US DOJ to probe Fed Reserve’s Cook, urges Powell to remove her: Report

According to Bloomberg News, a top official instructed Fed Reserve Chairman Jerome Powell to step down and advised him to do so, according to the report from the US Department of Justice.

According to a letter from a Department of Justice (DOJ) official who has conducted similar investigations into New York Attorney General Letitia James and Senator Adam Schiff of California, Cook’s case “requires further investigation,” Bloomberg reported on Thursday.

According to Bloomberg, Martin wrote, “At this time, I urge you to remove Ms. Cook from your Board.” “Do it now before it’s too late!” No American, after all, would agree that she should serve this time with a cloud over her.

A comment request was not immediately addressed by the DOJ.

A Fed representative referred to Cook’s statement on Wednesday, in which she claimed she had no intention of being “bullied” into resigning based on allegations made by a member of his administration about mortgages she holds in Michigan and Georgia.

A Fed chair has no authority under the Federal Reserve Act to appoint a new board of governors member.

Cook, the first Black woman to hold office in the Federal Reserve, is in the runoff for a 14-year term that began in 2023 with her second Senate confirmation.

The administration’s decision to remove Cook coincides with the launch of a campaign against diversity, equity, and inclusion (DEI), which furthers Trump’s ongoing efforts to control the US central bank and slash interest rates.

Fed under pressure

The Kansas City Fed’s annual Jackson Hole symposium, which will feature Powell giving a keynote speech on Friday, will open the organization’s annual meeting in Grand Teton National Park, where central bankers from around the world will discuss the state of the economy and, in the hope that, where rates will go, was held on Thursday.

At the event, Cleveland Fed President Beth Hammack stated to Yahoo Finance, “I just want to say that I know her to be an outstanding economist and person of high integrity.”

William Pulte, director of the US Federal Housing Finance Agency, claimed the allegations against Cook were part of his agency’s regular investigations into mortgage fraud and weren’t a “witch-hunt.” Pulte also referred the allegations against Cook to the Department of Justice this week.

According to Pulte, “frauding people is nothing new.” He claimed that “I believe she committed mortgage fraud” and that a special exemption for the powerful shouldn’t be granted because public records clearly ascribe fraud. He claimed that it is “self-evident” that the fraud exists.

As a member of the Federal Reserve, Cook has yet to respond directly to Pulte’s claim, saying only in his statement on Wednesday: “I do intend to take any questions about my financial history seriously. I am gathering the necessary information to respond to any legitimate questions and provide the facts.”

Due to concerns that Trump’s tariffs could reinvigorate inflation that is still below the Fed’s 2 percent target, the Fed has kept borrowing costs steady all year in the 4.25 to 4.5% range. Recent weaker labor market data, such as a report that showed job growth rates of a paltry 35, 000 between May and July, have raised concerns among Fed policymakers that borrowing costs may be a little too high and that financial markets are priced for the likelihood of a quarter-point cut at the Fed’s September meeting.

That would fall far short of the various Trump-required percentage points.

When Powell’s term expires in May, Trump has the power to appoint a new chair. Nearly a dozen candidates have endorsed the central bank’s proposal for significant rate cuts and changes, including US Treasury Secretary Scott Bessent, who is in charge of the search. Fed chairs typically resign when their positions of authority expire, but there is speculation that Powell will continue until 2028, denying Trump the opportunity to install more loyalists to bolster his position.

Trump has nominated Council of Economic Advisers Chairman Stephen Miran to lead the Fed in Adriana Kugler’s surprise resignation this month. Miran is a Fed critic and vocal supporter of Trump’s tariffs and other policies.

What’s the Texas redistricting fight about, and how has California reacted?

President Donald Trump and his allies have kicked off a redistricting fight in the United States as the country’s two main political parties angle for advantage in the 2026 midterm elections.

In an effort to maintain control of Congress, Republican leaders in the right-wing stronghold of Texas have pushed to redraw the state’s congressional districts in a way that would net the party as many as five additional seats in the US House of Representatives.

Trump has encouraged the effort, calling it a “big WIN for the Great State of Texas”. The state’s Senate is expected to vote on the new district plans as early as Thursday evening.

But that effort has prompted a backlash. The Democratic-leaning state of California responded in kind by passing a plan on Thursday to abandon nonpartisan redistricting and create new congressional maps that could bring the Democrats five more seats, negating the effort in Texas.

Party leaders in other states, including Missouri and Florida, have also indicated they may seek to rejigger their districts to pick up more seats.

The standoff points to larger questions about how to ensure fair representation in Congress and how Trump has sought to exert wide-reaching control over the country’s political system.

With Trump’s approval rating slipping to about 40 percent, Republicans risk losing their narrow, 219-person majority in the 435-seat House of Representatives in the midterm races.

