Principals

1. Trump attacks Harris on identity
2. Trump on Vance
3. Middle East tensions
4. Fed holds rates steady
5. Trump’s Social Security pitch
6. Russian prisoner swap hope

PDB: Raphael Warnock, Lisa Blunt Rochester raising funds for Harris on Martha’s Vineyard

Israel says it killed Hamas military commander… WSJ: Trump allies spend $20 million to reach young men … WaPo: Ledecky’s ‘golden senior moment’

Trump’s hostile event with Black journalists

Donald Trump berated an ABC journalist for her tough questioning and baselessly attacked Vice President Harris — the first Black and first Asian American vice president — over her identity during his testy interview at the National Association of Black Journalists conference. “I didn’t know she was Black until a number of years ago when she happened to turn Black and now she wants to be known as Black,” Trump told a panel of journalists, including Semafor’s Kadia Goba. “So I don’t know, is she Indian, or is she Black?” He later doubled down on Truth Social, and his campaign did, too. The remarks quickly drew condemnation from the White House, while Harris dismissed Trump’s rhetoric during a campaign stop in Houston as “the same old show, the divisiveness and disrespect. Let me just say: the American people deserve better.” And Republicans were once again forced to react to a controversial Trump news cycle. “Does it make any difference how much Polish ancestry versus Irish versus whatever else it is that I have in me?” Sen. Lisa Murkowski, R-Alaska, told Politico. “Why are we talking about this?” Maryland GOP Senate candidate Larry Hogan called the comment “unacceptable and abhorrent” and one House Republican told Axios “It was awful.” Sen. Kevin Cramer, R-N.D., defended Trump and said Harris “chooses another race when that’s convenient.”

Trump responds to Vance controversy

Donald Trump didn’t exactly offer a glowing defense of his running mate, JD Vance, and suggested his vice presidential pick wasn’t material to the outcome of the election. The VP nominee has “virtually no impact” on a candidate’s success or failure, he said at the National Association of Black Journalists event. Asked about Vance’s comments about childless adults, Trump said Vance is “strongly family-oriented, but that doesn’t mean if you don’t have a family there’s something wrong with that.” Vance has weathered a rocky start as Trump’s running mate due to earlier controversial comments that have resurfaced, leading to some speculation he could be swapped out. Trump has “taken note” of some of the comments and the ensuing criticism, The Wall Street Journal reported, but his campaign maintained he is “thrilled” with his running mate.

US seek to salvage ceasefire talks amid Middle East tensions

The US is still holding out hope for a Gaza ceasefire deal despite the killing of a key Hamas ceasefire negotiator in Tehran. Ismail Haniyeh was killed in an airstrike that Hamas blames on Israel and that Secretary of State Antony Blinken said the US was not involved in. “We still believe the gaps can be narrowed,” White House spokesman John Kirby said, adding that it was “too soon” to determine how the events would impact the talks. US officials engaged with Israeli, Qatari, Iraqi and Saudi officials after the Tehran strike to attempt to salvage a deal, The Wall Street Journal reported. The strike in Iran as well as one against a Hezbollah leader in Beirut raised already high tensions in the region. On Wednesday, the State Department raised the Lebanon travel advisory, imploring Americans not to travel to the country.

Fed may slash rates in September

The Federal Reserve signaled it may slash interest rates as soon as September, although officials decided to keep rates unchanged for now. Fed Chair Jerome Powell said officials had a “real discussion” at the Federal Open Market Committee about cutting rates and that there would need to be more progress toward lowering inflation to 2%. A rate cut in September could shake up an already volatile US presidential race: Democrats worry that high interest rates are putting a damper on consumer sentiment, while Donald Trump has warned Powell not to cut rates before the election. “We never use our tools to support or oppose a political party or a politician or any political outcome,” Powell said Wednesday.

