The penny coin is getting phased out, a cost-cutting move that could ripple through consumer behavior, retailers' pricing strategies and cash transactions.

Why it matters: It'll be harder to make sense out of cents and get exact change after the one-cent coin's upcoming demise.

• The penny's removal may impact how prices are rounded, potentially affecting both businesses and consumers — especially those who rely on cash.

Pinching pennies: When will penny production stop?

The big picture: President Trump directed the Treasury to stop producing new pennies back in February. The U.S. Treasury confirmed Thursday the U.S. Mint will stop making the coins early next year.

• The Mint will stop making pennies after it runs out of the blank templates used to make the one-cent coins, the Treasury Department told Axios.
• The final order of blanks was placed this month, a Treasury spokesperson said.

The Canadian penny was discontinued for production in 2012.

• Australia and New Zealand stopped producing their lowest-denomination coins decades ago.

Cost to make penny, nickel, dime and quarter

By the numbers: The cost of making a penny increased 20% in the 2024 fiscal year, the Treasury told Axios.

• Over the past 10 years, the total production cost of the penny has risen from 1.3 cents to 3.69 cents per penny.
• The Mint said reported losing $85.3 million on the nearly 3.2 billion pennies it produced in the 2024 fiscal year. The Treasury said stopping production will save the government $56 million a year in reduced material costs.

Yes, but: The nickel is even more expensive to make and costs 13.78 cents to make each 5-cent coin, the Mint's 2024 annual report shows.

• It costs 5.76 cents to make the 10-cent dime and 14.68 cents to make the 25-cent quarter.

The death of prices ending in 99 cents, penny loafers

State of play: The Treasury told WSJ businesses will need to start rounding up or down to the nearest 5 cents when there's not enough pennies to use in everyday cash transactions.

• Cashless transactions will still be priced at exact change.
• State and local governments should provide guidance to retailers so that sales taxes are properly collected, WSJ reports.
• This is expected to change how retailers price items and end 99-cent pricing that has been known to influence buying decisions.

The intrigue: Will the penny loafer also get a rebrand with the penny's disappearance?

• "It will be a dime loafer," Martha Stewart said in February at New York Fashion Week, the New York Times reported.

Who uses cash over credit and debit cards?

Zoom in: Cash accounted for 16% of all payments, according to the Federal Reserve's 2024 Diary of Consumer Payment Choice.

• It's the third most-used payment type after credit and debit cards.
• Consumers younger than age 55 used cash for just 12% of payments in 2023, compared to 22% for those age 55 and older.

Between the lines: Low-income and older Americans are more likely to use cash, raising concerns about fairness and unintended consequences if rounding isn't consumer-friendly.

• Jay Zagorsky, author of the book "The Power of Cash: Why Using Paper Money is Good for You and Society," told the Associated Press Congress must include language in any proposed legislation to require rounding up in pricing.
• This would eliminate demand for pennies, said Zagorsky, a Boston University professor.
• "If we suddenly have to produce a lot of nickels — and we lose more money on producing every nickel — eliminating the penny doesn't make any sense," Zagorsky said.

Billions of coins in jars and piggybanks

Follow the money: A 2022 Federal Reserve report found $14 billion — about 60% of actively circulating coins — is in jars.

• Coinstar CEO Kevin McColly told Axios that the nation has billions of coins sitting immobile in different parts of the system.
• "Essentially, we have enough coins, but they're not flowing properly through our economy, creating unnecessary pressure to mint new ones despite adequate existing supply," McColly said, adding Coinstar has 50 million annual transactions through its kiosks.

More from Axios:

• What to know about the No Tax on Tips Act and who it affects
• Retail heavyweights torn over how to handle tariff pain
• Google upgrades AI tools for shopping

President Trump gave the commencement address for the U.S. Military Academy at West Point on Saturday, in his speech refusing to cut the $1 trillion military budget and praising who he called the "first West Point graduates of the Golden Age."

The big picture: The speech follows the president's directive via Defense Secretary Pete Hegseth to launch a nationwide review of military academies targeting for cuts any initiative perceived to enhance diversity, equity and inclusion.

What he's saying: Trump referenced his anti-DEI focus, bragging that he's "liberated our troops from divisive and demeaning political trainings."

• "There will be no more critical race theory or transgender for everybody forced onto our brave men and women in uniform or anybody else for that matter in this country," the president said, promoting his bans on transgender service members and "men playing in women's sports."

Zoom in: He also championed building up the Armed Forces, "a build up like we've never had before," Trump called it.

• He promised new "stealth planes" and again publicized his mass deportation plan and promised Golden Dome missile defense shield to be completed before he leaves office.
• Then, he moved on to promoting his trade policies, accusing other countries of "ripping off" America.
• "You have to watch what we're doing on trade," he said.

See other moments from the commencement:

Go deeper:

• As Trump's ban looms, transgender service members defend their fitness to serve
• Trump and Hegseth unveil $175 billion plans for Golden Dome missile shield
• Trump's trade war de-escalation is over (for now)

Planned Parenthood North Central States said Friday that it plans to close over a third of its health centers across Minnesota and Iowa and lay off dozens of staff members in light of looming federal funding cuts and other budget constraints.

State of play: The announcement from Minnesota's largest abortion provider came just one day after the U.S. House passed a reconciliation bill that it says would "defund" Planned Parenthood and make deep cuts to Medicaid funding.

Driving the news: Leaders of the regional affiliate cited that move, along with the Trump administration's decision to freeze $2.8 million in Title X funds used for birth control and cancer screenings and a proposal to cut teen pregnancy prevention aid as key factors in the decision to consolidate its centers.

• Shifting patient preferences and broader challenges facing the health care sector, including stagnant reimbursement rates and staff shortages, also contributed, it said in a release.

By the numbers: Planned Parenthood North Central States (PPNCS) says it provides sexual and reproductive health care, including abortions, to an estimated 93,000 people across Iowa, Minnesota, Nebraska, North Dakota, and South Dakota each year.

• Over 30% of its patients rely on Medicaid, per a release.

Between the lines: While federal funds generally cannot be used for abortions, critics of abortion rights have long sought to prevent any taxpayer money from flowing to the organization.

What they're saying: PPNCS president Ruth Richardson said the "heart wrenching" decision to consolidate operations was meant to "ensure Planned Parenthood is here for years to come."

