Ukrainian President Volodymyr Zelenskyy asked the U.S. for about 5 percent of its remaining Patriot inventory in a meeting with Mike Pence, the former vice president said Sunday.

Speaking from Kyiv during an interview with CNN’s “State of the Union,” Pence told host Dana Bash that Ukraine is “winning the war” with Russia, but Zelenskyy has expressed concerns about the upcoming winter season.

“One of the things President Zelenskyy made clear to me,” Pence said, “is that he fully expects that as winter approaches, sooner than later, that [Russian President Vladimir] Putin will start to strike not just children’s schools and hospitals as he did this week, not just a shopping mall taking more than a dozen lives, but that he’ll start to strike that energy infrastructure to try and essentially impose the deep winter cold on the people of Ukraine.”

Pence was in Ukraine for an Independence Day prayer breakfast, which he spoke at, alongside former special envoy Keith Kellogg.

If the U.S. could spare 5 percent of its missile defense system, Pence said Zelenskyy told him, then “he believes that would get them through the winter months.”

But the ongoing war with Iran has depleted the U.S.’s supply, and U.S. Ambassador to NATO Matthew Whitaker told Fox Business earlier this month that production would not solve the immediate shortage.

Still, Pence said Sunday the moment could be an “opportunity” for U.S. allies — like South Korea.

The relationship between the U.S. and South Korea has become strained in recent days after President Donald Trump instructed the Pentagon to “substantially reduce” joint military exercises in light of North Korea being “unthreatening and respectful” and his “very good relationship with Kim Jong Un.”

Pence on Sunday seemed to imply South Korea could begin rebuilding a strong relationship with the U.S. if it were to help Ukraine.

“South Korea has interceptors that are very sophisticated, and with some of the back and forth between the president and South Korea this week, this might be an opportunity for President Lee [Jae Myung] to step forward, make those interceptors available to the United States to deploy either in the Middle East or here in Ukraine,” Pence said. North Korea has provided troops to fight alongside Russian troops against Ukraine.

Pence also praised Trump for his actions against Iran and said he believes it will be “essential” that the military remain in the region.

“I think the time is going to come sooner rather than later when the president and our ally Israel are going to have to go in and finish the job,” Pence said.

The former vice president also offered advice for issues closer to home.

Following the collapse of a trade deal with Canada, Pence urged Trump to “drive a hard bargain” but to avoid a trade war.

“The last thing we need right now as our economy is getting back to its feet is a trade war with Canada,” he said. “My hope is, for the sake of American families and for the sake of the American economy, that what we’re looking at here is negotiation and not confrontation in a trade war.”

KARMIEL, Israel — It was a gunshot to the head of a Palestinian militant that first exposed the gulf between Gadi Eisenkot and Benjamin Netanyahu.

In March 2016, two Palestinians armed with knives attacked Israeli soldiers in the West Bank, wounding one of them. The soldiers opened fire, killing one attacker and leaving the other wounded on the ground. Several minutes later, a 19-year-old Israeli soldier named Elor Azaria cocked his rifle, aimed at the wounded attacker’s head and pulled the trigger. Azaria said he had felt threatened.

The question of whether the soldier should face a military trial divided the country. To some Israelis, Azaria was no criminal but a soldier who had killed a terrorist. To others, Azaria had carried out an extrajudicial killing or even murder. He was eventually convicted of manslaughter by a military court.

Eisenkot, then chief of staff of the Israel Defense Forces, defended the decision to prosecute Azaria, arguing that shooting an attacker who had already been incapacitated was incompatible with the values of the Israeli military. Netanyahu sided with the soldier and called for him to be pardoned.

A decade later, the dispute still reverberates. 

A former member of Netanyahu’s war cabinet, Eisenkot has seemingly overnight emerged as the prime minister’s most formidable challenger ahead of Israel’s parliamentary election on Oct. 27. His centrist Yashar! party — which he founded last year — was born out of rising discontent with Netanyahu’s response to the attack by Hamas on Israel on Oct. 7, 2023 and the war in Gaza that followed.

In several nationwide polls, Yashar! — a name that can be translated as “Straight!” or “Honest!” — has already overtaken Netanyahu’s ruling Likud party. Eisenkot’s supporters point to the Azaria case as evidence of their candidate’s high moral standards. Netanyahu’s allies, meanwhile, have revived it to portray the former military chief as too soft and too far to the left.

Rarely has an Israeli election been watched abroad with such anticipation. For much of the past 30 years, Netanyahu’s mix of right-wing nationalism and hardline stance on Israel’s relationship with the Palestinians and its neighbors has dominated Israeli politics. Eisenkot is promising his supporters that he can wrest the country in a new direction. 

“There are moments in history when, after a very charismatic and dominant leader, people deliberately choose someone less charismatic because they simply want peace and quiet,” said Shai Bazak, an Israeli former diplomat and communications figure who served Netanyahu as an adviser during his first term as prime minister. “They do not want all the drama anymore.”

“Eisenkot is a very nice person,” Bazak added. “He is not extreme. He is not particularly divisive. That makes it easier for people who traditionally vote for the right to move toward him.”

Whoever wins will have to navigate a radically different foreign-policy landscape.

Since Hamas killed about 1,200 people and took 251 hostages on Oct. 7, 2023, Israel’s position on the world stage has fundamentally changed. The largest mass murder of Jews since the Holocaust drew a wave of international solidarity that receded in the following months and years as Israel responded with a war in Gaza. According to the Hamas-run Health Ministry in Gaza, more than 73,000 Palestinians have been killed, both civilians and combatants — a figure widely considered reliable by the Associated Press, U.N. agencies and independent experts. Israeli military officials indicated at the beginning of this year that they agree that the overall Gaza death toll was around 70,000; in 2025 the IDF said it had killed more than 22,000 militants in Gaza and acknowledges that while it has tried to minimize civilian casualties, two to three civilians have died for every militant killed.

In several European countries, most notably Spain and France, criticism has grown as Netanyahu’s government has responded to attacks by Hamas and Hezbollah with what critics consider excessive military force, devastating large parts of Gaza and seizing a large swath of southern Lebanon.

Relations between Netanyahu’s government and the European Union have deteriorated to such an extent that Israel’s foreign minister no longer speaks to the EU’s top diplomat. On June 18, 2026, Gideon Sa’ar announced that he was severing all contact with Kaja Kallas after it emerged that during a visit to Mexico in May, Kallas had compared Israel’s treatment of Palestinians to South Africa’s apartheid system.

Israel’s traditionally close relationship with the United States has also come under strain. Netanyahu and U.S. President Donald Trump did agree to jointly conduct military strikes against Iran aimed at preventing the Islamist regime in Tehran from acquiring a nuclear weapon. Iran has declared the destruction of Israel to be one of its overriding goals.

Yet Trump has also occasionally criticized Netanyahu. “What the fuck are you doing?” Trump reportedly asked the Israeli prime minister in June, referring to his offensive against Hezbollah in Lebanon. Trump has so far stopped short of publicly endorsing Netanyahu for reelection.

Meanwhile, the conflict in Gaza and the war in Iran have driven down U.S. support for Israel, especially on the left wing of the Democratic Party and among parts of Trump’s MAGA coalition, making the debate over Israel a live political issue for both parties as they head toward midterm elections.

