The U.S. Is Over $40T In Debt & A Vaccine For Cancer

Hi readers, happy Thursday! Today, we’re covering the U.S.’s record-breaking debt numbers, a U.S.-Canada trade deal, two problems for Ukraine, OpenAI’s massive slump, more midterms, and a vaccine for cancer (kind of)

“If you don't have time to do it right, when will you have time to do it over?” – John Wooden

Spending Like It’s Going Out Of Style

Help, I can’t stop spending!! Yesterday, the U.S. Treasury Department announced that the nation’s debt broke a record on Tuesday afternoon, when the debt counter hit $40.047 trillion. The U.S.’s debt has more than doubled over the past decade, increasing under both Donald Trump and Joe Biden. During his first term, Trump authorized the government to take on roughly $8.4 trillion of debt, while Biden also approved a debt increase of $4.3 trillion during his time at the helm. Over the course of fiscal year 2026 (which began in October 2025 and will end on September 30, 2026), the Trump administration has taken on $1.8 trillion of debt.

While the country has long operated by borrowing money, balanced-budget hawks are increasingly sounding the alarm about how fast the government is burning through money. The $40 trillion debt threshold was broken just five months after government debt surpassed $39 trillion, and Washington is outspending its revenue by more than $2 trillion each year now. The Bipartisan Policy Center, a Washington-based thinktank, predicts that the country will reach the current $41.1 trillion debt limit sometime in mid to late 2027, at which point Congress will have to decide on either raising or suspending it.

“The federal debt is already raising the cost of living and choking out other spending and investment, threatening our economy and Americans’ long-term prosperity,” said Margaret Spellings, president and CEO of the Bipartisan Policy Center. “Our current fiscal trajectory is plainly unsustainable, and that’s the best-case scenario. AI disruption, a recession, global war, or any number of other events could quickly push us over the edge from a challenge into a full-blown crisis.”

“For perspective, it took nearly 200 years for America’s gross debt to reach $1 trillion for the first time in 1981,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. “$40 trillion of debt doesn’t exist solely on the government’s ledgers; it is felt throughout the economy and finds its way to the pocketbooks of people one way or another. The more we borrow, the more we exacerbate inflation, squeeze out other priorities in the budget, and leave ourselves vulnerable to emergencies at home and turmoil abroad.”

Are We Friends Again?

• It looks like the U.S.-Canada relationship is back to being “on-again.” Almost. Trump’s 50% tariffs on some imports from Canada were set to take effect yesterday morning, but White House announced that it would be suspending the duties for three days as the two countries work to hammer out a wider trade agreement. 

• Negotiations between the two neighbors have been going on all week at this point. The terms of the deal are still private, but Canada wants the U.S. to slash tariffs on its strategic exports sector (think steel, metals, and lumber), while the U.S. wants Canada to lower duties on American cars and agricultural products.

• “We feel confident that we've reached an agreement that will not only continue to protect American workers, American jobs, American supply chains, but really strengthen the North American economy,” said U.S. Trade Representative Jamieson Greer. Both sides have indicated that they’re moving to finalize the deal, which should be in place by the end of the week.

Kyiv Has Two Power Problems

• In the early hours of this morning (local time), Russia unleashed a “massive attack” on the Ukrainian capital of Kyiv. According to the State Emergency Service of Ukraine (DSNS), the attack targeted apartment blocks and warehouses, killing at least nine people and injuring 23 others. The strikes also took out electricity for parts of the city, affecting thousands of people.

• While Kyiv has been struck by Russian missiles almost nightly over the past few weeks, the problems in Ukraine don’t end there. Ukraine’s popular former Defense Minister Mykhailo Fedorov made a push for power on Tuesday, calling for national elections despite the ongoing war – he claims that President Volodymyr Zelenskyy’s government is mismanaging the war effort due to widespread corruption despite the fact that he was working inside it just a month ago. Public response to Fedorov’s election push was not positive at all, meaning Zelenskyy should remain in power with no issue for now, although Fedorov is still emerging as a well-trusted face of opposition against the prime minister.

Additional World News

• Brussels is giving drones a new mission: Killing bugs (Politico) 

• In China, rocket launches fuel tourism and space-age dreams (Reuters) 

• Prince Harry and Meghan ‘moving back to Britain this month’ (Guardian)

• She tried to blow up a millionaire in Monaco. Days later, she was dead (CNN)

• Iran eyes military targets in Europe if Donald Trump escalates war, insiders say (FT, $)

• Israel confirms soldiers fired at car in which Hind Rajab was killed and opens criminal investigation (BBC)

The Algorithm For Losing Money

• It looks like OpenAI has totally blown its lead in the AI race. Yesterday, the AI giant revealed some of its financials to its many investors – according to the data, the firm saw its revenue grow by 18% over the second quarter of the year, rising from $5.7 billion in January-March to $6.7 billion in April-June. Alongside those disappointing results, the company also stated that its operating margin became even more negative over the second quarter of 2026, bringing it even further away from turning a profit.