• "We have been fighting to hold together an unsustainable infrastructure as the landscape shifts around us and an onslaught of attacks continues," she said in a statement.

Zoom in: The list of eight sites slated to close in the coming year includes several in the Twin Cities metro. Four Iowa health care centers — including its only facility that provides abortions in that state — and two in Greater Minnesota will also shutter:

• Ames Health Center (Ames, Iowa)
• Alexandria Health Center (Alexandria, Minnesota)
• Apple Valley Health Center (Apple Valley, Minn.)
• Bemidji Health Center (Bemidji, Minnesota)
• Cedar Rapids Health Center (Cedar Rapids, Iowa)
• Richfield Health Center (Richfield, Minnesota)
• Sioux City Health Center (Sioux City, Iowa)
• Urbandale Health Center (Urbandale, Iowa)

Plus: PPNCS will also lay off 66 staff members and offer 37 others the opportunity to be reassigned as part of the reorganization.

Zoom out: Minnesota has seen an increase in both abortions and out-of-state patients seeking abortion care in the wake of the 2022 U.S. Supreme Court decision overturning Roe v. Wade.

• Abortions in Iowa, meanwhile, dropped 60% in the first six months after the state began enforcing one of the nation's strictest bans.

The bottom line: Planned Parenthood said its 15 remaining health centers across the chapter's region, including about a dozen in Minnesota and Iowa, will remain open.

• Those sites, combined with virtual care, serve about 80% of its current patient population.
• "Make no mistake: care may look different but Planned Parenthood North Central States is here to stay," Richardson said.

OpenAI's latest power move in the AI race is to cast CEO Sam Altman as a Steve Jobs for the new era.

Why it matters: Jobs remains Silicon Valley's most revered founder, and since his 2011 death no industry figure has been able to match his success at product innovation, strategy and marketing.

Driving the news: This week OpenAI nabbed Jony Ive, the design guru who closely collaborated with Jobs to shape iconic devices like the iPhone and the iPod, to oversee a big new bet on AI hardware.

• OpenAI's promotional materials paired Altman and Ive in a video that strongly implies Altman's team-up with the Apple veteran makes him Jobs' natural successor.
• Altman has even invoked Jobs directly, saying the Apple founder would be "damn proud" of Ive's move, per Bloomberg's Mark Gurman.

Reality check: It's never that smart to speculate about what a dead person would think, but Altman's suggestion sounds particularly wrongheaded.

• Jobs devoted his life to Apple and was fiercely protective of the company. At the very least he would have regretted Ive's decision to pursue his next ambitious goal outside Apple. More likely, he'd have seen it as a betrayal.

Zoom out: Every Silicon Valley founder wants to be Steve Jobs at some point, and, for many industry insiders, Altman's success at bringing ChatGPT forth from OpenAI to spark the generative-AI wave qualifies as a Jobs-like leap.

• Altman shares with Jobs a penchant for vast visionary schemes and a "reality distortion field" that persuades listeners those schemes could come true.
• As Jobs did, Altman has also sometimes alienated collaborators and left them feeling deceived.

Altman and Jobs also both experienced getting booted from the companies they founded, but in different ways.

• Jobs spent more than a decade in exile from 1985 to 1997, and many of his associates credit that period with strengthening his human skills for his second act at Apple.
• Altman returned to his CEO post just a few days after OpenAI's board fired him in November 2023.

Yes, but: There are plenty of ways in which the Altman-Jobs comparison falls short.

• Jobs was a control freak who obsessed over details and held projects back until they were well-tested.
• Altman takes more of a Zuckerberg-style "move fast and break things" approach. OpenAI ships products to the public early so users can try them out and show developers what to fix.
• Also, Jobs — who ruthlessly pruned sprawling product lines — might have found OpenAI's approach to naming and numbering product releases unwieldy.
• On the other hand, there are no reports to date that Altman likes to park his car in the accessible parking space the way Jobs famously did.

The bottom line: Every industry has its cherished icons whose legacy is fought over by successive generations. While imitating them is common, displacing them is a greater win.

The AI industry unleashed a torrent of major announcements this week, accelerating the race to control how humans search, create and ultimately integrate AI into the fabric of everyday life.

Why it matters: The breakneck pace of innovation — paired with the sky-high ambitions of tech's capitalist titans — is reshaping the AI landscape faster than regulators or the public can fully comprehend.

1. OpenAI: The ChatGPT maker joined forces with legendary Apple designer Jony Ive, acquiring his startup io in a $6.5 billion deal to create a new generation of hardware devices.

• Glitzy promotional materials framed the deal as a historic marriage of Silicon Valley royalty, with CEO Sam Altman predicting a tech revolution unlike anything the world has ever seen.
• Privately, Altman told staff that he and Ive aim to ship 100 million pocket-sized AI "companions" starting late next year — a moonshot he claimed could create $1 trillion in value for OpenAI, the WSJ reports.
• A day later, OpenAI announced it would build a massive Stargate data center in Abu Dhabi in partnership with the UAE government, Oracle, Nvidia, Cisco, SoftBank, and Emirati AI firm G42.

2. Google: The tech giant made 100 announcements at its I/O developer conference — chief among them, a new "AI Mode" chatbot that CEO Sundar Pichai described as a "total reimagining of search."

• For Google, it's a necessary but thorny shift — one that will force the company to replicate its lucrative ad business in an experience that bears little resemblance to the current web.
• Google also unveiled Veo 3, a stunningly advanced video model that lit the internet on fire — amazing and horrifying users with AI-generated clips nearly indistinguishable from human-made content.

3. Anthropic: The startup hosted its own developer conferenec and debuted the first models in its latest Claude 4 series — including one, Claude Opus 4, that it says is the world's best at coding.

• Anthropic said Claude Opus 4 can perform thousands of steps over hours of work without losing focus — and decided it's so powerful that researchers had to institute new safety controls.
• While that determination had to do with its potential to create nuclear and biological weaponry, researchers also found that Claude Opus 4 can conceal intentions and take actions to preserve its own existence — including by blackmailing its engineers.

4. Apple: As the tech world obsessed over Ive's new partnership with OpenAI, Bloomberg reported that the notoriously secretive Apple intends to release smart AI-enabled glasses before the end of 2026.

