| | | |  | | By Eli Okun | | Presented by |  | | | |  | THE CATCH-UP | | | 
Commerce Secretary Howard Lutnick and other U.S. negotiators are pressing the EU hard in trade negotiations. | Andrew Caballero-Reynolds/AFP via Getty Images | TRADING PLACES: Will the EU and the U.S. strike an eleventh-hour deal — or escalate to an all-out trade war as soon as next week? The talks: European negotiators thought they were headed for an agreement to set many U.S. tariffs at 10 percent, before President Donald Trump issued a new threat of 30 percent levies starting Aug. 1. Now Brussels is scrambling through more intense talks this week — and even “prepared to stomach an unbalanced agreement” if it must, Bloomberg’s Alberto Nardelli reports. The Americans are pushing for a deal that sets tariffs higher than 10 percent and exempts few products, while sector-specific tariffs on metals and cars seem here to stay. The art of the deal: Commerce Secretary Howard Lutnick told CBS over the weekend that he’s “confident” an agreement will come together — and that Aug. 1 is a “hard deadline.” On CNBC’s “Squawk Box” this morning, Treasury Secretary Scott Bessent maintained that “it doesn’t have to get ugly” with the EU. “The important thing here is the quality of the deal, not the timing of the deals,” he added. But but but: If the two sides don’t strike a deal in time, Europe is also readying to play hardball. “If they want war, they will get war,” one German official told WSJ’s Kim Mackrael and Bertrand Benoit. Among EU states, “the mood has pivoted … and they are more ready to react,” Reuters’ Philip Blenkinsop reports. Potential counter-measures remain a subject of internal debate, though. Europe could impose its own tariffs on U.S. goods — some of them politically targeted at Republican states — but France wants to go further with an “anti-coercion” instrument to take aim at U.S. services trade and restrict access to financial markets. Germany is now open to considering the ACI, while other countries are resistant to such a “nuclear option.” The impact: As a bloc, the EU is America’s single largest trading partner. WaPo’s Ellen Francis and Amaya Verde have a clicker detailing what could be hardest hit by an escalating trade war next month: German cars, Irish pharmaceuticals, French wine, American bourbon and more. Meanwhile, Trump’s trade threats and other aggression toward European allies has had the countervailing effect of bringing the EU closer together, and helping to bolster its public standing on the continent, NYT’s Jeanna Smialek reports. The dealmaker-in-chief: The New Yorker’s Antonia Hitchens profiles Lutnick, who has a phone call with Trump from bed most nights around 1 a.m. — to talk about trade and just shoot the shit. He has grand ideas about changing the government, from selling U.S. citizenship to replacing the IRS. He’s also “the most Trumpian member of Trump’s Cabinet,” she writes, “a raw, unbridled expression of the President’s mercantilist instincts and branding acumen, of government as dealmaking in gold-plated rooms.” One foreign negotiator says they see their mission as convincing Lutnick that he’s bullied them into a deal. Also angling for a deal: Taiwan said it’ll conduct a fourth round of trade talks with the U.S. this week, per Bloomberg. Meanwhile, a bipartisan group of senators met with Canadian PM Mark Carney today to try to tamp down trade tensions and build toward a renegotiation of the United States-Mexico-Canada Agreement, POLITICO’s Nick Taylor-Vaisey reports from Ottawa. Good Monday afternoon. Thanks for reading Playbook PM. Drop me a line at eokun@politico.com.
