Trump order to cut drug prices raises doubts – National & International News – MON 12May2025
Trump order to cut drug prices raises doubts.
Stocks rally after US, China agree to slash tariffs.
Hamas releases American-Israeli hostage in “good faith” gesture to Trump.
Trump order to cut drug prices raises doubts
Today, President Trump announced an executive order aimed at drastically cutting the prices of prescription drugs. In his Truth Social post, Trump raises the fact that prescription drugs in the US often cost three times or more what they cost in other countries. In his post, Trump demanded that pharmaceutical companies cut prices for US patients and said that other measures could follow if they do not follow through.
The executive order issued by Trump was substantially similar to an executive order he issued during his first term, which was blocked by the courts. This sort of policy would require legislation to implement. Democratic Senator Bernie Sanders and Congressman Ro Khanna announced that they would be happy to sponsor legislation with the exact text of Trump’s executive order in hopes of passing bipartisan legislation to lower drug prices for Americans. However, Sanders and Khanna are unlikely to get any takers from the Republican side.
Unpopular budget
From a more cynical lens, Trump’s announcement may already have achieved its objective- namely distracting from the release by House Republicans of their budget reconciliation bill, the text of which is likely to prove unpopular.
Republicans have drafted a budget bill that will make permanent Trump’s 2017 tax cuts (increasing the federal deficit by about $4 trillion over the next decade), while drastically cutting services for Americans. Some of the most unpopular cuts will be to Medicaid programs that tens of millions of Americans rely upon.
Trump himself last week urged House Republicans to raise the highest marginal tax rate on the wealthiest Americans. Trump proposed raising the highest tax bracket to what it was before his 2017 tax cuts in order to decrease the budget’s impact on the deficit while avoiding cutting programs like Medicaid. House Republicans apparently paid no heed.
Stocks rally after US, China agree to slash tariffs
Both the US and China have backed down from an escalating trade war, for now. China has reduced its effective tariff on US goods from 125% to 10%, while the US will lower tariffs from 145% to 30%. While markets breathed a sigh of relief, even these smaller tariffs are likely to increase inflationary pressures, especially within the US.
The White House announced a pause on the tariff program for 90 days to allow more talks between the two countries to continue. For several weeks, Washington and Beijing have been engaged in a game of chicken that threatened to unwind global supply chains and plunge the world into recession.
However, Beijing proved far more resilient than anyone in the White House seemed to anticipate. China is now the world’s manufacturing superpower and has dominated markets the world over. China also is a key source of many goods that the US manufacturing and technology base rely upon. This includes machine parts and rare earth minerals needed for the batteries and computer chips that power not only personal devices but also cars and robotic manufacturing equipment.
Hamas releases American-Israeli hostage in “good faith” gesture to Trump
Today, 21-year-old IDF soldier Edan Alexander was released by Hamas after 19 months in captivity in Gaza. Alexander was born in Israel but raised in New Jersey. On October 7, 2023, he was captured in uniform, making him a high value hostage.
In a Truth Social post, Trump called Alexander’s release a show of “good faith towards the United States”. Hamas confirmed in a statement that they had decided to release Alexander “following contacts with the US administration, to achieve a ceasefire, open crossings, and bring aid and relief to our people in Gaza”.
While reuniting with his family, Alexander appeared pale but healthy and in good spirits. The news that he was alive and well came as something of a surprise. A few weeks ago, Hamas announced that they had lost contact with the militants that were holding him after repeated Israeli strikes on their position. Many feared that Alexander had become one of dozens of Israeli hostages to perish due to IDF bombings in the Gaza Strip.
President Trump announced last week that three more hostages have been killed in Gaza since Israel resumed bombing at the beginning of March. Netanyahu’s government had made no such announcement, but later admitted that they had “concerns” for the statuses of three hostages.
Trump admin in talks with Hamas
Over the last week, there have been numerous developments that appear to show increasing strain in relations between the Trump administration and the Israeli government, particularly their Prime Minister Benjamin Netanyahu. It now emerges that the US has been negotiating with Hamas, through mediators in Qatar and Egypt. These talk so far have taken place without Israel’s participation. However, Netanyahu announced today that he will soon dispatch a negotiator to Doha.
Trump’s special envoy Steve Witkoff has also made statements recently calling on Netanyahu to agree to a ceasefire in Gaza, something Netanyahu has repeatedly rejected. Trump is due to arrive in the Middle East tomorrow. He is not scheduled to travel to Israel, but he will meet with leaders in Saudi Arabia, Qatar, and the UAE. He has teased a major announcement to be made while he is in the region, but it is not clear whether this announcement concerns Gaza.
