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Could Stormont get a bigger top-up?

June 9 (UPI) — NATO Secretary-General Mark Rutte was expected to call for member nations and allies to increase defense spending in London on Monday.

Rutte is set to deliver remarks at the Royal Institute of International Affairs, a British think tank also known as Chatham House, in London and meet with British Prime Minister Keir Starmer on the visit to London.

“The fact is, we need a quantum leap in our collective defense,” he is expected to say according to remarks shared with reporters.

It is anticipated that Rutte will ask NATO allies to increase their defense spending by 400%. He’s likely to lay out an outline for why it’s necessary for each to agree to up their military spending to 5% of GDP when they meet at a summit in The Hague later this month.

“The work ahead of us for the [NATO summit] in The Hague is clear,” Rutte posted to X Thursday. “We need a new defense investment plan that will ensure we have the resources we need to be able to deter and defend in this more dangerous world.”

Each will be asked to invest millions more on tanks and artillery shells as Rutte will focus on the possibility of an aggressive Russia in the future.

“The fact is, danger will not disappear even when the war in Ukraine ends,” Rutte is expected to say while adding that, that Russia won’t back down on its military even if and after when its war on Ukraine ends.

Kremlin spokesperson Dmitry Peskov already reportedly responded Monday to what Rutte is expected to discuss and said that NATO “is demonstrating itself as an instrument of aggression and confrontation.”

NATo already announced Friday that Rutte will ask for its allies to spend 3.5% of that 5% on core defense, with the other 1.5% to go to defense and security-related investments.

Rutte is also slated to meet with British Prime Minister Keir Starmer while in London Monday.

German Chancellor Friedrich Merz has called on the US to apply more pressure on Russia to end its three-year-old war on Ukraine.

“You know that we gave support to Ukraine and that we are looking for more pressure on Russia,” Merz told US President Donald Trump at the start of their meeting on Thursday at the Oval Office.

Merz emphasised that Germany “was on the side of Ukraine”, while Trump likened the war to a fight between two young children who hated each other.

“Sometimes, you’re better off letting them fight for a while and then pulling them apart,” Trump said. He added that he had relayed that analogy to Russian President Vladimir Putin in their phone conversation on Wednesday.

Asked about Trump’s comments as the two leaders sat next to each other, Merz stressed that both he and Trump agreed “on this war and how terrible this war is going on,” pointing to the US president as the “key person in the world” who would be able to stop the bloodshed.

Al Jazeera’s Kimberly Halkett said that, while the two men agreed that the war needed to end, how that happens “seems to be a point of contention”.

“What we saw there was the German chancellor suggesting and pointing out that … Russia continues to hit back at civilian targets, whereas, when it comes to Ukraine, the focus in the eyes of Germany has been strictly on military targets inside Russia,” she said from Washington, DC.

Halkett added that Trump revealed during the meeting that he “implored the Russian president not to retaliate for that attack that took place over the weekend … and Vladimir Putin said he was going to attack regardless.”

A ‘decent’ relationship

Thursday’s meeting marked the first time that the two leaders sat down in person. After exchanging pleasantries – Merz gave Trump a gold-framed birth certificate of the US president’s grandfather, Friedrich Trump, who immigrated from Germany – the two leaders were to discuss issues such as Ukraine, trade and NATO spending.

Trump and Merz have spoken several times by phone, either bilaterally or with other European leaders, since Merz took office on May 6. German officials say the two leaders have started to build a “decent” relationship, with Merz wanting to avoid the antagonism that defined Trump’s relationship with one of his predecessors, Angela Merkel, in the Republican president’s first term.

The 69-year-old Merz, who came to office with an extensive business background, is a conservative former rival of Merkel’s who took over her party after she retired from politics.

Merz has thrown himself into diplomacy on Ukraine, travelling to Kyiv with fellow European leaders days after taking office and receiving Zelenskyy in Berlin last week.

He has thanked Trump for his support for an unconditional ceasefire while rejecting the idea of “dictated peace” or the “subjugation” of Ukraine and advocating for more sanctions against Russia.

In their first phone call since Merz became chancellor, Trump said he would support the efforts of Germany and other European countries to achieve peace, according to a readout from the German government. Merz also said last month that “it is of paramount importance that the political West not let itself be divided, so I will continue to make every effort to produce the greatest possible unity between the European and American partners.”

Under Merz’s immediate predecessor, Olaf Scholz, Germany became the second-biggest supplier of military aid to Ukraine after the United States. Merz has promised to keep up the support and last week, pledged to help Ukraine develop its own long-range missile systems that would be free of any imposed range limits.

At home, Merz’s government is intensifying a drive that Scholz started to bolster the German military after Russia launched its full-scale invasion of Ukraine. In Trump’s first term, Berlin was a target of his ire for failing to meet the current NATO target of spending 2 percent of gross domestic product on defence, and Trump is now demanding at least 5 percent from allies.

The White House official said the upcoming NATO summit in the Netherlands later this month is a “good opportunity” for Germany to commit to meeting that 5 percent mark.

During their meeting on Thursday, Trump described Merz as a good representative of Germany and also “difficult,” which he suggested was a compliment. He said US troops would remain in Germany and said it was positive that Berlin was spending more money on defence.

‘Ok with tariffs’

Another top priority for Merz is to get Germany’s economy, Europe’s biggest, moving again after it shrank the past two years. He wants to make it a “locomotive of growth,” but Trump’s tariff threats are a potential obstacle for a country whose exports have been a key strength. At present, the economy is forecast to stagnate in 2025.

