Elon Musk's xAI, even more than rival AI startup leaders like OpenAI and Anthropic, is a cash incinerator — and despite the company's soaring valuations, it has little prospect of building significant revenue, let alone profit.

Yes, but: There's one niche of a future AI business ecosystem that xAI fits perfectly. It could end up as the Fox News of the AI infosphere — a right-skewed source of truth for those who view mainstream alternatives as too "woke."

The big picture: Musk is trying to raise an additional $5 billion for xAI, and he's turning to his own companies for cash — including SpaceX and Tesla — presumably because it's convenient and free of strings.

• It could also mean that outside investors are tiring of throwing money at the company, which has already raised more than $20 billion in debt and equity but continues to show little return.

By the numbers: xAI's AI business is expected to bring in $500 million in revenue this year, per Bloomberg, chiefly from API fees and subscriptions.

• Now that Musk has rolled X into xAI, xAI can add the former Twitter's $2.26 billion estimated ad revenue (per eMarketer).
• That figure may look paltry next to the income of social media giants like Meta and YouTube, but it's transformative for xAI's top line.
• The company also made headlines last week with an announcement that it has a deal for "up to $200 million" with the Pentagon, which is exploring uses for advanced AI and has also made similar deals with OpenAI, Google and Anthropic.

So the revenue line is beginning to move up — but hardly enough to justify the $200 billion valuation that Musk is reportedly seeking from new investors in xAI, or even cover its estimated $1 billion-a-month burn rate.

• The company does have some real assets: Its foundation model, Grok, has matured to a level where, for the moment, it's beating rivals like OpenAI's GPT, Anthropic's Claude and Google's Gemini on a variety of benchmark tests. And its Colossus data center in Memphis is one of the largest AI development facilities in the world today.

But turning those assets into cash flow is going to be very hard.

• The AI model business is ridiculously competitive, with those three rivals all boasting larger customer bases, more impressive research records and better reputations.
• It's unlikely that the U.S. market will support four separate, wildly expensive and largely duplicative frontier-model makers. That would leave Musk's company as the AI equivalent of the losers in the 1990s search engine wars. Who remembers Lycos or Excite?

xAI's biggest advantage is its integration with X. It gets real-time news and information from X users at the same time that it can promote its chatbot's services to them.

• The trouble is, this edge is also an Achilles' heel for xAI, because X itself has become such a troubled media environment.
• Since Musk bought Twitter in 2022 and renamed it X, he has opened the doors wide to racists, extremists, Nazis and other hate groups — in the name of free speech.
• That's had an impact not only on the social media platform, which has seen an exodus of left-leaning users and nervous advertisers, but also on xAI's Grok, which recently went on a pro-Hitler posting bender.

What's next: The likeliest path for xAI is to continue to cultivate and refine its appeal to the deep red side of America's red-blue split.

• Google, Apple, Microsoft, Meta, Amazon, OpenAI, Anthropic and other startups are all in a race to connect consumers and businesses to AI.
• The key differentiator will be how well they integrate AI with the rest of the tech we use every day — whether that's phones and desktop software, education and medical platforms, or cars and TV sets.

But some potential AI users will also choose based on ideology.

• Many of these users don't want their chatbots telling them that Donald Trump lost the 2020 election, that ivermectin is not a cure-all, and that climate change is real.
• There might even be some who don't mind hearing that Hitler was an admirably decisive leader.
• AI makers who want their chatbots to provide a middle-of-the-road consensus reality may not satisfy such users. That opens a lane for Musk's Grok — which can be intentionally provocative and, at one point, was instructed to "not shy away from making claims which are politically incorrect."

Of course, it's hard to predict what the size of that market is, or how xAI could tap it for enough revenue to support a ten-figure valuation.

• Fox News has dominated the conservative media for several decades, but at a roughly $24 billion market cap Fox Corporation today is worth 1/8 what Musk is reportedly asking for xAI.

The Senate early Thursday passed President Trump's requested clawback of $9 billion in federal funding for the Public Broadcasting Service, National Public Radio and foreign aid programs.

Why it matters: It's a win for conservative fiscal hawks who wanted to follow on DOGE's work, while Democrats fear the victory for the White House opens the door for more rescissions packages negating bipartisan spending deals.

• The measure passed 51-48 with only Republican support. Two Republicans — Susan Collins (Maine) and Lisa Murkowski (Alaska) — voted with Democrats against the bill.
• The package will now need to gain final approval in the House, which is facing a Friday deadline to get the measure to Trump.

The big picture: The GOP's rescissions package takes back money that has already been appropriated by Congress and signed into law by the president.

• The Senate stripped parts of the version the House passed in June, including cuts to PEPFAR — a global health program to prevent HIV and AIDS.
• To secure the support of Sen. Mike Rounds (R-S.D.), GOP leaders committed to fund tribal broadcast services in South Dakota.
• Democrats waged a messaging campaign against the bill, hoping to pick off the support of enough Republicans to sink it.

Driving the news: Senators endured hours of yet another vote-a-rama, with Democrats raising numerous amendments to try to undo parts of the bill.

• Collins and Murkowski at times voted in favor of amendments, though none passed.

Between the lines: Democrats worry Trump will ask Congress to approve even larger rescission packages in the future, potentially undermining bipartisan deals to avoid a government shutdown.

• Senate Minority Leader Chuck Schumer (D-N.Y.) has warned Republicans against more attempts to rescind federal funding, signaling that could threaten Democrats' support for government funding bills ahead of a Sept. 30 deadline.
• Unlike the rescissions bills, which have a simple majority threshold for passage, any measure to fund the government before the end of September will require Democratic support to get to 60 votes in the Senate.

The House voted late Wednesday to take up a bill establishing a regulatory framework for stablecoin issuers, after a record-breaking session that involved intense negotiations to quell a rebellion from hardliners.

Why it matters: "The vote puts the GENIUS Act on a glide path to Trump's desk this week for his signature.

