Washington, DC

1. Primary night drama
2. Canada tariff reprieve
3. Warren shares the wealth
4. Crypto mix-up
5. Fed may offer rates clue
6. US-China tech race

PDB: Vance’s next stop 

Trump holds policy meetings … WSJ: Trump wants meeting with North Korea’s Kim Jong Un this year … China’s top envoy visits South Korea

Mills loses in dramatic Florida primary

Florida Republicans ousted Rep. Cory Mills on Tuesday, as the state’s Democrats rejected an early figure of the #Resistance against President Donald Trump in favor of a socialist state legislator. Mills, a two-term conservative who refused to resign over sexual misconduct allegations, lost by 13 points to Ryan Elijah, a former TV reporter who in his victory speech thanked Trump for staying out of the race. Trump’s preferred candidates for a southwest Florida House seat and for governor of Wyoming both lost their primaries. But Republicans were encouraged when Florida state Rep. Angie Nixon, who was massively outspent by Ukraine scandal whistleblower Alexander Vindman, beat him by double digits. She’ll face Sen. Ashley Moody in a race Democrats do not have on their main target list.

— David Weigel

Canada secures brief tariff reprieve

Trump gave Canada three-day reprieve on tariffs that had been due to come into effect overnight, suggesting the two countries were on the verge of a trade agreement. The 50% levies would have affected around 5% of all Canadian exports to the US; Washington separately said the apparently imminent deal would include “economic security commitments” and digital trade “alignment.” Were the agreement to be finalized, it could provide momentum for talks to renew the USMCA North American trade deal; US-Mexico trade talks have themselves dragged on, and the White House has voiced opposition to a renewal of the transcontinental pact. Though Washington views the talks as opportunities to exact better terms, the long-term costs may be significant: Pew research last month showed that Canadians and Mexicans now view China more favorably than the US.

Warren sends Dems $600K for midterms

Sen. Elizabeth Warren, D-Mass., will announce today that she is transferring $600,000 from her campaign account to Democratic committees working on the midterms, according to details first shared with Semafor. The progressive senator will send $300,000 to the Democratic Senatorial Campaign Committee, $200,000 to the Democratic Congressional Campaign Committee, and $100,000 to the Democratic National Committee, bringing her total to more than $1.5 million in political donations this cycle. Warren will make the announcement in Springfield, Illinois, at the Illinois Democratic County Chairs’ Association Brunch; she was invited by Gov. JB Pritzker, a long-rumored 2028 Democratic candidate. Warren has also raised more than $1.1 million for the DNC, making her one of the committee’s highest-grossing surrogates, according to a person familiar with the DNC’s fundraising.

— Burgess Everett

WH mix-up delayed SEC crypto rule

The Securities and Exchange Commission delayed its release of a regulatory framework for certain digital assets following White House officials’ concerns that a separate but related rule could bog down cryptocurrency legislation, people familiar with the process told Semafor. The SEC was set to consider both proposals at a Friday meeting before confusion over which rule it planned to advance led to a cancellation, the people said. Only the framework, not the second proposal, known as the innovation exemption, was set for approval; commissioners later voted on the framework individually, said an SEC spokesperson, who last week attributed the cancellation to “an unforeseen scheduling issue.” A separate person familiar disputed that the crypto bill played any role, saying “the regulations were still technically under review.” Trump will host crypto executives at the White House today as that measure, which would enshrine the current SEC’s approach, languishes in the Senate.

— Eleanor Mueller

Fed minutes to offer inflation strategy clues

The outlook for future interest rate hikes may become clearer today, as the Federal Reserve releases details from its July meeting. The minutes are taking on greater importance given new Fed Chair Kevin Warsh’s reluctance to share much of anything publicly about his thinking; three officials wanted to hike interest rates at the last meeting where the central bank decided to keep them steady, and one analyst thinks that’s the “tip of the iceberg.” Also today, Lowe’s and Target will report earnings, offering further clues of how consumers are navigating sticky inflation. The information will add to a complicated economic picture: A selloff in bonds this week is increasing borrowing costs for people and governments around the globe, driven by inflation, high government deficits, and AI companies’ borrowing. And there’s no end in sight for war-related inflation as the conflict with Iran drags on.

Power chips evade geopolitics — for now

China “pushes” US tech companies to innovate and ship products faster, a leading American power chip CEO told Semafor. “The pace in China is unheard of,” said Onsemi’s Hassane El-Khoury. He has a unique vantage point given that his company — whose products convert power that flows through AI data centers, factories, and cars — sells in both the US and China. Onsemi isn’t subject to the same cross-border scrutiny that advanced computing chipmakers face, and recently struck a deal with Great Wall Power Supply Technology, which supports Chinese data centers. El-Khoury said he feels “pretty comfortable” operating in both markets. But as hawks in Washington increasingly scrutinize anything supporting China’s AI buildout, power chips risk getting swept up in the geopolitical fray.

— J.D. Capelouto

Blindspot: Swalwell and Kennedy Center

Stories that are being largely ignored by either left-leaning or right-leaning outlets, curated with help from our partners at Ground News.

What the Left isn’t reading: Newly declassified FBI records released by the White House shed light on former Democratic Rep. Eric Swalwell’s relations with a suspected Chinese spy.

What the Right isn’t reading: The National Symphony Orchestra announced its upcoming season, which will not take place at the Kennedy Center, its usual home.

White House

• President Trump tapped White House policy aide Heidi Overton as Food and Drug Administration chief.
• Vice President JD Vance is stepping up his travel ahead of the midterms with a stop in his hometown in Ohio on Friday. — NBC
• Emily Underwood, who serves as White House deputy chief of staff under Stephen Miller, is departing. — Axios

Campaigns

• In Alaska, former Democratic Rep. Mary Peltola will challenge Republican Sen. Dan Sullivan for his Senate seat; the other Dan Sullivan came in a distant third.
• VoteVets Action Fund is making another ad buy against Sen. Dan Sullivan after the Alaska Republican voted against reining in President Trump on Iran, this time spending $250,000 on audio, shared first with Semafor, that links his support to affordability concerns, Semafor’s Eleanor Mueller reports.
• Sen. Darline Graham faced challenger Rep. Ralph Norman in her first Senate campaign debate.

Outside the Beltway

• The Agriculture Department plans to rescind a rule that barred the building of new roads through untouched stretches of national forest.
• Minnesota sued Texas Gov. Greg Abbott to force the state to extradite an ICE agent to face state assault charges.

Business

• OpenAI’s revenue grew by significantly less last quarter than top rival Anthropic’s. — WSJ

Economy

• Mexico is considering increasing trade restrictions on Chinese goods to more closely align with the US as trade deal talks continue.

Courts

• A former adviser to Anthony Fauci pleaded guilty to plotting to conceal records related to research on the origins of COVID-19.
• A federal judge ruled that a 2022 restriction on “ghost guns” is unconstitutional.
• The National Trust for Historic Preservation asked the Supreme Court to halt construction on President Trump’s ballroom.