Germany exported $160bn worth of goods to the US last year, according to the Census Bureau. That was about $85bn more than what the US sent to Germany, a trade deficit that Trump wants to erase.

“Germany is one of the very big investors in America,” Merz told reporters Thursday morning. “Only a few countries invest more than Germany in the USA. We are in third place in terms of foreign direct investment.”

The United States and the European Union are in talks to reach a trade deal, which would be critical for Germany’s export-heavy economy, but Trump said he would be fine with an agreement or with tariffs.

“We’ll end up hopefully with a trade deal,” Trump said. “I’m OK with the tariffs, or we make a deal with the trade.”

WASHINGTON — The White House on Tuesday officially asked Congress to claw back $9.4 billion in already approved spending, taking funding away from programs targeted by Elon Musk’s Department of Government Efficiency.

It’s a process known as “rescission,” which requires President Donald Trump to get approval from Congress to return money that had previously been appropriated. Trump’s aides say the funding cuts target programs that promote liberal ideologies.

The request, if it passes the House and Senate, would formally enshrine many of the spending cuts and freezes sought by DOGE. It comes at a time when Musk is extremely unhappy with the tax cut and spending plan making its way through Congress, calling it on Tuesday a “disgusting abomination” for increasing the federal deficit.

White House budget director Russ Vought said more rescission packages and other efforts to cut spending could follow if the current effort succeeds.

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Here’s what to know about the rescissions request:

Will the rescissions make a dent in the national debt?

The request to Congress is unlikely to meaningfully change the troublesome increase in the U.S. national debt. Tax revenues have been insufficient to cover the growing costs of Social Security, Medicare and other programs. The Congressional Budget Office estimates the government is on track to spend roughly $7 trillion this year, with the rescission request equaling just 0.1% of that total.

White House press secretary Karoline Leavitt told reporters at Tuesday’s briefing that Vought would continue to cut spending, hinting that there could be additional efforts to return funds.

“He has tools at his disposal to produce even more savings,” Leavitt said.

Vought said he can send up additional rescissions at the end of the fiscal year in September “and if Congress does not act on it, that funding expires.”

“It’s one of the reasons why we are not putting all of our expectations in a typical rescissions process,” he added.

What programs are targeted by the rescissions?

A spokesperson for the White House Office of Management and Budget, speaking on condition of anonymity to preview some of the items that would lose funding, said that $8.3 billion was being cut from the State Department and the U.S. Agency for International Development. NPR and PBS would also lose federal funding, as would the U.S. President’s Emergency Plan for AIDS Relief, also known as PEPFAR.

The spokesperson listed specific programs that the Trump administration considered wasteful, including $750,000 to reduce xenophobia in Venezuela, $67,000 for feeding insect powder to children in Madagascar and $3 million for circumcision, vasectomies and condoms in Zambia.

Is the rescissions package likely to get passed?

House Speaker Mike Johnson, R-La., complimented the planned cuts and pledged to pass them.

“This rescissions package reflects many of DOGE’s findings and is one of the many legislative tools Republicans are using to restore fiscal sanity,” Johnson said. “Congress will continue working closely with the White House to codify these recommendations, and the House will bring the package to the floor as quickly as possible.”

Members of the House Freedom Caucus, among the chamber’s most conservative lawmakers, said they would like to see additional rescission packages from the administration.

“We will support as many more rescissions packages the White House can send us in the coming weeks and months,” the group said in a press release.

Sen. Susan Collins, chair of the Senate Appropriations Committee, gave the package a less optimistic greeting.

“Despite this fast track, the Senate Appropriations Committee will carefully review the rescissions package and examine the potential consequences of these rescissions on global health, national security, emergency communications in rural communities, and public radio and television stations,” the Maine lawmaker said in a statement.

Boak writes for the Associated Press.

Orders tumble by 3.7 percent after a rise in March when businesses increased purchases in anticipation of tariffs.

Orders from United States factories have tumbled in April after a surge in March when businesses had front-loaded purchases in anticipation of tariffs.

New orders for US manufactured goods dropped by 3.7 percent on a monthly basis, worse than economists had expected, according to Census Bureau data released on Tuesday.

Economists polled by the Reuters news agency expected a 3.1 percent drop. Dow Jones forecast a 3.3 percent drop. On an annual basis, however, factory orders rose by 2 percent.

April’s report is in sharp contrast to the 3.4 percent increase in March, which topped five straight months of increases.

Manufacturing, which accounts for 10.2 percent of the US economy, has been put under pressure by President Donald Trump’s aggressive tariffs. Trump sees the tariffs as a tool to raise revenue to offset his promised extension of tax cuts and to revive a long-declining industrial base, a feat that economists argued was impossible in the short term because of labour shortages and other structural issues.

Hardest hit sectors

Orders in the transportation sector fell 17.1 percent, led by a sharp drop in the commercial aircraft sector. Aircraft orders fell by 51.5 percent in April. Orders for motor vehicles, parts and trailers dropped 0.7 percent.

Electrical equipment, appliances and component manufacturing fell by 0.3 percent. But manufacturing for computers and other electronic products actually grew by 1 percent.

Machinery orders also rose 0.6 percent. Excluding transportation, which led the surge in March orders, orders fell 0.5 percent, matching March’s decline of non-transportation goods.

The government also reported that orders for nondefence capital goods excluding aircraft, a measure of business spending plans on equipment, decreased 1.5 percent in April rather than 1.3 percent as estimated last month.

Shipments of these so-called core capital goods fell by an unrevised 0.1 percent, or $1.8bn.

An Institute for Supply Management survey showed manufacturing contracted for a third straight month in May and suppliers took the longest time in nearly three years to deliver inputs to factories.

