The Latest: Trump keeps immunity from tax probes while scrapping $1.8 billion compensation fund
Jun 3, 2026, 5:39 AM
A giant portrait of President Donald Trump looks down from the Justice Department in Washington, Tuesday, June 2, 2026. The Justice Department said it would comply with a court order pausing the implementation of a $1.776 billion settlement fund designed to compensate President Donald Trump's political allies after GOP senators revolted. (AP Photo/J. Scott Applewhite)
Credit: AP Photo/J. Scott Applewhite
(AP Photo/J. Scott Applewhite)
The Trump administration is scrapping plans for a $1.8 billion fund to compensate the Republican president’s allies, Acting Attorney General Todd Blanche said after a fierce political backlash threatened to stall key elements of the White House agenda. But Blanche said they’re sticking with a deal to permanently drop tax claims against President Donald Trump, an extraordinary flex of executive power that could help shield the president from further examination of his finances and legal conduct.
Most of the GOP primary challengers Trump has endorsed as he culls his party of politicians deemed insufficiently loyal have been successful, knocking off incumbents in Indiana, Louisiana, Kentucky and Texas, but in a setback Tuesday night, he couldn’t lift Rep. Randy Feenstra to victory in Iowa’s Republican primary for governor, setting up what Democrats see as one of their best opportunities to pick up a governorship this year. See other AP coverage of Tuesday’s primary results here.
The Latest:
For generations, the federal government enforced civil rights laws with an eye toward remedying historic, systemic discrimination against Black people and other people of color. The Justice Department pressed schools to desegregate. The Education Department worked to promote equal opportunity and held schools accountable for racial bias.
But under the Trump administration, efforts to address deep-rooted inequities for students of color are being cast as discriminatory against white students. Programs that have long withstood legal scrutiny are now quick to be deemed “ illegal DEI ” — diversity, equity and inclusion — by the White House. Schools that do not comply have faced threats to their funding, and in some cases, lost federal grants.
Civil rights attorneys describe the administration’s actions as a complete inversion of legal history.
The U.S. government has opened investigations or joined litigation over a wide range of efforts to address racial inequality. The Justice Department is investigating programs to increase the number of teachers of color in Rhode Island and Iowa. And grants to districts to train teachers or recruit school mental health workers have been discontinued for mentions of diversity in recruitment.
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Trump signed an executive order on oversight of artificial intelligence Tuesday, less than two weeks after postponing a White House ceremony over his concerns that a similar policy could dull America’s technological edge.
The order establishes a framework for the federal government to vet the national security risks of the most advanced AI systems for up to a month before their public release. Participation by AI developers would be voluntary, the order says.
“Advanced AI capabilities make our Nation stronger, but also introduce new national security considerations that require coordinated action across executive departments and agencies,” the order says.
It was not immediately clear to what extent the order differed from the one Trump declined to sign on May 21.
The order says the government would have only 30 days to review an AI system, a shorter time frame than some in the industry were expecting. A longer time period might have been seen as too burdensome for a fast-moving and highly competitive industry.
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The Trump administration is proposing that tariffs of 10% or more be imposed on products from dozens of major trading partners following a probe into imports of goods allegedly made with forced labor.
The report released early Wednesday by the U.S. Trade Representative said Canada, Mexico, Taiwan and the United Kingdom and some other countries and territories would face 10% additional tariffs for allegedly failing to enforce a forced labor import ban.
A 12.5% additional tariff would be imposed on China, Japan, India, South Korea, Brazil and Switzerland and dozens of other countries.
“The failure of our most important trading partners to address the importation of goods made with forced labor is unacceptable. This creates a dynamic where American workers are forced to compete globally on an unlevel playing field,” USTR Ambassador Jamieson Greer said in a statement.
He added that “each of our trading partners must do more to ensure that trade does not perversely encourage and entrench forced labor globally.”
The USTR said failure to prevent such imports is “unreasonable and burdens or restricts U.S. commerce.”
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The Trump administration is scrapping plans for a $1.8 billion fund that would have compensated allies of the Republican president, the Justice Department’s top official said Tuesday in retreating from a program that faced a fierce political backlash that had threatened to stall key elements of the White House agenda.
“We are not moving forward with the fund, period,” Acting Attorney General Todd Blanche said in response to questions at a House hearing on the Justice Department budget.
“Not moving forward ever?” asked Rep. Grace Meng, a New York Democrat.
“Correct,” Blanche answered.
The blunt declaration marked an extraordinary and rare Trump administration turnabout in the face of mounting political opposition to a fund that officials said was meant to compensate people who believe they have been improperly targeted by the criminal justice system. Since the establishment of the fund two weeks ago, it’s been paused by a judge and lambasted by Democrats and Republicans alike, who said they were troubled by a lack of oversight and the potential for payouts to participants in the violent Jan. 6, 2021, riot at the U.S. Capitol.
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