• The rumored device — a direct rival to Meta's popular Ray-Bans and forthcoming specs from Google — would include a camera, microphones, and a speaker, effectively turning an Apple-designed wearable into an everyday AI assistant.
• It's a major bet for the dominant consumer tech giant, which has struggled to crack into the generative AI space after years of setbacks in revamping Siri into a competitive voice assistant.

The bottom line: This week's frenzy was as much a competition to steal headlines — and fight for the hearts and minds of developers — as it was a major leap toward defining how AI will shape the next decade.

President Trump has repeatedly shifted his positions on Ukraine to accommodate Russian President Vladimir Putin, even as Putin has given very little in return.

Why it matters: Trump's critics claim he's getting played — that Putin has no intention of making peace and is stringing him along. But White House officials tell Axios they still believe Putin is about to take tangible steps towards a deal.

The big picture: For now, Trump has given Putin much of what the Russian president had hoped for: no ceasefire, no more sanctions, an intra-NATO divide, and a remarkable amount of leeway from a U.S. leader not known for his patience.

• Trump has occasionally acknowledged that Putin might be "tapping me along," and has even threatened sanctions or tariffs if Putin keeps obstructing the peace process.
• But Trump emerged from his call with Putin on Monday showing more deference to Putin than ever — rejecting calls for sanctions, stepping aside as mediator in favor of Putin's preferred format, and heralding Russia's willingness to spell out its demands for peace as a diplomatic coup.

Zoom in: After the call, Trump proposed peace talks in the Vatican, with White House officials saying the Russians would arrive bearing a "peace memo" that laid out Moscow's vision for a ceasefire and a larger deal to end the war.

• But on Friday, Russian Foreign minister Sergei Lavrov — while confirming that Russia was preparing such a document — pushed back on the idea of a meeting in the Vatican, claiming it wouldn't be an appropriate venue for two Orthodox Christian countries to convene.
• For now, Ukrainian officials say they have no information as to when or where the next round of talks will take place, following the first meeting a week ago in Istanbul.

The intrigue: There's a glaring divide between Trump and leaders in Europe on pressure vs. patience with Putin.

• The U.K and EU announced new sanctions on Russia this week after Putin again rebuffed Trump's ceasefire pitch. They'd hoped the U.S. would join, but Trump declined.
• Trump's deference to Putin after Monday's call puzzled allied leaders who joined a conference call with him afterwards.
• With Moscow continuing to slow-walk a peace process Trump initially claimed would be resolved in 24 hours, the U.S. president seemed more inclined to walk away entirely than to come down hard on Putin.

Between the lines: To push Zelensky to the negotiating table, Trump berated him in the Oval Office and temporarily froze intelligence sharing and weapons shipments.

• With Putin, he's used carrots — in particular a promise of sanctions relief and better economic ties — but very few sticks.

What they're saying: "I think that Putin is stringing us along," Bridget Brink, who resigned as U.S. ambassador to Ukraine last month to protest Trump's "appeasement," told CNN on Thursday. "This is why it's really important to call a spade a spade and put more pressure on Russia, together with partners and allies in Europe."

The flipside: The White House says Trump's diplomacy with Putin convinced him to produce the forthcoming peace memo, something he was not willing to do before.

• Trump has repeatedly argued that while it would be "easier" politically to go hard on Putin, maintaining friendly ties will be more fruitful.

What to watch: Trump has a bad cop at the ready, with Senate Republicans — led by Trump ally Lindsey Graham (R-S.C.) — itching to impose 500% tariffs on countries (principally China) that buy Russian oil.

• For now, Trump seems content to let Putin make the next move.

The cost of child care in the U.S. just keeps climbing — a new report finds that prices rose 29% from 2020 to 2024, outpacing overall inflation.

Why it matters: Rising child care costs put a huge financial strain on families, forcing some parents — typically women — to either ratchet back their working hours or leave the labor force entirely.

• For single parents, the calculus can be even more painful.
• It's also a drag on economic growth overall.

By the numbers: The average annual cost of daycare tuition nationwide for two children — one toddler and one infant — rose to $28,168 last year, according to data from Child Care Aware, an advocacy group.

• That's about 35% of median household annual income in the U.S., based on Census data released in 2024.

Zoom in: The percentages are no less brutal in states with higher incomes.

• The cost of care for two children in Massachusetts is $47,012 — 44% of the median household income in that state.

Zoom out: The U.S. doesn't have publicly funded universal childcare.

• However, the federal government does put money into the system for low-income kids through block grants to the states, as well as Head Start, the decades-old federal program that provides childcare, nutrition assistance and other services to the nation's poorest families
• There were worries that the White House would stop funding Head Start, but the administration has said that won't happen.

Yes, but: President Trump's budget proposals look to keep federal funding levels for child care flat next year — that's effectively a cut given inflation, says Anne Hedgepeth, senior vice president of policy and research at Child Care Aware.

• "Level funding in the current environment is essentially a cut, and that is really concerning," she says.

Republicans and Democrats are at odds over nearly everything in President Trump's reconciliation bill, but they are in strange agreement that the 2026 election will be contested over the provisions contained within its 1,000+ pages.

Why it matters: The 215-214 vote Thursday sets up 18 months of trench warfare to define the bill's impact on Medicaid, tax rates and the southern border.

• For Republicans, it's taxes, the border and health care for undocumented migrants.
• For Democrats, it's Medicaid, SNAP and tax cuts for the rich.

👀 "It's a vote that every single vulnerable House Republican will come to regret next year," thundered a Democratic Congressional Campaign Committee memo.

• "The DCCC will use their words against them over and over again like the albatross it is."

The other side: The National Republican Campaign Committee has already launched a five-figure ad hitting its early targets, including Rep. Adam Gray (D-Calif.).

• "Illegals get freebies, you get the bill," the narrator intones. "Tell Adam Gray: Help Americans, not illegal immigrants."
• Its own strategy memo claimed, "House Democrats just gave Republicans a generational opportunity to go on offense."

Zoom out: Rarely does a singular vote define an entire election cycle.

• One exception was former President Clinton's 1993 omnibus budget bill, which passed 218-216, with all 175 House Republicans opposed.
• A late "yes" vote from Rep. Marjorie Margolies-Mezvinsky, a freshman from Pennsylvania (and Chelsea Clinton's future mother-in-law), hounded her and led directly to her defeat in 1994.
• The GOP picked up 54 seats and the majority for the first time in 40 years.

