Economy

Economy https://washingtonsun.com/economy Economy en-US Wed, 09 Sep 2026 09:30:00 GMT Sam Altman Privately Rejected Giving OpenAI Shares to the Government https://washingtonsun.com/technology/sam-altman-privately-rejected-open-ai-government-equity Jeff Stein The remarks follow months of reports connecting Altman to the idea of giving the government equity in his company. Wed, 09 Sep 2026 09:30:00 GMT https://washingtonsun.com/technology/sam-altman-privately-rejected-open-ai-government-equity

OpenAI founder and CEO Sam Altman told conservative economic policy experts that he does not support having the government take shares in the company. (Francis Chung/POLITICO/AP)

OpenAI CEO Sam Altman privately told a group of conservatives this summer that he did not support having the government take shares in the company, distancing himself from a proposal that he and his firm were widely understood to have supported.

For months, OpenAI has been connected to the idea that it is interested in voluntarily ceding shares to the government. Altman has spoken to senior Trump administration officials about the idea, as The Washington Sun first reported in June. The Financial Times reported that OpenAI had proposed giving the government a 5 percent stake in the company, citing Altman’s private comments. The New York Times wrote that Altman had directly pitched President Donald Trump on creating a “government investment fund” seeded with shares in OpenAI. And The Associated Press reported that Altman told Sen. Bernie Sanders (I-Vermont) that he wants the public to have equity in artificial intelligence companies.

At the off-record meeting with conservative economists on July 29, Altman said that he supports some version of redistributing company shares to the American public, according to three people present and notes taken by one participant reviewed by The Washington Sun. But he also was adamant that he would oppose the government taking equity in his firm and would resist any efforts for federal control over the company, those in the room said.

Altman’s comments, previously unreported, provide new insight about the intentions of the leader of one of the most powerful technology companies in the world, as companies like his own and Anthropic navigate public backlash against the rise of AI.

To those present, Altman appeared confused why anyone could think he wanted the government to take shares in the company.

"To most people in Washington, 'public shares in OpenAI' obviously means government control," said one of the economists who attended the meeting. “But he did not seem to understand that and seemed confused that anyone would think that’s what it meant. He said, 'That's not what we're talking about.' … I had the sense that he did not see as big of a difference between individual Americans owning shares and the government owning shares as there is in reality.”

The economists spoke on the condition of anonymity to describe the off-record discussion.

In a statement to The Sun, the company said it supported creating a “government-administered public wealth fund,” which it distinguished from one in which the government took a “controlling or ownership stake in AI companies, which we would not support.”

"We think AI should create economic opportunity for everyone,” the statement said. “In April, we published an industrial policy blueprint with several ideas, including a public wealth fund that would let people share directly in the economic gains from AI. We’ve also talked with policymakers in both parties about related ideas, including whether AI companies could contribute equity to help seed a fund, but we are not close to anything specific.”

Several experts expressed confusion about Altman’s position. Theoretically, it would be possible for OpenAI to at some point donate “nonvoting” shares to a private entity overseen in part by government officials, which would limit federal control over the firm. But this would still amount to ceding stakes to the government.

"Everything we've seen from Sam Altman and OpenAI over the years implied a pretty conventional government ownership stake in the companies, including voting rights, dividend rights, other kinds of shareholder rights," said Matt Bruenig, founder of the People's Policy Project, a left-leaning think tank. "The distinction they are drawing is hard to understand: How does a government-administered public wealth fund that owns equity not have an ownership stake in companies? These sentences are contradictory."

The position also diverges from that understood by others in Washington who have met with Altman. In a meeting in Sanders’ office in late June, Altman said he had seen the senator’s bill requiring AI giants to turn over 50 percent of their shares to the government and agreed that the government should have some stake in the AI companies, though not 50 percent, according to another person familiar with the matter, who also spoke on the condition of anonymity to recount that private discussion.

By contrast, the economists who attended the July 29 meeting came away from the discussion with Altman believing that OpenAI agreed with their fierce opposition to expanding the government’s control over the private sector.

Some experts have long been skeptical that OpenAI really would be voluntarily willing to turn over what would amount to billions of dollars to the government. Jeremy Bearer-Friend, an AI expert and law professor at George Washington University who helped design the Sanders plan, said there is nothing in corporate law currently stopping Altman from ceding shares to the government.

Shareholders could sue the company if it made that decision, but it would have the freedom to try.

“They already could have done it,” Bearer-Friend said.

The same day Altman met with conservative economic policy experts, the OpenAI executive also briefed a group of economists influential with Democratic policymakers. Several attendees of that second meeting did not recall the equity stakes question being discussed.