| | | | A message from bp: bp supports ~300,000 US jobs. Like the engineering and skilled labor jobs that are working to produce more American energy right now. Across our five offshore platforms in the Gulf of America, we're making major investments in people and infrastructure. It's just one of the ways bp is investing in America. | | | | | | 6 THINGS YOU NEED TO KNOW | | 1. CONSTITUTIONAL CRISIS WATCH: Across 165 court cases in which judges have ruled against the Trump administration, plaintiffs have accused the government of defying court orders in more than one-third — and many of the judges have agreed, WaPo’s Justin Jouvenal reports. The numbers, “suggesting widespread noncompliance with America’s legal system,” amount to a pattern that experts say is “unprecedented for any presidential administration.” Immigration and federal funding/civil service cuts have been the biggest flashpoints. But the administration claims it has not flouted judicial rulings. And not a single judge has yet punished the administration for failing to comply. 2. TRAIL MIX: The DNC raised a paltry $8.6 million in June, according to a new filing with the FEC late last night, POLITICO’s Jessica Piper writes in. That’s bad on several levels: The RNC raised nearly twice as much — $16.1 million — over the same period and ended the month with $80.7 million in the bank, while the DNC had just $15.2 million cash on hand. And the DNC is not even moving in the right direction, money-wise: The $8.6 million raised in June was actually the party committee’s lowest month of the year. The continued financial challenges come as new DNC Chair Ken Martin’s early tenure has been marked by bitter infighting, with some Democrats worried that internal squabbles have distracted the party from focusing on Trump. Meanwhile, Trump is closely focused on retaining GOP control of Congress in the midterms, and he plans to raise and spend a lot — including by headlining an RNC fundraiser this fall, Axios’ Alex Isenstadt reports. New in the field: Democrat Katherine Aleman has launched a bid to unseat Rep. Ken Calvert (R-Calif.), POLITICO’s Melanie Mason reports. She’s a teacher, farmer and former city council member from a conservative part of the district. … Republican Eric Flores officially kicked off his effort to flip Rep. Vicente Gonzalez’s (D-Texas) district, Fox News’ Paul Steinhauser scooped. The former assistant U.S. attorney and Army veteran is seen as the GOP’s leading pick, though the contours of the district remain uncertain amid a Republican redistricting attempt. Smooth sailing: As they gear up for special elections next fall, appointed Sens. Jon Husted (R-Ohio) and Ashley Moody (R-Fla.) are facing easier paths than some had initially expected, NBC’s Henry Gomez and Matt Dixon report. Crowded primaries haven’t materialized, both have proven strong fundraisers, and their states are trending redder. 3. UNDER THE RADAR: “An Attack on the Medical Establishment Buried in an 1,800-Page Regulation,” by NYT’s Reed Abelson and Margot Sanger-Katz: “For decades, the prices Medicare pays doctors for different medical services have been largely decided not by Medicare itself, but by a powerful industry group, the American Medical Association. … And for decades, critics have complained that this process unfairly rewards surgeons and other specialists, at the expense of primary care physicians and other generalists. … But a change buried inside a 1,803-page proposed regulation published last Monday suggests the Trump administration would like to move away from this longstanding system.”
| | | | Playbook, the unofficial guide to official Washington, isn’t just a newsletter — it’s a podcast, too. With new co-hosts who bring unmatched Trump world reporting and analysis, The Playbook Podcast dives deeper into the power plays shaping Washington. Get the insider edge—start listening now. | | | | | 4. SHUTDOWN SHOWDOWN: The fiscal year 2026 appropriations process is heating up this week, as the Senate takes a filibuster-busting vote tomorrow on the Military Construction-VA bill and the House works through subcommittee markups starting this evening. In the House, Republicans may have to navigate demands from the Freedom Caucus, which has often thrown a wrench into the appropriations process in a bid to shift spending lower and policy to the right. One big question mark: Senate Democrats. After Republicans voted through a rescissions package and the Trump administration has threatened to upend the bipartisan appropriations process, many Democrats say they simply don’t trust the GOP anymore to stick to a deal, NOTUS’ Helen Huiskes and Ursula Perano report. Some want Republican commitments to acting in good faith, and action to back it up. But the reality is that Democrats have few good options and limited leverage — and they haven’t gotten on the same page for a strategy, POLITICO’s Jennifer Scholtes and colleagues report. And Senate Dems haven’t gone so far as to threaten a government shutdown. 