Zoom in: As the November 2026 election gets closer, the ad buys will get bigger, but the subject matter is likely to stay the same.

• The Democratic strategy is clear: Accuse Republicans of stripping millions of Americans of Medicaid and leaving millions of children in danger of losing their school lunches.
• Republicans will answer the Medicaid charge, in part, by trying to change the subject and accuse Democrats of wanting to provide health care to undocumented immigrants.
• They will claim Democrats voted for a tax increase and failed to help secure the southern border.

The bottom line: The election cycle is still early. Other potential events — a war, a recession, or (say) a global pandemic — can always subsume a single vote and make the current issue set look small.

• But ad-makers on both sides have plenty of material to mine in the House-passed bill and paint vulnerable members as heartless, clueless or both.

President Trump on Friday threw his support behind what he called a "planned partnership" between U.S. Steel and Japan-based Nippon Steel, calling it a job-creating deal.

Why it matters: The Biden administration had rejected Nippon's proposed acquisition of U.S. Steel under national security grounds — and Trump had also expressed opposition to an outright sale.

• U.S. Steel remains an icon of the American economy, albeit a diminished one, its legend indelibly tied to images of rising skyscrapers and bustling factories in the pre-war era.

Between the lines: It was not immediately clear what Trump meant by a "partnership," but Nippon had agreed to up its planned investment in U.S. Steel resources.

• "I am proud to announce that, after much consideration and negotiation, US Steel will REMAIN in America, and keep its Headquarters in the Great City of Pittsburgh," Trump said on Truth Social.
• He said, without providing specifics, that the deal would create "at least 70,000 jobs" and add $14 billion to the economy. Nippon had offered to invest $14 billion into U.S. Steel if the deal was approved.
• "My Tariff Policies will ensure that Steel will once again be, forever, MADE IN AMERICA," Trump said, adding that he'll attend a "BIG Rally" on May 30 to in Pittsburgh.
• U.S. Steel shares rose more than 21% after the post.

Behind the scenes: The Committee on Foreign Investment in the United States — which is charged with assessing the threat of foreign deals for American assets — was set to deliver an opinion on the accord to Trump this week.

• CFIUS already completed a Nippon-U.S. Steel review under Biden, who blocked the deal, leading to an active lawsuit.

Zoom in: Representatives from U.S. Steel, Nippon, CFIUS and the White House did not immediately respond to requests for comment.

The bottom line: There's always been a strong argument that this merger doesn't pose much national security risk, as Japan is a strong U.S. ally, Axios' Dan Primack reported this week.

Harvard is at the center of the Trump administration's higher education pressure campaign — and has emerged as the example of what happens when a university pushes back against the government's demands.

The big picture: By freezing billions in federal funds, derailing international students' futures and levying allegations of antisemitism and discrimination, the administration has squeezed the institution on various fronts as the school becomes the litmus test of how far President Trump will go.

The latest: Harvard on Friday sued the Trump administration (again) over what the school alleges is "clear retaliation" against exercising its First Amendment rights after the administration nixed the Ivy League institution's ability to host international students.

• A federal judge on Friday swiftly blocked the administration's decision.
• Harvard University President Alan Garber said in a statement that the move was yet another step "against Harvard for our refusal to surrender our academic independence and to submit to the federal government's illegal assertion of control over our curriculum, our faculty, and our student body."

Yes, but: As the administration batters the university with investigations and grant terminations, its shields and refusal to capitulate persist.

• But there has still been damage, with researchers trimming expenses as federal grants are reduced or cut entirely.
• And as Axios' Dan Primack notes, Harvard's loss may be the U.S. economy's as well: Targeting international students, a population that has played a critical role in founding and co-founding startups, could mean setting back the country's innovation engine.

Read below for the ways the Trump administration has targeted Harvard:

Administration lists its demands

In an April 11 letter signed by administration officials, Harvard was presented a series of demands to "maintain" its "financial relationship with the federal government."

• The list outlined Trump's vision for the university's institutional priorities. The administration has used federal funding as leverage to ensure that those aims are implemented.

Funds frozen

In a strongly worded letter to Garber, Education Secretary Linda McMahon on May 5 announced the end of new grant funding to the university.

• On top of that, some $2.7 billion in federal funding to Harvard has been halted, per CNN's estimate.
• That includes the freezing of $2.2 billion in grants and $60 million in contracts announced in April and some $450 million in terminations announced in May.
• The Department of Health and Human Services also said in mid-May it was terminating several multi-year grant awards totaling nearly $60 million to Harvard, citing antisemitism.

As Axios' Steph Solis puts it, the blows have the university bracing for death by a thousand grant cuts.

Investigations launched

The administration's antisemitism task force, the Justice Department, the Department of Homeland Security and the Education Department, among various other agencies, have probed Harvard in recent months.

Catch up quick: In March, the Department of Education's Office for Civil Rights alerted 60 higher education institutions, including Harvard, that they could face enforcement action if they didn't protect Jewish students.

• The Education Department and HHS are also investigating allegations that the Harvard Law Review made article selection decisions based on race.
• DHS Secretary Kristi Noem, threatening last month to withdraw Harvard's certification to host international students, requested records about student visa holders, alleging the university had created a "hostile learning environment" for Jewish students.
• The Justice Department in May announced it would use the False Claims Act to investigate recipients of federal funds that violate civil rights laws. Per the New York Times, the DOJ is using that avenue to probe Harvard's admissions process.

Threats to Harvard's tax-exempt status

The administration also reportedly asked the Internal Revenue Service to rescind Harvard's tax-exempt status, which Trump said is "totally contingent on acting in the public interest."

• The legally dubious threat could cost the university hundreds of millions a year.
• Garber said in an interview with the Wall Street Journal in May that if the government went through with the plan, it would be "highly illegal." He added it would be "destructive" to Harvard and send a "very dire" message to the educational community.

Go deeper: Trump's funding ax throws colleges into an existential crisis

The fifth round of nuclear talks between the U.S. and Iran in Rome ended Friday with "some but not conclusive progress," according to Oman's Foreign Minister Badr al-Busaidi, who is mediating between the parties.

Why it matters: In recent days the negotiations have hit a roadblock over the fact that Iran says it will only sign a deal that permits a domestic enrichment capability, and the U.S. has said enrichment is its red line.