So what is redistricting? And what could it mean for upcoming elections? We answer those questions and more in this quick explainer.

What is redistricting?

Simply put, the practice of redistricting refers to drawing the boundaries of an election district.

Ideally, districts should be designed as an accurate and proportionate reflection of the area’s population. Maps are generally updated every 10 years, in accordance with the latest population census.

But political parties can take steps to shape districts to their benefit, in a process sometimes referred to as gerrymandering.

That involves finding creative ways to maximise the number of seats a party can win by carving districts based on demographics and voting trends, to increase the electoral weight of certain groups and minimise the influence of others.

“Politicians can look at information about the partisan and demographic breakdown of an area and stack the decks in their favour,” said Thad Kousser, a professor of political science at the University of California at San Diego.

This practice has a long and fraught history in the US, especially in states with histories of segregation and discrimination, where maps were often drawn to dilute representation for minority voters.

What is happening in Texas?

While redistricting is far from new, Texas has been in the spotlight recently for a particularly overt partisan effort.

Part of the controversy stems from the involvement of President Trump, who prompted Texas Republicans to redraw maps.

In June and July, reports began to emerge that the White House was holding calls with Texas state leaders to tee up a redistricting battle, in preparation for the 2026 midterms.

Despite early concerns that the effort could backfire, Republican lawmakers in the state quickly put the plan in motion.

Speaking by phone to CNBC on August 5, Trump seemed to suggest that the makeup of the US Congress should reflect his success in the 2024 presidential race.

“We should have many more seats in Congress,” Trump said. “I got the highest vote in the history of Texas, as you probably know, and we are entitled to five more seats.”

The state’s House of Representatives passed a new election map on Wednesday, and the Texas Senate is expected to do the same in the next few days. The new maps would carve out five additional districts in areas where Trump performed strongly during the last election.

How did Texas Democrats respond?

Texas Democrats condemned the redistricting as a partisan power grab and tried to prevent a vote on the new congressional map.

In early August, they left the state in a bid to deny the Texas legislature the quorum it needed to move the plan forward.

But as a minority voting bloc in the firmly Republican state legislature, the Democrats ultimately failed to stop the redistricting scheme.

While away, Texas Governor Greg Abbott ordered the absent Democrats’ arrest, and the Republicans in the state House echoed that effort with a vote to issue arrest warrants. Abbott also threatened the Democrats with criminal charges, including for bribery, if they solicited funds during their absence.

What’s more, the Texas Democrats faced a series of reported bomb threats at their Illinois hotels. Eventually, after two weeks, they returned to their home state, allowing the vote to proceed.

Democratic leaders have said that, while they did not stop the redistricting push, they drew attention to the issue and are preparing to challenge the new maps in court.

Do both parties gerrymander?

Yes, both parties have engaged in gerrymandering, and the practice has been employed throughout US history in varying contexts.

In recent years, however, the practice has been more commonly associated with right-leaning states.

Princeton University’s Gerrymandering Project found that states with the most severe gerrymandering tend to be Republican-led states in the southern US, where the practice has historically been employed to dilute the influence of Black voters.

The project also found that a handful of states, such as Oregon, Illinois and Nevada, have partisan election maps that heavily favour Democrats.

Some Democrats previously criticised gerrymandering as anti-democratic and pushed for changes to ensure that redistricting is nonpartisan.

“Public servants should earn the votes of the people that they hope to represent. What Republicans are trying to do in Texas is to have politicians choose their voters,” House Democratic Leader Hakeem Jeffries recently told reporters.

But as Trump seeks to increase his party’s advantage, some Democratic leaders have urged the party to change its approach and “fight fire with fire” through more explicitly partisan tactics.

Courts have, on occasion, struck down gerrymandered congressional maps on the basis that they violate the US Constitution’s Equal Protection Clause by disadvantaging racial minorities and other demographics.

But the Supreme Court has ruled it will not intervene in questions of partisan gerrymandering, though state courts can.

How is California responding?

Following the developments in Texas, California Governor Gavin Newsom announced his state would begin its own redistricting effort meant to add five congressional seats to the Democrats’ tally in the US House of Representatives.

California, the largest state by population, is considered solidly left-leaning: Nearly 47 percent of registered voters identified as Democrats in 2023, compared with 24 percent for Republicans.

On Thursday, the state’s legislature voted largely along party lines to forward the redistricting plan to Newsom’s desk for a signature.

“It’s the fact that this has been so baldly political and driven by demands from Trump that has allowed Democrats to take the gloves off,” said Kousser, the political science professor.

Newsom has depicted his actions as an unfortunate but necessary response to the Texas Republicans.