PM Albanese says government already increasing spending and decisions will be based on defence capability needs.

United States Defense Secretary Peter Hegseth has called on Australia to increase its military spending to 3.5 percent of gross domestic product (GDP) “as soon as possible”.

Responding on Monday, Prime Minister Anthony Albanese said the government will decide on Australia’s defence capability needs before announcing spending.

“What you should do in defence is decide what you need, your capability, and then provide for it,” Albanese told reporters.

“That’s what my government is doing. Investing to our capability and investing in our relationships.”

Albanese added that his government is already increasing defence spending by about 10 billion Australian dollars ($6.5bn).

“We’re continuing to lift up,” he said, citing his government’s goal to increase spending to 2.3 percent of GDP by 2033.

However, the government is facing other demands on its budget.

Albanese was speaking from a farm in the state of South Australia, which is experiencing a significant drought.

Meanwhile, Australia’s treasurer said the country is facing a bill of billions due to recent floods in New South Wales and Cyclone Alfred.

Public broadcaster ABC reported that increasing military spending to 3.5 percent of GDP would cost 100 billion Australian dollars ($65bn) annually, 40 billion Australian dollars ($25bn) more than it spends currently.

Matt Grudnoff, a senior economist with The Australia Institute, said “Australia already spends more than it should” on defence.

“Were Australia to increase its defence spending to 2.3% of GDP, we would be the ninth biggest spender on defence and the military,” Grudnoff said.

“Australia would be devoting more of its economy to defence than France and Taiwan, and on a par with the United Kingdom,” he added.

Worldwide military spending increased by 9.4 percent in 2024, the sharpest rise since the end of the Cold War, in part driven by increased spending by European countries, according to the Stockholm International Peace Research Institute (SIPRI).

The Australian government has already committed to spending hundreds of billions of dollars on US-manufactured nuclear submarines under its AUKUS agreement with the US and the UK in the coming decades.

It estimates that the programme could cost up to 368 billion Australian dollars ($238bn).

Hegseth and Australian Defence Minister Richard Marles discussed security issues, including accelerating US defence capabilities in Australia and advancing industrial base cooperation during a meeting on Friday, a Pentagon statement said on Sunday.

Australia’s role in manufacturing weapons components has come under increasing scrutiny amid Israel’s war on the Gaza Strip, with protests outside Australian weapons factories and at Australian ports, as well as legal challenges.

Albanese says Australia’s position on Taiwan has not changed

Hegseth’s call for Australia to increase its military spending comes after the US Secretary of State Marco Rubio told the Shangri-La Dialogue on Saturday that “the threat China poses is real, and it could be imminent”.

“There’s no reason to sugar-coat it,” the Pentagon chief added. The US continues to warn of the threat that China poses to Taiwan, which Beijing considers part of Chinese territory.

China’s Defence Minister Dong Jun skipped the conference, which is considered to be the region’s top security event.

The Chinese Ministry of Foreign Affairs responded by saying: “The US should not entertain illusions about using the question over Taiwan as a bargaining chip to contain China, nor should it play with fire.”

Asked about Hegseth’s remarks, Albanese said Australia will “determine our defence policy”.

“Our position with regard to Taiwan is very clear, [and] has been for a long period of time, which is a bipartisan position to support the status quo,” he said.

WASHINGTON — Elon Musk is criticizing the centerpiece of President Trump’s legislative agenda, a significant fracture in a partnership that was forged during last year’s campaign and was poised to reshape American politics and the federal government.

The billionaire entrepreneur, who supported Trump’s candidacy with at least $250 million and has worked for his administration as a senior advisor, said he was “disappointed” by what the president calls his “big, beautiful bill.”

The legislation includes a mix of tax cuts and enhanced immigration enforcement. While speaking to CBS, Musk described it as a “massive spending bill” that increases the federal deficit and “undermines the work” of his so-called Department of Government Efficiency, which is not a government agency.

“I think a bill can be big or it could be beautiful,” Musk said. “But I don’t know if it could be both.”

His CBS interview came out Tuesday night. Trump, speaking in the Oval Office on Wednesday, defended his agenda by talking about the delicate politics involved with negotiating the legislation.

“I’m not happy about certain aspects of it, but I’m thrilled by other aspects of it,” he said.

Trump also suggested that more changes could be made.

“We’re going to see what happens,” he said. “It’s got a way to go.”

Republicans recently pushed the measure through the House and are debating it in the Senate.

Musk’s comments come as he steps back from his government work, rededicating himself to his electric automaker Tesla and rocket manufacturer SpaceX. He’s also said he’ll reduce his political spending, because “I think I’ve done enough.”

At times, he’s seemed chastened by his experience working in government. Although he hoped that DOGE would generate $1 trillion in spending cuts, he’s fallen far short of that target.

“The federal bureaucracy situation is much worse than I realized,” he told the Washington Post. “I thought there were problems, but it sure is an uphill battle trying to improve things in D.C., to say the least.”

The White House is set to send proposed rescissions, a mechanism used to cancel previously authorized spending, to Capitol Hill to solidify some of DOGE’s cuts.

A spokesperson for the Office of Management and Budget said the package will include $1.1 billion from the Corporation for Public Broadcasting, which funds NPR and PBS, and $8.3 billion in foreign assistance.

Musk had previously been energized by the opportunity to reshape Washington. He wore campaign hats in the White House, held campaign rallies and talked about excessive spending as an existential crisis.

He often tended to be effusive in his praise of Trump.

“The more I’ve gotten to know President Trump, the more I like the guy,” Musk said in February. “Frankly, I love him.”