• After huddling in Speaker Mike Johnson's (R-La.) office, members of the House Freedom Caucus switched their votes to "yes," ending a nearly 10-hour standoff.
• The House is set to vote Thursday on the GENIUS Act as a standalone measure. Conservatives were pushing to combine a trio of crypto bills into one package, but ultimately settled for a partial win.

The latest: House GOP leadership unlocked support for the vote by agreeing to attach one of the key crypto measures, the Anti-CBDC Surveillance State Act, to the must-pass National Defense Authorization Act.

• Johnson told reporters he spoke with Senate Majority Leader John Thune (R-S.D.) on Wednesday about adding the provision to the NDAA.
• "We're hopeful that they'll hold the line," Johnson said of the Senate.

The big picture: Wednesday's revote prevailed 217-212 and follows a meeting Trump said he held late Tuesday in the Oval Office with opponents.

• "I am in the Oval Office with 11 of the 12 Congressmen/women necessary to pass the GENIUS Act and, after a short discussion, they have all agreed to vote tomorrow morning in favor of the Rule," Trump posted on his Truth Social account.
• But that confidence proved premature.

Catch up quick: The House floor ground to a halt Tuesday after the chamber rejected a procedural vote setting terms for floor debate on the GENIUS Act.

• Johnson abruptly cancelled votes for the rest of the day amid demands to combine the GENIUS Act with two other crypto bills the chamber is considering this week.
• That would have forced the Senate to reconsider the legislation, likely leading to significant delays.

Zoom out: After months of delicate bipartisan negotiations, the Senate passed the GENIUS Act in June by a 68-30 vote.

• Although the House has drafted its own stablecoin legislation, it ultimately chose to take up the Senate-passed version — in part to avoid having to go back to the Senate.
• Trump has said he wants the GENIUS Act on his desk as soon as possible.

Storms sweeping through the U.S. this summer have dumped intense rain on cities across the country, left towns flood-ravaged and forced water rescues.

The big picture: Scientists who spoke to Axios say the deadly floods in Texas that killed more than 130 people underscores the risk that climate change can worsen extreme rainfall events.

• By the early hours of the Fourth of July, storms over Texas had dumped some 12 inches of rain in certain parts of the region, according to National Weather Service radar estimates cited by The Texas Tribune.
• But the threat didn't stop that day, with more rain falling and hindering desperate search efforts throughout the following week.

Driving the news: Meanwhile, on the East Coast, Tropical Storm Chantal rapidly formed — and slowly drenched North Carolina with flooding rains.

• Last week, storms sparked floods in New Mexico that killed three in the Village of Ruidoso.
• Widespread rainfall along the I-95 corridor in the Mid-Atlantic Monday set off flash flood warnings, grounded flights and sent torrents rushing through New York City subway stations.
• In New Jersey, two people died after the vehicle they were in was swept away by floodwaters.

Context: Climate change "is supercharging the water cycle," sparking heavier precipitation extremes and related flood risks, according to Climate Central, a climate research group.

• Among 144 U.S. cities analyzed by the group in a report from earlier this year, 88% experienced an increase in hourly rainfall intensity between 1970 and 2024.
• The summer months already provide the weather patterns for higher rainfall rates in some regions, and climate change makes that risk worse.

The latest: A National Weather Service discussion warned the risk wasn't over, noting that a "[p]otent summer storm system" will bring the threat of flash flooding and severe weather "to the Midwest and northern/central Plains Wednesday."

• It also noted "storms will continue ahead of the cold front across the interior Northeast/northern Mid-Atlantic/Upper Ohio Valley Thursday."
• In Louisiana, New Orleans and Jefferson Parish is bracing for up to 10 inches of rainfall as a tropical system moves through the region.

Friction point: The Washington Post reported Wednesday that the development of a tool aiming to predict how rising temperatures will impact extreme rainfall frequency had been delayed amid a Commerce Department review.

• A NWS spokesperson confirmed to the Post the move to delay the forward-looking part of the Atlas 15 project.
• But a National Oceanic & Atmospheric Administration spokesperson told Axios the administration "has not stopped the production of Atlas-15."
• The Commerce Department did not immediately respond to Axios' request for comment.

What they're saying: "With all these events, what they have in common is that in a warmer world, our atmosphere can hold more moisture," said meteorologist Shel Winkley, the weather and climate engagement specialist at Climate Central.

• In Texas, he said, the remnants of a tropical system primed the area for a heavy rain event over a part of the state prone for flash floods. In a stable climate, it still would have been a significant weather event. But with climate change, "we're essentially just loading up" systems, he said.
• Winkley continued, "We're adding a little bit more moisture, so that allows for higher rainfall intensity. It allows for a little more heavier rain to come down, and it allows for these weather systems to become more likely and ... more frequent."

By the numbers: For every 1°F of warming, the air can hold an extra 4% of moisture, per Climate Central.

• With climate change, the atmosphere becomes "greedier," Winkley said, meaning it can release more moisture — but it can also take more from the ground.

Zoom in: In New Mexico, rain fell over an area that had been previously hit by wildfires, increasing its risk of flash floods.

• Similarly, the ground in areas hit by drought — like Kerr County, Texas — may not be able to handle downpours, exacerbating flash flood risk.

The bottom line: With 2°C of global warming, a large majority of U.S. counties are likely to experience a 10% or higher increase in precipitation falling on the heaviest days, Winkley noted.

• "We understand that there's an even bigger increase ... where we're headed versus where we are now," he said.

Go deeper: How the Texas floods compare to the deadliest floods of the past decade

Editor's note: This article has been updated with comments from the NOAA.

The Trump administration is being sued by 20 states who are seeking to block the cancelation of a grant program that helped protect against potential natural disasters.

The big picture: "By unilaterally shutting down FEMA's flagship pre-disaster mitigation program, Defendants have acted unlawfully and violated core separation of powers principles," says the lawsuit that was filed in Boston, Mass., on Wednesday on the program, which has helped states, local and territorial governments and tribal nations work to reduce their hazard risk.