5. MEGABILL FALLOUT: The deep Medicaid cuts coming soon from the One Big Beautiful Bill Act could threaten home- and community-based care for disabled people, NYT’s Maggie Astor reports. Though Republicans argue that states can avoid cuts to these services by getting all their savings from hospital reimbursement changes, experts say that isn’t realistic — and cuts to disabled people’s services are likely in some states. That “would have a profound effect on their lives.” Another hard choice for states: The law’s big expansion of school choice via new tax credits is opt-in for governors, WSJ’s Matt Barnum reports. That will present Democratic state leaders with a high-profile decision of whether to join the program to expand private-school subsidies — one expert analogizes the situation to red states’ Medicaid expansion decisions. 6. EPSTEIN LATEST: “House won’t vote on Epstein matter this week,” by POLITICO’s Meredith Lee Hill: “Speaker Mike Johnson doesn’t have any plans to put a non-binding resolution on the floor this week before the August recess — or possibly ever — that would call for the administration to release Jeffrey Epstein-related documents. Instead, GOP leaders have an understanding with White House officials that the House will wait to address the matter until after the monthlong break in order to give the administration time to release documents on its own.”
| | | | | TALK OF THE TOWN | | Joe Biden will receive the Lifetime Achievement Award at the Edward M. Kennedy Institute’s 10th-anniversary celebration this fall, along with honors for Marty Walsh and retired Adm. Lisa Franchetti. Jonathan Scott, one of the Property Brothers, is working with the National Fire Protection Association on a new campaign advocating for the Pro Codes Act and the preservation of independent safety codes and standards. BOOK CLUB — Jon Ralston is putting out the first complete biography of Harry Reid, “The Game Changer: How Harry Reid Remade the Rules and Showed Democrats How to Fight” ($30). It’ll publish Jan. 20 from Simon & Schuster. OUT AND ABOUT — SPOTTED at a kick-off party for the Mubadala Citi DC Open tennis tournament last night at Ned’s Club, co-hosted by Uber and featuring a performance by Wale: Frances Tiafoe, Nick Kyrgios, Jessica Pegula, Eugenie Bouchard, Andrey Rublev, Maria Sakkari, Hailey Baptiste, Mark and Sally Ein, Jill Hazelbaker and Chris Franks, D.C. Mayor Muriel Bowser, Brandon Beach, Todd and Kristine Blanche, Terry and Dorothy McAuliffe, Jim Goyer, Alex Flemister, Mike Needham, Paige Willey, Anna Kelly, Senay Bulbul, Spike Mendelsohn, Jonathan Martin, Josh Dawsey, Meridith McGraw and Michael Steel. TRANSITIONS — Loughlin Cleary has rejoined the Independent Community Bankers of America as EVP for member relations. He most recently was president and national sales director for Lenders Cooperative. … Kristin Ford is now VP for global strategy and engagement and professor of practice at Arizona State University. She previously was president and CEO of IREX. … Morgan Adamski has joined PwC as a U.S. leader in its cyber, data and technology risk business. She previously was executive director and the highest-ranking civilian at U.S. Cyber Command. ENGAGED — Nathaniel Reed, congressional correspondent for Scripps News, and Eddie Mansius, VP of development at Secant Property Partners, got engaged in Wainscott, New York, on Friday. They met online on two separate dating apps at the same time and had their first date in February 2022 at Calico, before Nathaniel had to rush back to the studio to cover Ketanji Brown Jackson’s Supreme Court nomination. Pics BONUS BIRTHDAY: Christian Morgan of HB Strategies Did someone forward this email to you? Sign up here. Send Playbookers tips to playbook@politico.com or text us on Signal here. Playbook couldn’t happen without our editor Zack Stanton, deputy editor Garrett Ross and Playbook Podcast producer Callan Tansill-Suddath.
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