in the early 2030s. If Congress does not change the law, scheduled tax revenue would then be enough to cover only about three-quarters of scheduled benefits. Recent projections translate that shortfall into an estimated 22% reduction in benefits beginning in 2032.

That does not mean retirees are facing an immediate 22% cut. It means Congress must act before the trust fund’s reserves are exhausted if it wants to prevent an automatic reduction under current law.

Lawmakers propose a path toward reform

Sens. Dick Durbin, D-Ill., and Bill Cassidy, R-La., have become leading figures in a bipartisan effort to force Congress to address the problem.

Their PROMISE Act would not itself raise taxes or reduce benefits. Instead, it would establish a process through which the bipartisan Social Security Advisory Board would develop legislation designed to keep the program solvent for at least 50 years.

A separate bipartisan proposal in the House, the Bipartisan Social Security Commission Act of 2026, would create a commission charged with developing recommendations to restore solvency for an even longer period.

The proposals reflect an increasingly urgent political reality: lawmakers agree that Social Security’s finances need attention, but they remain divided over who should bear the cost.

Option 1: Tax more income

One of the most frequently discussed solutions is to increase the amount of income subject to Social Security payroll taxes.

In 2026, workers pay Social Security payroll taxes on earnings up to $184,500. Income above that threshold is generally not subject to the Social Security payroll tax.

Some proposals would eliminate the cap entirely. Others would create a new taxable range for high earners while leaving the existing system in place for most workers.

According to analyses cited by CBS News, different approaches to raising or eliminating the taxable wage cap could close a substantial portion of Social Security’s projected long-term financing gap.

Supporters argue that requiring higher earners to contribute more could raise significant revenue without increasing payroll taxes on most workers.

Option 2: Increase the payroll tax

Another approach would raise the Social Security payroll tax rate.

Workers currently pay 6.2% of covered wages, while employers generally pay another 6.2%, for a combined rate of 12.4%.

Increasing the rate would generate additional revenue immediately, but it would also increase the cost of employing workers and reduce take-home pay for employees.

Analysts therefore view a payroll-tax increase as financially powerful but politically difficult.

Option 3: Raise the retirement age

Congress could also increase the age at which workers qualify for full Social Security benefits.

The full retirement age is currently 67 for people born in 1960 or later.

Raising that age further would reduce the program’s long-term costs because people would receive their full scheduled benefits later.

But critics argue that raising the retirement age effectively amounts to a benefit reduction, particularly for workers in physically demanding occupations or people who cannot continue working into their late 60s.

A Congressional Budget Office analysis has found that increasing the full retirement age from 67 to 69 would reduce annual benefits by an average of about 13%.

Option 4: Reduce benefits for higher earners

Another possibility is changing the benefit formula so that higher-income retirees receive smaller increases or lower benefits.

This approach would preserve the basic Social Security structure while directing more resources toward lower- and middle-income beneficiaries.

Some proposals would also place limits on benefits received by very high-income households.

Supporters argue that Social Security should focus more heavily on retirement income security for people who depend on the program most.

Opponents counter that workers who paid more into Social Security should not necessarily receive substantially less in return.

Option 5: Change the cost-of-living adjustment

Congress could also modify how Social Security’s annual cost-of-living adjustment, or COLA, is calculated.

Even small changes to the annual adjustment can have significant effects over many years because the difference compounds as benefits increase.

Supporters of changing the formula argue that it could reduce long-term costs without imposing an immediate benefit cut.

Critics warn that reducing COLAs could gradually erode retirees’ purchasing power, particularly as older Americans face rising medical and housing costs.

Option 6: Use other sources of federal revenue

Some lawmakers and policy groups have proposed using additional taxes or other federal revenues to strengthen Social Security.

The underlying principle is straightforward: instead of reducing benefits, Congress could increase the amount of money flowing into the system.

The challenge is determining which taxpayers should provide that additional revenue and whether Congress could reach the bipartisan agreement necessary to enact it.

There is no painless solution

The central problem facing Congress is that Social Security’s long-term gap cannot be closed without making difficult choices.

Broadly, lawmakers can:

Raise revenue → reduce spending → or combine both.

Raising taxes places more of the burden on workers, employers or higher-income Americans.

Reducing benefits places more of the burden on current or future retirees.

Delaying action leaves fewer years to phase in changes and increases the possibility of a more abrupt adjustment later.

