Washington, DC

1. Canada talks cancelled
2. Venezuela campaign escalates
3. Trump heads to Asia
4. SAfrica envoy pick
5. Business-as-usual shutdown
6. Crypto legislation hurdles
7. WH ballroom funders

PDB: Trump backs down on San Francisco deployment 

US officials descend on Gaza for ‘Bibi-sitting’ …Trump could meet Kim Jong Un next week … UMich releases consumer sentiment data

Trump abruptly cancels Canada talks

President Donald Trump abruptly canceled ongoing trade talks with Canada after a provincial government launched an ad campaign against his tariff regime, throwing Washington’s relationship with its second-biggest trading partner into fresh turmoil. After the Ontario government aired an ad quoting former President Ronald Reagan as saying that tariffs “hurt every American,” Trump lashed out on Truth Social, calling the ad fake and writing that “Based on their egregious behavior, ALL TRADE NEGOTIATIONS WITH CANADA ARE HEREBY TERMINATED.” Trump’s sudden reversal upended what appeared to be warming ties between the neighbors; Canadian Prime Minister Mark Carney has sought to balance a tough line against US protectionism with a pragmatic recognition of his country’s dependence on the US. The last time Trump suspended trade talks with Ottawa — in June, over a digital tax on US tech companies — Canadian authorities quickly withdrew the measure.

GOP backs Trump’s Venezuela campaign

Trump is escalating a military campaign against drug traffickers in and around Venezuela without approval from the GOP-controlled Congress. And most Republicans are cheering him on as he squeezes Venezuelan leader Nicolás Maduro, Semafor’s Burgess Everett, Eleanor Mueller and Shelby Talcott report. “It’s important to liberate Venezuela from the illegitimate narco-king,” said Sen. Bernie Moreno, R-Ohio. “We ought to just keep shooting them out of the water,” added Sen. Cynthia Lummis, R-Wyo. A handful of Republicans are asking questions, like Sens. Mike Lee, R-Utah, and Thom Tillis, R-N.C., but don’t count on sustained effort to constrain Trump, despite many worrying the mobilization could balloon into a long-term foreign entanglement. “One of the questions we should be asking right now, which many did not ask before Iraq, is: What happens when we win?” said Sen. Jack Reed, D-R.I.

High stakes for Trump-Xi meeting

US soybean exports, access to rare earths, and overall trade with China hang in the balance as Trump embarks on his first trip to Asia later tonight. The main event will be his meeting with Chinese leader Xi Jinping in South Korea next Thursday (their first meeting since 2019), at which Trump will seek a deal with China amid bubbling tensions over tariffs and export controls. The Trump administration is trying to amp up the pressure ahead of that meeting, with The New York Times reporting that US officials will probe China’s failure to meet its obligations under Trump’s first-term trade deal. The White House said Trump will also meet with Malaysia’s prime minister on the sidelines of the ASEAN meeting there, before traveling to Japan to meet with the country’s new prime minister and on to South Korea for APEC.

Dem senators grill SAfrica envoy pick

Washington’s nominee for ambassador to South Africa used his confirmation hearing to offer support for disputed claims that the country’s white minority is under attack. Leo Brent Bozell, a conservative media critic with no diplomatic background, declined to accept Democratic senators’ framing of Trump’s “legally and morally absurd claim” of a genocide against white farmers by the South African government, saying “I’m not a lawyer so I can’t address it that way.” Bozell also refused to respond to questions from Sens. Chris Van Hollen, D-Md., and Chris Murphy, D-Conn., over whether he would oppose the reinstitution of discriminatory race-based laws in the US allowing only white people to vote, and said he would push Africa’s biggest economy to halt its “geostrategic drift” toward US rivals including China, Iran, and Russia.