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As Netanyahu comes under growing pressure from Eisenkot, he is fighting back hard, seeking to turn the former army chief’s greatest strength, his security credentials, against him. “Eisenkot wanted to surrender. Netanyahu is fighting!” the prime minister declared in a recent campaign video.

“The campaign against me has begun,” Eisenkot told supporters at a campaign event earlier this month in the northern Israeli city of Karmiel. Speaking in a slightly hoarse voice, he launched his counterattack. “Netanyahu attacks his opponents in the same way every time, claiming: Only Netanyahu can provide security.”

Then he added pointedly: “We saw how that worked out on October 7.”

Eisenkot is demanding an independent state commission of inquiry into the failures of the military, intelligence services and political leadership surrounding the 2023 Hamas attack. In doing so, he also wants the prime minister himself to be held accountable. Netanyahu’s government has so far resisted establishing such a commission.

“If there is no commission of inquiry, it will hang over Israeli society like a curse,” Eisenkot said. He delivered his attacks on Netanyahu calmly, almost monotonously. Eisenkot is stocky, with the air of a chef who has been persuaded to leave his kitchen to greet an enthusiastic dining room. 

He is neither a charismatic nor a gifted speaker in the mold of Netanyahu. But he projects something that could become the most valuable currency in this election: trustworthiness. While Netanyahu carries the burden of an ongoing corruption trial, his challenger is widely regarded as a man of exceptional integrity.

An Israeli retiree named Josef Benjamin listened intently to Eisenkot’s speech in Karmiel, watching him with a critical eye. He had come to make up his own mind about the man who has suddenly become the talk of the country. “Eisenkot is a man of the people, a good man,” Benjamin said. “Netanyahu, on the other hand, rules like a king. He is no longer good for Israel and should step down.”

It is no coincidence that Eisenkot chose Karmiel. The city is predominantly home to lower- and middle-income Israelis and is a stronghold of Netanyahu’s Likud party. Over the course of just a few days, Eisenkot was making 15 appearances here in northern Israel.

The rally was a display of confidence: He wants to win over the prime minister’s voters. Among the roughly 300 people gathered in Karmiel’s municipal auditorium, there was plenty of gray hair, along with hearing aids and walking sticks. Young faces were rare.

Eisenkot has something of a paternal charm. He projects the experience of a man who has known both a remarkable rise and profound loss. He comes from modest circumstances. The son of Jewish immigrants from Morocco, he was born in the city of Tiberias on the Sea of Galilee, far from Israel’s major metropolises. He grew up in Eilat, a Red Sea resort town on the country’s southern tip. 

In the military, he rose from an ordinary infantryman in the storied Golani Brigade to chief of staff of the IDF — appointed by Netanyahu, himself a product of intellectual circles and elite American universities. In one campaign ad, Likud mocks Eisenkot’s less-than-perfect English. Yet his popularity continues to rise.

Majd Yassin, an Arab Israeli in his 40s, likes the prospect of Eisenkot becoming Israel’s first prime minister with Moroccan Jewish roots. “I really appreciate that he addressed the problems facing Arab society. No one is really showing much interest in solving the problems we face in Israel’s Arab community, as Israeli citizens,” Yassin says. “I think Gadi Eisenkot recognizes these issues, and he has the ability to address them.”

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It is not only Eisenkot’s story of social mobility that makes him relatable to many Israelis, but also his family’s tragedy.

On Dec. 7, 2023, Eisenkot’s son Gal Meir was taking part in an operation to recover the bodies of two Israelis who had been abducted into Gaza on Oct. 7 and killed. As the soldier approached an open tunnel shaft, an explosive device detonated. The 25-year-old was critically wounded and later died in hospital.

Two of Eisenkot’s nephews were also killed in Gaza. Eisenkot does not make his loss a campaign issue, but most Israelis know exactly what his family has sacrificed. Netanyahu’s son Yair, by contrast, remained in Florida as Israel mobilized some 360,000 reservists in the aftermath of the Hamas attack, drawing criticism from Israelis who returned from abroad to serve. Netanyahu defended his son, saying Yair was volunteering in the United States and helping procure equipment for the military and emergency services.

Eisenkot now embodies Israel’s grief for its fallen sons and daughters — and the hope that the man whose profession was war might be the one to end it.

His popularity also reflects a yearning among many Israelis to once again place the country in the hands of a benevolent father figure, as Yitzhak Rabin once was. Rabin, too, had served as IDF chief of staff before entering politics, commanding Israel’s military during its victory in the Six-Day War. Until his assassination in 1995, he was the great hope for peace in the Middle East.

Does Eisenkot have what it takes to inherit Rabin’s mantle? Many highly decorated former military commanders have tried before him. According to an analysis by the Israel Democracy Institute, roughly two-thirds of former IDF chiefs of staff later entered national politics. Most failed. Ehud Barak did become prime minister, but his coalition collapsed after just 20 months. More recently, former IDF chief Benny Gantz, a centrist who once emerged as Netanyahu’s most formidable political rival, saw his party’s support collapse and is now likely to fail to make it back into the Knesset.

The military and politics ultimately operate according to very different rules. The armed forces are hierarchical; politics demands compromise — and therefore a particular ability to deal with people. 

Those are soft skills the military does not necessarily teach, said Danny Orbach, a military historian at the Hebrew University of Jerusalem. “In the army, Ehud Barak — an extreme example of a failed politician with a military background — could shout at his subordinates if they didn’t obey him,” Orbach added. “In politics, people simply walk away.” 

Orbach, however, considers Eisenkot a different kind of figure: “Eisenkot is very conscientious and deeply patriotic,” he said. “He means well. Without Netanyahu’s baggage, he may be able to rebuild relations with the EU and with certain segments of the Democratic Party in the United States.”

The military historian is more skeptical about Eisenkot’s lack of political experience. Eisenkot entered parliament only four years ago. He is also critical of positions Eisenkot took as a member of Netanyahu’s war cabinet after Oct. 7.

“Had it been up to Eisenkot, he would have given in to pressure from the families of the hostages and ended the war,” Orbach said. “We would now be without the achievements we have made: 60 percent of Gaza under our control, and Hamas weakened and isolated.”

Eisenkot has argued that this presents a false choice: Israel could have struck a deal to bring the hostages home and resumed its campaign against Hamas later.

Generally, Eisenkot and his campaign team are trying to overcome such criticism with a promise of a better future. Even the choice of music at his campaign rallies makes the point.

An old Israeli peace song comes over the speakers: “Everything will be alright.”

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The U.K., Australia and Canada on Friday called Israel’s decision not to pursue a criminal investigation into the deadly 2024 strike on a World Central Kitchen convoy “shameful.”

The three governments said in a joint statement that “announcing this decision on World Humanitarian Day was particularly egregious,” adding that they had spent more than two years pressing Israel to examine the attack and hold those responsible to account.

“This decision is both too little, and too late. The victims of this incident and their families deserve justice and accountability, and we will continue to seek answers on their behalf,” they added.

Warsaw escalated the diplomatic pressure Thursday night by summoning Israel’s ambassador. Polish aid worker Damian Soból was among the seven people killed in the strike.

Poland’s foreign ministry said in a post on X that it “does not accept the perpetrators’ evasion of legal and moral responsibility” and stressed that prosecutors in Przemyśl are still looking into the matter. Warsaw also demanded Israel provide “all necessary clarifications and materials” requested by Polish investigators.