That is why Social Security reform is politically difficult even though the basic financial problem is well understood.

Why Congress is under pressure now

Social Security’s financing problems have been known for decades, but lawmakers have repeatedly postponed comprehensive reform.

The urgency is increasing because the projected depletion date is approaching.

The Social Security Administration says that once trust fund reserves are depleted, continuing tax revenue would cover only about three-quarters of scheduled benefits unless Congress changes the law.

That gives lawmakers a choice between making gradual changes now or potentially facing much larger adjustments later.

The political stakes are enormous. Social Security provides retirement, survivor and disability benefits to tens of millions of Americans, making changes to the program highly consequential for voters.

What happens next

The bipartisan proposals now before Congress are primarily attempts to create a process for reaching agreement. They do not themselves solve the funding shortfall.

The key question is whether lawmakers can agree on a combination of tax increases, benefit changes or other measures before the trust fund reaches the point where scheduled benefits exceed available revenue.

For retirees and workers, the most important point is that a 22% cut has not been enacted.

It is a projected consequence of the program’s financing shortfall if Congress fails to act.

The longer lawmakers wait, however, the fewer options they may have for introducing changes gradually.

Key Facts

• Projected benefit reduction without congressional action: About 22%
• Projected timing: 2032
• 2026 taxable wage cap: $184,500
• Current employee Social Security tax: 6.2%
• Current employer Social Security tax: 6.2%
• Full retirement age: 67 for people born in 1960 or later
• Major bipartisan proposal: PROMISE Act
• Status: Congress has not enacted a comprehensive Social Security solvency package

Reporting Credit: Social Security Administration, U.S. Senate and Congressional Budget Office, with Journos News independently synthesizing and presenting the verified information on Social Security’s projected financing shortfall and proposed reform options.

The post How to Avoid a Social Security Cut? Lawmakers Are Floating Ideas appeared first on Journos News - Breaking News, World News, Top Stories, Todays Headlines and Flash Reports.

An Associated Press analysis of federal data found that roughly one in five federal student loan borrowers is now in default, meaning they are at least 270 days behind on required payments. The increase follows the expiration of pandemic-era protections that temporarily suspended payments and shielded borrowers from default during the public health emergency.

Education advocates say rising living costs, combined with increasing monthly student loan payments, are making it more difficult for many borrowers to remain current on their obligations.

“Folks are struggling to make ends meet and cover all the rising costs of everything else. The growing student loan bills are making things worse and folks are falling behind,” Aissa Canchola Bañez, policy director at Protect Borrowers, told The Associated Press.

Although missed payments can damage borrowers’ credit scores, default carries more serious consequences, including potential wage garnishment, offsets of federal tax refunds and reductions in certain federal benefits. The Trump administration has not yet resumed involuntary collections.

Defaults Accelerated After Pandemic Protections Expired

Federal student loan payments were suspended during the pandemic under relief measures administered by the U.S. Department of Education.

Although repayment officially resumed in 2023, the Biden administration created a one-year transition period that protected delinquent borrowers from entering default through the fall of 2024.

During that period, loans could not enter default, while federal rehabilitation initiatives and debt-relief programs helped millions of borrowers leave default status.

Once those protections expired, defaults began rising again. Beginning in June 2025, nine months after the transition period ended, borrowers once again became eligible to enter default.

Since then, the number of borrowers in default has increased from about 5.3 million to approximately 9.5 million, according to the Office of Federal Student Aid. Agency data show that $233.3 billion of the nation’s roughly $1.7 trillion in federally backed student loans is currently in default.

Another increase could follow as borrowers adjust to recent changes in the federal loan system. The Trump administration ended the Saving on a Valuable Education (SAVE) income-driven repayment plan, requiring millions of borrowers to transition to alternative repayment options that may result in higher monthly payments.

Beginning this month, new federal student loan borrowers also face fewer repayment choices, generally selecting between one standard repayment plan and one income-driven option. The Education Department said the revised structure is intended to simplify what it described as a fragmented repayment system.

Southern States Report the Highest Default Rates

The AP’s analysis found that many of the nation’s highest student loan default rates are concentrated in Southern states.

Mississippi recorded the highest default rate among U.S. states at 28.3%.

Other states with comparatively high default rates include:

• Louisiana
• Alabama
• West Virginia
• Oklahoma
• Georgia
• South Carolina
• Texas

The analysis also identified Alaska, Arizona, Ohio, Indiana, Michigan, New Mexico and Nevada among the 15 states with the highest shares of borrowers in default.