Low-effort shutdown to stretch to 27 days

Let’s be real: This is a lazy shutdown. The House last voted Sept. 19, the Senate is gone until Monday, and Trump is leaving the country. “I’m surprised that Leader [John] Thune isn’t keeping us in over the weekend. And I’m frankly shocked that the House has taken a month off,” said Sen. Chris Coons, D-Del. Thune said if he thought keeping members around would help, he’d do it. But “fatigue is part of the motivator,” argued Sen. Kevin Cramer, R-N.D. “If you’re getting refreshed every four or five days, you lose your own personal drive.” And what about changing the Senate rules to sideline Democrats? “People want to know how I feel about getting rid of the filibuster. No, that’s not how we end a government shutdown. We’ve got to end it because we’ve come together,” said Sen. Lisa Murkowski, R-Alaska.

— Burgess Everett and Eleanor Mueller

More headwinds for bipartisan crypto bill

The cryptocurrency industry’s top legislative priority is facing yet more headwinds shortly after CEOs huddled with senators to salvage bipartisan talks. First, law enforcement alleged NBA head coach Chauncey Billups and others used crypto to launder proceeds from a mafia-linked gambling ring. Then, The Wall Street Journal scooped that Trump pardoned Binance founder Changpeng Zhao, whose firm gave the Trump family crypto firm its first big break. Both developments could hand fresh ammunition to the Democrats who Republicans need to advance the bill — Democrats who had already raised concerns in closed-door meetings Wednesday over illicit finance and conflicts of interest. The pardon “just reeks of further Trump corruption,” Sen. Ruben Gallego, D-Ariz., told Semafor. “I’ll be shocked if we make much progress in the crypto space [this Congress], because it’s become a political lightning rod,” Sen. Thom Tillis, R-N.C., said.

— Eleanor Mueller

Firms line up to fund Trump’s ballroom

The White House ballroom project that’s resulted in the demolition of the East Wing is giving corporations a new way to curry favor with Trump. The list of private funders for the new ballroom includes major companies like Meta, Amazon, Apple, and Google, as well as crypto industry donors, like the Winklevoss twins. Construction began earlier this week on the new ballroom — which the White House now expects to cost $300 million, $100 million more than the initial projection — and the project is proving polarizing. “The optics are not good,” Murkowski said, adding that Americans are “seeing the headlines that say SNAP benefits, food benefits for lower-income people may not be available next week. Federal funding for nursing moms, WIC benefits may not be available … and then you have a White House where they’re expanding a massive ballroom.”

American Eagle’s summer campaign with Sydney Sweeney blew up in ways no one could’ve imagined, but its chief marketing officer, Craig Brommers, knew they were going to hit a cultural nerve. This week, Ben and Max bring on the AE CMO to give us an inside look into the “Great Jeans” campaign, what he made of the controversy that surrounded it, and how Trump and Vice President JD Vance boosted their sales. They also discuss how marketing today is like running an entertainment company, why he ignored the advice of what he calls the “crisis communication industrial complex,” and whether their campaign with Travis Kelce was timed to Kelce’s engagement to Taylor Swift.

Debatable: Changing Obamacare subsidies

At the center of the impasse over US government funding are expiring Affordable Care Act subsidies passed at the height of the COVID pandemic. Senate Democrats are demanding a deal to address them as part of any funding measure, while Republicans say that Congress should end the shutdown and then have that conversation. Congress initially expanded the insurance premium tax credits — which expire at the end of the year — to lower out-of-pocket health care costs, increasing assistance available to those eligible while lifting the income cap. Sen. Richard Blumenthal, D-Conn., says that the subsidies should be extended with no major changes, calling them “essential to millions having health care.” But Rep. Mike Haridopolos, R-Fla., argued during Semafor’s World Economy Summit that a minimum premium should be added to the subsidies to control rising health care costs.

Beltway Newsletters

Punchbowl News: White House deputy chief of staff James Blair said President Trump plans to tap his substantial political war chest — running to hundreds of millions of dollars — to support Republicans in the 2026 elections and has already been quietly funding political races nationwide.

Axios: Sen. Bernie Sanders, I-Vt., believes the government should break up OpenAI.

Playbook: Sen. Rand Paul, R-Ky., warned Trump over his foreign policy, saying that the president could see “all hell break loose” if he involves the US further in Venezuela or Ukraine.

WaPo: “At one point there had been hope that this meeting could lead to almost forward-looking announcements,” one Asia expert said of Trump’s upcoming meeting with Chinese leader Xi Jinping