Trump’s new 2024 pitch to seniors

Former President Trump on Wednesday floated eliminating taxes on Social Security benefits. The campaign pitch appears designed to shore up Trump’s standing among seniors and could cost $1.6 trillion over a decade, per the Tax Foundation. Taxing Social Security benefits is the result of a Reagan-era compromise to extend the program’s lifespan, which may partly explain why there hasn’t been major GOP interest to unwind a policy set four decades ago. Sen. Pete Ricketts, R-Neb., though, is the sole sponsor of a bill that would phase it out over 10 years. “This is a way we can help people keep more of their own money, especially with seniors who are on fixed income,” Ricketts told Semafor. Other top Republicans, like Sens. Shelley Moore Capito, R-W. Va., and Steve Daines, R-Mont., said Trump’s idea was worth considering.

— Joseph Zeballos-Roig

Prisoner swap speculation grows

High-profile Western prisoners held in Russian jails disappeared from view, fueling speculation among Kremlin watchers that “what may be the biggest swap since the Cold War” was imminent. The former US marine Paul Whelan, the Russian-British dissident Vladimir Kara-Murza, and Wall Street Journal reporter Evan Gershkovich as well as a slew of domestic critics of Moscow were all named as potentially involved in the multi-country discussions. Negotiations for such a complex prisoner exchange would be shrouded in secrecy, but if successfully executed, the timing would be notable: Russian President Vladimir Putin is loath to offer a political win to Democrats in the US, but likely fears Republican candidate Donald Trump’s “bull-in-a-china-shop approach to deal-making,” Politico said.

Beltway Newsletters

Punchbowl News: Senate Majority Leader Chuck Schumer opened up about his decision to raise concerns directly with President Biden about his reelection path following the June 27 debate. “My caucus had very strong feelings. And I was not at all sure that President Biden was hearing those feelings. And so I wanted to tell him myself,” he said.

Playbook: Vice President Harris’ VP vetting team has met with both Pennsylvania Gov. Josh Shapiro and Arizona Sen. Mark Kelly.

Axios: Donald Trump’s attacks on Harris at the NABJ conference “redirected attention to his long and controversial record on race.”

White House

• Vice President Harris will deliver the eulogy at the service for the late Rep. Sheila Jackson Lee in Houston.
• White House aide Jordan Finkelstein is set to leave his post in the next few days and is expected to advise super PAC Future Forward. — Politico
• The White House executive chef, Cris Comerford, is retiring after three decades. — AP

Congress

• Senate Majority Leader Chuck Schumer and more than two-dozen Democrats introduced the “No Kings Act,” a bill that would eliminate immunity for presidents or vice presidents who violated federal criminal law and remove the Supreme Court from hearing challenges to the constitutionality of the legislation.
• House Republicans do not plan to bring up the children’s online safety package that passed the Senate earlier this week in its current form. — Punchbowl News

Economy

• Boeing hired industry veteran Robert “Kelly” Ortberg out of retirement to be the planemaker’s next chief executive, effective Aug. 8. Ortberg had been the CEO of Boeing supplier Rockwell Collins until 2018 and retired in 2021.
• Delta Air Lines CEO Ed Bastian said the technology outage that caused more than 5,000 flight cancellations over several days last month cost the carrier $500 million.

Courts

• Khalid Shaikh Mohammed, the accused planner of the Sept. 11, 2001 attacks, and two of his accomplices have pleaded guilty to murder and conspiracy charges in exchange for life sentences instead of a death-penalty trial at Guantánamo Bay, Cuba.
• A federal appeals court ruled that Texas can keep a 1,000-foot-long floating barrier in the Rio Grande to hinder illegal crossings at the southern border, rejecting a challenge by the Biden administration.
• Supreme Court Justice Samuel Alito’s hardline approach cost him the opportunity to write the majority opinions in two cases heard close together in the court’s latest term involving free speech and social media. — CNN

Polls

• Nearly 8 in 10 Democrats will be somewhat or very satisfied if Vice President Harris becomes the Democratic Party’s nominee for president, according to a survey by the Associated Press-NORC Center for Public Affair Research conducted after President Biden dropped out of the race. In an AP-NORC poll before Biden’s debate with Donald Trump in late June, just about 4 in 10 Democrats were somewhat or very satisfied he could be the party’s nominee.

• More than half of voters between 18 and 34 in swing states said they are more likely to participate in the election after Biden left the race, according to a Bloomberg News/Morning Consult poll. Thirty-eight percent said they are much more likely to vote now that he left, and 16% said they are more likely to cast a ballot.