Both meetings started with presentations from Altman about the mathematical breakthroughs made by the OpenAI models. To the conservative economists, Altman stressed that OpenAI had the least politically biased model of any of the major AI companies, two of the people at that meeting said. The liberal economists did not remember Altman discussing the political orientation of the OpenAI model.]]> U.S. Hits Iran's Aviation Industry With Crippling Sanctions https://washingtonsun.com/foreign-policy/us-iran-war-airline-industry-sanctions-treasury Associated Press The Trump administration accused the 36 entities targeted this week of supporting the Islamic Republic's efforts to use its aviation sector to move weapons, personnel, and illicit cargo. Tue, 08 Sep 2026 15:22:05 GMT https://washingtonsun.com/foreign-policy/us-iran-war-airline-industry-sanctions-treasury

“Let this be a warning to anyone doing business with Iran’s remaining airlines, all of which we sanctioned today: You are at risk of being cut off from the global financial system,” Treasury Secretary Scott Bessent said in a press release. Gerald Herbert/AP

By Farnoush Amiri

The Trump administration on Tuesday imposed sanctions on additional elements of Iran's aviation industry, targeting more than two dozen commercial and private airlines as well as foreign cargo service providers in its new push to isolate Tehran from its remaining trading partners.

The latest actions are part of the Trump administration’s Operation Economic Outcast campaign that is aimed at severing “critical financial lifelines” for the already heavily sanctioned Iranian government. The new penalties target the remaining facets of Tehran’s already beleaguered aviation ecosystem, which Washington has sanctioned for years.

“Let this be a warning to anyone doing business with Iran’s remaining airlines, all of which we sanctioned today: You are at risk of being cut off from the global financial system,” Treasury Secretary Scott Bessent said in a press release.

The Trump administration accused the 36 entities targeted this week of supporting the Islamic Republic's efforts to use its aviation sector to move weapons, personnel, and illicit cargo. The moves will subject foreign firms and governments that do business with the targeted entities to sanctions themselves, including a freeze on any assets they may have in U.S. jurisdictions.

In a post on X, Iranian Foreign Minister Abbas Araghchi called out the longstanding U.S. sanctions campaign against Iran, saying that the fallout “has been disastrous for America, including its standing worldwide.”

“After failing to achieve its aims through sanctions or war, Washington’s “novel” solution is…more sanctions. Seriously?” Araghchi wrote Tuesday afternoon.

The administration also claimed that private entities based in Turkey, the United Arab Emirates, Kazakhstan and Malaysia have provided parts and logistics services to Iran’s Mahan Air. The major airline, which flies from Tehran to a few dozen destinations in Asia, Europe and the Middle East, has been subject to U.S. counterterrorism sanctions since 2019 for its support for Iran’s paramilitary Revolutionary Guard, which the State Department has designated a foreign terrorist organization.

The airline was first targeted by the U.S. under the Obama administration in 2011, when it accused Mahan Air of being used to send weapons to Iranian proxies in Lebanon and Yemen.

The latest sanctions campaign is part of a two-pronged economic and military approach by President Donald Trump as he struggles to bring an end to a more than six-month-old war with Tehran.

Last week, the U.S. announced penalties against Golden Global Yatirim Bankasi Anonim Sirketi, a Turkish bank, which it accused of being established to enable Iran’s efforts to transfer oil revenues from China to Turkey, where they could then be converted to cash and gold.

The U.S. also said the institution “knowingly offered” banking services to Iranian financial entities, including those already sanctioned by the U.S. government in 2022 for funneling Tehran’s oil sales.

An Egyptian bank’s operations in the United Arab Emirates were also limited last month as part of the campaign, but the administration stopped short of imposing sanctions as it grapples with how to sever Iran's economic footprint without upending the global financial system.
]]> Canada Seeks Closer Ties to Europe as It Hits the U.S. With Billions in Tariffs https://washingtonsun.com/economy/canada-tariffs-billions-us-goods Associated Press Canada is exploring ties with the European Union that could stop just short of membership, a Canadian official familiar with the discussions said. Tue, 08 Sep 2026 14:33:53 GMT https://washingtonsun.com/economy/canada-tariffs-billions-us-goods Canada US Trade

Canadian Prime Minister Mark Carney has criticized U.S. tariff policy. (Patrick Doyle/The Canadian Press via AP)

By Rob Gillies

TORONTO (AP) — Canadian Prime Minister Mark Carney said Tuesday that Canada would move faster to reduce its economic reliance on the United States and deepen ties with Europe as retaliatory tariffs took effect on about $20 billion worth of U.S. goods and the country braced for U.S. President Donald Trump’s response.

“In too many areas, they wanted dependency, not a true economic partnership,” Carney said in a prerecorded video outlining his government’s plan to withstand the trade war. The prime minister said four decades of deeper economic integration had left Canada too reliant on the U.S.

Canada is exploring ties with the European Union that could stop just short of membership, a Canadian official familiar with the discussions said.

Options could include expanding existing agreements, negotiating a new treaty or creating other forms of cooperation. The official said Canada is already consulting provinces, territories and labor groups about what a deeper relationship with the EU could look like, but no model has been chosen.

The official spoke on condition of anonymity because they were not authorized to discuss the talks publicly.