Puerto Rico reported an even higher default rate of 30.9%, exceeding every U.S. state.

Bañez said the geographic distribution challenges common assumptions about who is affected by student loan debt.

“These are folks who live in states that President Trump won in the previous election,” she told The Associated Press.

She added that many borrowers falling behind are working-class Americans struggling to balance student loan payments with broader increases in living expenses.

Borrowers From For-Profit Colleges Face Greater Challenges

Borrowers who attended for-profit colleges continue to experience significantly greater repayment difficulties than those who attended public institutions, according to Office of Federal Student Aid data released this year.

The data show that 33% of borrowers from for-profit schools were at least 90 days behind on their student loan payments—more than twice the rate among borrowers who attended public colleges.

Among institutions in the highest quarter for nonpayment rates, 76% were for-profit schools.

The Office of Federal Student Aid said elevated nonpayment rates are a strong indicator that schools may also experience higher default rates among former students.

The trend has prompted action within the career education sector.

Career Education Colleges and Universities, an association representing private trade schools and career colleges, has established a task force focused on improving student loan repayment awareness.

Jason Altmire, the organization’s president, told The Associated Press that several factors may be contributing to repayment difficulties, including lingering economic effects from the pandemic and confusion following the Biden administration’s unsuccessful student loan forgiveness initiative.

“We take it seriously,” Altmire said. “It’s a real problem.”

This report is based on reporting by The Associated Press.

Article Topics: Student Loan Defaults | Federal Student Loans | Higher Education | Office of Federal Student Aid | Student Debt | Loan Repayment | For-Profit Colleges | Education Policy

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In a social media post before the deadline to act on the legislation, Trump said he would not sign the housing bill because the Senate had not passed the SAVE America Act, legislation that would require proof of citizenship for all voters.

“I will not sign the Housing Bill, which has been fully approved by Congress and sent to the White House, in PROTEST over the fact that the United States Senate is not capable of passing THE SAVE AMERICA ACT,” Trump wrote.

Under the Constitution, a bill approved by Congress becomes law if a president neither signs nor vetoes it within the prescribed period while Congress remains in session. Trump had until Friday to decide whether to sign the measure, veto it, or allow it to take effect without his signature.

White House Protest Centers on Election Legislation

Trump’s decision links a bipartisan housing measure to a separate legislative effort focused on election rules, underscoring his administration’s emphasis on voter identification legislation even as Congress had already approved the housing package with overwhelming bipartisan support.

The president had already delayed action on the measure more than a week earlier, canceling a planned signing ceremony after announcing he would withhold his approval until lawmakers acted on the SAVE America Act.

According to the report, the voter ID proposal does not currently have enough Republican support in the Senate to secure passage.

House Speaker Mike Johnson, a Republican from Louisiana, had encouraged Trump to sign the legislation after it was delivered to the White House.

Johnson told reporters he hoped the president would approve the bill but acknowledged that it would become law regardless. He also said he understood Trump’s effort to emphasize the elections legislation as his top priority.

Housing Measure Targets Affordability Challenges

The newly enacted 21st Century ROAD to Housing Act represents one of the broadest federal housing initiatives in decades and is intended to reduce housing costs while encouraging additional residential construction.

The legislation seeks to ease federal housing regulations, streamline environmental reviews, accelerate homebuilding projects and limit corporate purchases of single-family homes.

Earlier this year, White House economists estimated that the United States faces a shortage of approximately 10 million homes. The administration said the legislation could help reduce part of that deficit.

Despite those goals, Trump dismissed the measure as “a yawn” and “so unimportant” compared with legislation addressing voter eligibility requirements.

The bill does not address every factor contributing to housing affordability, including shortages of construction workers, rising insurance costs and wage growth that has not kept pace with housing expenses. However, it has received backing from housing advocates and the real estate industry.

Bipartisan Congressional Support

The legislation advanced through Congress with broad bipartisan backing.

The Senate approved the bill by an 85-5 vote, while the House passed it 358-32.

Trump’s decision not to sign the measure nevertheless drew criticism from Democrats, who argued that the move shifted attention away from housing affordability.

Senate Democratic Leader Chuck Schumer said on X that Trump’s priorities favored expanding his own political influence over addressing costs facing American families.