Israeli drones struck the World Central Kitchen convoy as it delivered food to civilians in Gaza, killing three Britons, an Australian, Soból, a dual U.S.-Canadian citizen and a Palestinian on April 1, 2024. The Israel Defense Forces described the attack at the time as a serious mistake and failure and pledged a thorough probe.

Closing the case this week, the IDF said it determined “no reasonable suspicion of criminal misconduct that would justify the opening of a criminal investigation or the taking of additional measures against any of those involved in the incident.”

“Partnership requires mutual respect,” Polish Foreign Minister Radosław Sikorski wrote on X Thursday evening, warning that the humanitarian catastrophe in Gaza and lack of accountability for the IDF’s “excessive use of force” were undermining public support “even in pro-Israel nations.”

The Trump administration’s snub of South Korea has America’s allies in Asia rethinking how much they can depend on the U.S. for defense — and looking to each other to reduce their reliance on Washington.

President Donald Trump said this week he is cutting back joint military exercises with South Korea, and announced Wednesday that he will meet with North Korean leader Kim Jong Un later this year. That is pushing countries in the region to accelerate their defense spending and forge alternate partnerships, according to Asian diplomats and others familiar with discussions among regional governments.

“Expect a refocus on self-reliance,” said one Asian diplomat. The diplomat, and others, were granted anonymity due to the sensitivity of their comments.

“U.S. defense tech is still the best, and it’s not economical or logical for countries already locked in on it to pivot or diversify due to interoperability and maintenance issues,” the diplomat said. “But I reckon there’ll be more investment by those that can in self-defense to reduce reliance on the U.S. umbrella in the long term.”

That’s especially true because the move against South Korea was a pressure tactic related to a completely different conflict: the Iran war.

Trump’s move “resonates not just in Korea but across the entire Indo-Pacific because everyone’s wondering whether or not their relationship with the United States is as unstable as the Koreans’,” said Ian Brzezinski, who served as deputy assistant secretary of Defense for European and NATO Policy under President George W. Bush. Brzezinski is still in regular contact with Asian officials.

As recently as December, Secretary of Defense Pete Hegseth declared South Korea a “model ally” worthy of a “special favor.” The apparent reevaluation of that relationship is the latest sign that Trump can quickly flip on longtime partners in the region. In May, Trump delayed a $14 billion arms sale to Taiwan as a “bargaining chip” with Chinese leader Xi Jinping.

The U.S. has long worked to buttress alliances in Asia as a counterweight to Beijing’s growing military dominance. Over recent months, however, the Trump administration has appeared to see that as less essential, and Asian countries have already been investing in their own capacities.

The South Korea decision could speed that transition. South Korea is making it clear that it sees the Trump administration’s action and its approach as an insult.

South Korean Foreign Minister Cho Hyun told lawmakers in Seoul on Wednesday that the government was “not notified in advance” of Trump’s decision to cut the duration of the exercises by a week. President Lee Jae Myung — who presented Trump with a gold crown in October — is trying to get U.S. military ties back on track through joint discussions with administration officials, Cho added.

And the talks “are getting messy,” said a person familiar with those discussions. “The War Department and U.S. Forces Korea are just surprised and don’t have any specific plans right now.”

Lee is already seeking other partnerships. “He’s talking to African countries, to the Gulf and Japan” to expand those links, said Jung Pak, a former U.S. senior official who worked on North Korea and the region in the Biden administration. “This dispute is just going to reinforce that the Republic of Korea has to continue to do that.”

Trump’s push to renew high-profile conversations with the North Korean leader, whom he met three times in his first term, comes as the nuclear-armed authoritarian state accelerates its tempo of ballistic missile tests and threats against neighboring Japan.

The departure of the only Asia-based U.S. aircraft carrier to the Middle East this week also has allies questioning how committed the U.S. is to preventing such acts of aggression.

“Recent signals look more like U.S. disengagement, even though cooperation is clearly still ongoing,” said a second Asian diplomat. “The key issue is increasingly not U.S. intent, but U.S. capacity to sustain the level of presence it has promised.”

The Department of Defense declined to comment.

Asian countries do have some options to insulate their defense capabilities — including military hardware supplies — from the risk of becoming bargaining chips in future policy disputes with Washington.

That could include investments in air and missile defense systems, the hardening of military facilities to protect them from attack and greater cooperation with Australian and European forces, said a third Asian diplomat.

China and North Korea’s growing arsenal of conventional long-range ballistic and hypersonic missiles has increased the vulnerability of Asian nations’ military infrastructure previously considered safe from attack — making such investments high on many countries’ priority lists. Taiwan is building a network of hardened fighter aircraft shelters designed to withstand a Chinese missile barrage.

Longer term, South Korea and Japan could develop their own nuclear arsenals for fear that they may not be able to rely on the U.S. as a deterrent.

Indo-Pacific countries are already forging alternate defense partnerships. Japan and the Philippines sealed an agreement in June that creates a secure supply chain for joint military training exercises, while India and Vietnam launched a weapons co-production initiative in May.

“Tokyo keeps repeating that the U.S.-Japan alliance is a cornerstone of its defense policy, but that’s dwindled down to lip service at this point,” said Yuki Tatsumi, former special assistant for political affairs at the Japanese Embassy in Washington, who is in regular contact with both Japanese diplomats and government officials in Tokyo. “Japan increasingly sees itself as leading a coalition of U.S. allies with deep anxiety about U.S. long-term commitment in the region.”

Asian governments feel a growing sense of urgency to take such measures due to the strains that the ongoing war in Iran has placed on the U.S. military and the depletion of key munitions essential in any possible future conflict with China, the third diplomat said.

“U.S. commitments look more contingent, transactional and vulnerable to being overtaken by events elsewhere, and that raises doubts about whether the U.S. can sustain its stated Indo-Pacific priority in a multi-theater crisis,” the person added.

The rise of those new defense groupings could boost Beijing’s longtime efforts to pry Asian countries away from established U.S.-dominated alliances. Chinese Foreign Minister Wang Yi could make the case for a South Korean defense strategy less dependent on the U.S. during his two-day visit to Seoul, which began today.

“The Chinese leadership has long sought an opening to divide the U.S. from its two most important allies in the region: South Korea and Japan,” said Nicholas Burns, former U.S. ambassador to China in the Biden administration. “The timing of the president’s criticism of the South Korean leadership will give Wang Yi an opening to drive the wedge further between Washington and Seoul.”

The Chinese embassy declined to respond to a request for comment.

The Iran war is giving fresh life to Somali pirates who prey on commercial ships laden with fuel and goods – a threat that had lain dormant for years.

Earlier this week, a group of pirates seized a cargo ship off the coast of Somalia – at least the fifth such attack since April, according to Windward, a global maritime intelligence firm. Windward concluded that the pirates are likely resurgent in part because nations have shifted naval resources to the Middle East because of the war.

In addition to the hit this week, Somali pirates have seized at least three tankers carrying oil and fertilizer – two commodities that have seen the highest price spikes due to disruptions in the Strait of Hormuz. In July, pirates seized a ship carrying chemicals off the coast of Yemen. The seized tankers are now being held off the coast of Somalia and dozens of crew members are hostages.