Carney is due in Strasbourg, France, next week, where he will attend European Commission President Ursula von der Leyen’s State of the European Union address Sept. 16 and address the European Parliament the following day.

The trade war began after Trump returned to office and imposed a series of tariffs on Canadian goods despite having negotiated and repeatedly praised the North American trade agreement during his first term. Many of those tariffs violate the pact.

The rupture is especially striking because the countries have long shared one of the world’s closest relationships, with deeply integrated economies, close defense and security cooperation, vast cultural ties and, before relations deteriorated, about 400,000 people crossing the border each day.

Canada looks beyond the US

The latest U.S. trade actions will cause short-term pain, Carney acknowledged, but he said they would push Canada to move faster on investment, infrastructure and trade diversification. He acknowledged the shift would be costly but said standing still would cost more.

Carney contrasted Canada’s deteriorating relationship with Washington with its push to deepen ties elsewhere. “For the past year and a half, we have been steering our economy toward trusted partners,” he said.

“It was easy business, but it meant we relied too much on one economic partner,” he said. “That time is over.”

Canada retaliates as Trump response looms

Carney defended the retaliation, saying Canada was matching the latest U.S. measures dollar for dollar while supporting affected workers and industries and accelerating efforts to expand trade with other countries.

“We can’t let American goods into Canada tariff-free while they charge our companies to export to them,” he said.

Canada was not seeking to escalate the confrontation, he said, but the tariffs were necessary to protect Canadian workers.

The prime minister also defended Canada’s decision to walk away from the talks, saying Washington sought limits on French-language and cultural protections, influence over future trade deals, and terms that would weaken the auto, steel and forestry sectors.

How the trade war ends could carry consequences far beyond Canada, testing whether a smaller U.S. ally can resist Trump’s economic pressure without being forced to yield.

U.S. Trade Representative Jamieson Greer has suggested Washington could retaliate by blocking some Canadian products from the U.S. market.

The Canadian official said Ottawa does not intend to change course regardless of whether Trump responds with nothing or what the official called a “nuclear response.” The government’s strategy will remain focused on building more at home and diversifying trade abroad, the official said.

The tariffs hit hundreds of American products, including steel, aluminum, cheese, appliances, clothing, cosmetics and farm equipment, at rates of 15%, 25% or 50%. They cover about $20 billion in American goods, roughly 6% of the $333.6 billion the United States exported to Canada last year.

Since Canada-U.S. trade talks collapsed Aug. 21, Trump and his administration have imposed additional tariffs and issued a series of threats and attacks portraying Canada as weak and dependent.

Trump’s trade war and repeated talk of making Canada the 51st state have fueled anger and rallied support for Carney. Canadians have sharply cut travel to the United States and boycotted U.S. goods.

Carney praised those efforts, saying “every time we choose to buy Canadian and travel in Canada, we are sending a message that nobody is in the stands, 40 million of us are on the ice.”

Neither side is rushing back to the table

Gabriel Brunet, a spokesman for Canada-U.S. Trade Minister Dominic LeBlanc, said officials from both countries remain in contact even though formal negotiations have not resumed.

“Canadian and American officials have maintained ongoing discussions on a range of issues, although formal trade negotiations are not taking place at this stage,” Brunet said.

Former U.S. trade official Wendy Cutler said neither side appeared eager to make the first move.

“With a growing public approval rating now topping 70%, Prime Minister Carney is not in any hurry to reach out to Washington. But importantly, he has not closed the door to talks,” she said. “Clearly, at this point each side does not want to look too anxious to reengage in fear of looking weak.”

Associated Press writer Paul Wiseman in Washington contributed to this report.]]> U.S. Job Market Rebounds in Surprising Fashion While Unemployment Stays Flat https://washingtonsun.com/economy/us-job-numbers-market-rebounds-unemployment-trump-iran-war Jade Lozada, Associated Press Revisions also added 55,000 jobs to June and July payrolls. Fri, 04 Sep 2026 12:53:26 GMT https://washingtonsun.com/economy/us-job-numbers-market-rebounds-unemployment-trump-iran-war

A job seeker waits to talk to a recruiter at a job fair in Sunrise, Florida. (AP Photo/Marta Lavandier)

The U.S. job market rebounded in August as employers added a surprising 162,000 jobs. The unemployment stayed at a low 4.1%.

Friday’s strong jobs report reflected employment gains in food services and local government education, notching tens of thousands of new jobs in each sector, according to the Bureau of Labor Statistics. The manufacturing and health care industries continued to march on a monthslong upward trend.

Revisions added 55,000 jobs to June and July payrolls.

Hiring has been up and down this year, two months before midterm elections and at a time when voters are unhappy about the economy and the high cost of living in particular.

Those problems are exacerbated by wage growth that isn’t keeping up with inflation. Workers saw a 0.3% increase in average hourly earnings in August, according to the jobs report.