The housing market remains a significant affordability challenge across the United States. According to the National Association of Realtors, the median existing-home sales price reached a record $440,600 in June, up 1.8% from a year earlier and the highest level since the organization began tracking the data in 1999.

This report is based on reporting by The Associated Press.

Article Topics: Housing Policy | Congress | Voter ID | Executive Branch | Housing Affordability | Senate | Federal Legislation

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Speaking after marking the start of trading, Trump predicted continued gains for U.S. markets.

“It’s going to go up — I think the market’s going to go through the roof,” Trump said.

The event reflected the White House’s effort to connect the administration’s economic policies with investment growth, even as inflation continues to challenge public perceptions of the economy ahead of the November midterm elections.

According to a June survey conducted by The Associated Press-NORC Center for Public Affairs Research, 33% of U.S. adults approve of Trump’s handling of the economy.

Trump Accounts Take Center Stage

The Oval Office ceremony also promoted the launch of Trump Accounts, an investment program established under Republicans’ 2025 tax and spending legislation.

The accounts are designed to provide children with investments tied to stock market indexes, with the administration presenting the initiative as a way to encourage long-term participation in financial markets.

Treasury Secretary Scott Bessent said many American households remain disconnected from equity investments.

Before the opening bell ceremony, Bessent stated that “38% of American families do not have any exposure to our great equity markets.”

The administration argues that expanding access to investment accounts could allow more families to benefit from long-term market growth.

Stock Market Gains Contrast With Inflation Concerns

Although U.S. equity markets have continued to perform strongly, inflation has remained a significant political challenge for the administration.

The benchmark S&P 500 gained 17.9% during 2025 after posting annual returns of 25% in 2024 and 26.3% in 2023 during former President Joe Biden’s administration. The index has risen roughly 10% so far this year.

Despite those gains, higher consumer prices have continued to affect public sentiment.

Trump entered office after campaigning on lowering household costs, but his administration’s tariff policies and the outbreak of war involving Iran have added new inflationary pressures.

The consumer price index has increased 4.2% over the past 12 months, compared with 3% when Trump began his second term in January 2025.

Billionaires Back New Investment Initiative

The Trump Accounts initiative has also attracted support from several prominent business leaders and investors beyond the government’s initial $1,000 contribution for eligible accounts.

Michael Dell, founder of Dell Technologies, and his wife Susan Dell joined Trump at Monday’s event after pledging $6.25 billion toward the program.

Additional commitments have come from investor Ray Dalio and Gwynne Shotwell, president of SpaceX. Shotwell announced Monday that she plans to donate company stock to support the accounts.

The administration has argued that such investments could give future generations a stronger financial stake in the U.S. economy through long-term ownership of stock market assets.

Trump also joked during the event that children had missed out on earlier market gains because of the delay in launching the investment program.

This report is based on reporting by The Associated Press.

Topics: Donald Trump | Trump Accounts | Stock Market | Treasury Department | Economic Policy | Inflation | Wall Street

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About 3 million fewer Americans were enrolled in Affordable Care Act (ACA) health insurance plans in February compared with the same period a year earlier, according to new data released Friday by the U.S. Department of Health and Human Services (HHS). The figures highlight the first major enrollment decline following the expiration of enhanced federal premium subsidies at the start of the year.

The HHS report found ACA marketplace enrollment fell 13%, from 22.1 million people in February 2025 to 19.2 million in February 2026. The department said the decrease may have been influenced by federal efforts to eliminate fraudulent or “phantom” enrollments from the marketplace.

However, health policy experts argue that rising insurance costs after the expiration of federal subsidies played a much larger role in reducing coverage.

Higher Premiums Linked to Enrollment Decline

According to Cynthia Cox, vice president and director of the ACA program at healthcare research nonprofit KFF, millions of consumers experienced substantial premium increases after the enhanced subsidies ended on Jan. 1.

Cox said survey findings indicate that many individuals who left ACA plans did so because they could no longer afford their monthly insurance payments.

She noted that many households faced premium increases reaching double- or even triple-digit percentages, making continued coverage financially difficult for many families.

The latest federal data provide one of the clearest pictures yet of the impact because they reflect enrollment after the marketplace’s grace period for unpaid premiums had expired.

Government Data Reflects Post-Payment Enrollment

The enrollment figures, compiled in April but measuring coverage during February, capture individuals who successfully maintained their health insurance after paying their first premiums of the year.