• Meanwhile, OpenAI’s main rival Anthropic saw its financials blast off over the same time period. The firm (which is behind the Claude chatbot) saw its revenue more than double to $11.6 billion last quarter – the milestone marks the first time Anthropic has ever out-earned OpenAI, and also means that the company is now operating at a (small) profit. 

• OpenAI tried to ease investors’ concerns by stating that it expects its revenue to grow next quarter after its latest models begin to make a financial impact, but the firm has also seen multiple top executives depart over the past year, which is probably not very confidence-inspiring to the people who’ve handed Sam Altman billions of dollars.

Midterm Madness Approaches

• On Tuesday night, Florida, Alaska, and Wyoming all hosted primary elections as we gear up for November’s midterms. The elections offered some mixed signals for the future directions of both parties. For Democrats, a few progressives and democratic socialists eked out wins while others were easily beaten by mainstream candidates; for Republicans, multiple far-right candidates suffered a string of defeats, but a handful of Trump-backed candidates also lost their races.

• The biggest news from the night was probably the Democratic primary for one of Florida’s U.S. Senate seats. There, Democratic Socialists of America (DSA) member Angie Nixon defeated former army intelligence officer Alex Vindman in a landslide victory, securing 750,000 votes compared to Vindman’s 550,000. The massive win marks the first time a DSA member has ever won a statewide primary, and also marked a huge upset in terms of spending – Vindman’s campaign raised over $16 million, while Nixon’s raised just $975,000. Now, the Jacksonville representative is set to face off against incumbent Republican senator Ashley Moody in the midterms, though analysts don’t expect her to pull off another upset due to Florida’s solidly Republican voter base.

• “They look at this movement and they call us extreme, they call us radical, but I think people see through that. I won’t let them define me and I know you will always know where I stand,” Nixon said after securing the Democratic nomination. “If believing a mom shouldn’t have to work three jobs to keep a roof over her head is extreme, call me extreme. Ashley Moody can call me whatever she wants, but in November she’ll be calling me senator.”

Additional USA News

• Who is Natalie Harp, Trump's right-hand woman? (BBC)

• Trump's pick to lead the FDA faces uphill Senate battle (Politico)

• ProPublica Is Reporting on the Pentagon’s $1 Trillion Budget (ProPublica)

• Trump shows off White House renovations and ornate new helipad (Guardian)

• Why are progressives winning across the United States? It’s not complicated (Guardian)

• Former Fauci adviser Dr. David Morens pleads guilty to concealing COVID-related records (NPR)

A Big Moment For Big Pharma

• Pharmaceutical companies have announced that they’ve successfully developed a vaccine for cancer. More specifically – there’s always a catch – pharmaceutical giants Moderna and Merck claim that their mRNA vaccine can significantly reduce the risk of cancer recurring or spreading in patients who’ve had high-risk melanoma (a type of skin cancer) and have also had their melanoma surgically removed.

• The study examined 1,137 melanoma patients who’d had their melanoma removed. All of the patients received a commonly-used immunotherapy drug called Keytruda, and a segment of them were also administered a dose of the mRNA vaccine that the companies are working on. According to the companies, the study demonstrated that patients who were administered both the mRNA vaccine and Keytruda saw “statistically significant and clinically meaningful improvements” in their melanoma over the patients who were administered just Keytruda.

• The companies haven’t released the full results from the trial yet, but their stocks both soared (Merck rose by 12% and Moderna jumped 177%). The trial marks the first big test for the mRNA technology that the vaccine is built on, which allows companies to create personalized vaccines for each patient based on their tumors’ genetics. The technology could soon be rolled out for a variety of cancer vaccines, including lung, bladder, kidney, and pancreatic cancer.

Additional Reads

• The promising race to get kids reading again (Vox)

• Why the Closing of Harvard’s Writing Center Matters (Atlantic)

• Arabic has four words for sadness. Philosophy explains why (Psyche)

• YouTube Offers Creators Millions to Not Work With Netflix (Bloomberg, $)

• Could a drug designed for weight loss help athletes perform better? (BBC)

• A real-world study of Oregon's nonmedical psilocybin program shows promise (NPR)

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Peanut For Your Thoughts

Anthropic is adding an invisible watermark to any text outputted by its chatbots: The Mark of the Machine (New Yorker). Which is cool I guess until we end up relying on it too much and then someone figures out a way to circumvent it.

Editor + Writer: Marcus Gee-Lim

Designer: Joe Stella