“In general this is a strong report. The main problem is that wage growth continues to slow as workers lose more leverage in the labor market,” said Ben Zipperer, a senior economist at the liberal Economic Policy Institute who studies wages.

Wages rose by 3.1% over the year ending in August. Though last month’s inflation report will not be released until next Friday, the annual inflation rate punched in at 3.4% in July.

It’s not just workers facing challenges in the economy. Employers are dealing with their own labor market issues, as well.

Companies are contending with a shortage of workers — the result of President Donald Trump’s immigration crackdown and the retirement of baby boomers — and some are responding by using technology for tasks that human beings used to do.

But employers have been reluctant to let go of the staff they have, so most Americans enjoy unusual job security and unemployment is low.

Paul Wiseman reported from AP.]]> Energy Jobs Fell in Almost Every Sector Last Year https://washingtonsun.com/energy/energy-jobs-fell-almost-every-sector-last-year Mara Hoplamazian The Energy Department found only that transmission, storage and distribution sectors grew, in part due to the expansion of data centers. Thu, 03 Sep 2026 20:21:44 GMT https://washingtonsun.com/energy/energy-jobs-fell-almost-every-sector-last-year Solar Farm

Most power-generation sector job losses were in the solar industry. (AP Photo/Robert F. Bukaty)

The energy industry’s workforce shrank last year.

The energy sector lost roughly 86,000 workers — roughly 1% of its workforce — between 2024 and 2025, according to an annual report from the Department of Energy. The losses came from almost every part of the energy industry, the United States Energy and Employment Report said, amid increased automation and the Trump administration’s push away from green energy.

Only the transmission, distribution and storage parts of the energy sector saw job growth in 2025, a trend DOE officials attributed to the expansion of data centers, growth in manufacturing and industrial activity and the increased adoption of electric vehicles and heat pumps. Enrollment in apprenticeship programs also increased.

The Trump administration’s efforts to increase coal- and nuclear-power generation led to employment bumps, with each of those industries adding about 2,500 workers.

But as a whole, the power-generation sector lost about 15,000 workers from 2024 to 2025. Most of those losses were in the solar industry, with additional job losses in wind and hydroelectric power.

Jobs in petroleum and natural gas also declined in 2025, dropping by 3% and 4%, respectively. Energy officials said that reflected a shift toward a “smaller, higher-paid workforce.”

“Industry sources also point out the role of AI, automation, and digital technologies in improving operational efficiencies and reducing labor requirements,” the report said.

About 50,000 jobs disappeared from the motor-vehicle industry in 2025, but wages in that sector also increased. Energy Department officials said “output-per-worker” increased over that time, too.

The report found that higher-wage occupations added workers in 2025, while lower-wage occupations declined. The median salary in the energy sector in 2025 was $63,000, higher than the national median of $51,000.

Across several energy industry sectors, employers reported having difficulty hiring workers and concerns about a lack of people available for technical positions like electric work or construction.

Despite the drop in employment, the Energy Department report projected that demand for workers in the energy sector would increase as electricity demand rises and data centers expand.]]> Are ‘Opportunity Zones’ Creating Opportunity? Rural America Is Waiting. https://washingtonsun.com/economy/opportunity-zones-rural-america Jade Lozada Local officials tell NOTUS they haven’t seen investment dollars pour in. But they’re welcoming the coming changes to the tax program. Thu, 03 Sep 2026 09:50:00 GMT https://washingtonsun.com/economy/opportunity-zones-rural-america Housing construction

There’s no comprehensive federal tracking of the impact of opportunity zones, but outside research has shown the program yielding mixed results. (Damian Dovarganes/AP) Damian Dovarganes/AP

Montgomery County, Illinois, is roughly 700 square miles of sparsely populated land almost perfectly situated in between Springfield and St. Louis. It’s home to a Route 66 Welcome Center and, if a federal tax-incentive program is successful, is supposed to be a hotspot for new economic development.

But when Mike Plunkett, a county coordinator whose job it is to field those millions of dollars in investment, looks around, he wonders why a developer would come there.

“What do we have to offer that a million other Midwestern communities don’t have? We have very little competitive advantage,” Plunkett said.

In the eight years since the federal government implemented “opportunity zones,” a tax-incentive program that aims to spur economic development in selected low-income census tracts in the U.S., many counties have been experiencing what Montgomery has.

As the Treasury Department fields nominations from governors’ offices for the second round of opportunity zone investments this summer — tracts that will be eligible for tax-incentivized investments starting in January 2027 — communities are wondering whether they will actually experience the benefits of the program this time.

Plunkett said he has received only one inquiry about the program: from a construction gear manufacturer that set up shop in Montgomery County.

“There have been no other inquiries about the opportunity zone,” Plunkett added.

Multiple local officials from around the country reached by NOTUS said they weren’t aware their county was in an opportunity zone. “This is the first I’ve heard about this program,” said a rural county treasurer in Illinois, who requested anonymity for fear of retaliation. “There isn’t any attraction to come here.”