Though Somali pirates so far have seized relatively few ships by sheer numbers, it represents another threat to shipping companies already severely strained by recent attacks on vessels around the Strait of Hormuz and Bab el-Mandeb Strait on the Red Sea, said Brett Erickson, managing principal of the consultancy Obsidian Risk Advisors.

“We’re now looking at multiple vectors that are increasing pricing for maritime companies, forcing companies to de-risk entirely, and posing a huge threat to the global economy,” he said. “The threat from Somali pirates doesn’t need to be significant on its own, but because it compounds with all the other factors, it makes a fairly large difference at this point every time they take action.”

A White House official said the U.S. is the largest contributor to Somalia’s security and suggested it is “false” to “blame localized piracy attacks on recent regional conflicts with Iran.”

“The United States maintains robust, highly capable maritime security forces in the region that are fully equipped to protect critical shipping lanes, including oil transport, while simultaneously addressing broader regional threats,” the official said.

Regardless of what is driving the uptick in attacks, the pirates are also now active again in an area that has served as a relief valve for global oil shipping routes as an alternative to the Strait of Hormuz.

According to Windward, “Somali piracy is back as an active operational threat to commercial shipping in the Western Indian Ocean and southern Gulf of Aden.”

Somali pirates attacked hundreds of ships between 2005 and 2011, causing an estimated $18 billion in damages annually. However, the threat was largely neutralized after sustained efforts by NATO and the Combined Maritime Forces, a 47-nation naval partnership that includes the United States. Now, American ships are protecting tankers crossing the Strait of Hormuz.

If the situation worsens, it could pose increasingly severe risk to the global economy, said Erickson. In the short term, fewer ships will be willing to take the risk of traveling in the region. It also means greater shipping costs, higher insurance prices and increased spending on private security. For now, the increased cost of a barrel of oil and tightness in the market means it’s a more attractive target for the Somali pirates.

“This is obviously a very, very lucrative business for them, and right now they have a far lower risk of American reaction to it because so many resources are tied up in the Middle East in general,” he said. “They’re profiteers, and this is an opportunity to profit.”

President Donald Trump dropped a political bombshell on the Korean peninsula this week.

But security officials say the president’s threats to curtail a major military exercise with South Korea will do little to undermine the detente between Seoul and Pyongyang.

Trump’s declaration Sunday that he would instruct the Pentagon to cut back on annual drills sent Seoul’s leaders scrambling to repair the damage. But the president appears more focused on pushing for investment from the country than trying to upend defenses against North Korea’s nuclear threat. And that means security on the world’s most militarized border hasn’t significantly changed.

The U.S. has more than 28,000 troops stationed on the peninsula, along with thick layers of air defenses. It has worked hand in glove with the Korean military for decades, a powerful joint force that works closely at every level. The border between a nuclear-armed North Korea and the U.S. ally to its south is a case study in mutually assured destruction. And top commanders in Seoul and Washington remain in tight contact.

“I don’t think this is cataclysmic,” said Sydney Seiler, former national intelligence officer for North Korea at the National Intelligence Council.

Defense officials were tight-lipped about what Trump’s announcement would mean in terms of concrete changes to military exercises. The Pentagon would only say that it is “is actively working on executing the commander-in-chief’s directive.”

Trump’s order, and his praise of dictator North Korean leader Kim Jong Un’s “unthreatening and respectful” behavior, came days after the secretive nation launched its second ballistic missile test in a week. It flew over 430 miles before landing just outside Japan’s exclusive economic zone.

Some American lawmakers said the optics were horrible, particularly Trump’s seeming desire to appease a totalitarian regime.

“Kim Jong Un has won a propaganda victory and South Korea, one of our strongest allies, has been punished for no reason beyond Trump’s ego,” said Sen. Jack Reed of Rhode Island, the top Democrat on the Senate Armed Services Committee. “China and Russia are watching how easily this president abandons America’s allies, and they will remember it the next time they test us.”

The order affects a major exercise, Ulchi Freedom Shield, a staple of the alliance since it was first held in 1976. The drills this year were scheduled to begin Monday and encompass 14 different exercises over 11 days, ranging from cyber warfare to defending against drone attacks and GPS jamming. Officials are especially worried that North Korea received Russian technologies and know-how about electronic jamming after it sent tens of thousands of troops to help Russia’s war against Ukraine.

“The alliance will manage through, [although] this is clearly a rough patch,” said Victor Cha, a former National Security Council official during the George W. Bush administration and now Korea chair at the Center for Strategic and International Studies.

Trump’s criticism of South Korea is particularly surprising because it’s a departure from comments by top Pentagon officials, who have repeatedly praised Seoul for increasing defense spending.

Pentagon policy chief Elbridge Colby called South Korea “a model ally” in a January speech in Seoul, and lauded its commitment to the alliance. Defense Secretary Pete Hegseth also praised the relationship several times this year, including when his South Korean counterpart visited the Pentagon in May.

South Korean President Lee Jae Myung on Tuesday sought to soothe concerns over a rift. He said in a Cabinet meeting that “a strong alliance makes the foundation of security stronger, and strengthening our own capabilities increases our value and necessity as an ally.”

Many officials remain puzzled about why Trump would abruptly curtail an annual exercise that has taken place reliably for 50 years. There’s some precedent. He had railed against expensive exercises in South Korea during his first term and the Pentagon did scale back some large joint operations. But Ulchi Freedom Shield is a cornerstone of the military-to-military relationship.

The effort — a combination of a tabletop, virtual event and physical exercises — will continue in some form. But U.S. officials indicated that military leadership is trying to find ways to modify the event to meet the president’s demands. And the announcement underscores that American support remains at the whim of an unpredictable president.

Some of the president’s motivation is likely financial. South Korea pledged last year to invest $350 billion in the U.S., but Trump officials believe its government is slow-walking its commitment, POLITICO has reported.

“The thing about Trump is it’s all very transactional,” said Cha. “So if they announce a first tranche of investments, he’ll be fine, right?”

But Asian allies are closely watching whether the distancing from traditional backers will continue, particularly movement of some critical American military assets out of the Pacific region. The USS George Washington aircraft carrier left port in Tokyo this month and is heading west. It will presumably go to the Middle East and replace the beleaguered USS Abraham Lincoln aircraft carrier, which is on the ninth month of an extended deployment.

The Pentagon relocated some elements of the THAAD missile defense system earlier this year from South Korea as part of a wider shift to the Middle East.

Lawmakers are also watching warily. Congress voted last year to restrict the Pentagon from reducing troop levels on the Korean peninsula below 28,500 unless the Pentagon certifies doing so is in the national interest and conducted after consultation with South Korea and other allies.

Lawmakers appear poised to extend those restrictions again in the 2027 National Defense Authorization Act.

“Reduced training hurts American preparedness too,” said Rep. Don Bacon (R-Neb.). “If we have moral clarity, then we’d treat [South Korea] as our ally and know North Korea is a dictatorship and slave labor state. … The president is wrong here.”

Conor O’Brien and Leo Shane contributed to this report.

President Donald Trump is waiting for Iran to cave to his economic pressure. Tehran may be willing to wait even longer.

Even as Treasury Secretary Scott Bessent promises a level of economic isolation “never seen before,” former Trump administration officials, U.S. ambassadors and other Middle East experts are skeptical that tightening the economic vise will force Iran to relinquish its desire to toll ships passing through the State of Hormuz and make the other concessions Trump is demanding to bring an end to the war.