On the Trail

• The United Auto Workers endorsed Vice President Harris.
• Sen. Raphael Warnock and Rep. Lisa Blunt Rochester are hosting a fundraiser for the Harris Victory Fund on Aug. 13 on Martha’s Vineyard, according to an invitation shared with Semafor’s Liz Hoffman. The guest list features several prominent Black figures and politicians, including actor Wendell Pierce, basketball coach John Thompson III, and author Jodie Patterson.
• At the NABJ conference, Donald Trump also said he would “absolutely” step down as president if his health deteriorated in office and hedged on his campaign pledge to give police officers “immunity from prosecution” in response to questions from Semafor’s Kadia Goba.
• Longtime Trump political adviser Kellyanne Conway is suspected by at least a dozen Trump campaign staffers of undermining JD Vance through leaks to journalists expressing concerns over his preparedness and the campaign’s vetting of him. — The Bulwark
• A group of more than 100 venture capitalists in Silicon Valley called VCs for Kamala said they are backing Harris and have solicited donations for her presidential campaign.
• Cantor Fitzgerald chief executive Howard Lutnick is hoping to raise $10 million for Trump at a fundraiser dinner on Friday.

National Security

• The US Army spent $11 million on a marketing deal with the United Football League — co-owned by Dwayne “The Rock” Johnson and Rupert Murdoch’s Fox Corp. — that didn’t result in one new recruit. Now the Army wants a $6 million refund. — Military.com
• A Department of Homeland Security internal watchdog accused the department’s leadership of trying to suppress a report focused on the Secret Service’s response during the attack on the Capital on Jan. 6, 2021. — Politico

Foreign Policy

• US Ambassador to China Nicholas Burns argued it is “too simplistic” to say the US and China are in a Cold War. — Vox
• The UN human rights office said in a report that Palestinians detained by Israel since Hamas’ attacks on Oct. 7 have faced waterboarding, sleep deprivation, electric shocks, and other forms of mistreatment and torture.
• North Korea wants to restart nuclear talks with the US if Donald Trump wins the election, according to a North Korean diplomat who recently defected to South Korea. — Reuters

Technology

• Applied Materials has been told by the Biden administration it won’t receive Chips Act funds for a $4 billion research and development center in California. — Bloomberg
• Meta Platforms’ Facebook and Instagram social-media platforms are still running ads that direct users to online marketplaces for cocaine and other illicit drugs, months after federal investigators were reportedly looking into the company’s involvement in the sale of illegal drugs. — WSJ
• The Biden administration is weighing unilateral restrictions on access by China to AI memory chips and equipment capable of producing semiconductors. — Bloomberg

Media

• The London Metropolitan Police has opened a criminal probe of Washington Post publisher and chief executive Will Lewis over his actions while he was an executive at Rupert Murdoch’s UK newspapers in 2011 during a phone-hacking scandal. — The Guardian

• Maya Rudolph will again play Vice President Harris on Saturday Night Live this fall through the election.

Big Read

Anti-Israel activists have singled out Pennsylvania Gov. Josh Shapiro over Palestine and not the other potential vice presidential nominees because he is Jewish, The Atlantic’s Yair Rosenberg writes. Shapiro’s positions are nuanced — he called Israeli Prime Minister Benjamin Netanyahu “one of the worst leaders of all time,” urged an “immediate two-state solution,” and differentiated between bigoted campus protesters and peaceful demonstrators — but more importantly, they aren’t significantly different from those of other potential running mates, none of whom have been targeted the same way.

Blindspot

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: Senate Minority Leader Mitch McConnell called President Biden’s proposed Supreme Court changes “dead on arrival” in Congress.

What the Right isn’t reading: Rudy Giuliani agreed to a deal to end his bankruptcy case.

Principals Team

Editors: Benjy Sarlin, Jordan Weissmann, Morgan Chalfant

Reporters: Kadia Goba, Joseph Zeballos-Roig, Shelby Talcott, David Weigel

Chris Coons is a Democratic senator from Delaware.

• Will the Fed rescue clean energy?
• Anyscale, software provider for OpenAI and other major firms, hires new CEO to boost sales.
• Far-right riots present ‘early test’ for new UK leader Starmer.