Driving the news: FEMA announced in April that it was ending the Building Resilient Infrastructure and Communities grant program and canceling all BRIC applications from fiscal years 2020-23.

• The post announcing the cuts that appears to have since been removed was titled, "FEMA Ends Wasteful, Politicized Grant Program, Returning Agency to Core Mission of Helping Americans Recovering From Natural Disasters."
• The suit led by Washington and Massachusetts argues that by "refusing to spend funds Congress directed toward BRIC or trying to spend them on other programs," the administration had violated the Constitution and unlawfully intruded on Congress' "power of the purse."

Zoom in: "The impact of the shutdown has been devastating. Communities across the country are being forced to delay, scale back, or cancel hundreds of mitigation projects depending on this funding," the states argue in the suit.

• Projects that have been in development for years, and in which communities have invested millions of dollars for planning, permitting, and environmental review are now threatened. And in the meantime, Americans across the country face a higher risk of harm from natural disasters.

For the record: Most of the states suing the Federal Emergency Management Agency, acting FEMA head David Richardson, the Department of Homeland Security and Homeland Security Secretary Kristi Noem are Democratic-led.

• The states suing the administration are: Arizona, California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Washington and Wisconsin.
• Representatives for the DHS and FEMA did not immediately respond to Axios' request for comment on Wednesday evening.

Go deeper: Governors accuse Trump admin of stalling disaster recovery

Editor's note: This is a breaking news story. Please check back for updates.

House Republicans broke the record Wednesday for the lower chamber's longest vote in history — for the second time in as many weeks.

Why it matters: It's the latest example of House Speaker Mike Johnson's strategy for dealing with his razor-thin majority — holding votes open for hours as he tries to sway opponents in his own party.

• Wednesday's record-setting vote was on a resolution setting the terms of debate on several measures, including the GENIUS Act, which would establish a regulatory framework for stablecoin issuers.
• That broke the previous record, set two weeks ago to the day amid grueling negotiations over President Trump's "big, beautiful bill."

The big picture: Before two weeks ago, the previous record was set in 2021, when the House took seven hours and six minutes on a procedural vote related to then-President Biden's Build Back Better legislation.

• This was Johnson's (R-La.) second attempt after the House floor ground to a halt Tuesday when the chamber rejected the procedural vote on the first try.
• Johnson is facing demands from hardliners to combine the GENIUS Act with two other crypto bills the chamber is considering this week.
• That would force the Senate to reconsider the legislation, likely leading to significant delays.

Between the lines: Wednesday's revote followed a meeting Trump said he held late Tuesday in the Oval Office with opponents — after which he declared victory, apparently prematurely.

• "I am in the Oval Office with 11 of the 12 Congressmen/women necessary to pass the GENIUS Act and, after a short discussion, they have all agreed to vote tomorrow morning in favor of the Rule," Trump posted on his Truth Social account.

A federal judge on Wednesday delayed making a ruling on whether Kilmar Ábrego García should be released from jail as he awaits trial, multiple outlets reported.

The big picture: The legal U.S. resident, who spent nearly three months in an El Salvador mega-prison before being returned to a Tennessee jail, is awaiting trial on human smuggling charges to which he has pleaded not guilty.

Driving the news: U.S. District Judge Waverly Crenshaw Jr. reportedly said during a hearing Wednesday that he plans to making a ruling next week on the Trump administration's case against Ábrego García.

• The administration has indicated it will deport Ábrego García if he's released pending trial.

Catch up quick: A federal judge ordered Ábrego García's release from prison last month, but another judge then ruled he should remain in jail for now over concerns from his legal team that he could be deported if freed while awaiting trial.

• The administration has accused Ábrego García of being a criminal and a member of the MS-13 gang, which his attorneys have denied.

Go deeper: Ábrego García alleges "severe beatings," torture in El Salvador prison

Some Senate candidates aren't hitting the fundraising circuit as if their political lives depend on it.

Why it matters: Most battleground senators facing reelection this cycle put up seven-figure fundraising numbers last quarter. It's a testament to the power of incumbency, indicating their own desire to stay in office.

• But Sen. Joni Ernst (R-Iowa) raised $723K this quarter, compared to $1.1 million during the same period six years ago.
• Former Rep. Mike Rogers, the GOP's preferred candidate in Michigan, raised $1.5 million, much of it through his joint fundraising committee. The figure is unlikely to scare Rep. Bill Huizenga (R-Mich.) out of a contested primary.

By the numbers: The Democrats' most endangered incumbent, Sen. Jon Ossoff (D-Ga.), had another impressive quarter, raising $10 million. That leaves him with $15.5 million cash on hand.

• Sen. Susan Collins of Maine, the only GOP senator from a state Democrats won in the presidential election last year, raised $2.4 million. She has $5.25 million cash on hand.

Zoom in: Sen. John Cornyn, facing a GOP primary challenge from Texas Attorney General Ken Paxton, raised $3.9 million for the quarter, although more than $3 million of that was to his joint fundraising committee.

• Paxton raised $2.9 million for the quarter and has $2.5 million cash on hand.
• Sen. Bill Cassidy (R-La.), who also faces a primary challenger, raised $2.1 million and has more than $9 million cash on hand.

What we're hearing: Ernst is telling colleagues she'll make a decision to run for reelection this fall.

• If she doesn't run, GOP strategists expect Rep. Ashley Hinson (R-Iowa) to jump in.
• Hinson raised $850,000 for the quarter and has $2.8 million cash on hand — funds she can transfer from her House race to a potential Senate one.
• Ernst campaign manager Bryan Kraber told us in a statement: "Instead of fundraising trips and meeting with millionaires, Senator Ernst has been hard at work advancing President Trump's agenda and delivering a tax break for hardworking Iowans."

Go deeper: Rogers, who struggled with fundraising in his 2024 loss to Sen. Elissa Slotkin (D-Mich.), does have some outside support from a super PAC this cycle. The Great Lakes Conservative Fund raised more than $5 million to support his candidacy, according to The Hill.