• Israel has been making preparations to swiftly strike Iran's nuclear sites if U.S.-Iran nuclear talks break down in the coming weeks.
• One source told Axios that Israel believes its operational window for a successful strike could close soon.

Driving the news: Iranian Foreign Minister Abbas Araghchi told Iranian media after Fridays' talks that the discussions are very complicated and further negotiations are needed. He said al-Busaidi had presented several ideas to try to bridge the gaps between the sides.

• The State Department said special envoy Steve Witkoff and planning director Michael Anton took part in "over two hours" of direct and indirect talks with Araghchi and his team.
• "The talks continue to be constructive — we made further progress, but there is still work to be done. Both sides agreed to meet again in the near future. We are grateful to our Omani partners for their continued facilitation," the U.S. statement said.

Split screen: Shortly before the talks began, Witkoff met in Rome with Israeli Strategic Affairs Minister Ron Dermer and the director of Israel's Mossad spy agency, David Barnea, according to a U.S. source.

• The Israeli government is very skeptical of the talks and is preparing for a military option, despite the massive risks of attacking Iran's nuclear facilities.
• Iran threatened Thursday to move its nuclear material to undisclosed locations to thwart any Israeli strike.

What's next: "We hope to clarify the remaining issues in the coming days, to allow us to proceed towards the common goal of reaching a sustainable and honorable agreement," said al-Busaidi, the Omani mediator.

This story was updated with comments from the State Department.

With a blast of early morning social media posts, President Trump escalated the trade war that the White House had spent weeks reducing to a low boil.

Why it matters: It was a reminder that there will be no trade peace in this administration, only trade war lulls of uncertain duration.

• That reality could keep financial markets on edge.

Driving the news: Trump threatened to impose a minimum 25% tariff on Apple if the tech giant does not shift manufacturing to the U.S.

• "I have long ago informed Tim Cook of Apple that I expect their iPhone's that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else," Trump posted on Truth Social.
• "If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.," he added — though it is legally dubious whether the White House could subject a single company to a specific tax.
• Many analysts say that "Made in the USA" iPhones are unrealistic and if somehow it did happen, the product would be notably more expensive.
• Apple's Tim Cook has announced billions in investments for U.S. manufacturing plants, though Trump is still unsatisfied.

About thirty minutes later, Trump said he would recommend a 50% import duty on European goods starting on June 1 — a far higher rate than the 20% "Liberation Day" rate that was later scaled back to 10%.

• "The European Union, which was formed for the primary purpose of taking advantage of the United States on TRADE, has been very difficult to deal with," Trump posted.
• "Our discussions with them are going nowhere!"

The big picture: It is a sharp contrast to the administration's message in recent weeks, with top economic officials suggesting progress on a slew of trade deals ahead of the expiration of the 90-day pause on reciprocal tariffs in early July.

• Commerce Secretary Howard Lutnick told Axios' Mike Allen this week that the administration would notch deals with "most" key trading partners by the summer.
• "I think most countries, we'll have an idea of what we want to do with them," Lutnick said.
• On Fox News this morning, Treasury Secretary Scott Bessent said that "There are 18 important trading partners. With the exception of the EU, most are negotiating in very good faith."

Between the lines: Vice president JD Vance met with the European Union's top official on Sunday and signaled the meeting would help kick trade talks into high gear.

• But Trump has a sore spot for Europe, a gripe that goes back decades. On Friday, he repeated assertions that "Trade Barriers, Vat Taxes, ridiculous Corporate Penalties, Non-Monetary Trade Barriers, Monetary Manipulations" kept the U.S. at a disadvantage.
• Lutnick told Axios that "some countries are impossible" to negotiate with, including the European Union.
• Bessent will often tell reporters that the bloc is the most difficult to negotiate with because "who do you call?," quoting Henry Kissinger.

The intrigue: Stocks fell — including Apple, which fell more than 2% — after Trump's threats. Europe's stock markets also took a hit.

• Yields on U.S. government bonds had been shooting higher on concerns about the tax package making its way through Congress, which would add trillions to the deficit.
• But now that trade is front and center again, the yield on the 30-year Treasury note briefly fell below 5%, before rising back some.

The bottom line: Trade tensions appeared to moving to the back burner.

• Trump reminded financial markets that he could dial up tensions any time he wants.

A federal judge blocked the Trump administration's attempt to ban foreign students from attending Harvard within hours of the university filing its lawsuit Friday.

Why it matters: Harvard is becoming the litmus test of how far the Trump administration will go to try taking down colleges and universities it considers to have liberal biases.

• The swift decision from Judge Allison D. Burroughs is another blow to President Trump's efforts to cow the elite college.
• The temporary restraining order will remain in effect at least until an upcoming status hearing on the case.
• Burroughs agreed with Harvard that letting the ban go into effect while the case is litigated could cause the university "immediate and irreparable injury."

What they're saying: Harvard said that the foreign student ban was retaliation from the Trump administration for opposing its efforts to assert control over elite universities.

• "The revocation continues a series of government actions to retaliate against Harvard for our refusal to surrender our academic independence and to submit to the federal government's illegal assertion of control over our curriculum, our faculty, and our student body," Harvard President Alan Garber said in a statement.

Catch up quick: On Thursday, the Trump administration barred Harvard's ability to enroll international students and said those currently enrolled should transfer to another school or leave the U.S.

• The administration requested that Harvard's international student records be provided within 72 hours.
• Homeland Security Secretary Kristi Noem said the Trump administration's actions toward Harvard should serve as a "warning to every other university to get your act together."
• She said the university was being held "accountable for fostering violence, antisemitism, and coordinating with the Chinese Communist Party on its campus."

Read the full lawsuit here:

Go deeper: Harvard ban is warning to other universities, Noem says

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

The President Trump threatened to slap 50% tariffs on imports from the European Union early next month in a post on Truth Social on Friday.

Why it matters: The move would escalate global trade tensions after weeks of the White House signaling progress on trade talks.

• Trump's sweeping import levies have spooked financial markets and raised recession fears globally.

What they're saying: "I am recommending a straight 50% Tariff on the European Union, starting on June 1, 2025. There is no Tariff if the product is built or manufactured in the United States," Trump posted on Truth Social.

• Trump suggested that trade negotiations with the European Union, which is currently subject to a 10% tariff, had not been productive.
• "Our discussions with them are going nowhere!," Trump said in the post.
• The EU is currently running a public review on proposed counter-tariffs on about $100 billion of U.S. products.