“It’s an attrition campaign, and I am sure Treasury tweaks this or that to fill gaps or expand coverage of sanctions,” said James Jeffrey, a former ambassador who served in the Middle East during three presidential administrations, including Trump’s first term. “But, it’s hard to believe [there will be] something decisive after 20 years of U.S. sanctions and Iranian experience of going around them.”

It’s an acknowledgement that underscores the asymmetry of the situation. The Trump administration is staring down a consequential midterm election amid an unpopular war that has sent oil prices back up to roughly $90 a barrel and helped push long-term borrowing costs to their highest level in nearly two decades as hope dims that a peace deal is near.

Iran’s leaders, meanwhile, see the conflict as existential, giving Tehran reason to absorb the extraordinary economic pain rather than accept terms it believes could imperil the regime — especially as U.S. inflation remains elevated and treasuries sell off.

The yield on 30-year U.S. government bonds, a figure Trump has in the past been attuned to, jumped on Tuesday to its highest level since just before the global financial crisis.

The increase in the yield to its highest level in nearly two decades isn’t solely because of the six-month war; global fuel shortages and broader instability have kept energy prices higher for longer, increasing the threat of persistent inflation. And that’s heaped even more risk on global bond markets that have repeatedly blanched at Trump-related shocks.

“We are in a situation where we’re spending more and more to finance more and more,” said Julia Coronado, founder of MacroPolicy Perspectives. And the war has created “a riskier world full of more frictions, full of more supply shocks.”

Iran’s outsized incentive to muscle through the pain is partly why some former administration officials doubt that the naval blockade, while unprecedented in its scale in the modern era or whatever new strategies Bessent may unveil, will change Iran’s calculus.

“I think the economic pressure would need to hit them in new ways we haven’t seen so far to change the mindset of the regime,” said one former Trump administration official, granted anonymity to candidly assess the impact of the U.S.’s economic pressure campaign.

The administration has yet to indicate what further action it plans to take, but options include going after major Chinese banks that facilitate Iran’s oil trade, expand secondary sanctions on countries doing business with Iran and confiscating Iranian assets under U.S. jurisdiction instead of just freezing them.

Iranian leaders publicly mocked U.S. efforts to sanction them into submission.

“Americans think squeezing Iran harder will win concessions that were never part of the agreement,” Mohammad Bagher Ghalibaf, the speaker of Iran’s parliament, posted on X Tuesday.

“Bessent and [Defense Secretary Pete] Hegseth are way out of their league,” he wrote. “Stop waiting for the clown crew to pull a rabbit out of their hat and clean up the mess you made.”

White House aides, however, continue to contend that the leverage is on its side.

“The crushing sanctions and one of the most successful blockades that have crippled Iran’s economy and has left Iran completely broke,” said one administration official, granted anonymity to share the U.S.’s thinking. “There are many levers the president can crank harder in the weeks and months ahead.”

In the half-year since the Iran war began, the president has deployed an array of pressure tactics to choke Iran economically, including physically preventing the country from selling its most important export — oil — as part of an ongoing naval blockade of Iranian ports. The administration has also sanctioned foreign buyers of Iranian oil, targeted the country’s shadow fleet of ships that ferries it and sought to cut the country off from the financial networks it uses to move money.

That economic pressure has sent Iran’s economy, which was already troubled before the war, into a deeper tailspin. Now, Iran is grappling with year-over-year inflation of 88 percent, long lines and rationing at gas pumps and food prices that have more than doubled.

But those who have worked on previous Iran negotiations say that’s far from enough to get the regime to cave, especially after six months of U.S. bombing that has killed, by Tehran’s own measure, more than 3,000 Iranians.

“It’s undeniable that there is economic pressure. The question is whether there is a breaking point, and I would say for a regime that is fighting for its life and has never hesitated to transfer economic pain to its population, there is no breaking point,” said Ali Vaez, the International Crisis Group’s Iran project director, who helped work to bridge differences between Iran and world powers during negotiations over the 2015 nuclear agreement.

Yet Trump continued to project patience on Tuesday, signaling that he was prepared to let the pressure campaign play out.

“There are no talks or conversations going on, or scheduled, with the Islamic Republic of Iran. The Naval Blockade remains in full force and effect. The Hormuz Strait is open and operating. All water mines have been removed or detonated. Thank you for your attention to this matter!” Trump wrote on Truth Social.

A senior White House official, granted anonymity to discuss the situation in Iran, insisted that Iran will cave long before the pain in the U.S. or world markets become intolerable.

“Ultimately we want a deal, but in the interim, the Iranian economy is tanking … people are lining up for gas, just for a half gallon of gas. And there’s a lot of civil unrest going on in Iran, that’s not being played on the news for whatever reason,” the official said late last week. “We’re fine if that’s the route they want to take.”

Still, there are signs inside the White House that the economic impacts are a growing concern. Vice President JD Vance last week said on Fox News that the administration’s first goal in the Iran war was to “keep oil and gas cheap for Americans all over the country.” The president, meanwhile, has repeatedly insisted voters will bear the pain of higher gas prices for an end to Iran’s nuclear ambitions.

The voters have a more dyspeptic view. A Reuters/Ipsos survey released this week showed Trump’s approval rating at 33 percent, the lowest level of his presidency. Roughly 80 percent of Americans — 87 percent of Democrats and 71 percent of Republicans — think U.S. involvement in Iran “will go on for an extended period of time,” the poll found.

But some former Trump administration officials, however, are holding out hope that patience will be rewarded and that the administration’s economic pressure campaign will work, in part because they see the other options on the table, including putting U.S. boots on the ground in Iran, as politically untenable.

Fred Fleitz, Trump’s former National Security Council chief of staff and vice chair of the American First Policy Institute’s American Security, predicted that the U.S. could be “dealing with a different Iran” in 30 to 60 days.

“I think patience is the best approach,” Fleitz said. “I don’t believe that a large-scale military attack right now is going to make a difference in changing the regime’s position, and I strongly oppose the idea of seizing Kharg Island or sending in American troops. The American people don’t want that. That would really bog us down in a quagmire.”

Wer regiert die Welt – und was treibt sie an? In unserem regelmäßigen Machthaber-Spezial geht es um die mächtigsten und umstrittensten Politikerinnen und Politiker unserer Zeit. Wir zeigen, wie sie denken, entscheiden – und was das für uns bedeutet. Eine Politikerin oder Politiker, ein Blick hinter die Kulissen der Macht.

Das Berlin Playbook als Podcast gibt es jeden Morgen ab 5 Uhr. Gordon Repinski und das POLITICO-Team liefern Politik zum Hören – kompakt, international, hintergründig. Für alle Hauptstadt-Profis: Der Berlin Playbook-Newsletter bietet jeden Morgen die wichtigsten Themen und Einordnungen. ⁠Jetzt kostenlos abonnieren.⁠

Mehr von Host und POLITICO Executive Editor Gordon Repinski:
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Israeli Prime Minister Benjamin Netanyahu this week publicly rejected President Donald Trump’s latest Gaza peace plan.

The Trump administration can live with it — for now.

The administration says it’s less concerned with what Netanyahu says than what the Israeli Defense Forces do. A U.S. official, who, like others in the story, was granted anonymity to discuss internal thinking, said that the administration was initially “disappointed” that Israel responded to the 15-point peace proposal by ramping up attacks in Gaza — but is pleased that it has since eased its assault.