• His quarterly numbers this year are double the amount he raised in the first quarter after he announced in 2023.
• "I'm in this fight for Michigan, and we're going to win it for Michigan," Rogers said when he announced his Q2 numbers.

The Senate is plowing ahead Wednesday evening on $9 billion in cuts to PBS, NPR and foreign aid, threats from Democrats be damned.

Why it matters: Democratic leaders — and some high-level Republicans — say budget rescissions undermine the trust they need to pass the annual bipartisan spending deals.

• Senate Minority Leader Chuck Schumer (D-N.Y.) has warned Republicans they'll be left to figure out a potential government shutdown on their own if they keep the partisan cuts coming.
• But GOP leaders insist they aren't worried.

Between the lines: Democrats have a "valid concern" about making spending deals just to be undone through rescissions, Sen. Mike Rounds (R-S.D.) told reporters Wednesday.

• "We've actually shared with folks from the administration that the bigger challenge for them is — appropriations take 60 votes," Rounds said.

The other side: Majority Leader John Thune (R-S.D.) told Axios he didn't think the appropriations would be any more difficult because of the rescissions package.

• "I think we can have a bipartisan process," he said, pointing to the appropriations bills that have already been voted out of committee with Democratic support.
• He said the Senate could even start voting on appropriations bills or the National Defense Authorization Act as early as before the August recess.
• "I think our first markup went well. The second one was mixed, but we've reported bills out of committee. I expect we're going to report more tomorrow," Senate Appropriations Chair Susan Collins (R-Maine) said on whether rescissions will complicate her job.

The simple math: Government spending bills require 60 votes to advance in the Senate.

• But rescission packages — which cut specific spending from a budget — can be passed with a simple majority, as they're set to tonight.
• "This is beyond a bait-and-switch — it is a bait and poison-to-kill," Schumer said earlier this month.

The bottom line: Votes on rescission packages originating from the White House are rare.

• It hasn't been done successfully since 1999.

Mainstream Senate Democrats are starting to echo their party's base, which has soured on supporting Israel.

Zoom in: Sen. Elissa Slotkin (D-Mich.), a moderate Democrat from a swing state, this week slammed the Israeli government for the lack of humanitarian aid in Gaza and violence by Israeli settlers in the West Bank.

• "There are times when, to me, it doesn't look like [Prime Minister Benjamin Netanyahu] is prioritizing the hostage situation," Sen. Tim Kaine (D-Va.) told Axios. "Certainly, there's times when it looks like Hamas does not want a deal."
• "I think it's way overdue to have Democratic members of Congress speak up and speak out about the humanitarian disaster in Gaza," Sen. Chris Van Hollen (D-Md.), another moderate who has criticized Israel since the start of the war, told Axios on Wednesday.

The big picture: The comments are part of a significant shift in tone toward Netanyahu from the center of the Democratic Party.

• Slotkin's post on X this week addressed the killing of an American by Israeli settlers in the West Bank and slammed Netanyahu for a lack of accountability.
• Slotkin, a former CIA analyst who spent time in Iraq, told Axios on Wednesday she has heard "lots of negative feedback" about her post following a "very rough weekend in the Middle East."
• "I say strong things about Iran and how I'm glad that their nuclear capability has been put back, and I also hear a negative response to that," Slotkin said. "So I just try and objectively call balls and strikes."

The other side: Sen. John Fetterman (D-Pa.) has emerged as one of the strongest pro-Israel voices in the party.

• Fetterman offered his full support of President Trump's decision to attack Iran last month, saying the U.S. commitment to Israel must be "absolute."

The bottom line: Progressive Sen. Bernie Sanders (I-Vt.) told Axios that lawmakers are starting to understand "this is not just a moral issue, it's a political issue."

• Van Hollen, a leading Senate Democratic voice against the Netanyahu government, told Axios he's happy to have more Democrats speak up.
• "We've seen a pattern of impunity from the Netanyahu government — no accountability for these killings — and we've seen a pattern of indifference from the U.S. government," Van Hollen said. "I'm glad more people seem to be paying attention."

Expelling migrants to third-countries that are not their place of origin is becoming a cornerstone of President Trump's deportation strategy.

The big picture: The administration's increasing number of third-country deportation agreements showcases a dogged desire to pursue every possible avenue to fulfill Trump's promise to deport record numbers of noncitizens.

Catch up quick: The Trump administration restarted deportation flights after the Supreme Court ruled last month that the Department of Homeland Security could resume sending migrants to countries that were not their place of origin.

• The decision put a lower court order that required the government to give immigrants adequate time to challenge their deportations on hold.

State of play: Border czar Tom Homan said the U.S. aims to sign third-country deportation agreements with "many countries" to support the administration's deportation plans.

• The administration has either approached or plans to approach roughly 51 countries to accept non-citizen deportations from the U.S., per a June report New York Times report.
• At least two of those countries, Eswatini and South Sudan in Africa, have accepted flights from the U.S. since the report came out.
• The DHS did not immediately respond to Axios' Wednesday evening request for comment on how many of the countries have been approached.

Thought bubble via Axios' Dave Lawler: The administration has reportedly discussed safe third-country agreements with many countries for which the "safe" description is very much in question.

• Take Libya or South Sudan, both of which have been wracked by instability and violence for years. Several other countries involved in these deals are among the poorest in the world.
• The prospect of deporting migrants thousands of miles away to unfamiliar and often unstable countries has raised alarm among human rights groups, but the idea has strong support within the administration.

Here are the countries that have already accepted deportees who are not their citizens:

Eswatini

Five migrants from Cuba, Jamaica, Laos, Vietnam and Yemen were deported to the tiny African nation of Eswatini on Tuesday, the DHS announced.

• DHS spokesperson Tricia McLaughlin wrote on X that the flight was carrying individuals who had been convicted of a range of crimes that included murder, homicide, and child rape.

El Salvador

The Trump administration sent at least 238 Venezuelan migrants to a notorious El Salvadorian maximum security prison under the Alien Enemies Act in March, claiming that they were terrorists and members of a violent gang.