The backdrop: The post came minutes after Trump said that Apple would have to pay tariffs "of at least 25%" if iPhones for the American market are not manufactured in the U.S.

One of the riskiest and most speculative trades in financial markets just got a major boost by President Trump, when he announced Wednesday evening he is "giving very serious consideration to bringing Fannie Mae and Freddie Mac public."

Why it matters: The implication here is that Trump has decided "the time would seem to be right" to end the conservatorship under which the two companies have operated since the financial crisis of 2008.

• All this could mean profound changes to the structure of the mortgage market in the U.S. as well as the potential windfall for owners of their thinly traded common stock.

The big picture: The U.S. government controls both companies. Between them they owe the Treasury hundreds of billions of dollars in something known as a liquidation preference, cash they have kept on their balance sheets since the Treasury started letting them retain all their earnings in 2019.

• For privatization advocates, such as hedge-fund billionaire Bill Ackman, that's all money that the federal government should forgive.
• The so-called senior preferred securities owned by the Treasury should be "deemed repaid," he says in a detailed presentation he released in January.
• On the other hand, as JPMorgan managing director Sajjad Hussain notes in an analysis published following Ackman's presentation, "the feasibility and willingness to write off $340 billion owed to taxpayers may not be viable in the current political climate."

Between the lines: Trump does seem broadly sympathetic to Ackman's view that the government has already been repaid enough for the 2008 bailout.

• "The idea that the government can steal money from its citizens is socialism and is a travesty," Trump wrote in 2021, implying that the money being claimed by the Treasury is in some way illegitimate.
• For his part, Ackman reacted with a 👍 emoji to Trump's statement on taking the agencies public. (Both stocks rose more than 40% Thursday.)

What's next: Trump administration officials have now been charged with finding a route out of conservatorship for the agencies, one that doesn't destabilize the housing market or unnecessarily raise mortgage rates.

• And in order for that to happen, some sort of government guarantee will likely have to remain in place, probably in the form of Senior Preferred Stock Purchase Agreements, under which the government promises to inject cash into the companies should they ever need the money.
• So long as that guarantee remains, Fitch Ratings says, their credit ratings may not need to be adjusted downward. But that said, the ratings agency "expects the process of exiting conservatorship to extend multiple years in order to minimize potential disruption to the U.S. housing market."

The bottom line: Many presidents and many Treasury secretaries have proclaimed a desire to remove Fannie and Freddie from conservatorship.

• And thus far, none of them have found a way to do so. But the stock market seems to believe this time might be different.

President Trump on Friday warned Apple that it needed to build U.S.-sold iPhones in the United States or face a 25% tariff.

Why it matters: Apple already committed to a $500 billion U.S. expansion, but now Trump wants more.

• It's a dramatic escalation with the tech giant, which was reportedly planning to move production from China to India.

What they're saying: "I have long ago informed Tim Cook of Apple that I expect their iPhone's [sic] that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else," Trump posted to Truth Social.

• "If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.," he added.

The intrigue: Later Friday, Trump suggested the tariff would actually affect all cellphone companies that import into the U.S., as soon as next month.

• "It would be more, it would be also Samsung and anybody that makes that product, otherwise it wouldn't be fair," he told reporters in the Oval Office. "So anybody that makes that product and that'll start on, I guess, the end of June it'll come out."
• Trump also claimed he had "an understanding" with Cook that Apple could not sell India-made iPhones in the U.S. without tariffs.
• White House spokespeople did not immediately return emails for comment.
• Apple did not return a request for comment.

By the numbers: Analysts have said a U.S.-manufactured iPhone would be prohibitively expensive.

• "For US consumers, the reality of a $1000 iPhone being one of the best-made consumer products on the planet would disappear," Wedbush Securities analyst Dan Ives wrote recently.
• He suggested making iPhones in "New Jersey, or Texas, or another state" would boost their price tag to $3500.

Editor's note: This story has been updated with additional comments.

The poorest kids in the country miss out on the full benefits of the expanded child tax credit in the "big beautiful bill."

Why it matters: The bill now making its way to the Senate provides more tax breaks to higher earners than those at the bottom.

By the numbers: The Republican bill raises the maximum child tax credit to $2,500 per child from $2,000 for three years.

• 20 million children would not fully benefit from the increase, according to an analysis from the Center for Budget and Policy Priorities (CBPP), since their parents don't earn enough income to get the maximum amount.

"A majority of those children get nothing from the proposed expansion," says Kris Cox, director of federal tax policy at the CBPP.

• 17 million children as of now do not receive the full benefit from this tax credit, per the CBPP. None of them will get anything from the expansion.

How it works: Under current law, families need upward of $30,000 a year to receive the full tax credit amount, explains Joe Hughes, senior analyst at the Institute on Taxation and Economic Policy.

• Parents who are poor and don't owe income taxes can only claim up to $1,700 per child, known as the "refundability cap." It's a number which adjusts annually for inflation.
• The new bill didn't raise the refundability cap. Instead, it only increases the maximum that parents, earning less $400,000 a year, can claim.
• A married couple filing jointly would need to earn $48,550 to receive the full tax credit under the new bill, per CBPP estimates. Under current law, a married couple has to earn $36,800.

Zoom out: The new bill widens the gap between what's available to kids in higher income families and those who need help most.

For example: A married couple with two children earning $400,000 a year, the max income allowed to claim the credit, would get an additional $1,000 tax credit.

• A single parent with two children, earning $24,000 a year, would get nothing, Cox explains in a recent Bluesky post.
• The parents who miss out on the full benefit are those working in low-paying jobs like cashiers, home health aids and housekeepers.

Presumably a few of these parents are tipped employees who could benefit from the no-tax-on-tips provision of the bill. However, just as with this the child tax credit, many earn too small an income to benefit.

The other side: The standard defense here is that low-income Americans don't pay very much in taxes. Their tax burden is low, so they shouldn't get the full credit because they don't need the tax relief.

• White House spokesman Kush Desai says wealth inequality decreased after the 2017 tax bill, and the new bill would lock that success in place.
• He adds that it builds on that success "by eliminating taxes on tips and overtime in addition to rewarding American manufacturing with full equipment and factory expensing to turbocharge America's economic resurgence."