He said he will shelve California’s redistricting plans if Texas agrees to do the same, but he argues that Democrat-led states cannot “unilaterally disarm” and allow partisan redistricting to disadvantage them in Congress.

“Other blue states need to stand up,” Newsom said as he announced his plan. “We need to be firm.”

Former Democratic President Barack Obama said that, while his “preference” is to do away with gerrymandering, Newsom was taking a “responsible approach” by countering the Republicans.

Are other states considering redistricting plans?

Yes. The Republican-led state of Ohio announced redistricting plans, and Republican leaders in Florida, Indiana and Missouri have also suggested they will follow suit.

Meanwhile, officials in the Democrat-led state of Illinois are also mulling changes to the map-drawing process. New York’s Democratic Governor Kathy Hochul also said that her state may pursue redistricting if Texas moves forward with its plan.

How could this affect future elections?

It is unclear how much this redistricting battle will tip the scales for either party, particularly as Democrats consider steps to negate Republican gains.

But experts say there are generally more Republican-led states where redistricting might be viable

The primary objective is to gain an advantage in anticipation of the 2026 midterms, when control of Congress is up for grabs.

While each state receives exactly two senators, the number of representatives in the House varies depending on each state’s population size. All 435 seats in the House will be up for grabs in the midterms, and each congressional district is responsible for selecting the winner for one of those seats.

Trump last month called Texas the greatest prize – “the biggest one” – in the redistricting battle.

On Thursday, he framed the five seats Republicans hope to gain there as integral to his platform: “On our way to FIVE more Congressional seats and saving your Rights, your Freedoms, and your Country, itself. Texas never lets us down.”

But halfway through Trump’s first term in office, the Republicans lost their majority in the House during the midterm elections. That loss gave Democrats greater power to stymie Trump’s legislative priorities.

“Trump is urging his allies to redraw districts as a way to insulate him and his political party from possible backlash in the midterms,” said Kousser.

Isn’t California doing the same thing as Texas?

Newsom has attempted to assuage concerns about California’s redistricting scheme by contrasting his plan with the one in Texas.

He says that California’s new map will go before voters in November for approval, unlike in Texas, and will only go into effect if Republican-led states do the same.

Still, his efforts would require sidelining a nonpartisan redistricting panel previously approved by California voters.

But Kousser says that Trump’s push for greater sway over the country’s political system may induce more Democrats to adopt partisan redistricting for themselves.

US Supreme Court rules Trump admin can cut nearly $800m in health funding

The highest court in the US has ruled that the Trump administration can slash hundreds of millions of dollars’ worth of research funding on breast cancer, HIV prevention and suicide, among other issues, in its push to cut federal diversity, equity and inclusion (DEI) efforts.

In a 5-4 decision issued on Thursday, the Supreme Court lifted a judge’s order blocking $783m worth of cuts made by the National Institutes of Health (NIH) to align with Republican President Donald Trump’s priorities.

The justices granted the Justice Department’s request to lift Boston-based US District Judge William Young’s decision in June that the grant terminations violated federal law, while a legal challenge brought by researchers and 16 US states plays out in a lower court.

The order marks the latest Supreme Court win for Trump and allows the administration to forge ahead with cancelling hundreds of grants while the lawsuit continues to unfold. The plaintiffs, including states and public-health advocacy groups, have argued that the cuts will inflict “incalculable losses in public health and human life”.

The NIH is the world’s largest funder of biomedical research. The cuts are part of Trump’s wide-ranging actions to reshape the US government, slash federal spending and end government support for programmes aimed at promoting diversity or “gender ideology” that the administration opposes.

The administration said Young’s ruling required the NIH to continue paying $783m in grants that run counter to its priorities.

The Supreme Court, which has a 6-3 conservative majority, has sided with the administration in almost every case that it has been called upon to review since Trump returned to the presidency in January.

After Trump signed executive orders in January targeting DEI and gender ideology, NIH instructed staff to terminate grant funding for “low-value and off-mission” studies deemed related to these concepts, as well as COVID-19 and ways to curb vaccine hesitancy.

Young’s ruling came in two lawsuits challenging the cuts. One was filed by the American Public Health Association, individual researchers and other plaintiffs, who called the cuts an “ongoing ideological purge” targeting projects based on “vague, now-forbidden language”. The other was filed by the states, most of them Democratic-led.

The plaintiffs said the terminated grants included projects on breast cancer, Alzheimer’s disease, HIV prevention, suicide, depression and other conditions that often disproportionately burden minority communities, as well as grants mandated by Congress to train and support a diverse group of scientists in biomedical research.

Young, an appointee of former Republican President Ronald Reagan, invalidated the grant terminations in June. In a written ruling, the judge said they were “breathtakingly arbitrary and capricious”, violating a federal law governing the actions of agencies.

