US lawmaker backs renegotiating global economic rules to reflect China’s rise

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By KEN MORITSUGU, Associated Press

SHANGHAI (AP) — The head of a U.S. congressional delegation visiting China said he backed renegotiating the rules governing the global economy to take into account China’s rise and that of others such as India and Brazil.

Rep. Adam Smith, a Democrat from Washington state, told the mayor of Shanghai on Thursday that the U.S.-led post-World War II order has worked well for many countries, including China, but that “we understand that things have changed.”

US Representative Adam Smith speaks during a press conference at the American Chamber of Commerce (AmCham) in Shanghai, China, Thursday, Sept.25, 2025. (Jade Gao/Pool Photo via AP)

His remarks, at end of a five-day trip to China, dovetailed with Chinese leader Xi Jinping’s recent announcement of an initiative to build a more equitable global governance system. They also reflected the reality that though the U.S. remains the most powerful country in the world, China is emerging as a potential challenger for global leadership.

The delegation of three Democrats — Smith, Rep. Ro Khanna from California and Rep. Chrissy Houlahan from Pennsylvania — and Republican Rep. Michael Baumgartner from Washington state, wrapped up their trip in Shanghai after three days of meetings with government leaders in Beijing.

The main purpose of the visit — the first by members of the U.S. House of Representatives since 2019 — was to open up lines of communication between the governments, Smith said. A U.S. Senate delegation visited in 2023.

Citing the expansion of McDonald’s outlets in China, Smith said his biggest takeaway from the trip was that a lot of business is going on between the two economies despite the ongoing trade and tariff war.

“We have a lot of work to do to resolve those issues,” he told a small group of journalists after a meeting with the American Chamber of Commerce in Shanghai. The trade conflict is creating difficulties for companies on both sides of the Pacific, he said.

The lawmakers were later seen at a Starbucks, another U.S.-headquartered company, in the lobby of the office building.

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The exchange with the Shanghai Mayor Gong Zheng started after Smith politely interrupted Gong about 10 minutes — including time for translation — into the mayor’s introduction to Shanghai as an economic and financial center.

How is the U.S.-China tariff war impacting Shanghai’s economy, Smith wanted to know, and how does the mayor think it should be resolved.

Gong said that Shanghai, a major shipping port, is among those most affected because of its high exposure to international trade.

“We’re very glad to see that we already have talks and negotiations,” Gong said, citing the four rounds of meetings since May in Geneva, Stockholm, London and, most recently, Madrid.

He stated the Chinese government position that there are no winners in trade wars, but China will fight back if there is a war while remaining open to negotiation.

Smith expressed hope that both tariffs and other barriers to imports would be reduced. He then called for a robust debate about how to renegotiate the rules governing the economy.

“China and the U.S. are the two most important players in how we resolve that,” he said. “How do we get to an international rules based order that is more agreeable to everyone?”

China maintains that the current international order favors the U.S. and other rich nations. The government says it doesn’t want to overturn that order but make it better serve the interests of all countries, particularly developing ones.

“The collective rise of emerging markets and developing countries necessitates boosting the representation of the Global South,” a Foreign Ministry document says, using a catch-all term for those nations.

The three Democrats in the delegation are members of the House Armed Services Committee, and Smith repeated his call from the outset of the trip for more communication between the U.S. and Chinese militaries.

“Two of the largest nuclear powers in the world need to be talking to each other, particularly considering the fact that we do have some disagreements,” he said.

Russian warplanes detected flying near Alaska for ninth time this year, US military says

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By AAMER MADHANI, Associated Press

WASHINGTON (AP) — U.S. fighter jets scrambled to identify and intercept four Russian warplanes flying near Alaska, the North American Aerospace Defense Command said Thursday.

It’s the third time in about a month and the ninth time this year NORAD has reported such an incident involving Russian aircraft flying near Alaska. This latest incident happened Wednesday.

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NORAD said in a statement issued early Thursday that it detected and tracked two Tu-95s and two Su-35s operating in the Alaskan Air Defense Identification Zone.

Nine U.S. aircraft — an E-3 Sentry command and control aircraft, four F-16s and four KC-135 tankers — scrambled to positively identify and intercept the Russian jets, NORAD said.

The Russian aircraft remained in international airspace and did not enter American or Canadian sovereign airspace, it said. Such Russian activity near Alaska occurs regularly and is not seen as a threat, it added in its statement.

The incident comes after President Donald Trump said Tuesday he believed Ukraine could win back all territory lost to Russia, a dramatic shift from the Republican’s repeated calls for Kyiv to make concessions to end Russia’s war in Ukraine.