By the numbers: An April CBS News report found 75% of the migrants sent to the prison had no criminal record.

Mexico

Mexico has received roughly 6,000 non-Mexicans from the U.S. as of late April, per Mexican President Claudia Sheinbaum.

• Sheinbaum said the non-Mexicans her country was accepting for "humanitarian reasons" comprise a small number of the nearly 39,000 migrants the U.S. has deported to Mexico since Jan. 20.

Guatemala

Guatemalan President Bernardo Arevalo announced in February that his country had agreed to accept third-country nationals from the United States and would be ramping up deportation flights from the U.S. by 40%.

• Arevalo told NBC News that the agreement was not supposed to provide a pathway for people to seek asylum in Guatemala. Rather, the country would serve as a pit stop in the process of sending people back to their home countries.

Costa Rica

Costa Rica accepted roughly 200 third-country nationals from two different U.S. flights through the end of February, per a May Human Rights Watch report.

• On the planes were at least 81 children and two pregnant women.

What they're saying: After announcing the expulsion agreement, Costa Rican President Rodrigo Chaves said his country was helping its "economically powerful brother to the north."

• Costa Rican officials have said the U.S. will cover the costs of the deported people's stay in the country, and that the arrangement was expected to be a temporary stop in the repatriation process.

Panama

The U.S. has deported hundreds of people to Panama since February as part of a deal for the country serve as a "bridge" while the U.S. bears the financial costs, per AP.

• The migrants are from countries including Iran, India, Nepal, Sri Lanka, Pakistan, Afghanistan and China.

Rwanda

The U.S. paid the Rwandan government $100,000 to accept an Iraqi citizen in April and agreed to take 10 more deportees, the New York Times reported.

• Negotiations reached over the Iraqi citizen "proved the concept for a new removal program, according to the report.

South Sudan

The U.S. deported eight men to South Sudan in July, after a legal battle diverted their deportation flight to Djibouti for several weeks.

• Some of the men deported were from Cuba, Laos, Mexico, Myanmar and Vietnam.

Kosovo

This landlocked Balkan nation in Europe agreed to host 50 noncitizen deportees from the U.S. in June.

• The deal would allow noncitizens to be "temporarily relocated" before being sent back to their home country.

The intrigue: Kosovo reportedly agreed to accept the noncitizens from the U.S. in the hope that the administration will continue to lobby other nations to recognize the small country's independence.

Go deeper: Supreme Court allows Trump to restart deportations to non-origin countries

The Transportation Security Administration's security protocols could be in for another shakeup — this time involving the long-standing limits on carry-on liquids.

The big picture: Homeland Security Secretary Kristi Noem said TSA is looking to modify the liquid rule Wednesday at the Hill Nation Summit.

• Noem's comments come eight days after TSA ended the "shoes off policy" and more than two months after the Real ID enforcement deadline.

Driving the news: Noem said she's questioning "everything TSA does," hinting that the next big update could target the 3.4-ounce liquid limit.

• "The liquids, I'm questioning," Noem said. "So that may be the next big announcement is what size your liquids need to be," she added.
• "We have put in place in TSA a multilayered screening process that allows us to change some of how we do security and screening so it's still as safe."

TSA liquid restriction

State of play: Currently, TSA rules say travelers are "allowed to bring a quart-sized bag of liquids, aerosols, gels, creams and pastes in your carry-on bag and through the checkpoint."

• These items are limited to travel-sized containers that are 3.4 ounces or less per item.
• The rule was put in place in 2006 after authorities thwarted a plot to use liquid explosives.

The fine print: Larger liquid items, like shampoo bottles or water bottles, must go in checked baggage — with some exceptions for medications and baby formula.

• The TSA lists what items are allowed to bring in carry-on or checked bags on its website.

When will TSA liquids rule change?

What's next: Noem did not provide a timeline nor specifics for what changes might be coming.

• "Hopefully, the future of an airport, where I'm looking to go is that you walk in the door with your carry-on suitcase, you walk through a scanner and go right to your plane," Noem said, noting it could take "one minute."
• Noem told The Hill after the summit that this was "not certainly anything we'll be announcing in the next week or two."
• "But we're working to see what we can do to make the traveling experience much better and more hospitable for individuals, but also still keep safety standards," she said.

More from Axios:

• Trump says Coca-Cola has agreed to use real cane sugar in Coke
• Tariffs and tight budgets reshape back-to-school shopping
• Why the end of pennies could trigger a small "rounding tax"

Maurene Comey, the federal prosecutor who worked on both Jeffrey Epstein and Ghislaine Maxwell's criminal cases, was fired on Wednesday, Politico first reported.

The big picture: It was not immediately clear why Maurene Comey was dismissed from her job, but her firing is also notable because she is the daughter of former FBI director James Comey, who was fired by President Trump during his first term.

• Her father is reportedly under investigation by the Trump administration in connection with the Russia probe.

Context: Before her firing, Maurene Comey led the prosecution of Sean "Diddy" Combs in a sex trafficking and racketeering trial. The jury cleared him of racketeering conspiracy and sex trafficking charges but convicted him of prostitution-related charges.

• She served for nearly a decade as an assistant U.S. attorney in the Southern District of New York, according to her LinkedIn profile.

Zoom in: Maurene Comey previously successfully prosecuted gang members, drugs and firearm traffickers and murderers, according to the DOJ website.

• She also led the prosecution of Epstein's assistant Ghislaine Maxwell. who was convicted of sex trafficking and sentenced 20 years in prison.
• Representatives for the White House and the Department of Justice did not immediately respond to Axios' requests for comment on Wednesday evening.
• The Southern District of New York declined to comment.

The intrigue: Leading voices in Trump's MAGA base have for months called for Maurene Comey's ouster.

• Among them was far-right activist Laura Loomer, who responded to news of her firing by calling on X for the dismissal of Maurene Comey's husband, Lucas Issacharoff, an assistant U.S. attorney in the civil rights division.
• Loomer has also been leading MAGA calls for the release of the Epstein files, after the Trump administration said there was no evidence to suggest the disgraced financier was murdered or kept a "client list."
• Maurene Comey successfully argued in a court filing last year that the disclosure of investigative records concerning Epstein would likely interfere with Maxwell's appeal.