Trump repaid the favor, describing Musk as “a truly great American.” When Tesla faced declining sales, he turned the White House driveway into a makeshift showroom to illustrate his support.

It’s unclear if Musk’s comments about the bill will affect the legislative debate. During the transition period, he helped whip up opposition to a spending measure as the country stood on the brink of a federal government shutdown.

House Speaker Mike Johnson (R-La.) has asked senators to make as few changes to the legislation as possible, saying that House Republicans reached a “very delicate balance” that could be upended with major changes. The narrowly divided House will have to vote again on final passage once the Senate alters the bill.

However, Musk’s criticism could embolden Republicans who want bigger spending cuts. Republican Utah Sen. Mike Lee reposted a Fox News story about Musk’s interview while adding his own take on the measure, saying there was “still time to fix it.”

“The Senate version will be more aggressive,” Lee said. “It can, it must, and it will be. Or it won’t pass.”

Only two Republicans — Reps. Warren Davidson of Ohio and Thomas Massie of Kentucky — voted against the bill when the House took up the measure last week.

Davidson took note of Musk’s comments on social media.

“Hopefully, the Senate will succeed with the Big Beautiful Bill where the House missed the moment,” he wrote. “Don’t hope someone else will cut deficits someday, know it has been done this Congress.”

The Congressional Budget Office, in a preliminary estimate, said the tax provisions would increase federal deficits by $3.8 trillion over the decade, while the changes to Medicaid, food stamps and other services would reduce spending by slightly more than $1 trillion over the same period.

House Republican leaders say increased economic growth would allow the bill to be deficit neutral or reducing, but outside watchdogs are skeptical. The Committee for a Responsible Federal Budget estimates the bill would add $3 trillion to the debt, including interest, over the next decade.

Megerian and Freking write for the Associated Press. AP writer Lisa Mascaro contributed to this report.

America’s debt-addicted government just lost its triple-A credit rating from Moody’s, as it previously had from fellow rating agencies S&P and Fitch. Many in Washington shrugged the move off as minor or as unfair treatment of the Trump administration. The truth is more sobering: a flashing red signal that the United States is no longer seen as a “perfect” credit risk and that politicians should stop pretending economic growth alone can bail us out.

Yes, the mess is real, and it’s because habitual deficit financing — the very disease fiscally minded founding father Alexander Hamilton warned against — has become business as usual.

The reckoning comes as House Republicans push to extend the 2017 Trump tax cuts with a “big, beautiful bill.” If handled correctly, it’s a good idea. But while the legislation aims to avoid tax hikes, it pairs modestly pro-growth provisions with a smorgasbord of costly special-interest giveaways. Worse, it assumes we can afford yet another $3 trillion to $5 trillion in debt without serious consequences. That’s the kind of magical thinking that spurred the credit downgrade.

Starting with Hamilton, American politicians long understood the importance of fiscal policy guided by the ethos of balanced budgets, low taxes and steady debt reduction. Their vision, combined with a deep respect for contractual repayment and financial responsibility, made America a creditor nation.

Washington abandoned that honorable legacy in recent decades. U.S. national debt held by the public is racing toward $30 trillion, and the cost of servicing it is ballooning. Interest payments are now one of the fastest-growing parts of the budget — $1 trillion in 2026 — crowding out core priorities and leaving us vulnerable to economic shocks. The Congressional Budget Office warns that even modest interest-rate increases could lead to hundreds of billions of dollars in added annual costs. It’s not a theoretical problem; it’s a real, compounding threat.

Which brings us back to the downgrade. Historically, downgrades like those from S&P in 2011 or Fitch in 2023 haven’t caused immediate crises, but they do raise borrowing costs and gradually erode investor confidence. The downgrades are not the problem, but symptoms of a deeper illness: lack of credible fiscal discipline. Market participants aren’t worried because Moody’s wrote a negative report; they’re worried because what Moody’s wrote is true.

If our political class continues to ignore warnings, the market will do what rating agencies only hint at: impose real discipline through higher borrowing costs, weaker currency demand and tighter credit conditions. Already, China and other countries have reduced holdings of U.S. Treasuries from 42% in 2019 to 30% today.

Meanwhile, the tax plan so far embodies Washington’s worst habits. It makes only temporary the most important pro-growth provisions of the 2017 tax cuts — like full expensing for equipment and research and development — while rendering permanent a raft of unrelated policies catering to favored industries and constituencies. That’s not tax reform; it’s pork-barrel politics dressed up as populist economics.

Worse still, the bill’s Republican supporters in the House justify it with the fantastical claim that it’s fiscally responsible based on the notion that it will raise trillions in growth-generated revenue. Even the most optimistic models show the current bill barely moving the growth needle. The administration claims growth will be enormous once it deregulates and sells off assets, but these distinct policies take a long time to bear fruit.

What a missed opportunity. According to Tax Foundation experts, making just four cost-recovery provisions permanent — bonus depreciation, R&D expensing, full expensing for factories and reforming the business-interest limitation — would more than double the tax bill’s long-run growth benefits.

That’s where legislators should be focused. Not on tax breaks for hand-picked industries or energy credits for hand-picked technologies — on structural reforms that maximize American investment, innovation and capital formation. Even such pro-growth tax policy must be paired with real spending restraint, something we haven’t seen in earnest since the 1990s. Otherwise, any gains from better tax policy will have red ink spilled all over them.

The lesson from Moody’s, and from history, is that America cannot borrow its way to prosperity. That was Treasury Secretary Andrew Mellon’s view in the 1920s, and it remains true today. Mellon quietly prepared for debt defaults by building budget surpluses, knowing that while international repayments might fail, American citizens still had to be paid. That was back when Treasury secretaries respected taxpayers.

