WSJ What’s News - Republicans Triumph as House Passes Trump’s Megabill

Episode Date: July 3, 2025

P.M. Edition for July 3. House Republicans overcame some lawmakers’ resistance to narrowly pass the tax-and-spending bill ahead of President Trump’s July 4 deadline. WSJ reporter Jasmine Li discusses what’s in the final bill. Plus, U.S. stocks notch another closing high after the Labor Department’s June jobs report came in stronger than expected. We hear from WSJ investing columnist Spencer Jakab about what the report says about the economy, and what’s now on Fed officials’ minds ahead of their meeting later this month. And Journal science reporter Nidhi Subbaraman tells us how Harvard is already preparing to fill the gaps in its budget left by a loss of federal funding. Alex Ossola hosts. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

No Frills delivers. Get groceries delivered to your door from No Frills with PC Express. Shop online and get $15 in PC Optimum points on your first five orders. Shop now at NoFriills.ca. On this vote, the yeas are 218, the nays are 214. The motion is adopted. Yeah! USA! USA!

After an all-night session, the House passes President Trump's big, beautiful tax and spending bill. What does it mean for you? Plus, U.S. stocks notch another closing high after the June jobs report came in stronger than expected. And with less federal money available, Harvard has a plan to make up its budget shortfall. It's Thursday, July 3rd. I'm Alex Osela for the Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today.

The House narrowly passed Republicans' sprawling tax and spending bill today. It's a major second-term victory for President Trump and again demonstrates his power to keep GOP lawmakers in line. House Minority Leader Hakeem Jeffries spoke for eight hours and 44 minutes, setting a record for the longest floor speech as he read hours of stories of voters in GOP districts whom he said could be harmed by the bill. In the end, Republicans prevailed. The 218 to 214 vote now sends the measure to Trump's desk

ahead of the July 4th target he set for Congress to finish the legislation. For more on the bill, I'm joined by WSJ reporter Jasmine Lee speaking with us from the U.S. Capitol. Jasmine, what is in this bill that has passed? Perhaps the biggest piece of the bill is extending President Trump's 2017 tax cuts, and that would essentially make current income tax rates permanent. On top of that, it adds some new tax breaks for individuals and businesses, and it also

directs a lot of new spending, new things like border security and immigration enforcement for over the next decade. The Congressional Budget Office estimates that this bill would add nearly $3.4 trillion to deficits through 2034. And this bill also includes a $5 trillion increase to the debt ceiling. What does this say about President Trump's policies and his priorities? Because he ran on his campaign on a number of things that he said would be included in this bill. This bill definitely does reflect a lot of President Trump's priorities, and that includes

appropriating hundreds of billions of dollars for the military, for immigration enforcement. And it also adds some tax breaks for businesses while ending clean energy tax breaks. How might the average person feel the impact of this bill? I would say the biggest piece of the bill is still tax related and generally people will see their income tax rate continue, but there are some new tax breaks for things like tipped income over time. The state and local tax deduction cap is also higher in this bill, but it also makes cuts to some benefits programs like food aid, SNAP, and Medicaid. Most of the tax changes in this bill take effect

either this year or next year, and some of the cuts to things like health care programs, food aid programs, food aid programs, those come later. That was Wall Street Journal reporter Jasmine Lee. The Labor Department said today that the U.S. added 147,000 jobs in June. That's more than the gain of 110,000 jobs that economists expected. The unemployment rate, which is based on a separate survey of U.S. households, fell to 4.1% from 4.2%. For more on the numbers, I'm joined by WSJ investing columnist Spencer Jacob. Spencer, you wrote in a recent column that the ADP numbers that came out yesterday could potentially signal an economic slowdown, but that today's Labor Department numbers could clear that up. So what exactly do they show?

They clear nothing up. That's the short answer. Yesterday's ADP number was surprisingly weak, contraction in jobs. This was surprisingly strong relative to expectations. ADP focuses on the private sector. Now if you look at this number and you look at private employment, it grew by 74,000, which is the weakest number this year. So that is conspicuously weak. A lot of the growth came in state and local employment and things like that. Okay, so what do they tell us about the state of the economy, at least in the short term? Well, investors and economists tend to take this number much more seriously than the ADP for better or worse.

This is the big number that everyone focuses on. And the immediate reaction was pretty clear. The stock market rose, bond yields rose, and bets that the Fed will cut rates in July fell substantially. You had about maybe 25% odds right before the number came out, and they fell to a little more than 5%. And the odds for the year as a whole, in terms of how many Fed rate cuts are expected,

fell from about three to about two. Yeah, that was gonna be my next question. What's on the Fed's mind right now, considering that they are also under pressure from President Trump to cut rates? This strengthens the case for let's wait and see. They already, of course, did cut rates last year a couple of times. One reason they're waiting to see is that we still haven't seen the inflationary impact

of the tariffs that President Trump imposed. A lot of goods just haven't reflected that. And so they want to see what that is because they have a dual mandate, employment and inflation. The employment side of things looks pretty rosy now. The unemployment rate fell to 4.1%. It was expected to rise. So that all looks good and we'll have to wait another month for the official numbers to come through.