Editor's note: This is a breaking news story. Please check back for updates.

President Trump said Wednesday that Coca-Cola has agreed to use "REAL Cane Sugar in Coke in the United States."

Why it matters: The beverage giant has been under pressure to reduce sugar in its drinks.

• The company currently uses high fructose corn syrup in the original soda recipe, according to its website.

What they're saying: Trump said he's been speaking with the Atlanta-based company about using cane sugar, which it does in its Mexican Coke.

• "I'd like to thank all of those in authority at Coca-Cola. This will be a very good move by them — You'll see. It's just better!" Trump wrote on Truth Social.

The other side: It is not immediately clear whether Coke plans to change the original recipe or introduce a new product.

• "We appreciate President Trump's enthusiasm for our iconic Coca-Cola brand," the company said in a statement to Axios. "More details on new innovative offerings within our Coca-Cola product range will be shared soon."

Zoom in: Coca-Cola CEO James Quincey told investors in April that "we continue to make progress on sugar reduction in our beverages."

• He noted that the company has "done this by changing recipes as well as by using our global marketing resources and distribution network to boost awareness of and interest in our ever-expanding portfolio."

The intrigue: President Trump is an avid Diet Coke drinker who famously had a "Diet Coke button" installed in the Oval Office to obtain the soda quickly.

• Diet Coke does not have sugar.

State of play: Coca-Cola has been actively working to mitigate President Trump's imposition of tariffs on imported aluminum, which the company uses to make soda cans.

• Quincey told investors in February that "if aluminum cans become more expensive, we can put more emphasis" on plastic bottles.

The big picture: Brazil is the No. 1 producer of cane sugar in the world, according to the USDA.

• Trump has said a new 50% U.S. tariff on Brazilian imports will start Aug. 1.
• Sugarcane is also produced in Florida, Louisiana and Texas, the USDA said.

Editor's note: This story has been updated with information throughout.

Sen. Elizabeth Warren (D-Mass.) will defend the Federal Reserve in a speech on Wednesday, an unlikely ally for the Fed as it faces unprecedented attacks from the Trump administration.

Why it matters: Even one of Fed chair Jerome Powell's toughest, most consistent critics won't back the White House argument.

• The rare support from the influential lawmaker, who is the top Democrat on the Senate Banking Committee, shows how the party will hit back at White House pressure to oust Powell.

What they're saying: "When [Trump's] initial attempts to bully Powell failed, Trump and Republicans in Congress suddenly decided to look into how much the Fed is spending on building renovations," Warren will tell a group of financial policymakers and economists at the Exchequer Club of Washington, D.C.

• In the remarks — first seen by Axios — Warren acknowledges the topsy-turvy world in which she defends the institution that she has slammed for years.
• "Independence does not mean impunity and I have long pushed for more transparency and accountability at the Fed. But give me a break," Warren will say in a speech that slams Trump economic policy.
• "[N]obody is fooled by this pretext to fire Chair Powell. And markets will tank if he does."

The big picture: The new attack line among top Trump administration officials and some Republican lawmakers — renovations of the Fed's offices are too costly and over-the-top.

• President Trump on Tuesday said that the renovations issue could be grounds to fire Powell, a legally dubious move.

Flashback: Just a few weeks ago, Warren co-sponsored legislation with Florida Republican Sen. Rick Scott that would force the Fed's watchdog to be Senate-confirmed — a move aimed at stepping up oversight of the central bank.

• Warren has called Powell a "dangerous man" in her criticism of the Fed's bank regulation policies.
• She is among the few lawmakers who voted against his confirmation in 2017; she did so again when former President Biden renominated Powell in 2021.
• "Look, I don't think [Powell] should be chairman of the Federal Reserve. I have said it as publicly as I know how to say it. I've said it to everyone," Warren told NBC's "Meet the Press" in 2023.

MAGA is recoiling at President Trump's increasingly personal attacks on his own followers over Jeffrey Epstein, opening the most bitter divisions yet between the president and the GOP base.

Why it matters: MAGA has at times grumbled over Trump's handling of foreign affairs, immigration and other sporadic issues. But the president's growing irritation with his supporters' Epstein theories and adamance that they're illegitimate is widening the most significant rift yet.

What they're saying: MAGA did not take kindly to Trump's latest post Wednesday, which included calling his followers' theories a "hoax," claiming they're doing Democrats' bidding and waving away "PAST supporters" discussing Epstein instead of his recent policy wins.

• "By continuing to go to war with the online MAGA class, he only continues to keep his unpopular stance on the issue front of mind," one right-wing influencer told Axios. "It's definitely become an inflection point online."
• As one MAGAworld operative put it: "Villainizing your base for caring about the thing you told them to care about is never a good strategy."

Zoom in: Sources suggested to Axios that Trump was fundamentally missing MAGA's commitment to Epstein disclosures, and said belittling that stance risked alienating even his most committed supporters.

• Calls for a special counsel spiked Wednesday, with sources telling Axios that it would take the launch of an independent investigation into Epstein's operation and supposed intelligence ties to satiate the base.
• Raheem Kassam, the National Pulse's editor-in-chief, said: "President Trump sat for interviews during the campaign and committed to releasing more Epstein files. If he's changed his mind, he should at least be willing to explain to his voters why."
• "If he maintains that he no longer wants the support of those who want more information, his terms may be acceptable to more people than he realizes."

The big picture: The administration has been torn over how to course-correct since its handling of evidence in the convicted sex offender's case caused an uproar among its base since last week.

• MAGA for years has been convinced Epstein was murdered in an attempt to protect supposedly rich and powerful clients, and suggestions to the contrary have already set off multiple convulsions.

Catch up quick: Trump has waffled in recent days between expressing surprise at his base's fixation on Epstein and vowing to release details on the financier's sex trafficking operation and death.

