“President Trump’s return to office has been an unforgiving crucible for the hidebound Internal Revenue Service. He and his aides have decimated its ranks, fired and replaced its leaders and made repeated attempts to enlist the agency in his quest for political retribution,” the New York Times reports.

“Now, as part of an arrangement drawn up this week by Todd Blanche, the acting attorney general, the I.R.S. faces its most profound legal and ethical test yet: a demand to drop any audits of Mr. Trump, his family members or their affiliates.”

“Tax lawyers and former I.R.S. officials said such expansive protection would cut to the core of the agency’s mission to collect taxes in a disinterested, nonpartisan way — and could potentially run afoul of the laws governing how it does so.”

Fortune: “It wasn’t even a year ago that fiscal hawks were wringing their hands over a new national debt milestone: The debt had hit $38 trillion, and interest payments on an annual basis would be 13 figures.”

“A little over 200 days later, the U.S. national debt stands at more than $39 trillion. According to Treasury data, updated retrospectively for May 18, the debt landed at $39,008,999,901,378.68.” 

“The Pentagon put the cost of the war on Iran at ‘closer’ to $29 billion, roughly $4 billion more than two weeks ago,” the New York Times reports.

“Democrats appear poised to retake the House, and Rep. Richard Neal is quietly making plans,” Politico reports.

“The Massachusetts Democrat has a clear path back into the chairmanship of the Ways and Means Committee and, behind the scenes, he’s laying the groundwork for a second stint as his party’s point man on all things tax, as well as trade, health care and Social Security.”

“A federal judge ruled Thursday that the U.S. DOGE Service did not have the authority to cancel National Endowment for the Humanities grants, which made up more than $100 million in congressionally appropriated funds,” the Washington Post reports.

New York Times: “The U.S. government learned last week that it may have reached an unfortunate milestone: The size of its debt surpassed the nation’s total economic output.”

“It was a striking imbalance, according to early estimates, one that the country has experienced only in rare circumstances — briefly during the pandemic, and in the aftermath of World War II. But the development barely seemed to register in the nation’s capital, where few policymakers bothered to acknowledge the latest warning sign about the government’s poor fiscal health.”

Washington Post: “A panel tasked with shaping the future of the Federal Emergency Management Agency voted Thursday to approve a report recommending that the Trump administration gradually cut FEMA by 50 percent, among other significant overhauls meant to streamline the beleaguered agency.”

“The report also recommends that FEMA shift leadership of emergency response and recovery to the state level, make changes to some of its most relied-on programs, and do away with reviews that members said can often slow disaster response and recovery.”

Rolling Stone: “You probably missed an obscure but important milestone our country hit last week: America’s debt passed 100 percent of our gross domestic product.”

“So what, you say? That sounds boring and technical. It’s actually really fucking important. It means that America’s accumulated debt — our impulse to borrow from other people to pay for the things we want and need — is now larger than the total size of the American economy. It shouldn’t take an economist to recognize this as bad and definitionally unsustainable.”

“The last time our deficit passed 100 percent of GDP, it was World War II. But when countries pass this milestone in ordinary times, it is a formula for decline that has accompanied the fall of republics and empires alike.”

Wall Street Journal: “The U.S. national debt now exceeds 100% of gross domestic product, crossing a once-unthinkable threshold, on the way toward breaking the record set in the wake of World War II.”

President Trump announced he would be removing tariffs on Whiskey from Scotland after a request from King Charles.

Said Trump: “The King and Queen got me to do something that nobody else was able to do, without hardly even asking!”

What would the Founding Fathers think of a president who unilaterally imposed tariffs—without congressional approval—only to reverse course at the request of the King of England?

“The Federal Emergency Management Agency is reversing job cuts that Kristi Noem, the former homeland security secretary, had overseen before she was fired last month,” the New York Times reports.

Politico: “President Donald Trump signed bipartisan legislation on Thursday to fund key agencies at the Department of Homeland Security, officially concluding the record-breaking shutdown.”

Bloomberg: “Republican lawmakers are looking at ways to lower taxes on capital gains as the party searches for new ways to woo voters worried about the cost of living heading into November’s midterm elections.”

“A proposal to index capital gains for inflation could be in play for a tax-and-spending package later this year, though the likelihood of a bill coming together before the midterms remains a long shot. Some Republicans have also pushed President Donald Trump’s administration to make that change unilaterally.”