Now, as then, we stand at a crossroads. Will we restore Hamiltonian principles of fiscal prudence or continue down a path where downgrades become defaults and our creditors decide the terms of American fiscal policy? The next move belongs to Congress. Legislators can’t say they weren’t warned. If they fail the fiscal prudence test again, we’ll all pay the price.

Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University. This article was produced in collaboration with Creators Syndicate.

The Republican-controlled US House of Representatives has passed the “Big, Beautiful Bill”, the sweeping tax and spending bill by a single vote.

The legislation, which would enact much of President Donald Trump’s policy agenda, passed early Thursday morning after an overnight session.

The bill, which is now headed to the Senate, will cut taxes, but also saddle the country with trillions of dollars more in debt.

The bill would fulfil many of Trump’s populist campaign pledges, delivering new tax breaks on tips and car loans and boosting spending on the military and border enforcement. It will add about $3.8 trillion to the federal government’s $36.2 trillion in debt over the next decade, according to the nonpartisan Congressional Budget Office.

“This is arguably the most significant piece of Legislation that will ever be signed in the History of our Country!” Trump wrote on social media.

The package passed in a 215-214 vote after a marathon push that kept lawmakers debating the bill through two successive nights.

All of the chamber’s Democrats and two Republicans voted against it, while a third Republican voted “present”, neither for nor against the bill. Another Republican missed the vote because he was asleep.

With a narrow 220-212 majority, House Speaker Mike Johnson could not afford to lose more than a handful of votes from his side, and he made several last-minute changes to satisfy various Republican factions.

“The House has passed generational, truly nation-shaping legislation,” Johnson said.

The bill is now headed to the Republican-controlled Senate, where it will likely be changed further during weeks of debate.

The 1,100-page bill would extend corporate and individual tax cuts passed in 2017 during Trump’s first term in office, cancel many green-energy incentives passed by Democratic former President Joe Biden and tighten eligibility for health and food programmes for the poor.

It also would fund Trump’s crackdown on immigration, adding tens of thousands of border guards and creating the capacity to deport up to one million people each year. Regulations on firearm silencers would be loosened.

The bill passed despite growing concerns about the US debt, which has reached 124 percent of gross domestic product (GDP), prompting a downgrade of the country’s top-notch credit rating by Moody’s last week. The US government has recorded budget deficits every year of this century, as Republican and Democratic administrations alike have failed to bring spending into alignment with revenue.

Interest payments accounted for one out of every eight dollars spent by the US government last year, more than the amount spent on the military, according to the CBO. That share is due to grow to one out of every six dollars over the next 10 years as an ageing population pushes up the government’s health and pension costs, even if Trump’s budget bill is not taken into account.

A mixed response

“We’re not rearranging deck chairs on the Titanic tonight. We’re putting coal in the boiler and setting a course for the iceberg,” said Representative Thomas Massie of Kentucky, one of the two Republicans to vote against the bill.

The growing debt has paradoxically given urgency for Republicans to pass the bill, as it would raise the federal government’s debt ceiling by $4 trillion. That would avert the prospect of a default, which officials have warned could otherwise come sometime in the middle of this year.

Republicans have also argued that failure to pass the bill would mean an effective tax hike for many Americans, as Trump’s 2017 tax cuts are due to expire at the end of the year.

Hardliners on the party’s right flank had pushed for deeper spending cuts to lessen the budget impact, but they met resistance from centrists who worried that would fall too heavily on the 71 million low-income Americans enrolled in the Medicaid health programme. Johnson made changes to address conservatives’ concerns, pulling forward new work requirements for Medicaid recipients to take effect at the end of 2026, two years earlier than before. That would kick several million people off the programme, according to the CBO. The bill also would penalise states that expand Medicaid in the future.

Johnson also expanded a deduction for state and local tax payments from $30,000 to $40,000, which was a priority for a handful of centrist Republicans who represent high-tax states like New York and California. Democrats blasted the bill as disproportionately benefitting the wealthy while cutting benefits for working Americans. The CBO found it would reduce income for the poorest 10 percent of US households and boost income for the top 10 percent.

“This bill is a scam, a tax scam designed to steal from you, the American people, and give to Trump’s millionaire and billionaire friends,” Democratic Representative Jim McGovern said.

Investors, unnerved by the fiscal position of the US and Trump’s erratic tariff moves, are increasingly selling the dollar and other US assets that make up the bedrock of the global financial system. The three major indices the Dow, Nasdaq and S&P 500 are trending upwards slightly after its worst day in a month following a bond market sell-off yesterday.

JPMorgan Chase Chief Executive Jamie Dimon gave a mixed response to the bill’s passage.

“I think they should do the tax bill. I do think it’ll stabilise things a little bit, but it’ll probably add to the deficit,” Dimon said at JPMorgan’s Global China Summit in Shanghai.

Donald Trump made a rare trip to Capitol Hill to try and convince Republican members of Congress to approve his “big, beautiful bill” that would cut programmes for the poor and lower taxes while raising the US’ national debt.

Tasha, who has been travelling the world for two years, recently visited the Maldives and was left amazed by the paradise islands – and how affordable they can be

A savvy traveller has taken to TikTok to share how to enjoy the Maldives on a budget, proving that paradise doesn’t have to cost the earth.

Tasha, a seasoned explorer who’s been trotting the globe for two years, unveiled the truth about affordable Maldivian adventures, stating: “Why don’t more people know this about the Maldives? And that is that you don’t have to be a millionaire to visit here.”

Keen to share her knowledge, Tasha explained that swerving the costly private resorts in favour of cosier, more economical options is the key.

