Washington, DC

1. Trump pivots to economy
2. Trump lauds Japan deal
3. Dems battle on tax cuts
4. Anthropic-Pentagon rupture
5. CFTC on prediction markets
6. Iran talks progress

PDB: No shutdown movement

Trump attends Black History Month reception … US reports industrial production … Fed releases minutes

Trump to talk affordability in GA

President Donald Trump’s scheduled Thursday trip to Rome, Georgia, to talk about affordability is the latest sign of a pre-midterms shift toward domestic economic policy that many in his party have clamored for. In advance of his visit, Trump announced a new critical minerals facility in the state as well as Japan-backed oil and gas projects in Texas and Ohio (which will also host top-tier Senate races this fall). Expect Trump to focus his travel — which will feature a stop at a local business, according to a White House official — on the benefits to US workers from the new projects. He also might take the opportunity to keep bashing former Rep. Marjorie Taylor Greene, R-Ga., a longtime ally-turned-recent critic who represented the Rome area. “I’m not in his cult,” Greene said Tuesday.

— Shelby Talcott and Eleanor Mueller

Trump touts trade deal with Japan

As Trump faces resistance to his tariffs on Capitol Hill and stares down a Supreme Court ruling, he’s working to tout the success of the duties. He announced the first wave of investments under his $550 billion trade deal with Japan, which will see the country invest up to $36 billion in US fossil-fuel and mineral projects he’s likely to tout later this week, including a huge natural-gas power plant in Ohio and an oil platform in the Gulf of Mexico. “Our MASSIVE Trade Deal with Japan has just launched!” Trump posted Tuesday on Truth Social. “The scale of these projects are so large, and could not be done without one very special word, TARIFFS.” As part of the deal signed last year, Washington agreed to reduce levies on Japanese exports, namely cars, although it could reinstate them if Tokyo fails to meet its commitments.

Dems wage populist fight on tax cuts

Democrats are shaking up their campaign against the GOP’s 2025 tax cuts. The group Fair Share America is rebranding as Families Over Billionaires and launching the Stop the Billionaire Bailout PAC. It’s a sign of Democrats leaning into the economic populist fight, a battle that the group’s executive director, Kristen Crowell, said “intensified” after Trump signed the 2025 tax law. The PAC plans to raise $3 million, according to details first shared with Semafor, and aims to capitalize on new polling showing that voters want to raise taxes on billionaires and corporations. Democrats’ Biden-era goals of raising taxes on wealthy Americans and big companies to fund upgrades to health care, education, and clean energy were somewhat stifled by their 50-50 majority. Rep. Brendan Boyle, D-Pa., says he’s “grateful” for an ally “in the fight to build an economy that works for everyone.”

— Burgess Everett

Pentagon’s growing rift with Anthropic

The brewing conflict between the US military and Anthropic has its roots in the changing nature of the software stacks used by the Pentagon, Semafor’s Reed Albergotti reports. As AI models become more powerful and general-purpose, the same underlying models that power consumer chatbots could one day make life and death decisions on the battlefield, raising new ethical questions. Anthropic is one of the few “frontier” large language models available for classified use by the US government because it is available through Amazon’s Top Secret Cloud and through Palantir’s Artificial Intelligence Platform — which is how its Claude chatbot ended up appearing on the screens of officials who were monitoring last month’s raid to capture Nicolás Maduro. An exchange between Anthropic and Palantir about the operation eventually led to the former’s rupture with the Pentagon (an Anthropic spokesman denied Semafor’s account of the exchange).

CFTC defends prediction markets

The Commodity Futures Trading Commission is warning states and tribes against coming after prediction markets like Kalshi and Polymarket. Chair Mike Selig on Tuesday argued his agency has “exclusive jurisdiction” over the firms — and pledged to intervene when local regulators sue them, including for not complying with gambling laws. His first move: filing an amicus brief in a legal battle between Crypto.com and the Nevada Gaming Control Board. The industry swooned. “This is a critically important part of the American economy and the states should not be allowed to deprive their citizens,” Coalition for Prediction Markets’ Sean Patrick Maloney told Semafor. Consumer advocates like Better Markets’ Dennis Kelleher panned it as a “de facto lawless assertion” given states’ longstanding jurisdiction over the issue. “It’s one of the most brazen, outrageous attempts to avoid literally 100 years of regulation that’s ever happened,” Kelleher said.

— Eleanor Mueller

Cautious progress in Iran talks

The US and Iran each reported positive developments from indirect talks in Switzerland. Now, they’re looking ahead to the next two weeks, when Tehran is expected to offer detailed proposals on how to close gaps in the negotiations. Iran’s foreign minister said the two sides had reached an agreement on “guiding principles” through the talks, which were mediated by Oman, while a US official told Reuters that “progress was made, but there are still a lot of details to discuss.” Iran signaled willingness to suspend nuclear enrichment for three to five years in exchange for sanctions relief, and has also floated investment and trade opportunities in the US, per The New York Times. Still, the US is keeping up military pressure, while Iran partially closed the Strait of Hormuz amid military drills and its supreme leader issued a threat of his own.

Blindspot: ICE and Noem

Stories that are being largely ignored by either left-leaning or right-leaning outlets, curated with help from our partners at Ground News.

What the Left isn’t reading: The number of agreements between ICE and local law enforcement to work on immigration arrests increased dramatically during the first year of President Trump’s second term.

What the Right isn’t reading: Homeland Security Secretary Kristi Noem is butting heads with leaders at the US Coast Guard, NBC News reported.

There’s a money story in the Arabian Peninsula. Take one look at the news, and you’ll see headlines about Saudi Arabia’s rapidly changing economy, Qatar’s investment in mass infrastructure, and the UAE’s transformation into a global tech hub. The geopolitical tectonic plates are shifting. To stay up to date on the business happening in the Gulf that impacts the world around you, check out Semafor Gulf. Each issue uncovers the economic forces shaping the region — and the world.

Beltway Newsletters

Playbook: Texas Democratic Senate hopeful James Talarico’s campaign garnered $2.5 million in donations in 24 hours, after CBS pulled his planned interview with Stephen Colbert on The Late Show on Monday night.

WaPo: Candidates in closely fought Illinois Democratic primaries say the influential pro-Israel group AIPAC is masking its involvement in the races.

Axios: A possible US military operation in Iran is closer than many Americans think, and “would likely be a massive, weekslong campaign that would look more like full-fledged war than last month’s pinpoint operation in Venezuela.”

White House

• White House chief of staff Susie Wiles and deputy chief of staff James Blair gathered much of Trump’s Cabinet on Tuesday evening at the Capitol Hill Club for a meeting to discuss midterm strategy.
• President Trump tapped his longtime executive assistant, Chamberlain Harris, to the body that will review his ballroom.
• The Trump family filed to trademark the use of Trump’s name on airports.

Congress

• Immigration enforcement negotiations are not making any headway in ending the DHS shutdown. A White House official told Semafor’s Burgess Everett that Republicans and Democrats are “still pretty far apart” after Democrats’ offer last night; spokespeople for Democratic leaders Hakeem Jeffries and Chuck Schumer said “Republicans have largely ignored the core guardrails Americans are demanding.”
• House Democrats may try to force a vote to censure Rep. Randy Fine, R-Fla., over his anti-Muslim remarks unless House Speaker Mike Johnson disciplines him. — Axios

Outside the Beltway

• New York Mayor Zohran Mamdani proposed raising the city’s property taxes by almost 10% if Gov. Kathy Hochul will not raise taxes on high earners.

Inside the Beltway

• The Government Accountability Office is probing DHS’ handling of whistleblower complaints.