Now, the administration is willing to give the Israeli prime minister some leeway to message the peace plan in the way he needs to, the official said. There is broad understanding that he is two months from a tough reelection — and needs to please his own hard-right allies to win. Few expected the president’s roadmap to be wholesale embraced, even as Trump on Truth Social trumpeted it as a “major milestone” in the conflict.

“We recognize the complexities that come from the Israeli elections, and we’re obviously going to give Bibi a space to try and navigate that,” the official said. But in turn, “they need to give us a little bit of space in terms of no targeted killings in order to allow us to try to get to the next phase, so there’s a lot more challenges to go to get there.”

U.S. officials and Hamas negotiated the latest peace framework separately, with help from Middle East allies. The proposal, announced last month, called for Hamas to disarm and relinquish governance in Gaza and Israel to withdraw its military from the territory. The plan stalled when Hamas said it would not disarm until Israel withdrew, and Israel said it would not withdraw until Hamas disarmed.

Even as skeptics of the Trump plan criticized the president for overhyping its achievement, U.S. officials believed that they needed to go public once Hamas was on board to lock in its pledge to disarm. Despite the president’s public confidence, administration officials privately expected that the proposal would likely face pushback from Netanyahu but that talks could continue with Israel.

Still, they considered the roadmap a significant win.

“Nobody’s ever gotten to this point where they got Hamas to agree to this, so that’s a necessary step before actually disarming it,” the U.S. official said.

And there are signs that Israel is preparing for the possibility of withdrawal anyway, with Israeli media reporting Israel’s defense establishment began weighing contingencies to do so in the days after Netanyahu’s public rejection.

Another administration official said the Board of Peace, a 27-country initiative formed as part of Trump’s deal last year to end the war between Israel and Hamas in the Gaza Strip, has been “getting good cooperation on the ground of late.”

“That’s what’s important,” the administration official said.

And it’s not just Trump administration officials hailing the framework as a step in the right direction. Former ambassadors and administration officials, including some who served in the Biden and Obama administrations, see the recent commitment the U.S. secured from Hamas to disarm — a monthslong sticking point in the peace process — as a small, but meaningful step, even as doubts remain whether Hamas will follow through. A member of the Hamas political bureau, according to the Associated Press, said this week that Hamas remains “committed to the roadmap.”

“For Netanyahu, his primary objective, of course, is getting through his election so he’s going to at least voice rejection even while he may allow some aspects of it to move forward,” said Dan Shapiro, a U.S. ambassador to Israel during the Obama administration. “It looks like Trump is tolerating the Netanyahu two-step. These two have done a dance like this before and as long as certain elements of it are moving forward … Trump seems to be willing to tolerate Netanyahu’s stated rejection.”

Even Trump appeared in little hurry Monday to escalate the dispute with Netanyahu, insisting to reporters in the Oval Office that he had a “good relationship” with the Israeli prime minister despite the very public rejection of his peace proposal.

The White House referred requests for comment to the Board of Peace.

A Board of Peace official added that “separate discussions with Israel are continuing.”

“The objective remains the full decommissioning of weapons and ensuring Gaza can never again pose the kind of threat Israel faced on October 7,” the official said. “Plans are moving forward in this regard. We have seen important elements of cooperation in recent days and we are intensifying our efforts to accelerate progress.”

The U.S. official added that Israel remains skeptical that Hamas will follow through on their commitments, while noting the country was similarly skeptical that Hamas would release the Israeli hostages.

“We basically have built a lot of credit with them. And I think that they’re willing to give us more of a shot to see if we can get to the next phase,” the official said. “We’re in an uncomfortable position for everyone, but I think that there’s a pathway to get through it.”

The idea that Israeli troops are at least planning to withdraw — especially if that withdrawal goes to the yellow line in Gaza, a key point of the plan the Board of Peace proposed — is giving Trump allies hope that Netanyahu’s words are meant for a domestic audience, while his actions are meant to demonstrate he might consider a deal in the future.

“Netanyahu’s playing a fairly tricky tightrope, where on the one hand he flexes his muscle for domestic audiences, given his situation at election eve, and on the other hand, he’s doing some baby steps in the direction of the 15-point plan — testing the tolerance of the American or Board of Peace team,” said Nimrod Novik, who served as senior diplomatic adviser to former Israeli Prime Minister Shimon Peres.

James Jeffrey, a former ambassador who served in the Middle East during three presidential administrations, including Trump’s first term, said that “of course it’s a win” to get Hamas to agree to disarm. And, behind the scenes, he said there continues to be movement between the U.S and Israel.

“Slowly we and Israel are moving forward on both Lebanon and Gaza even in the face of Israeli elections,” Jeffrey said.

Still, the incremental movement leaves fundamental questions, which have repeatedly stymied efforts to create a lasting peace between Israel and Gaza. U.S. allies are also concerned that Netanyahu’s public rejection of the latest peace plan is undermining confidence in the Board of Peace and the broader Middle East peace efforts.

Hamas’ willingness to disarm is conditioned on Israel withdrawing from Gaza, leaving unresolved how — and in what order — either side would carry out its commitments.

Hamas is supposed to turn over its weapons to a United Nations-created body responsible for governing the day-to-day operation in Gaza, and that governing authority is supposed to eventually run the territory, supervised by the Board of Peace, though the timeline for leadership handover remains uncertain. And Israel, meanwhile, has not agreed to the withdrawal in the plan, even as its military is preparing for the possibility.

But administration allies don’t really expect some big peace ceremony at Camp David or in Geneva. They’ll settle for dialogue, however tenuous.

“You have to judge these things incrementally in the Middle East,” a person familiar with the White House’s discussions around the peace process said.

Jerry Wu and Daniella Cheslow contributed to this report.

Wer regiert die Welt – und was treibt sie an? In unserem regelmäßigen Machthaber-Spezial geht es um die mächtigsten und umstrittensten Politikerinnen und Politiker unserer Zeit. Wir zeigen, wie sie denken, entscheiden – und was das für uns bedeutet. Eine Politikerin oder Politiker, ein Blick hinter die Kulissen der Macht.

Das Berlin Playbook als Podcast gibt es jeden Morgen ab 5 Uhr. Gordon Repinski und das POLITICO-Team liefern Politik zum Hören – kompakt, international, hintergründig. Für alle Hauptstadt-Profis: Der Berlin Playbook-Newsletter bietet jeden Morgen die wichtigsten Themen und Einordnungen. ⁠Jetzt kostenlos abonnieren.⁠

Mehr von Host und POLITICO Executive Editor Gordon Repinski:
Instagram: ⁠@gordon.repinski⁠ | X: ⁠@GordonRepinski⁠.

POLITICO Deutschland – ein Angebot der Axel Springer Deutschland GmbH
Axel-Springer-Straße 65, 10888 Berlin
Tel: +49 (30) 2591 0
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USt-IdNr: DE 214 852 390
Geschäftsführer: Carolin Hulshoff Pol, Mathias Sanchez Luna

U.S. allies see Israeli Prime Minister Benjamin Netanyahu’s rejection of Washington’s 15-point plan for Gaza as undermining confidence in the Board of Peace — and in the Trump administration’s ability to influence the Middle East more broadly.