Reliving her visit to Dhigurah, one of the archipelago’s local islands, she called it “just the most beautiful island paradise surrounded by palm trees and blue water”.

This scenic bliss could slash your trip expenses by half since digs can be scooped up starting at just £50 per night – a fraction of the overwater villa prices often flaunted online.

Tasha divulged: “There are hundreds of local islands that you can choose from.”

She explained how public ferry transportation is a bargain at merely £1, and pointed out beachfront accommodation deals starting at around £50 per night; local fare can be found at about £5, while outings are pegged at £50, astonishingly less than resort equivalent excursions.

“I don’t know why more people aren’t discovering the local island of the Maldives, because this is the way you can discover paradise on a budget,” Tasha gushed enthusiastically.

She continued: “So next time you’re thinking of a tropical island getaway, forget Thailand, forget the Philippines, Maldives needs to be number one on your bucket list.”

Tasha did point out some constraints when visiting local islands, like the requirement to dress modestly and avoid alcohol due to the Maldives being a predominantly Muslim nation with specific public decorum.

Opting for a private beach or island allows for a more laid-back vibe and lenient rules, but be warned – it comes with a heftier price tag.

Tasha’s insider info has struck a chord with other globetrotters; comments poured in with one travel enthusiast sharing, “I loved Dhigurah! So gorgeous,” and another chimed in, saying, “Dhigurah is the best place. I miss it so much!”.

One commenter expressed surprise: “I had no idea. Always wanted to go to the Maldives but thought it wouldn’t happen for a long time.”

While yet another grateful wanderer added: “Maldives is honestly so amazing, thanks so much for the tips.”

How to do Maldives on a budget

1. Go off peak – The Maldives’ off-season is from May to October, which overlaps with the monsoon season. Although you might experience occasional rain, you can enjoy significant discounts on flights, accommodations, and activities.

2. Stick to local islands – Instead of staying at luxurious private island resorts, opt for budget-friendly guesthouses or boutique hotels on inhabited local islands. Popular local islands for budget travellers are Maafushi, Dhigurah, Fulidhoo, Thoddoo, and Hulhumalé.

3. Take the ferry – The Maldives has a reliable ferry network connecting Malé (the capital) to local islands. Public ferries are incredibly affordable, costing as little as £1 per trip.

4. Eat like a local – Skip the pricey resort restaurants and eat at local cafés (called “hotaa”). Traditional meals cost around £5. Traditional Maldivian dishes include mas huni (tuna and coconut), fish curries, and roshi (flatbread).

5. Book affordable trips – Excursions (like snorkelling, diving, or sandbank trips) from resorts are usually quite expensive, but guesthouses on local islands offer budget-friendly packages starting at about £20-£50 per activity.

SACRAMENTO — After nearly seven years of hibernation, a ballot initiative overwhelmingly approved by the voters is emerging from its slumber to challenge the way California governments spend the taxpayers’ money.

Designed by tax crusader Paul Gann to limit public spending, Proposition 4 was largely forgotten after it won passage in 1979. But now the measure’s spending curbs are on the verge of taking hold–offering the prospect of a tax rebate and the threat of deep program cuts.

When the new fiscal year begins July 1, the state will be within sneezing distance of the measure’s spending limit–just $95 million below the lid in a budget of nearly $37 billion. State analysts expect the limit to take effect by 1987, preventing the state from spending an estimated $900 million it will collect.

Possible Tax Refund

The awakening of the initiative has prompted Gov. George Deukmejian to suggest the possibility of a tax refund.

But others fear that the measure will ultimately put the brakes on economic growth in California by handicapping government’s ability to provide highways, schools and other necessary services.

Major business organizations, the education establishment and lobbyists for local governments have already begun searching for ways to divert money that would otherwise be returned to the taxpayers.

Three business groups that originally helped draft the initiative–the state Chamber of Commerce, the California Assn. of Realtors and the California Taxpayers Assn.–are leading a drive to alter Proposition 4 and free highway construction from the spending restriction.

And many of the state’s leading politicians, including state Supt. of Public Instruction Bill Honig, Los Angeles Mayor Tom Bradley and Assembly Speaker Willie Brown (D-San Francisco) have quietly come to the conclusion that the limit must be modified or repealed.

“Eventually, I think you’re going to have to repeal it because it’s a death sentence for the schools,” Honig said. “It will put the state in such a straitjacket that you’ll end up with a second-rate state–and I don’t think the people will stand for it.”

Proposition 4 began with a simple idea: Put a specific limit on the rate of growth in government spending.

Gann’s measure followed on the heels of Proposition 13, the 1978 property tax-cutting initiative and was dubbed “the spirit of 13” by its backers. The constitutional amendment drew a broad range of supporters that included then-Gov. Edmund G. Brown Jr.

Overwhelming Approval

Voters, outraged by high taxes, double-digit inflation and dollar-a-gallon gasoline, approved the initiative with an amazing 74% of the vote.

Now, all levels of government–the state, counties, cities, school districts and special districts–can increase spending at a pace governed by a formula based on population growth and either the national inflation rate or the increase in per-capita income–whichever is lower.

The rate of inflation is calculated by using the U.S. Consumer Price Index.

Revenues collected above the limit must be returned to the taxpayers within two years, unless voters agree to raise the lid for a four-year period.

The measure is aimed primarily at government’s ongoing operations, including such programs as education, health, transportation, welfare, prisons, parks and road and school construction.