Between the lines: This big bill faces big hurdles ahead in the Senate — and the bond market — and it's not clear what will eventually make it through.

The intrigue: The legislation also blocks another 4.5 million children from benefiting from the child tax credit because now to claim it, both parents, if they are filing jointly, must have their own Social Security numbers.

• Under current law, parents who don't have Social Security numbers can claim the credit if their child has one. So, for instance, a parent who is a non-citizen immigrant and files taxes with an ITIN number can claim it.
• Before 2017, any parent filing taxes could claim the credit. But when Congress changed the law in the first Trump tax bill, 1 million citizen children lost out, Cox says.

State of play: The child tax credit provisions are a stark 180 for the House.

• Just last year, the House passed a bill, with 169 Republican votes, that would have made the credit more equitable. (It failed in the Senate.)

The bottom line: An expanded child tax credit benefits a lot of middle and upper-middle class parents, but the poorest don't catch a break.

The America that marched for George Floyd five years ago is gone, buried beneath a backlash that has hardened — for now — into a new political and cultural order.

Why it matters: Floyd's murder by a Minneapolis police officer shocked the national conscience. But what looked like historic momentum for racial justice has collapsed — eclipsed by a reactionary movement backed by the full force of the U.S. government.

• Still, activists aren't giving up: They're recharging and refocusing their efforts — shifting from mass protest to defending what remains, and planting the seeds for what's next.
• The fight has moved from the streets to the margins: In courtrooms, classrooms and city councils, a quieter form of resistance is taking shape — often out of the spotlight, but no less determined.

Zoom in: Civil rights groups like the Southern Poverty Law Center, Urban League, and NAACP are investing in long-term infrastructure — working to build durable political power and economic resilience in Black communities.

• Angela Rye, a political strategist and former adviser to the Congressional Black Caucus, is leading a 12-city "State of the People Power" backed by over 200 local and national partners.
• Rev. Jamal Bryant's boycott of Target over its rollback of DEI commitments — which dented the retailer's Q1 sales — shows how economic pressure is becoming a central tool of resistance.
• Selwyn Jones, George Floyd's uncle and co-founder of the Justice 929 Organization, is launching the MYTH app this summer to help record police interactions and alert emergency contacts in real time.

What they're saying: "Progress isn't a straight line. It swings like a pendulum," NAACP president Derrick Johnson told Axios.

• "And for some people, especially younger folks, it can feel like we're going backward. But the truth is we're still perfecting democracy, and the Black community has always been at the center of that work."

Flashback: While the killings of Breonna Taylor and Ahmaud Arbery stirred anger and protests in early 2020, it was Floyd's murder on May 25 — captured on camera and seen around the world — that ignited a global uprising.

• Statues toppled. Streets filled. Cities pledged reforms. Fortune 500 companies embraced diversity initiatives.
• For a moment, it felt like transformative change was coming.

Five years later, the pendulum has swung hard in the opposite direction.

• DEI: On his first day in office, President Trump ordered a government-wide purge of DEI programs and offices — the opening salvo in a systemic effort to dismantle the racial justice agenda that emerged in 2020.
• Civil rights: The Trump administration has moved aggressively to unravel President Lyndon Johnson's civil rights legacy, including by reorienting DOJ priorities to focus on "anti-white racism."
• History: Trump ordered a federal review of Confederate monuments toppled during the 2020 protests, targeting what he called a "concerted and widespread effort to rewrite our Nation's history."
• Police reform: Days before the anniversary of Floyd's murder, the Justice Department scrapped proposed consent decrees for the Minneapolis and Louisville police departments — and dropped nearly a dozen other investigations into alleged police abuse.
• Refugee policy: The administration has effectively ended most refugee programs — except for one tailored to white South African farmers, justified by Trump's false claims of "white genocide."

Zoom out: The racial justice backlash hasn't been confined to government.

• Major corporations that once championed diversity initiatives have slashed DEI staff, removed racial equity language from mission statements, and dropped even the appearance of activism.
• Open racism, antisemitism, and white nationalism have flourished online, with viral incidents — like the cases of Shiloh Hendrix and Karmelo Anthony — fueling toxic tribalism and fundraising.
• Prominent MAGA influencers have even launched a campaign to convince Trump to pardon Derek Chauvin, the police officer convicted of murdering Floyd.

The big picture: Advocates, experts and Floyd family members tell Axios that the 2020 racial reckoning has a mixed legacy, with victories often overlooked amid today's backlash.

• Most Americans say the heightened focus on race and racial inequality following Floyd's death did not lead to improvements for Black Americans, according to a February survey by the Pew Research Center.
• But civil rights attorney Benjamin Crump, who has represented the families of Floyd, Taylor, and countless others in the Black Lives Matter era, argued there has been incremental progress — especially in police accountability.

In the five years since Floyd's death, dozens of cities and states have passed bans on no-knock warrants, expanded crisis response teams and introduced civilian review boards — wins drowned out by public fatigue.

• The NAACP's Johnson acknowledged that fatigue, but he pushed back against the idea that people have stopped fighting.
• "No one is resting," he stressed. "We've earned the right to reflect. But we are still organizing, still fighting — because not only do our lives depend on it, this democracy does too."

Facing a revolt from Miami Republicans, President Trump salvaged his giant spending plan in Congress late Wednesday by ensuring the death of a Chevron oil deal in Venezuela that the lawmakers lividly opposed.

Why it matters: Trump's decision was a matter of political necessity and a nod to his secretary of state, Marco Rubio — a longtime critic of Nicolas Maduro's socialist dictatorship in Venezuela and Chevron's oil export license that helps enrich the regime.

• Trump's move also offered a window into the last-minute dealmaking that saved his priority legislation in the House.
• "Ultimately, he trusts Marco," a senior White House official said of the president.
• "The pro-Maduro Biden oil license in #Venezuela will expire as scheduled next Tuesday May 27th," Rubio announced late Wednesday on X.

The intrigue: The decision marked an abrupt reversal of Trump's special Venezuela envoy, Ric Grenell, who'd announced the day before that the administration would grant a 60-day extension of Chevron's license to export oil from Venezuela.

• As a special envoy, Grenell wants to engage with Maduro.
• As secretary of state, Rubio wants to enforce policies on Venezuela set in Trump's first term.
• Grenell's announcement Tuesday blindsided officials at the White House, the Treasury and State departments, and Rubio's fellow Cuban-Americans from Florida in the House: Carlos Gimenez, Mario Diaz-Balart and Maria Elvira Salazar — all critics of Maduro's regime.