It increasingly appears that the U.S. either doesn’t have — or isn’t willing to exercise — the leverage needed to deliver on Gaza, a number of diplomats and others familiar with U.S. strategy in the region told POLITICO. And that has them concerned about U.S. efforts at negotiations across the region.

“Netanyahu’s rejection of the peace plan carries significant implications for long-term regional stability and Israeli security,” said an Arab diplomat familiar with U.S. policy in the Middle East. “President Trump is the only one to have the potential to influence this situation, as he could seek to reassert his political relevance by pressuring Netanyahu to reconsider his position.”

Netanyahu’s defiance adds to the growing list of woes Washington faces as it struggles to reshape the Middle East, from ending the Iran war to winding down the conflict between Israel and Hezbollah in Lebanon.

The Arab diplomat warned: “Arab and regional leaders may find themselves in a complex position, needing to balance their interests amid these evolving dynamics.”

Netanyahu disavowed the White House-backed peace plan for Gaza on Sunday, declaring that Israel requires Hamas to have “genuinely disarmed” before it withdraws its troops from the territory. That hard line could further threaten the viability of Trump’s Board of Peace, a 27-country initiative formed as part of Trump’s deal last year to end the war between Israel and Hamas in the Gaza Strip.

“The Board of Peace has a distinct limp to its gait at the moment,” said Robert Jordan, who served as U.S. ambassador to Saudi Arabia during the George W. Bush administration.

“It never appeared to be a broadly based, highly viable substitute for the United Nations,” he added, referring to Trump’s assertions in January that the board could be used as an alternative to the world body. “That’s compounded by the political situation in Israel at the moment.”

The Board of Peace declined to comment, but an official with the organization insisted that work is continuing apace, with Israel’s buy-in. The official pointed to a logistical support area under construction that is meant to serve hundreds of troops expected to deploy to Gaza as part of the international stabilization force envisioned by the board.

“The roadmap is between the Board of Peace and Hamas,” said the board official. “Separate discussions with Israel are continuing. Israel is not being asked to rely on trust or to make irreversible moves before verified steps are taken on the ground.”

The official, like others, was granted anonymity because of the sensitivity of the negotiation process.

A Western diplomat familiar with Middle East policy argued Netanyahu’s action is a sign that U.S. strategy toward Israel is misguided.

“This latest rejection once again shows that appeasing Israel only leads to more maximalist demands,” the diplomat said. “I don’t think it kills the [Board of Peace] but what it does do is once again show that Israel remains one of the obstacles to a viable two-state solution.”

Trump has avoided clashing publicly with Netanyahu over the roadmap, telling reporters Monday that he had a “good relationship” with the Israeli prime minister even though Netanyahu rejected the U.S. proposal. The White House declined to comment further on Israel’s rejection of the deal.

A Trump administration official, granted anonymity because they were not authorized to discuss the issue publicly, said the White House doesn’t see Netanyahu’s action as derailing the peace process at all.

“Broadly speaking, we see this as election-posturing by Bibi for a domestic audience,” the official said. “The [Board of Peace] has actually been getting good cooperation on the ground as of late. So that’s what’s important.”

Netanyahu’s rejection of the road map comes as his popularity has been eroding in Israel ahead of an October parliamentary vote that could lead to his unseating.

In Europe, some governments are still holding out hope that the Board of Peace can rescue the Gaza peace process.

“I extremely appreciate the work of chief negotiator [Nickolay] Mladenov on behalf of the Board of Peace, his achievements in the 15-point plan are absolutely substantial,” said Hildegard Bentele, a center-right German lawmaker in the European Parliament. He said he was confident the U.S.-led effort would make progress “if re-submitted after Israeli elections and targeting the core point of full weapons’ decommissioning.”

Others with experience in the region said that Netanyahu appeared to be successfully pushing the Board of Peace in a direction more favorable to Israel.

Netanyahu’s actions are “testing the tolerance of the American or Board of Peace team,” said Nimrod Novik, who served as senior diplomatic adviser to former Israeli Prime Minister Shimon Peres and is now a fellow at the New York-based Israel Policy Forum.

“It’s really a Trump personal enterprise,” said Zaha Hassan, who advised the Palestinian negotiating team during its bid for U.N. membership from 2010 to 2012 and is now a fellow at the Carnegie Endowment for International Peace. “So if it can’t get Israel to stand down in Gaza, to withdraw, to allow the Board of Peace to do its work, how can any other regional actor believe that the U.S. can restrain Israel in their neighborhood?”

A European diplomat said the disillusionment with Trump’s sway in the Middle East was already evident in his failure to wrap up the war in Iran quickly.

“The solution is not as close as anticipated or as Trump told us at some point. I think Trump is losing credibility,” said the diplomat, granted anonymity because they weren’t authorized to discuss the issue publicly. “Everything seems to be in limbo and in a high degree of uncertainty that affects us all.”

Jerry Wu, Megan Messerly, Myah Ward and Nicholas Vinocur contributed to this report.

Negotiations between Iran and Oman on delineating a shipping route through the Strait of Hormuz have reached the final stage, the Iranian Foreign Ministry confirmed on Wednesday.

The shipping lane would primarily lie within Iranian territorial waters, with parts extending into Omani waters.

Foreign Ministry spokesperson Esmaeil Baqaei told journalists that “the geographical coordinates of the proposed maritime route have been agreed upon by both sides,” adding that the bilateral process was “professional” and “forward-moving.”

U.S. President Donald Trump announced last weekend that Tehran had asked Washington to hold off any attack on Iran due to the pending agreement on the strait. “This would include the Immediate, Complete, and Total OPENING OF THE HORMUZ STRAIT, and an end to Iran’s nuclear threat,” Trump wrote on Truth Social.

The U.S. reimposed a naval blockade on Iranian ports on July 14 after hostilities between the two countries resumed. The blockade has since become one of the main sticking points in ceasefire negotiations, with Tehran insisting it must be lifted as part of any broader agreement.

The strait remains closed as a result of the military strikes launched by the U.S. and Israel, Baqaei maintained in his remarks.

LONDON — Andy Burnham entered Downing Street with a promise to give hard-pressed voters “breathing space” on the cost of living. Now he must show he can deliver. 

At the top of his list is finding a way to reduce stubbornly high energy bills — even as the Iran-U.S. war forces up prices and ministers are under pressure to cut their own departmental budgets. The new prime minister knows any intervention must make a real impact for voters if he is to turn Labour’s fortunes around. 

“You need to make an emotional connection with people,” said one senior government official, granted anonymity to talk candidly about Whitehall thinking. 

Britain’s new prime minister has already made one bid to show voters he is serious about tackling the problem: Removing VAT from household electricity bills, something he announced on his first day in No. 10. 

The move will knock less than £4 off the average monthly bill, ends after one year, and comes with a price tag of £850 million. Downing Street said it will be paid for through so-far unspecified Whitehall savings. 

But Burnham and his new Energy Secretary, Miatta Fahnbulleh, promised that the intervention is just a start. Cutting VAT is a “down payment” ahead of the winter, Fahnbulleh said. 

That means ministers have just weeks before Burnham’s first budget this fall to figure out what, if anything, can really ease the burden — and how to pay for it. 

Salami slicing 

“The fiscal space is going to be a challenge, and that is the case for any government,” said Sam Alvis, associate director for environment, energy security, and nature at the Labour-aligned Institute for Public Policy Research think tank. 