A variety of exceptions were built into the initiative that provide some protection for long-term capital improvements and programs that directly pay for themselves. Some sources of income are not subject to the restraint, including bonds, tidelands oil revenues, user fees collected to pay for a particular service and proceeds from the sale of land. Certain state expenditures also are exempt, including unrestricted payments to local governments, interest payments on loans and spending required by the federal government or a court.

In 1979, state analysts believed it would be many years before the state ever reached its spending restriction. But during the last several years, California has enjoyed both low inflation and economic growth, a combination that has pushed state revenues to the limit.

Lack of Flexibility Cited

“Over a period of four to five years, the limit will rise at a rate well below the growth of the state’s economy,” said former Legislative Analyst William G. Hamm. “The state would be put in the position of having to reduce services. Ultimately, the limit is just not flexible enough to stand up over a long period of time.”

Since Proposition 4 was approved, public resentment toward state taxes appears to have cooled off somewhat. A Los Angeles Times Poll in 1983 found that 71% of those surveyed said they were either satisfied or neutral about the level of California taxes they were paying.

During the last several years, 10 cities and counties have reached their own spending constraints and asked the voters to raise their limits. In all but one case, the voters agreed, local government officials report.

In a 1984 election in Santa Monica, for example, a measure to hike the spending lid by $4 million to pay for more police won 74% of the vote while a second measure to raise the cap by $3.5 million for public works won 69%.

Paradoxically, the initiative spawned during former Gov. Brown’s “era of limits” may make his successor, George Deukmejian, its biggest beneficiary.

Should the Republican governor win election to a second term in November, Proposition 4 offers him a golden opportunity to preside over a politically popular tax refund.

The governor hinted at that prospect earlier this year.

Speaks of Refund

“That might be a good possibility of happening,” he told reporters. “If we got more revenue in than we could legally spend, it would have to be returned. . . . You’re not going to be able to expand and have a mushrooming bureaucracy.”

Deukmejian, who has enlarged the state budget each year of his first term, could accomplish his longtime goal of cutting back the size of government. Armed with the Gann limit, he would have a powerful tool at his disposal to block legislative spending proposals and reduce social programs popular among Democrats.

At the same time, the limit would create a sizable surplus that could not be spent. This would allow the governor to propose a rebate without incurring criticism from the Legislature that he was hoarding funds needed for programs and services.

“We would enjoy the people’s will being carried out,” said Steven A. Merskamer, Deukmejian’s chief of staff.

Lt. Gov. Leo McCarthy, who was a leading advocate of Proposition 4, worries now that the state could cut services and give money back to the taxpayers at the same time that it is unable to make up for large reductions in federal aid resulting from the Gramm-Rudman deficit-cutting measure.

A tax rebate could take many forms–especially since there is no requirement that the people who paid the taxes are the same ones who would receive a refund.

Selected Tax Breaks

The governor and lawmakers could use the opportunity to give tax breaks to selected groups, such as the multinational corporations that have long been seeking elimination of the unitary tax, one legislative staff member suggested.

Legislators have also begun looking at the possibility of developing creative methods of financing to make up for cuts in some state programs. For example, the state could offer tax credits to developers who carry out projects deemed desirable, such as construction of schools or low-income housing.

Already, business leaders, educators and local officials are angling for ways to divert money from a possible refund by taking advantage of loopholes in Proposition 4.

The proposal that has advanced the furthest is a constitutional amendment authored by Sen. John Foran (D-San Francisco) that would remove road and highway construction expenditures from the limit by declaring that the gasoline tax is a user fee, not a tax. The measure, which would be placed before the voters in November, cleared the Senate and is pending in the Assembly.

Deukmejian, in a rare break with the business community, opposes the measure.

“I strongly supported Proposition 4,” Deukmejian said in a speech last week. “I believe its limit on government growth is very reasonable, and I don’t agree with those who say we should do away with it so taxes can be raised.”

Gann said he also is against the Foran bill “simply because it kicks a hole in 4.”

Key Supporters

Among the bill’s backers are three people who helped Gann draft Proposition 4 in 1979: Dugald Gillies, lobbyist for the California Assn. of Realtors; James P. Kennedy, vice president of the California Chamber of Commerce, and Kirk West, then executive vice president of the California Taxpayers Assn. and now president of the Chamber of Commerce.

“Everything is made to be altered,” Gillies explained. “Even the 10 commandments are altered by interpretation. The Constitution is altered by interpretation. Gann was meant to be dealt with in the same context. The flexibility was built right into it.”

Gillies argued that the Gann limit will not restrict growth in California because voters have the option of raising the spending lid. But he said the spending restraint should be altered to exclude highways because of a tremendous need for new roads around the state.

Education has become another rallying point for opposition to the spending restrictions.

Honig predicts that unless the Proposition 4 limit is altered, California’s drive to improve education will eventually come to a standstill. Although school districts may not reach their limits for at least a year, Honig said, the spending lid would eventually halt efforts to reduce class size and institute other reforms.

“It is very shortsighted to limit the growth of schools by an arbitrary limit of inflation plus growth,” Honig said. “If Gann cuts in, we’ll never catch up with other industrial states. That’s going to put us at a competitive disadvantage.”

Bradley, Deukmejian’s Democratic rival in the gubernatorial race, also cites the need for more spending on education as the primary reason to alter Proposition 4.

Popular Vote

“The problem we face particularly in the field of education indicates to me there is a need for either repeal or modification that must be put before the people,” the Democratic candidate said in an interview.

One suggestion that is gaining popularity among opponents of the limit is to leave the concept of the spending restriction intact while changing the formula for calculating the spending cap.

Instead of a formula that would use either the Consumer Price Index or per-capita income in calculating the spending limit, the idea is to use only California’s per-capita income. Advocates of this change say personal income is a better indicator of the state’s economic growth.