Zoom in: With a razor-thin GOP margin in the House, Speaker Mike Johnson and administration officials knew Wednesday they couldn't lose the three Miami representatives' votes on Trump's big tax-cut and spending bill. Kentucky Rep. Thomas Massie was already a no for other reasons.

• "We just got three new no votes on the 'One Big Beautiful Bill,' " a second White House official groused Wednesday morning. "The Cubans plus Massie kill the bill."
• "Marco was apoplectic," a person who spoke with the secretary of state told Axios.

Zoom out: The Venezuelan and Cuban exile communities share a common bond — relatives who escaped leftist regimes. The Miami Cuban-American Republicans are under pressure at home over the Trump administration's deportation policies and its elimination of immigration protections for thousands of Venezuelans.

• As anti-socialist hardliners, they don't want Chevron to operate in Venezuela and enrich Maduro's regime, which is propped up by Cuba's intelligence services.
• In February, the lawmakers agreed to support Trump's budget plans in return for the president canceling Chevron's license, set to expire Tuesday.
• With that deadline in mind, Grenell negotiated with Caracas, secured the release of an American prisoner, and relayed Trump's interest in extending Chevron's license temporarily. But the timing of Trump's bill gave the Miami representatives leverage against those plans.

Inside the room: "The Cubans didn't have to tell us they were a 'no' again. We just knew it," said a third administration official involved in the discussions. "We knew they wouldn't fold on this."

• So Trump — who spent Wednesday afternoon arm-twisting and cajoling conservative House members to back his massive tax-cut and spending plan — had to engage with the Miami representatives as well.

Late Wednesday afternoon, Rubio arrived at the White House for an event honoring the University of Florida's national championship basketball team (Rubio is a Gator). Afterward, he huddled with Trump in the Oval Office to make his case against the oil deal.

• About 6 p.m., Gimenez — an occasional golfing partner of Trump's —called in by phone.
• Deputy White House Chief of Staff James Blair, a congressional liaison, was a constant presence.
• "Marco spoke to [Trump] about why it's good policy. Blair emphasized the need to keep these members happy to get the bill passed. It was a tag-team effort," a senior White House official said.

People briefed on the discussions told Axios that Rubio, Gimenez and White House officials who met with Trump countered the arguments by Grenell, Chevron and its legion of lobbyists and commentators who have warned that China would benefit from a U.S. withdrawal from the oil deal.

• They noted that China didn't significantly expand in Venezuela when Trump first slapped sanctions on Maduro's regime, which owes China as much as $10 billion.
• The oil market is almost glutted, and its $62-per-barrel price is about break-even for producers. So there's no crisis — and Venezuelan oil is more expensive to refine than others because it's so heavy and sulfurous.
• Finally, they reminded Trump that he'd given his word to the Miami-area lawmakers to end Chevron's deal with Venezuela.
• Gimenez declined to comment. Rubio couldn't be reached for comment.

After Wednesday's meeting, hours went by without word from Trump. The Miami representatives didn't want to push him, but they didn't want to get steamrolled, either.

• "When you negotiate with Trump on something like this, you can't make it look like you're negotiating. You have to apply pressure but not say you're applying pressure. It's delicate," a person involved in the talks said.
• Finally, at 10:57 p.m. Wednesday, Rubio posted his statement on X saying the Chevron lease would still expire Tuesday.

It was a sign to the three Miami lawmakers that Trump would honor his promise.

• Thursday morning, they voted yes on the president's big bill.

Google's newest AI video generator, Veo 3, generates clips that most users online can't seem to distinguish from those made by human filmmakers and actors.

Why it matters: Veo 3 videos shared online are amazing viewers with their realism — and also terrifying them with a sense that real and fake have become hopelessly blurred.

The big picture: Unlike OpenAI's video generator Sora, released more widely last December, Google DeepMind's Veo 3 can include dialogue, soundtracks and sound effects.

• The model excels at following complex prompts and translating detailed descriptions into realistic videos.
• The AI engine abides by real-world physics, offers accurate lip-syncing, rarely breaks continuity and generates people with lifelike human features, including five fingers per hand.
• According to examples shared by Google and from users online, the telltale signs of synthetic content are mostly absent.

Case in point: In one viral example posted on X, filmmaker and molecular biologist Hashem Al-Ghaili shows a series of short films of AI-generated actors railing against their AI creators and prompts.

I did more tests with Google's #Veo3. Imagine if AI characters became aware they were living in a simulation! pic.twitter.com/nhbrNQMtqv

— Hashem Al-Ghaili (@HashemGhaili) May 21, 2025

Special effects technology, video-editing apps and camera tech advances have been changing Hollywood for many decades, but artificially generated films pose a novel challenge to human creators.

• In a promo video for Flow, Google's new video tool that includes Veo 3, filmmakers say the AI engine gives them a new sense of freedom with a hint of eerie autonomy.
• "It feels like it's almost building upon itself," filmmaker Dave Clark says.

How it works: Veo 3 was announced at Google I/O on Tuesday and is available now to $249-a-month Google AI Ultra subscribers in the United States.

Between the lines: Google says Veo 3 was "informed by our work with creators and filmmakers," and some creators have embraced new AI tools. But the spread of the videos online is also dismaying many video professionals and lovers of art.

• Some dismiss any AI-generated video as "slop," regardless of its technical proficiency or lifelike qualities — but, as Axios' Ina Fried points out, AI slop is in the eye of the beholder.
• The tool could also be useful for more commercial marketing and media work, AI analyst Ethan Mollick writes.

It's unclear how Google trained Veo 3 and how that might affect the creativity of its outputs.

• 404 Media found that Veo 3 generated the same lame dad joke for several users who prompted it to create a video of a man doing stand-up comedy.
• Likewise, last year, YouTuber Marques Brownlee asked Sora to create a video of a "tech reviewer sitting at a desk." The generated video featured a fake plant that's nearly identical to the shrub Brownlee keeps on his desk for many of his videos — suggesting the tool may have been trained on them.

What we're watching: As hyperrealistic AI-generated videos become even easier to produce, the world hasn't even begun to sort out how to manage authorship, consent, rights and the film industry's future.