That’s because any intervention to bring down energy bills will have to be funded from already under-pressure Whitehall departments. 

“This government is going to have a look at the budget. Whether it chooses to do some priorities differently — that is an open question,” Alvis said. 

One option for Burnham is to slice more charges from electricity bills, as he did with VAT. But any savings could be quickly wiped out if, as expected, the Middle East crisis pushes up wholesale gas prices.

Forecasters at Cornwall Insight predict that average annual household bills will rise by two percent this fall, even after the VAT intervention. 

That leaves Burnham facing the same problems as the man he replaced, Keir Starmer. 

Starmer cut £150 off yearly bills last November by shifting some so-called green levies, used to fund a clean energy scheme, onto general taxation. By the summer, that cut had been swallowed up by higher prices driven by the Strait of Hormuz crisis. 

Nonetheless, Alvis said, this approach remains Burnham’s most realistic option. 

“We are now in a bit of a scenario of salami slicing, where you’re aggregating lots and lots of smaller bits,” he said. “There’s no one big thing that you can do that’s going to take over £100 off bills. So, it’s about accumulating all those things that you think you could possibly do in one go, so it becomes sizable and noticeable.” 

Decisions, decisions 

One of those options, proposed by the think tank Nesta and reportedly being considered by Burnham, involves shifting further green levies from electricity bills onto tax.  

It identified another £42 of savings from a yearly bill, costing the Treasury £1.7 billion per year for a decade. 

Every small cut helps consumers, insists Andrew Sissons, Nesta’s director of sustainable futures. The think tank has also proposed knocking £22 a year off bills by shifting the standing charge on gas — currently a fixed daily fee — onto the unit rate, which changes depending on how much energy a home uses. That would take a year to implement and would not cost the government a penny, Nesta says. 

But such moves must be accompanied by larger interventions if voters are to feel the benefit, he added. 

“The amount you’d need to cut people’s energy bills … for it to feel like a real difference is quite substantial,” he said. The government, he argued, should aim for a “big package.”  

If the government aims for larger changes, they would come with even greater costs.  

Nesta has suggested a one-off move to wipe out electricity debt, removing some bailout costs currently funded through bills, taking total annual bill savings to £130. But the Treasury would have to find £2.7 billion to fund that. 

“[We] shouldn’t ignore the fact that there are fiscal trade-offs. But if the government wants to prioritize energy bills, then this is the kind of step it needs to take,” Sissons added, pointing to their proposed levy change alongside the VAT cut.  

Things take time  

Net-zero policies will, ministers hope, bring down bills for good. But large-scale changes take years to implement. 

“Realistically, the only way to deeply, deeply help people is to get them solar panels, is to get them an EV [electric vehicle], potentially heat pumps in some houses as well,” said Alvis. 

This is another reason to opt for “salami slicing”, he said: To “alter the balance of electricity and gas prices, so that those clean technologies stack up and save people even more money.”  

Alex Bevan, a research fellow at the Future Governance Forum, agreed that big savings attached to the shift to green energy were still a way off.  

“There aren’t quick workarounds on whichever form of energy you choose to generate and deploy,” he said. But government must nonetheless “lock in the benefits [of clean energy],” he argued. 

The same official quoted above stressed that no decision had yet been made on how the government would intervene on bills. Asked whether the government favored a series of small policies or one big intervention, they said: “It doesn’t have to be binary. … It doesn’t have to be one or the other.”  

A Department for Energy Security and Net Zero spokesperson said: “The energy secretary’s focus is bringing bills down for good. We will tackle the cost of living to make life’s essentials affordable again and bring back hope.”

For now, Alvis insisted, Burnham has one thing going for him: He can operate in the knowledge voters accept international issues are pushing up costs. 

“The political point I would make is: By doing your best effort, you give yourself the space to have a conversation with the public,” he said. 

Italy will use extra leeway from the EU to spend billions of euros on energy and defense, Finance Minister Giancarlo Giorgetti told members of the country’s parliament on Wednesday.

Rome is set to boost its expenditure on green energy and defense over the coming three years, said Giorgetti following a relaxation of rules from Brussels, which allows the additional spending to be exempted from the EU’s strict spending targets and waived from Rome’s deficit figures.

Italy is poised to issue a formal request to the European Commission — laying out the investments it intends to undertake with the extra flexibility — by a mid-August deadline.

Giorgetti said Italy will request to spend an additional 0.6 percent of gross domestic product on green energy investments and 0.9 percent on defense — the full amount that is envisaged under the new fiscal guidelines.

The additional defense spending will “include both new multi-year investment programs and proposals to reallocate resources already provided for under current legislation,” Giorgetti told MPs. Italy’s parliament is expected to approve Giorgetti’s request to the Commission on Wednesday.

The extra flexibility is aimed at reducing dependence on fossil fuels and moving toward NATO’s target to spend 5 percent of GDP on defense. With 2 percent of GDP allocated to defense in 2025, Italy is among the alliance’s spending laggards.

However, the decision to raise military spending is set to inflame political tensions within the country ahead of a crucial election year that will see incumbent Prime Minister Giorgia Meloni seek a second mandate.

The governing coalition is split on the issue, and the right-wing League party — from which Giorgetti himself hails — has repeatedly campaigned against spending more money to counter the Russian threat.

In a further constraint, the government is under heavy pressure from the right-wing, Russia-friendly National Future party led by former Gen. Roberto Vannacci, which is eating into support for the other governing parties, according to the polls.  

More leeway

In June, the Commission gave EU countries suffering from the ongoing energy crisis more fiscal breathing room by exempting some green investments from public spending rules.

The goal was to allow heavily indebted governments to mobilize resources for green expenditure, including subsidies for electric vehicles, geothermal and solar energy to reduce dependence on fossil fuels. Italy lobbied the EU to offer this concession after the war in the Middle East fueled a surge in oil prices.

However, Giorgetti failed to lay out which green investments will be included in Italy’s request to the Commission.

In another gaping omission, he did not reveal whether Italy will tap into the EU’s cheap loans for defense — another divisive issue within the government coalition.

Rome had initially earmarked €15 billion under the Security Action for Europe (SAFE) program, prompting defense companies to factor in those investments.

Italian Foreign Minister Antonio Tajani recently suggested that Rome will use the SAFE money, but said the exact amount will be decided later in the year.

Jacopo Barigazzi contributed to this report.

Europe wants to kick its U.S. tech habit, but it’s struggling to detangle itself from American data analytics firm Palantir. 

The problem is, the company’s tools are already deeply embedded in critical sectors across the bloc like policing, national defense and health systems. A report released today also shows that the tech firm has found ways to pay minimal taxes in Europe. On the show, hosts Zoya Sheftalovich and Ian Wishart discuss European alternatives and why detaching is easier said than done.

Next, our colleague Seb Starcevic has interviewed Mediterranean Commissioner Dubravka Šuica. The role that was originally thought to be low profile has instead thrust the Croatian official into the limelight as various crises hit the Middle East and the Mediterranean.

Plus: Three new foods are being added to the EU’s list of products with geographic indicators. These are the labels given to products that can only be made in a specific region, like Champagne or … yes, you guessed it, halloumi.

Questions? Comments? Get in touch! You can message us or send a voice message to our WhatsApp here or at +32 491 05 06 29.