Among those calling for modification of Proposition 4 are the Capitol lobbyists for city and county government.

“This has the potential of being a hell of a lot more destructive for public services than Proposition 13,” said Larry Naake, executive director of the County Supervisors Assn. of California. “At the same time that we’re talking about not letting the state appropriate money, we’ve got counties that are going under.”

Naake and other local government officials have begun lobbying to get a share of the money that the state would be prohibited from spending on its own programs. Such transfers–allowed under Proposition 4 as long as lawmakers do not place restrictions on the way the money can be used–would then count against the limits of the jurisdictions that spent the money.

Limits Will Be Reached

But even with that money, most cities and counties will reach their own limits sooner or later. When that happens, some officials predict, they will be unable to provide basic services as well as those needed for economic development at the local level.

“It certainly does inhibit our ability to finance growth in certain situations,” said Kenneth J. Emanuels, lobbyist for the League of California Cities. “It’s anti-growth in terms of business development. It certainly is not the situation that was envisioned.”

Despite the widespread perception of problems with Proposition 4, most advocates of altering the measure expect that the spending limits will have to take hold before the public will be willing to make major modifications.

Many politicians are reluctant to predict the worst–recalling how wrong they were in making dire predictions of financial disaster if Proposition 13 passed.

“I think it’s hard to change something like Proposition 4 before the problem is at our doorstep,” Emanuels said. “In the past, we haven’t been persuasive when we predicted problems. We’re going to have to experience some of this before there’s a consensus.”

PETER Sullivan is in line for a £1million compensation payout after spending 38 years in jail for a murder he didn’t commit.

The then 29-year-old was branded ‘Beast of Birkenhead’ after being wrongly convicted of killing 21-year-old Diane Sindall in 1986.

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Yesterday, Mr Sullivan, 68, saw his conviction quashed following a review at the Court of Appeal.

It also means a new murder investigation has been launched to find Diane’s killer.

Mr Sullivan, who held his hand to his mouth and appeared tearful as the decision was handed down, said he was “not angry” and would “begin repairing what I made from the driftwood that is my life”.

In a statement released through his solicitor, Sarah Myatt, moments after the verdict, he said: “As God is my witness, it is said the truth shall set you free. It is unfortunate that it does not give a timescale.”

The victim of Britain’s longest miscarriage of justice left prison a free man last night.

Compensation from the Ministry of Justice is capped at £1million, which Mr Sullivan is now in line for.

The MoJ said: “Peter Sullivan suffered a grave miscarriage of justice, and our thoughts are with him and the family of Diane Sindall.

“We will carefully consider this judgment, looking at how this could have happened and making sure both Mr Sullivan and Diane’s family get the answers they deserve.”

Mr Sullivan’s release comes after new tests ordered by the Criminal Cases Review Commission revealed his DNA was not present on samples preserved at the time.

On the night of her murder, Diane had just left her shift as a part-time barmaid at a pub in Bebington when her small blue van ran out of petrol.

She was making her way to a garage when she was beaten to death and sexually assaulted in a “frenzied” attack.

Her body was discovered partially clothed on August 2 in an alleyway.

Diane’s belongings were later found close to where a small fire had been started – with a man seen running from the scene.

Mr Sullivan was said to have spent the day of the murder drinking heavily.

Following his arrest in September 1986, he was quizzed 22 times and denied legal advice in the first seven interviews – despite requesting it.

Mr Sullivan later “confessed to the murder” in an unrecorded interview a day after his arrest.

He then made a formal confession but the court was told this was “inconsistent with the facts established by the investigation”.

It also went against his earlier interviews, with Mr Sullivan retracting the admission later that day.

Since his conviction, questions have been raised about whether he had proper legal representation during his interviews.

Evidence related to bite marks on Diane’s body has also been called into question.

At the time of the case, DNA technology was not available and subsequent requests for new tests were refused.

Mr Sullivan first went to the CCRC for help in 2008 but they did not refer the sentence to the Court of Appeal.

He then launched his own appeal bid in 2019, which judges dismissed after ruling the bite mark evidence was not central to the prosecution at trial.

In 2021, Mr Sullivan went back to the CCRC and raised concerns over police interviews, the bite mark evidence and the murder weapon.

The independent body revealed Mr Sullivan’s DNA was not present on samples preserved at the time.

This led Merseyside Police to confirm they were “carrying out an extensive investigation in a bid to identify who the new DNA profile belongs to”.

The force revealed they had no matches on the police database but were contacting people previously identified in the original probe to request new samples.

The Crown Prosecution Service yesterday told the Court of Appeal the new evidence was enough to cast “sufficient” doubt on the conviction.

It also agreed the fresh clue was “reliable” and that the CPS “does not seek to argue that this evidence is not capable of undermining the safety of Mr Sullivan’s conviction”.

Duncan Atkinson KC, for the CPS, said: “The respondent considers that there is no credible basis on which the appeal can be opposed, solely by reference to the DNA evidence.

“On the contrary, the DNA evidence provides a clear and uncontroverted basis to suggest that another person was responsible for both the sexual assault and the murder.

“As such, it positively undermines the circumstantial case against Mr Sullivan as identified at the time both of his trial and his 2021 appeal.”

The judge said: “Strong though the circumstantial evidence undoubtedly seemed at the trial, it is now necessary to take into account the new scientific evidence pointing to someone else – the unknown man.

“If the new evidence had been available in 1986, the evidence as a whole would have been regarded as insufficient.

“In the light of that evidence it is impossible to regard the appellant’s conviction as safe.”

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