On the other hand, some other numbers, like reports on hiring, layoffs, unemployment insurance, those are showing some weakness. So it went not out of the woods, but this big number was surprisingly benign. That was WSJ investing columnist Spencer Jacob. Thanks as always, Spencer. Thank you.

The US stock markets closed at 1 p.m. today ahead of the Independence Day holiday. But a short trading day didn't stop markets closed at 1 p.m. today, ahead of the Independence Day holiday. But a short trading day didn't stop markets from setting another round of records. The stronger-than-expected June jobs report defied expectations that uncertainty over trade and fiscal policy would hurt the labor market. Major U.S. indexes were up. The S&P 500 ended about 0.8% up in its seventh record close this year. The Dow also rose about 0.8%,

while the NASDAQ gained roughly 1%, an all-time closing high, its fourth this year. President Trump spoke on the phone with Russian President Vladimir Putin today. This was their first conversation since the US paused a series of weapon shipments to Ukraine. According to a Kremlin briefing on the call, Trump urged Putin to quickly end the war in Ukraine, but Putin refused.

The White House has not yet released its own summary of the call. Trump has been critical of Putin in recent days, and at a NATO summit last week, declared that the Russian president was most responsible for continuing the three-year-old war with Ukraine. A Trump administration official said the president is scheduled to speak with Ukrainian President Volodymyr Zelenskyy tomorrow. Coming up, how Harvard is planning to shore up its finances. That's after the break. We're exclusively reporting that Harvard University would face a budget shortfall of about a billion dollars a year if President Trump follows through on all of his plans and threats spanning research funding, tax policy, and student enrollment.

That's according to an analysis by the Wall Street Journal. The journal's estimate, based on publicly available data, is for a worst-case scenario in which Harvard loses all federal research funding, federal student aid, and its ability to enroll international students, and Congress hikes its annual endowment tax to 8%. That grim math helps explain why Harvard has taken steps toward negotiating with the administration after months of defiance. Still, the university is looking at other ways to fill its federal funding gap by seeking to drum up money from private sources.

The T.H. Chan School of Public Health at Harvard is one of the schools seeking corporate funders to support its science labs. Nidhi Subraman covers science for the journal and joins me now. Nidhi, what is Harvard trying to do with this move? Nidhi Mishra Harvard is really rethinking how it runs, given that a lot of its money just basically had the taps turned off. This is particularly acutely felt by their public health school, T.H. Chan School of Public Health, and they got 70% of their research budget from the federal government. With the administration's shifts,

and especially with the back and forth with Harvard, it's become clear that they're going to immediately have to figure out how to move, but also rethink whether their historic relationship with the government and funding from it is going to continue. And one of the key parts there is to reach out to companies who may be interested in the work that they're doing or in the people that they're cultivating in order to have their labs

keep running. How different is this from what the university has done in the past for additional funding? Culturally, it's quite a shift for scientists to be reaching out to industry for money. Now they're actively going out to seek people who would be interested in this by using alumni who are in research and development labs or scientists who are sitting on fancy scientific advisory boards at companies to begin conversations about where they might be a nice fit. What the Chan School says is they're hoping to really preserve the independence of their scientists and negotiate agreements upfront that let them,

for instance, keep their data or publish in the literature without any kind of input from their companies. They already do have some agreements with companies which spell out these terms and protect scientific integrity and they really hope to keep that model going forward. That was WSJ science reporter Nidhi Sumaraman. Thanks, Nidhi. Thanks.

The US Supreme Court has agreed to consider the constitutionality of state laws banning transgender women and girls from participating on female school sports teams. The cases arise from challenges brought by transgender student athletes against policies in West Virginia and Idaho that block individuals whose sex at birth was male

from competing in women's and girls' track teams. Arguments will be heard during the court's next term, starting this fall. And finally, if you're grilling up burgers this 4th of July, that beef is going to cost you. The American Farm Bureau Federation estimates that the retail price for 2 pounds of ground beef has shot up to $13.33, or $6.67 a pound.

That's the highest price recorded by the survey since it began in 2013. Wall Street Journal commodities reporter Kirk Maltes explains why. There's been a number of drought issues that have popped up for multiple years at this point that make it hard for a rancher to allow their cattle to graze. More recently, there's problems with disease. New World Screwworm is a concern that's prompted the USDA to shut down the ports between Mexico and the U.S. And USD beef is also pretty valued abroad. So there's a lot of export demand for that as well. So all this together means that ground beef is just harder to come by. And it's just a simple

supply and demand thing at this point. Fortunately for barbecue lovers, other kinds of meats haven't experienced the same price hike as beef. Sounds like a good time to try some chicken or maybe a hot dog. And that's what's news for this week. We're off tomorrow and over the weekend for the 4th of July holiday, but we'll be back with a new show Monday morning.

Today's show is produced by Pierre Bienneme and Anthony Bansi with supervising producer, Michael Kosmides. Additional support this week from Coleman Standifer. Michael Laval wrote our theme music. Aisha El-Muslim is our development producer, Scott Salloway and Chris Inslee are our deputy editors, and Falana Patterson is The Wall Street Journal's head of news audio. I'm Alex Osola.

Thanks for listening.