The average rural zone attracted just $7.3 million in investment from 2018 to 2024, compared to $23.3 million for the average nonrural opportunity zone, according to a June paper by the Treasury’s Office of Tax Analysis. In total, 16% of opportunity zone property was in rural areas, even though it makes up 38% of the U.S.’s 8,764 opportunity zones. In all, $112 billion has been invested using opportunity zone tax incentives.

There’s no comprehensive federal tracking of the impact of opportunity zones, but outside research has shown the program yielding mixed results. Opportunity zones have spurred the construction of 416,000 new homes, according to one paper from the Economic Innovation Group, a think tank that leads the pack in measuring the program’s impact. They have created new jobs, most of which go to residents from more affluent areas outside of the opportunity zone, reports another from the National Bureau of Economic Research. They have no significant effect on commercial investment and business activity, says a third by economists Naomi Feldman and Kevin Corinth, who is a fellow at the American Enterprise Institute.

Local economic development officials largely said they felt the incentives were not properly promoted.

Corey Proctor, the planning director for Forrest County, Mississippi, said his county needs new housing and has vast swathes of land he believes could attract industry, but local developers lack the requisite information to leverage the tax incentive.

Those developers could benefit from workshops that provide a rundown on how to invest in an opportunity zone, whether delivered by his office or the state or federal government, Proctor said.

“It’d be good to have everyone on the same page,” he said.

Last year’s budget reconciliation law does seek to remedy the rural investment disparity.

Opportunity zones allow taxpayers to invest capital gains income from stocks or property into funds that back development projects in low-income tracts. In return, investors can defer and reduce their tax payments on their gains. After 10 years invested in the fund, gains on the opportunity zone investment itself are completely tax free.

Starting next year, investors in newly created rural opportunity zone funds will receive a 30% reduction in their capital gains tax bill after five years invested in a rural opportunity zone, compared to 10% for nonrural zones.

Rural counties can’t offer the scores of people to fill shiny new apartment complexes and office buildings, or the transit infrastructure to support construction that their urban competitors for opportunity zone dollars can. They also typically lack the robust economic development teams with arsenals of resources for investors to utilize that many cities leverage.

That puts rural counties in a tough spot. With limited county staff and few established local investors, rural county leaders said attracting opportunity zone investment will require an unprecedented effort by local economic planners to read up on opportunity zones and pitch their own to developers — work that they currently don’t do or don’t know about.

Local officials told NOTUS that having extensive data on the impact of opportunity zone investments could help draw in new investors.

Currently, no one — neither the developers, nor the opportunity zone municipalities or the Treasury Department — bears the explicit responsibility to measure the program’s impact before changes in last year’s budget reconciliation law. Investors currently need only submit basic data on the value and the location of their property holdings on annual tax forms.

Under the latest budget law, however, investors must report the numbers of residential units held and full-time workers employed in the fund’s businesses, as well as the basic data on their investments. Congress allocated $15 million for the Treasury to produce annual reports enumerating opportunity zones’ housing and job creation, as well as less-frequent reports detailing the impact of investment on metrics such as poverty and unemployment rates and median family income.

“That would be on my wishlist for opportunity zone 2.0 is to really strengthen the reporting mechanisms so that communities truly can major those ROIs,” said Kersten Swinyard, the economic development director for Salt Lake County, Utah. “We’d love to be able to highlight these numbers. We just don’t have them.”

Localities that have successfully drawn investment do not have a clear picture of the program’s impact — or take pains to estimate it. Though she lacked impact data, Swinyard said opportunity zones were an undeniable success in Salt Lake County, where the tax incentive helped attract large logistics and industrial projects, as well as housing and commercial development.

“Opportunity zones can be either a useful way to channel investment to places that really need it or a tax shelter with high abuse potential, and the determining factor as to which side wins out is precisely the type of tracking and evaluation that is required, and that we've never seen quite enough of,” said Jared Bernstein, the chief economic adviser to then-President Joe Biden who co-authored the original 2015 paper proposing opportunity zones with Kevin Hassett, the current National Economic Council director.

The program’s impact is hard to grasp even on the ground and even in urban areas with more resources.

In Washington, D.C., which has raked in $1.2 billion in opportunity zone investment, the mayor’s office and developers are trying their own hands at data-gathering to paint a picture of the program that will keep investors coming back.

The mayor’s office cobbles together assessments through its building permitting process, conversations with developers about how much capital they’ve deployed and job estimates configured by the city’s tax revenue and licensing offices, said Nina Albert, the deputy mayor for economic planning and development.

RedBrick LMD, one of the largest private landowners in D.C., has hired a third-party firm to evaluate their opportunity zone investments for the purpose of pitching to impact investors.

Opportunity zone projects like those of RedBrick have transformed pockets of the city, particularly in Anacostia, Congress Heights and Barry Farm.