NATO warned Russia on Tuesday it would use all means to defend against any further breaches of its airspace after the downing this month of Russian drones over Poland and Estonia’s report of an intrusion by Russian fighter jets last week.

Trump on Tuesday said NATO countries should shoot down Russian aircraft if they enter their airspace. Asked if the U.S. would back up NATO allies in such a situation, Trump said “it depends on the circumstance.”

Following a summit with Russian President Vladimir Putin in Alaska last month, Trump said he was arranging for direct talks between Putin and Ukrainian President Volodymyr Zelenskyy. But Putin has shown no interest in meeting with Zelenskyy, and Moscow has only intensified its bombardment of Ukraine.

Trump hosts Turkey’s Erdogan at the White House as the US considers lifting a ban on F-35 sales

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By AAMER MADHANI, Associated Press

WASHINGTON (AP) — President Donald Trump will hold talks with Turkish President Recep Tayyip Erdogan at the White House on Thursday as the Republican leader has indicated that the U.S. government’s hold on sales of advanced fighter jets to Ankara may soon be lifted.

During Trump’s first term, the United States kicked out Turkey, a NATO ally, from its flagship F-35 fighter jet program after it purchased an air defense system from Russia. U.S. officials worried that Turkey’s use of Russia’s S-400 surface-to-air missile system could be used to gather data on the capabilities of the F-35 and that the information could end up in Russian hands.

But Trump last week gave Turkey hope that a resolution to the matter is near as he announced plans for Erdogan’s visit.

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“We are working on many Trade and Military Deals with the President, including the large scale purchase of Boeing aircraft, a major F-16 Deal, and a continuation of the F-35 talks, which we expect to conclude positively,” Trump said in a social media post.

The visit will be Erdogan’s first trip to the White House since 2019. The two leaders forged what Trump has described as a “very good relationship” during his first White House go-around despite the U.S.-Turkey relationship often being complicated.

U.S. officials have cited concerns about Turkey’s human rights record under Erdogan and the country’s ties with Russia. Tensions between Turkey and Israel, another important American ally, over Gaza and Syria have at times made relations difficult with Turkey.

Erdogan has made clear he’s eager to see the hold on F-35s lifted.

“I don’t think it’s very becoming of strategic partnership, and I don’t think it’s the right way to go,” Erdogan said in an interview this week on Fox News Channel’s “Special Report with Bret Baier.”

Turkish officials say they have already made a $1.4 billion payment for the jets.

Past reluctance to engage with Turkey

President Joe Biden’s administration kept Erdogan, who has served as Turkey’s president since 2014 and was prime minister for more than a decade before that, at an arm’s length during the Democrat’s four years in office.

The reluctance to engage deeply was borne out of Turkey’s record of democratic backsliding as well as Ankara’s close ties to Moscow.

Opposition parties and human rights organizations have accused Erdogan of undermining democracy and curbing freedom of expression during his more than two decades in power. International observers say that baseless investigations and prosecutions of human rights activists, journalists, opposition politicians and others remain a persistent problem in Turkey.

But Trump sees Erdogan as a critical partner and credible intermediary in his effort to find ends to the wars in Ukraine and Gaza. The Trump administration is also largely in sync with Turkey’s approach to Syria as both nations piece together their posture toward the once isolated country after the fall of Syrian leader Bashar al-Assad last December.

Trump and European leaders have followed Erdogan in embracing Syrian President Ahmad al-Sharaa, who once commanded a rebel group that was designated a foreign terrorist organization.

Trump’s chief diplomat, Secretary of State Marco Rubio, met with al-Sharaa Monday on the sidelines of the United Nations General Assembly.

Erdogan sees a key role for Turkey

Erdogan has sought to position his country as a point of stability in a tumultuous moment. He believes Turkey can play an essential role for European security and is able to span geopolitical divisions over Ukraine, Syria and U.S. tariffs that have sparked a global trade war.

Turkey President Recep Tayyip Erdogan addresses the 80th session of the United Nations General Assembly, Tuesday, Sept. 23, 2025. (AP Photo/Richard Drew)

Turkey also believes it has emerged as a credible broker in the Black Sea region, preserving relations with both Ukraine and Russia.

Turkey is an influential actor in neighboring Syria as the rebel groups it supported during the civil war took power last December. However, the fall of Assad aggravated already tense relations between Turkey and Israel, with their conflicting interests pushing the relationship toward a possible collision course.

Trump, for his part, has urged Israeli Prime Minister Benjamin Netanyahu to be “reasonable” in his dealings with Ankara.

Erdogan on Tuesday took part in a group meeting hosted by Trump on the sidelines of the United Nations General Assembly. Trump gathered the leaders of eight Arab and Muslim countries to discuss the nearly two-year-old Gaza war.