During a June hearing in the case, Young rebuked the administration for what he called a “darker aspect” to the case that the cuts represent “racial discrimination and discrimination against America’s LGBTQ community”.

“I’ve never seen a record where racial discrimination was so palpable,” the judge said.

Young also said the cuts were designed to stop research that bears on the health of the LGBTQ community. “That’s appalling,” the judge said.

The administration has argued that the litigation should have been brought in a different judicial body, the Washington-based Court of Federal Claims, which specialises in money damages claims against the US government.

Israeli PM Netanyahu approves Gaza City seizure despite ceasefire talks

Israeli Prime Minister Benjamin Netanyahu said he will give final approval for the seizure of Gaza City while also restarting negotiations with Hamas aimed at returning all the remaining captives and ending the nearly two-year-old war, but on “terms acceptable to Israel”.

Speaking to soldiers near Gaza on Thursday, Netanyahu said he was still set on approving plans for seizing Gaza City, the densely populated centre at the heart of the Palestinian enclave, forcibly displacing close to 1 million people and carrying out the systematic demolitions of Palestinian homes.

“At the same time I have issued instructions to begin immediate negotiations for the release of all our hostages and an end to the war on terms acceptable to Israel,” Netanyahu said, adding: “We are in the decision-making phase.”

The wide-scale operation in Gaza City could start within days after Netanyahu grants final approval at a meeting with senior security officials later on Thursday.

Israeli forces have already stepped up attacks there, and thousands of Palestinians have left their homes as Israeli tanks edged closer to Gaza City over the last 10 days.

Hamas said earlier this week that it had agreed to a ceasefire proposal from mediators Qatar and Egypt, which, if accepted by Israel, could forestall the assault.

Israel’s army plans to call up 60,000 reservists and extend the service of 20,000 more.

The proposal on the table calls for a 60-day ceasefire and the release of 10 living captives held in Gaza by Hamas and of 18 bodies. In turn, Israel would release about 200 Palestinian prisoners held by Israel.

Once the temporary ceasefire begins, the proposal is for Hamas and Israel to begin negotiations on a permanent ceasefire that would include the return of the remaining captives.

Marwan Bishara, Al Jazeera’s senior political analyst, has likened Netanyahu’s announcement about relaunching purported truce talks while the military escalates its assault on Gaza City to “negotiation under fire”.

“There will be no stoppage of the fighting. There will be no breaks in the genocide. Hamas is going to have to make up its mind as Israel kills dozens, perhaps hundreds, of Palestinians moving forward [and] as it transfers a million Palestinians southward in Gaza,” Bishara said.

“Israel is now dictating all the terms, and it’s not listening to anyone, and it has a green light from Washington.”

At least 48 Palestinians were killed in Israeli attacks across Gaza since dawn, including 16 aid seekers who were the latest victims of shootings at GHF aid distribution points.

Meanwhile, two more people have starved to death in Gaza in the past 24 hours, the Health Ministry said on Thursday. The new deaths raised the number of Palestinians who have died from Israeli-induced hunger to 271, including 112 children, since the war began.

‘Systematic destruction’

A renewed Israeli offensive could bring even more casualties and displacement to the famine-struck territory. The UN agency for Palestinian refugees (UNRWA) estimated that 90 percent of Gaza’s residents have been displaced, warning that shelters are deteriorating and any further displacement will worsen the catastrophic situation.

The Palestinian Ministry of Interior denounced Israel’s push to seize Gaza City as a “death sentence” for the more than one million people living there.

The Palestinian Health Ministry also released a statement responding to what it says is an Israeli push to transfer health system resources to the south of the enclave.

“The Ministry of Health expresses its rejection of any step that would undermine what remains of the health system following the systematic destruction carried out by the Israeli occupation authorities,” it said.

“This step would deprive more than one million people of their right to treatment and put the lives of residents, patients and the wounded at imminent risk.”

Some Palestinian families in Gaza City have left for shelters along the coast, while others have moved to central and southern parts of the enclave, according to residents there.

“We are facing a bitter, bitter situation, to die at home or leave and die somewhere else. As long as this war continues, survival is uncertain,” Rabah Abu Elias, 67, a father of seven, told the Reuters news agency.

“In the news, they speak about a possible truce, on the ground, we only hear explosions and see deaths. To leave Gaza City or not isn’t an easy decision to make,” he said.

Meanwhile, Israeli air attacks also destroyed a tent camp in Deir el-Balah, central Gaza, where many people have sought refuge. Residents said the Israeli military warned them to flee shortly before the attacks set the camp ablaze.

Families, many with children, could later be seen sifting through the ashes for the belongings they had managed to take with them during earlier evacuations.

Mohammad Kahlout, who had been displaced from northern Gaza, told The Associated Press they were given just five minutes to gather what they could and flee.