Aside a bend in the Anacostia River, facing the white arches of the Frederick Douglass Memorial Bridge stretching to Navy Yard, RedBrick erected the Bridge District towers — a swanky mixed-income and mixed-use development with a plant wall in the lobby and a pool on the rooftop. A brewery and coffee shop sit on the ground floor.

The Bridge District — an opportunity zone project touted by Albert — went up in an area with little else, as the program intended. Bounded on one side by the river and treetops of Anacostia Park and the other by crisscrossing roadways, the closest major development visible from the roof is the Marine One hangar about two miles away.

Albert credits D.C.’s expansive tax incentives for developers beyond opportunity zones. There’s the federal New Markets Tax Credit Program, the District’s low-income-housing tax credit, and even a local tax incentive for opening grocery stores.

“It's surpassed our expectations,” Albert said of opportunity zones. “I wouldn't say it's our premier tool.”

RedBrick LMD managing partner Louis Dubin had a different take.

“Anything we may have done locally would be so de minimis it would really not have materially contributed. So I would attribute this all to opportunity zone,” the real-estate developer told NOTUS.]]> Bessent Downplays the Bond Market’s Latest Swing: It’s Not ‘Dire’ https://washingtonsun.com/economy/bessent-downplay-bond-markets-swing Jade Lozada Yields on 10-year U.S. Treasury bonds hit 20-month highs on Tuesday. Economists say reversing the trend will require lowering inflation. Tue, 01 Sep 2026 18:09:43 GMT https://washingtonsun.com/economy/bessent-downplay-bond-markets-swing Treasury Bessent

Treasury Secretary Scott Bessent pointed to the U.S.’s continued economic growth amid the Iran war, including the explosion of the artificial intelligence sector. Julia Demaree Nikhinson/AP

The Trump administration is struggling to assuage investors’ concerns over the U.S. economy.

The 10-year U.S. Treasury bond yield hit 4.798% on Tuesday morning, the highest rate for investors’ returns on the government debt in 20 months. The bond market’s new highs cap a summer of volatility for yields that have been climbing since the United States began attacking Iran in February. The stakes are high for the U.S. economy: High bond yields mean higher borrowing costs for mortgages, auto loans and consumer credit.

Yields have worsened as investors brace for potential interest rate hikes this month and face uncertainty around President Donald Trump’s inflation-stoking foreign policy and the country’s ballooning debt, economists say.

“Bond yields will keep rising if our fiscal health and inflation concerns aren’t fixed,” Jai Kedia, a research fellow at the libertarian Cato Institute, wrote in a text to NOTUS. “If the administration is serious about lowering borrowing costs, it should reverse course on its own bad policies like tariffs and conflict in the Middle East, along with getting government spending back on track.”

Treasury Secretary Scott Bessent downplayed Tuesday’s rising yields in remarks at the Group of 20 summit, a meeting of the world’s top finance ministers taking place in Asheville, North Carolina, this week.

He pointed to the U.S.’s continued economic growth amid the Iran war, including the explosion of the artificial intelligence sector.

“I don’t think that we’re in any kind of a dire situation,” Bessent said during a discussion with Fox Business host Larry Kudlow. “The U.S. bond market has been the best-performing bond market. What happens over a month doesn’t matter.”

The administration has been sensitive to the bond market’s swings, however. Bessent attempted to soothe concerns in August, announcing an initiative to offload at least $4 billion in government debt from the market. Bond yields quickly rebounded, however, and have remained high.

Inflation is currently a primary driver of bond yields, economists told NOTUS. Investors have been in limbo this year as the Federal Reserve has punted on interest rate changes. There are some signs investors anticipate interest rates will go up to tamp down inflation, especially after Fed Chair Kevin Warsh noted the issue in his first major speech at Jackson Hole, Wyoming, last week.

“We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed,” Warsh said. “Otherwise, we have work to do. That’s our job, that’s our mandate and that’s our charge to keep.”

Economists say the only lasting way out of the bond yield problem is to tackle inflation and the economy’s structural issues. Conservatives have pointed to the federal deficit, calling to reduce government spending — something Bessent also alluded to last month.

“The No. 1 thing the U.S. government can do to reduce those yields is to reduce the deficit,” said Judge Glock, the research director at the conservative Manhattan Institute. “It would also assure bondholders and bond traders that the U.S. could get its debt under control over the long term.”

Ryan Young, a senior economist with the libertarian Competitive Enterprise Institute, noted that Tuesday’s yield highs could also be the result of the news cycle, including Warsh’s Jackson Hole speech, flaring tensions between the U.S. and Canada and resumed fighting in Iran.

“What’s happening today could well get canceled out tomorrow, but in the long-run trajectory until something does get done about the debt situation, I would look for a slow long-term creep-up, along with plenty of day-to-day volatility as stories pop up,” Young said.

Conservative economists are skeptical the Treasury can influence bond yields through its buyback operation. Glock said the Treasury can’t lay down those billions of dollars in funds without eventually recouping them through additional debt.