• The president on Tuesday said Attorney General Pam Bondi should release "credible evidence" — comments that served as a steam valve for MAGA and that he repeated in the Oval Office Wednesday.
• Trump's Truth Social post spiked the temperature again Wednesday morning.

Between the lines: Few things are more foundational to MAGA than fighting against the "deep state," and Trump and his allies spun up the right over Epstein for years.

• Now, Trump's pushing the base to not care so much about a microcosm of a singular concern for MAGA, and the base is pushing back.
• "This is a proxy for Trump getting owned by the deep state," the MAGAworld operative said.

Reality check: There have been divides between Trump and MAGA before — including on Ukraine and Iran — that ultimately did not drive supporters away. And this movement remains reluctant to break from the only person who has ever served as its leader.

• "Time and again, we see forces aligned against President Trump concocting narratives designed to try to split his historic America First movement but those supposed divisions always fail to materialize. At what point is this the boy who cried wolf?" Breitbart News Washington Bureau Chief Matt Boyle told Axios.

Go deeper:

• Trump disavows "PAST supporters" who believed "Jeffrey Epstein Hoax"
• How the DOJ's Epstein memo led to a Dan Bongino White House blowup
• MAGA's siege mentality shadows Trump's "Golden Age"

A new proposal in Congress would stop federal immigration agents from detaining and possibly deporting U.S. citizens.

Why it matters: U.S. citizens aren't supposed to be arrested or detained unless agents allege they're breaking laws. But reports of citizens of Latino descent being detained — or stopped and asked to prove citizenship — are rippling through Latino communities nationwide.

• Critics say reports of ICE detaining citizens are instances of racial profiling and overzealous policing — something the U.S. Department of Homeland Security angrily denies.

Zoom in: U.S. Rep. Pramila Jayapal (D-Wash.) introduced legislation Wednesday to formally block Immigration and Customs Enforcement from detaining or deporting U.S. citizens.

• Dubbed the "Stop ICE from Kidnapping US Citizens Act," the bill would set penalties for ICE agents who unlawfully hold U.S. citizens and place them in immigration proceedings.
• The proposal is co-sponsored by several Democrats and will likely face a long-shot bid in the GOP-controlled House.

Zoom out: The allegations of U.S. citizens being detained come as ICE continues raids in predominantly Latino communities in the Los Angeles, Chicago, Denver, Philadelphia, Phoenix and San Diego areas; cities in Texas, New Mexico, New York and Florida; and agricultural centers, such as central California.

• In May, ICE briefly detained Florida-born Leonardo Garcia Venegas from his job at a construction site in Foley, Alabama. Agents alleged that Garcia's Real ID was fake, according to Noticias Telemundo. He alleged agents forced him to his knees and handcuffed him.
• Immigration officials held U.S. citizen and Albuquerque resident Jose Hermosillo for 10 days in Arizona's Florence Correctional Center after arresting him, and didn't believe him when he said he was a citizen, per Arizona Public Media.
• Two U.S. citizen children in April were deported to Honduras after ICE detained their mother during a routine check-in.

What they're saying: "ICE is acting like a rogue force, kidnapping and disappearing people off the streets with no due process," Jayapal said in a statement.

• "When ICE is conducting immigration enforcement, arresting and detaining U.S. citizens is illegal — and deporting U.S. citizens is illegal, full stop."

Tricia McLaughlin, a Department of Homeland Security spokesperson, told Axios that recent reports of citizens wrongly being arrested are false — and that "the media is shamefully peddling a false narrative" to demonize ICE agents.

• "DHS enforcement operations are highly targeted and are not resulting in the arrest of U.S. citizens," McLaughlin said. "We do our due diligence."

Yes, but: An Axios review of news reports, social media videos and claims by advocacy groups about raids since President Trump took office found several instances in which U.S. citizens alleged they were wrongfully detained.

• ICE hasn't released statistics on such detentions in months.

Flashback: In May, House Republicans killed a measure in Trump's big budget bill that would have stopped ICE from being able to deport or detain U.S. citizens.

• The amendment, sponsored by Jayapal, would have prevented any funds earmarked for ICE from being used to detain or deport citizens.
• "The fact that Democrats ... feel the need to even introduce an amendment that says ICE cannot deport U.S. citizens is bats**t crazy," Rep. Ted Lieu (D-Calif.) said on the House floor.

Go deeper: ICE accused of racial profiling in detentions of Latino U.S. citizens

• U.S. Latinos fear new mass deportations may target all Hispanics

President Trump denied he was on the verge of firing Fed chair Jerome Powell, despite multiple news reports Wednesday suggesting he'd told congressional Republicans he was close to doing so.

Why it matters: Trump has the market on a knife's edge, waiting to see whether he throws out more than a century of central bank independence to get what he wants on interest rates.

Driving the news: The New York Times reported Wednesday that Trump has drafted a letter firing Powell and asked GOP figures for feedback.

• Bloomberg quoted an unnamed White House official as saying Trump was likely to fire Powell soon.
• CBS News also reported that Trump had asked House Republicans about ousting Powell, and indicated he was inclined to do so.

Yes, but: "We're not planning on doing it. It's highly unlikely," CNBC quoted Trump as saying.

• Trump also told the "Just the News, No Noise" TV show, in an interview set to air Thursday, that he wasn't planning to fire Powell.

The big picture: Trump wants interest rates to be multiple percentage points lower than they are now, and he has been incessant about demeaning Powell and demanding a rate cut.

Editor's note: This is a developing story. Please check back for updates.

Three things can simultaneously be true: that it would be reasonable for the Federal Reserve to cut interest rates; that its headquarters renovation is too expensive; and that the Trump administration's attacks show why central banks are designed to be independent in the first place.

The big picture: The whole reason the U.S. and other advanced economies grant their central banks a measure of independence is to instill confidence that they won't make policy based on what's most convenient in the near-term for elected leaders — such as cutting rates to save the fiscal authorities cash.

• Yet that is exactly the grounds President Trump has repeatedly invoked as the reason he believes the Fed should cut rates drastically.