Earlier government estimates released in January had already indicated weakening enrollment trends. At that time, approximately 800,000 fewer people had signed up for ACA coverage than during the same enrollment period a year earlier, marking the first annual decline in marketplace enrollment in four years.

The February data suggest that additional policyholders lost coverage after failing to keep up with higher premium payments.

More Enrollment Losses Could Follow

KFF expects enrollment to continue declining throughout 2026.

According to Cox, total ACA marketplace enrollment could fall to roughly 17.5 million people before the end of the year if current trends continue.

The Affordable Care Act marketplace has become an increasingly important source of health insurance for working-age Americans who do not receive employer-sponsored coverage and do not qualify for Medicaid.

Those relying on ACA plans include self-employed workers, gig economy employees, farmers, ranchers, hairstylists, freelancers, and other individuals purchasing insurance independently.

Subsidy Expiration Became a Political Issue

The enhanced ACA subsidies that expired this year were the subject of significant debate in Congress last fall.

Democrats and some Republicans supported extending the financial assistance, arguing it would help keep health insurance affordable for millions of Americans.

The expiration comes as healthcare affordability remains a prominent issue for voters ahead of the November elections. Rising medical costs and insurance premiums continue to rank among the public’s leading economic concerns alongside broader cost-of-living pressures.

While federal officials point to anti-fraud efforts as one factor behind lower enrollment, healthcare analysts say the higher premiums following the end of enhanced subsidies appear to have had a substantial impact on the number of Americans maintaining Affordable Care Act coverage.

Tags: Affordable Care Act, Obamacare, Health Insurance, Department of Health and Human Services, Healthcare Policy, Health Insurance Premiums, Congress, Medicaid, Health Coverage, Federal Subsidies

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In a statement posted on social media, Trump said countries moving ahead with digital services taxes would face sweeping tariffs on all goods exported to the United States. He argued that such taxes unfairly target American technology firms and said the proposed tariffs would override any previously negotiated trade agreements.

The warning comes as several European governments continue pursuing digital tax policies aimed at large multinational technology companies that generate significant revenue within their borders.

EU Rejects U.S. Criticism

The European Commission responded by defending its approach, saying digital taxation policies are applied without discrimination and cover all qualifying companies regardless of where they are headquartered.

Commission spokesperson Olof Gill said unilateral actions against those tax measures would be unjustified and warned that the European Union would act quickly to protect its legal rights and regulatory independence if new U.S. tariffs were introduced.

The exchange increases the possibility of a broader trade dispute between Washington and Brussels that could affect businesses, consumers, and economic growth on both sides of the Atlantic.

Digital Taxes Remain Major Point of Disagreement

Trump has consistently opposed foreign efforts to tax or regulate major American technology companies. He has previously argued that digital services taxes disproportionately affect U.S.-based firms and has repeatedly threatened tariff measures against governments adopting such policies.

Although the United States and the European Union recently concluded a trade agreement limiting tariffs on most EU exports to 15%, digital taxation was not included in that arrangement, leaving the issue unresolved.

The omission has kept digital tax policy among the most contentious aspects of transatlantic trade discussions.

Questions Remain Over Implementation

It remains unclear how the administration would enforce the proposed 100% tariffs or whether they would be applied universally to countries with digital services taxes or targeted at specific nations.

The U.S. government has previously examined digital services taxes through investigations conducted under Section 301 of the Trade Act of 1974, which has been used to evaluate foreign trade practices considered harmful to U.S. commercial interests.

United Kingdom Continues Digital Tax Policy

Although no longer part of the European Union, the United Kingdom has imposed a 2% digital services tax since 2020 on revenue generated by qualifying search engines, social media platforms, and online marketplaces that derive value from British users.

British officials said when introducing the measure that traditional corporate tax rules did not adequately reflect where digital companies create economic value. The government stated the policy was intended to ensure that large multinational technology companies make a fair contribution toward funding public services.

The tax includes revenue thresholds, meaning it primarily applies to the world’s largest digital businesses rather than smaller firms.

If the United States follows through on Trump’s latest threat, the dispute over digital taxation could become the next major flashpoint in global trade relations, with businesses on both sides watching closely for potential retaliatory measures.

Tags: Donald Trump, United States, European Union, Tariffs, Digital Services Tax, Trade Policy, Technology Companies, International Trade, U.K., Global Economy

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