The Turkish leader has been sharply critical of Israel’s handling of the war, which was launched after Hamas militants launched an Oct. 7, 2023, attack on Israel in which 1,200 were killed and 251 were taken captive. Over 65,000 Palestinians have been killed, according to Gaza’s Health Ministry, and about 90% of homes in the territory have been destroyed or damaged.

Erdogan in his Tuesday address at the U.N. once again laid into Israel, alleging its forces have committed genocide, an allegation rebutted by Israel and United States.

“This is not a fight against terrorism,” Erdogan said. “This is an occupation, deportation, exile, genocide and life destruction, mass destruction policy carried on by invoking the events of October the 7th.”

US economy expanded at a surprising 3.8% pace in significant upgrade of second quarter growth

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By PAUL WISEMAN, Associated Press Economics Writer

WASHINGTON (AP) — An uptick in consumer spending helped the U.S. economy expand at a surprising 3.8% from April through June, the government reported in a dramatic upgrade of its previous estimate of second-quarter growth.

U.S. gross domestic product — the nation’s output of goods and services — rebounded in the spring from a 0.6% first-quarter drop caused by fallout from President Donald Trump’s trade wars, the Commerce Department said Thursday. The department had previously estimated second-quarter growth at 3.3%, and forecasters had expected a repeat of that figure.

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The first-quarter GDP drop, the first retreat of the U.S. economy in three years, was mainly caused by a surge in imports — which are subtracted from GDP — as businesses hurried to bring in foreign goods before Trump could impose sweeping taxes on them. That trend reversed as expected in the second quarter: Imports fell at a 29.3% pace, boosting April-June growth by more than 5 percentage points.

Consumer spending rose at a 2.5% pace, up from 0.6% in the first quarter and well above the 1.6% the government previously estimated.

“The U.S. consumer remained a lot stronger than many thought, even in the midst of a stock market sell-off and a lot of trade uncertainty,” Heather Long, chief economist at Navy Federal Credit Union, posted on social media.

A category within the GDP data that measures the economy’s underlying strength came in stronger than previously reported as well, growing 2.9% from April-June, up from 1.9% in the first quarter and in the government’s previous estimate. This category includes consumer spending and private investment, but excludes volatile items like exports, inventories and government spending.

But private investment fell, including a 5.1% drop in residential investment. Declining business inventories took more than 3.4 percentage points off second-quarter growth.

Spending and investment by the federal government fell at a 5.3% annual pace on top of a 5.6% drop in the first quarter.

Since returning to the White House, Trump has overturned decades of U.S. policy in support of freer trade. He’s slapped double-digit taxes — tariffs — on imports from almost every country on earth and targeted specific products for tariffs, too, including steel, aluminum and autos.

Trump sees tariffs as a way to protect American industry, lure factories back to the United States and to help pay for the massive tax cuts he signed into law July 4.

But mainstream economists — whose views Trump and his advisers reject — say that his tariffs will damage the economy, raising costs and making protected U.S. companies less efficient. They note that tariffs are paid by importers in the United States, who try to pass along the cost to their customers via higher prices. Therefore, tariffs can be inflationary — though their impact on prices so far has been modest.

The unpredictable way that Trump has imposed the tariffs — announcing and suspending them, then coming up with new ones — has left businesses bewildered, contributing to a sharp deceleration in hiring.

From 2021 through 2023, the United States added an impressive 400,000 jobs a month as the economy bounded back from COVID-19 lockdowns. Since then, hiring has stalled, partly because of trade policy uncertainty and partly because of the lingering effects of 11 interest rate hikes by the Federal Reserve’s inflation fighters in 2022 and 2023.

Labor Department revisions earlier this month showed that the economy created 911,000 fewer jobs than originally reported in the year that ended in March. That meant that employers added an average of fewer than 71,000 new jobs a month over that period, not the 147,000 first reported. Since March, job creation has slowed even more — to an average 53,000 a month.

On Oct. 3, the Labor Department is expected to report that employers added just 43,000 jobs in September, though unemployment likely stayed at a low 4.3%, according to forecasters surveyed by the data firm FactSet.

Seeking to bolster the job market, the Fed last week cut its benchmark interest rate for the first time since December and signaled that it expected two more cuts this year. But the surprisingly strong second-quarter GDP growth may give the central bank less reason to cut rates — despite intense pressure from Trump to do so.

Thursday’s GDP report was Commerce Department’s third and final look at second-quarter economic growth. It will release its initial estimate of July-September growth on Oct. 30.

Forecasters surveyed by the data firm FactSet currently expect the GDP growth to slow to an annual pace of just 1.5% in the third quarter.