Driving the news: Bloomberg reported Wednesday that a White House official said Trump is likely to attempt to fire Fed chair Jerome Powell soon. CBS News reported that Trump circulated the idea to receptive Congressional Republicans on Tuesday.

State of play: The 3-percentage-point rate cut Trump has called for would put the Fed's policy in ultra-stimulative mode at a moment when unemployment is low, inflation remains elevated, and tariffs threaten a new price surge in the months ahead.

• The core of the argument playing out right now — and potential litigation, should Trump attempt to fire Powell for cause — is whether the U.S. will stick with its tradition of handing control over the money supply to technocrats as opposed to the president.

Between the lines: It's an important new chapter in the nation's long, tumultuous history with central banking.

• That includes key moments like Andrew Jackson's war with the Second Bank of the United States in the 1830s and the Treasury-Fed accord of 1951 that delineated the roles of the two institutions in managing government debt.

Yes, but: That doesn't mean that the Fed is getting things exactly right, either in its monetary policy or its real estate decisions.

• There is a pretty solid case for interest rate cuts right now, even if not the one Trump makes, and $2.5 billion truly is a massive amount of money to spend on renovating a couple of historic buildings.

Zoom in: The argument for rate cuts that could persuade independent-minded technocrats isn't tied to Trump's calls to save the federal government money on borrowing costs, but rather something rooted in current economic conditions.

• The argument would hold that the Fed's current target interest rate, around 4.4%, is still in territory that officials consider "restrictive," deliberately slowing economic activity to try to bring down inflation.
• But inflation has been mostly on a gradual downward path for three years now and is not far from the Fed's 2% target. Tariffs might create a price surge, but that should be a one-time event that policymakers ought to look past.
• Moreover, there are growing signs of weakness in the labor market, including low hiring rates and weak job creation in cyclical sectors.

Zoom out: The Fed's renovation — fueled by overhauling its historic 1935 headquarters building on the National Mall and a second historic building next door, with a tunnel connecting the two — really is costing a lot of money, ultimately borne by taxpayers.

• But it's also the case that the Federal Reserve Act gives the Board of Governors independent authority over its real estate precisely to insulate it from political pressure.
• And the Trump administration has left little doubt that the president's discontent over rates is driving the new scrutiny of the project.

What they're saying: "If the Fed were to lower interest rates this month to 1%, White House officials would stop talking about beehives and fancy elevators," Sarah Binder, a political scientist at George Washington University who has studied Fed governance, tells Axios.

• If Trump attempts to remove Powell from his job for cause before his term expires 10 months from now, it would set up a legal battle — very likely ending up before the Supreme Court — with long-term consequences for how U.S. economic policy is run.

The bottom line: "How far would the Court be willing to go to insulate the Fed if Powell were charged with 'neglect of duty?'" Binder asks. "Remains to be seen!"

The Trump administration has asked Israelx to halt its strikes on Syrian government targets and to open direct talks with Damascus, a senior U.S. official told Axios on Wednesday.

Why it matters: U.S. officials are highly concerned that the Israeli attacks — including on Syrian military headquarters in Damascus and near the presidential palace — could destabilize the new Syrian government.

• The official said the past 48 hours could seriously undermine progress toward a new security agreement between Israel and Syria as a first step toward normalization. Those discussions had previously been showing significant progress, the official said.
• Secretary of State Marco Rubio told reporters Wednesday that the U.S. was "very concerned" about the Israeli strikes in Syria and wants the fighting to stop.

Behind the scenes: U.S. special envoy for Syria Tom Barrack conducted several calls on Tuesday and Wednesday with Prime Minister Benjamin Netanyahu's top adviser Ron Dermer to push for deescalation.

• "We told the Israelis to stand down and take a breath," the senior U.S. official said, adding that the administration is pushing for direct talks between Israel and Syria to solve the crisis.
• Dermer's office did not immediately respond to a request for comment.

Catch up quick: In recent days, there have been clashes between a Druze militia and a Bedouin gang in the city of Suwayda in southern Syria. There has been sporadic violence between members of the two minority groups since dictator Bashar al-Assad was toppled in December and replaced by ex-militant Ahmed al-Sharaa.

• When the Syrian government sent in tanks to try to restore order, the Israeli air force attacked those tanks. The U.S. official said Syria had notified Israel in advance about the tanks and said its response was not directed at Israel.
• But Israeli officials claim the tanks entered a zone that Israel, which is occupying parts of western Syria, has demanded be demilitarized of heavy weapons.
• Over the last 24 hours, clashes continued in Suwayda between the Druze, the Bedouins, militias affiliated with the Syrian government and Syrian security forces. According to the Syrian human rights observatory in London, at least 250 people have been killed.

Driving the news: The leaders of the Druze community in Israel pressed the Israeli government to intervene, claiming militias affiliated with the Syrian government were carrying out a massacre of Druze in Suwayda.

• On Tuesday night local time and into Wednesday morning, Israel escalated its strikes against Syrian government targets in southern Syria and in Damascus.
• On Wednesday around noon local time, hundreds of Israeli Druze broke through the border fence with Syria in the Golan Heights and entered the buffer zone between the countries in an attempt to reach Suwayda.
• Israeli officials claim the strikes are intended to protect the Druze minority in Syria as part of its commitment to the Druze community in Israel, and that Syrian militias affiliated with the government have been killing dozens of Druze.

However, the senior U.S. official said U.S. intelligence does not show any involvement of the Syrian government in atrocities in Suwayda.

• The U.S. official said that the Israeli government told the Trump administration it sees what happened in Suwayda as an Oct. 7 like attack on the Druze community.
• The U.S. official said Israel's actions are influenced by domestic political pressure from the Druze community in Israel — which comprises around 2% of the population — on the Netanyahu government.

The latest: Despite the U.S. push for calm, the Israel Defense Forces said in a statement that it's sending reinforcements to the border with Syria to facilitate more strikes and stop the attacks against the Druze.

• "Israel will not allow a massacre of Druze in Syria," the statement says.