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1 big thing: Trump's China bind
President Trump returns Wednesday from Louisville. Photo: Susan Walsh/AP

Sources close to President Trump tell Axios' Jonathan Swan that the White House is in a China bind:

  • We're told a trade deal with China is "tough to improbable" in this deteriorating environment, with escalating security tensions between Washington and Beijing.
  • Why it matters: The biggest tool Trump has to pump the economy and the markets is a trade deal with China. But if anything, senior administration officials have turned harder against China in recent weeks.

This has less to do with trade than it does with national security, according to senior administration officials and sources briefed on the president’s thinking:

  • U.S. intelligence officials are worried about Hong Kong further deteriorating, and about the risk of the Chinese military overreaching in Hong Kong — and perhaps even in Taiwan.
  • Lots of members of Congress care about the U.S. protecting Taiwan from Chinese aggression, and Trump has enraged Beijing by increasing military sales to the Taiwanese from the Obama era.
  • And national security adviser John Bolton is a strong advocate for Taiwan.

Trump had been resisting chastising Chinese President Xi Jinping over his human rights abuses and his treatment of Hong Kong protesters. But he’s inched further toward criticizing the Chinese than he normally would in recent days.

  • Trump even hinted the Chinese wouldn’t get their trade deal unless they peacefully resolved the situation in Hong Kong — a move that pleasantly surprised China hawks.

When Secretary of State Mike Pompeo and Defense Secretary Mark Esper visited Australia earlier this month, they delivered an unequivocal message to senior Australian officials: The U.S. plans to forcefully push back against China’s destabilizing behavior in the Asia-Pacific.

  • Some left those meetings with the impression that the U.S. was serious about confronting China militarily.
  • Between the lines: This visit was important for the signals Pompeo and Esper sent, but didn’t get as much U.S. press attention as it deserved. (See Bloomberg's Aug. 4 story here.)

The bottom line: So if not a China trade deal, what then is left to juice Trump’s economy and stave off recession?

  • Tax cuts? Not going to happen.
  • Infrastructure? Not going to happen.
  • Federal Reserve rate cuts? Probably. But how much will these expected cuts actually achieve?

How it's playing ... WashPost lead story: "Shadow falls over Trump’s economy."

2. Dems unlikely to get Trump taxes before election
President Trump during an Aug. 15 rally in Manchester, N.H. Photo: Jonathan Ernst/Reuters

House Democrats, stymied by President Trump's resistance and a long path in court, "appear increasingly unlikely" to get his tax returns before the 2020 election, per the WashPost:

  • For the court challenge to be resolved by then would require a "perfect straight," a legal expert says.

Why it matters: Key Democrats "say that if they are going to impeach the president, they have to do so before the end of the year."

3. The new "collective capitalism"
Courtesy The Economist

We end the week where we began — with business titans rethinking the role of capitalism in a society that's offering increasing resistance.

"[T]he popular and intellectual backlash against shareholder value is already altering corporate decision-making," The Economist writes.

  • Why it matters: "Across the West, capitalism is not working as well as it should. Jobs are plentiful, but growth is sluggish, inequality is too high and the environment is suffering."

The Economist calls for a "really enlightened kind of capitalism":

  • "The Western world needs innovation, widely spread ownership and diverse firms that adapt fast to society’s needs."
4. Pic du jour
Photo: Christophe Petit Tesson/Pool via AP

U.K. Prime Minister Boris Johnson gets comfortable with French President Emmanuel Macron at the Élysée Palace in Paris yesterday.

5. News aggregation apps take on Big Tech
Illustration: Aida Amer/Axios

Several companies and investors around the globe are pouring billions of dollars into a new wave of news aggregation apps that they hope will steer news traffic away from the tech giants, Axios' Sara Fischer reports.

  • Why it matters: The dominance of a handful of companies over the news and information landscape is worrying policymakers around the world.

News Corp, the news holding company founded by Rupert Murdoch, is developing a news aggregation service called Knewz.

  • The website and a mobile app aim to address concerns that digital platforms "don’t reward publishers’ work adequately and play down articles from certain types of sites," sources told The Wall Street Journal, owned by News Corp.

By the numbers: In the U.S., Google Search and Facebook collectively drive over 70% of referral traffic, according to traffic analytics company Parse.ly.

  • Our thought bubble: There's little sign that anyone can seriously challenge the tech platforms' dominance. Aggregation made them big in the first place.
6. Europe's radical plan to confront Silicon Valley
Giovanni Buttarelli and Tim Cook. Photo: Tim Cook/Twitter

What's new: European officials have drawn up an aggressive plan to counter U.S.-based tech giants, Politico Europe reports.

  • "European Commission officials are pushing ... to set up a European Future Fund that would invest more than $100 billion ... in high-potential European companies."
  • Why it matters: The goal is to "get Europe competing head-on with the American and Chinese tech giants it has lagged behind for decades."

P.S. Apple CEO Tim Cook salutes EU data-privacy regulator Giovanni Buttarelli — who died this week at 62 — in Italy's largest newspaper, Corriere della Sera:

His spirited search for solutions, rather than conflict, made his crowning achievement, the General Data Protection Regulation, both possible and durable. ...
We will all benefit from his work for many years to come. And I believe the cornerstone he laid will prove a sure foundation for one of humanity’s greatest projects. 
7. Trump approval stable amid recession fears

The numbers may be ugly for a first-term president facing re-election in 14 months, but they are remarkably consistent: President Trump's approval rating has never dipped below 32% or risen above 42% in AP-NORC polls since he took office. (AP)

8. Price tag
Sanders holds a town hall on climate yesterday in Chico, Calif. Photo: Justin Sullivan/Getty Images

The climate plan Sen. Bernie Sanders released yesterday costs $16.3 trillion over 15 years, but he says it would "pay for itself" and create 20 million new jobs.

Why it matters: "[T]he Sanders plan’s eye-popping price tag is several times bigger than those of his leading opponents," per the N.Y. Times.

  • "Sanders's plan would be funded in part by imposing new fees and taxes on the fossil fuel industry."
9. Coming attractions
Courtesy OZY

Stacey Abrams and Monica are among the guests on tomorrow's premiere of "Black Women OWN the Conversation," a new four-part series from the Oprah Winfrey Network and OZY (Saturday, 10 p.m. ET on OWN).

  • The discussion show, which includes black women from all walks of life, covers intimate topics from colorism and fertility to mental health and 2020. 
10. ✈️ 1 plane thing: World's longest flight

Qantas is testing what would be the world’s longest flight: 19 hours in the air, Hannah Sampson reports on the WashPost's new travel site, By The Way:

  • The Australian carrier announced that it'll run three "ultra-long-haul research flights" of about 19 hours each this fall on new Boeing 787-9s.
  • "Two of the flights will take off in New York and go to Sydney ... The other will go from London to Sydney."
  • Why it matters: "Researchers will record melatonin levels of pilots, ... as well as track their brain wave patterns and alertness."

"Singapore Airlines operates the current world’s longest flight, between Singapore and Newark, ... [which can take] up to 18 hours and 45 minutes."

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