“There’s fundamentally no way that buyback program can work over the medium or long term,” he said. “It’s effectively trading one form of debt for another.”]]> U.S. Job Openings Rose Slightly in July https://washingtonsun.com/economy/us-job-openings-rose-slightly-july Associated Press Layoffs fell, but so did the number of people quitting their jobs, according to a Labor Department survey. Tue, 01 Sep 2026 16:54:41 GMT https://washingtonsun.com/economy/us-job-openings-rose-slightly-july A person waits in a line for a prospective employer at a job fair.

A person waits in a line for a prospective employer at a job fair.

Lynne Sladky/AP

By Paul Wiseman

Employers posted slightly more job openings in July but the American labor market remained sturdy in the face of higher costs that are squeezing household budgets.

U.S. job openings ticked up to 7.27 million in July from a revised 7.18 million in June, the Labor Department reported Tuesday.

The department's Job Openings and Labor Turnover Survey (JOLTS) also showed that layoffs fell. But so did the number of people quitting their jobs — a sign of confidence in their prospects. The report showed that gross hiring — before subtracting those who lost or quit their jobs — dipped to 5.1 million in July from 5.3 million in June.

The American job market is hardly booming, but it is ambling along despite an energy shock caused by the fighting with Iran that has squeezed family budgets.

So far this year, U.S. employers — companies, nonprofits and government agencies — added an average of 61,000 net jobs a month. The figure — which was dragged down by job losses in February and July — is unimpressive. But it's an improvement on 2025 when job growth came in below 10,000 a month — weakest hiring outside a recession since 2002 — as the lingering effect of high interest rates and uncertainty caused by Trump's tariffs discouraged firms from hiring.

But if U.S. employers aren't hiring much, at least they aren't firing much either. The unemployment rate remains at a low 4.1%, and the number of people signing up for unemployment benefits has come in low week after week.

“The labor market is back in the ‘low fire, low hire’ mode,” said Heather Long, chief economist at Navy Federal Credit Union. "Companies are growing cautious as the war in Iran drags on and borrowing costs have spiked.''

When the Labor Department puts out numbers on August hiring and unemployment Friday, it's expected to show that employers added 65,000 last month and that the jobless rate ticked up to 4.2%, according to a survey of forecasters by the data firm FactSet.]]> Trump Says Communities That Oppose Data Centers Will End Up ‘Backwards and Poor’ https://washingtonsun.com/trump-white-house/trump-data-centers-construction-development-candidates-artificial-intelligence Torrie Herrington “If we kill the Golden Goose, you will only have yourselves to blame,” he said. Mon, 31 Aug 2026 17:36:12 GMT https://washingtonsun.com/trump-white-house/trump-data-centers-construction-development-candidates-artificial-intelligence

Alex Brandon/AP

President Donald Trump came out strongly in favor of data center construction across the country on Monday, writing on Truth Social that those speaking out against the expensive and resource-intensive projects must want to “end up being backwards and poor.”

His post comes at a time when data center popularity is plummeting. According to a survey this year by the Pew Research Center, “more Americans say data centers have a negative effect on the environment, home energy costs and people’s quality of life nearby than say they have a positive effect.”

And a Reuters-Ipsos poll in June found that 77% of Americans worry that artificial intelligence will raise their electricity bills.

Trump, however, disagreed with that assessment.

“If they want to be successful and rich, with far lower taxes and jobs all over the place, let Data Reign,” he wrote Monday. “The good news is that there are plenty of other places that want them. If we kill the Golden Goose, you will only have yourselves to blame.”

Many lawmakers who support data centers have pitched their development as an existential struggle to defeat China, which is also working to create sophisticated AI technologies.

Trump highlighted this framing in his message, saying that “China could not be happier” with the anti-data center stances that candidates for both parties have adopted, including some Republicans who previously championed the developments.

For example, just last year Texas Gov. Greg Abbott declared his state the “epicenter of AI development” — but this month, he abandoned the claim and halted approvals of about 1,800 new data centers, citing concerns that they use too much power and water.

Nationally, progressive Democrats are pushing a moratorium on the construction of new AI data centers. A bill introduced by Sen. Bernie Sanders (I-Vermont) and Rep. Alexandria Ocasio-Cortez (D-New York) had faced bipartisan pushback when it was introduced in March, with elected officials from both parties arguing the United States must continue to develop the technology to stay ahead of rival nations.
]]> Gas Prices Are High. Trump’s Supporters Are Feeling The Most Pain. https://washingtonsun.com/economy/gas-prices-trump-areas-republican Andrew Van Dam We crunched the numbers: Pain at the pump is sharper on one side of the political spectrum. Fri, 28 Aug 2026 09:01:00 GMT https://washingtonsun.com/economy/gas-prices-trump-areas-republican Gas station

Gas prices have jumped across the country but some Americans are paying a higher share of the price. (Francis Chung/POLITICO/AP)

Gas at the pump costs 40% more than it did before the Iran war began in February, according to the Energy Information Administration. And whether you’re a die-hard Democrat or red-blooded Republican or somewhere in between, everyone pays directly or indirectly for that hike.

Historically, this would be awful news for the White House occupant. Political scientists seem to agree that, unlike some trends that preoccupy pundits, gas prices really do move the needle on presidential approval.

Gasoline is a substantial part of the typical family’s budget, of course, but its real influence may lie in its simplicity. As Northwestern University’s Laurel Harbridge-Yong said on Matt Grossmann’s “The Science of Politics” podcast, you drive by gas stations with enormous price signs all the time. If you have a gas-powered car, you fill up regularly, so you have a common point of comparison. And, unlike with groceries where the long receipt obfuscates individual changes, you watch your wallet empty as your car fills up.

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In a 2016 book chapter, an all-star team of Harbridge-Yong and co-authors Jon Krosnick of Stanford University and Jeffrey Wooldridge of Michigan State University assembled three decades of presidential approval ratings, compared them to gas-price data, and found that every 10-cent rise in gas prices led to as much as a 0.6 percentage-point drop in the president’s approval rating. That held true even after controlling for food-and-beverage inflation, unemployment and presidential scandals. Simply put, voter sentiment often follows the gas gauge.

In the years since, other scholars have found similar trends. American Politics Research analysis shows that people living in places with longer car commutes are more likely to punish the president’s party for rising gas prices.

In an apparent effort to blunt this poll penalty in the upcoming midterms, President Donald Trump has often tried to justify the higher prices.

“So I just say this, so for you to pay a tiny little bit more for your gasoline,” he told the crowd at an event this month on Long Island, “just remember, you're doing it so that a very evil country cannot have … a nuclear weapon. So remember that, when you have to pay a little bit more.”

And support for the president does seem to cloud our views on the price surge. A recent YouGov poll found 32% of Republicans said gas prices were going up a lot, compared with 60% of Democrats.

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In reality, since the war began in February, pump prices have leapt more than a dollar in both the reddest and bluest counties, with little variation based on politics, according to data from AAA and OPIS, the oil-price geniuses at Dow Jones. (The exception is Indiana, which now has the lowest gas prices in the nation after Republican Gov. Mike Braun suspended the state’s gas tax of about 60 cents a gallon.)

But, as our colleague Thomas Burr pointed out, it’s not just the change in price that determines how much gas prices hit your wallet. It’s how much you drive.

Seen through that lens, the initial results look pretty simple: The pain falls more heavily on Trump’s base. About 87% of workers in the Trumpiest fifth of the country commute by car, according to our analysis of the American Community Survey. That’s almost 40% more than the fifth of the country that went most heavily for Kamala Harris in 2024.

We can blame much of the gap on the urban-rural divide. Rural regions that went for Harris tend to drive a fair bit as well, but they’re rarer than rural red counties.

But gas prices can vary by well over a dollar per gallon depending on where you live, so isn’t it possible that, while Democrats tend to live in areas where people drive less, they also pay more per gallon?

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Yes! We estimate Americans living in the bluest fifth of the country pay almost 20% more per gallon, extrapolating from data from AAA.

So, that raises the ultimate question: Does the higher price in Democratic-leaning counties offset the fact that they tend to drive less?

It’s tricky to account for the actual miles driven in each county. The best source might be 2017 data from the Bureau of Transportation Statistics, which — while stale — tends to agree with more recent (albeit spottier) data from other sources.

If we use that data to account for the miles driven by households in each county, combined with spending data from the Energy Information Administration, we find that households in the reddest fifth of America still spend about 30% more on gasoline in a typical year than their friends in the bluest areas.

And if you look at it as a share of income — to account for the fact that city jobs tend to pay more — households in the reddest areas shell out about twice as much of their paychecks as their bluest buddies.

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That may be part of why even Republicans seem to be souring on the Trump economy.

“Republicans saw a pretty big decrease in sentiment this month,” said Joanne Hsu, director of the widely watched University of Michigan Survey of Consumers. “It’s the lowest we’ve seen since the start of this administration.”

When respondents are asked to explain their answers, she said, everybody is far more likely to point to gas prices these days, but Republicans remain a bit less likely to cite them specifically. It’s an echo of the YouGov poll above — Republicans don’t see gas prices rising as fast, even though they’re hit hardest at the pump.

But is it just partisan wishful thinking?

Hsu had another explanation. Later in their survey, they ask where folks expect gas prices to go in the next year. Democrats and independents both thought they’d keep on climbing, while Republicans were the only group that expected gas to get cheaper.

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“Republicans are still giving the president a little latitude on that,” Hsu said, “because there’s a belief that as soon as the war is over, gas prices are going to come down.”

“If you think it’s just a short-term pinch, you might have a higher tolerance for it,” she added. “You can stomach it because you don’t think it’s going to last.”]]>