The Joint Economic Committee’s latest analysis of federal trade data shows the U.S. trade deficit widened in May, reaching $77.58 billion — the largest monthly gap since March 2025.
The deficit increased by $23.02 billion from April and stood 28% above its 12-month average as exports declined and imports climbed.
Goods trade accounted for the bulk of the imbalance, with the goods deficit rising to $106.48 billion, up $23.57 billion from April, while the nation’s services surplus increased modestly to $28.90 billion, up $557 million from April.
Total exports fell to $317.68 billion in May, led by a decline in goods shipments of $11.29 billion, whereas imports rose to $395.26 billion as purchases of both goods and services increased by $12.50 billion.
Over the twelve months ending in May 2026, the United States recorded a cumulative trade deficit of $728.02 billion. Goods trade posted a $1.06 trillion deficit, partially offset by a $336.00 billion surplus in services. During that period, exports totaled $3.59 trillion and imports reached $4.32 trillion.
The nations largest goods trade deficits were with Vietnam ($203.85 billion), Mexico ($199.18 billion), and Taiwan ($194.38 billion), while its largest surpluses were with the Netherlands ($75.57 billion), the United Kingdom ($44.48 billion), and Hong Kong ($41.23 billion).
Civilian aircraft and related equipment, non monetary gold, and pharmaceutical preparations led the U.S. exports by value, accounting for 17.54% of all exported goods in the past 12 months. Whole computers, pharmaceuticals preparations, and computer accessories were the top imports accounting for 19.83%.
Mexico and Canada remained the country’s leading trading partners on both the export and import sides, joined by the United Kingdom among export destinations and China among import sources.
Major gateways for trade activity from May 2025 to May 2026 included the port districts of New York City ($273.88 billion), Houston-Galveston ($266.35 billion), and Laredo ($169.20 billion) for exports.
Over the same period Los Angeles ($379.22 billion), Chicago ($331.73 billion), and Laredo ($328.22 billion) were the port districts with the highest imports.
The United States collected $296.97 billion in import duties over the past year with $21.03 billion in May 2026. Passenger cars, vehicle parts, and electric apparatus generated the greatest duty revenue.
China accounted for the largest share of those duties, followed by Vietnam and Mexico accounting for around 46% of all applied duty rates.
Currency movements also shaped trade conditions. Between May 2025 and May 2026, the U.S. dollar weakened against the Chinese yuan by 6%, the euro by 2.1%, and the Mexican peso by 9.8%, while strengthening against the British pound by 0.5% and Japanese yen by 11.5%.
Exports prices rose 11.21% year-over-year, while import prices increased 4.61%, with fuel imports experiencing particularly sharp inflation at 35.89%.
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
Graham Platner has dropped out of the Maine Senate race.
His exit comes after Sen. Ruben Gallego (D-AZ) withdrew his endorsement of Platner following widespread criticism of the candidate.
This is the second candidate in nearly as many months that Gallego has backed off endorsing over sexual assault claims. Back in April, Gallego rescinded his endorsement of his longtime best friend: California gubernatorial candidate and resigned congressman, Eric Swalwell.
Although other allegations against Platner detailing unseemly behavior began to emerge earlier this year, it wasn’t until reporting came out this week detailing a sexual assault allegation that Gallego ended his support.
“The allegations against Graham Platner are troubling and deeply serious,” said Gallego. “I am rescinding my endorsement.”
The allegations against Graham Platner are troubling and deeply serious.
Gallego declined to rescind his endorsement after an initial accusation of assault emerged from 40-year-old conservative pundit Lyndsey Fifield in New York Timesreporting. Fifield and others have speculated that Gallego opted not to act because he was less inclined to believe Fifield’s claims. This new allegation claiming sexual assault came from a 41-year-old Maine resident and massage therapist, Jenny Racicot.
Racicot accused Platner of raping her in 2021 when he was heavily intoxicated. Racicot offered accounts of the alleged assault in exclusive interviews with CNN and Politico. Racicot had initially lent some insight to the media about Platner’s “reckless” and “unsettling” behavior, but decided to come forward with her story after witnessing the doubts raised against Fifield’s testimony.
Platner issued a short video statement calling the allegations “troubling, serious, and false,” and that all accusations of nonconsensual behavior were untrue. Platner also indicated he would take time to “reflect” on the future of his Senate campaign.
Gallego had praised Platner as a unifier across varied voting demographics, defending him against discoveries of Platner having acquired a tattoo of the Nazi military’s skull and crossbones known as a Totenkopf, and aligned himself publicly with Antifa and socialism.
“Platner can bring out new voters, can bring out cross-voters,” said Gallego. “This guy is an authentic man.”
The senator also defended Platner’s online indications of sexual deviancy as typical military behavior. Platner had admitted to a habit of masturbating into portable public toilets and appreciating the explicit graffiti on restroom walls.
Gallego described Platner as “relatable,” though other veterans serving in Congress disagreed.
The Republican Party of Arizona called Gallego “just another fat rat jumping off the various sinking socialists’ ships.”
There is a pattern emerging – first his former "roommate" Swalwell, now his socialist buddy. Ruben is just another fat rat jumping off the various sinking socialists' ships. https://t.co/4IgTNS4WJy
— Republican Party of Arizona (@AZGOP) July 7, 2026
Other Democrats who have held onto their endorsements of Platner have also begun bowing out.
The Democratic nominee for Maine governor, Hannah Pingree, called the allegations “deeply disturbing” and urged Platner to exit the race.
“Democrats need a nominee who can beat Susan Collins in November. Graham Platner is no longer that candidate,” said Pingree. “Graham Platner tapped into something real — voters hungry for change showed up with real passion and energy. That energy doesn’t have to go away. It needs a new candidate to carry it forward.”
My statement on Graham Platner:
These allegations are deeply disturbing. Jenny Racicot is a woman who has shown real courage in sharing her story — what she's describing is serious, credible and cannot be dismissed.
For Maine, for the future of control of the US Senate, and…
The Goldwater Institute has filed a motion in Maricopa County Superior Court seeking to intervene on behalf of two Air Force veterans in a lawsuit challenging a proposed constitutional amendment that would protect certain scholarship funds for children of military families.
The motion was filed on behalf of Nickolas Kupper and Robert Figueroa, whom Goldwater identified as Air Force veterans whose children currently participate in Arizona’s Empowerment Scholarship Account (ESA) program. The proposed intervenors are seeking to defend House Concurrent Resolution 2048, the “Military Families College Savings and Scholarship Protection Act,” which the Legislature recently referred to the November 2026 ballot.
The lawsuit was filed by the Protect Education Accountability Now Committee, Save Our Schools Arizona, and voter Linda May Lyon against the State of Arizona and Secretary of State Adrian Fontes. According to Goldwater’s motion to intervene, the plaintiffs are asking the court to block HCR 2048 from appearing on the November ballot.
Arizona's military families don't deserve to have their children's educational opportunities ripped from their hands. That's why we're stepping up to defend them. https://t.co/ayRcX5JbBE
— Goldwater Institute (@GoldwaterInst) July 2, 2026
Goldwater said in a July 2 announcement that Kupper and Figueroa are seeking to defend the measure because their families have used ESA funds for years and have a direct interest in the outcome of the litigation.
“Proposed Intervenors seek to intervene as Defendants to defend the constitutionality of House Concurrent Resolution 2048 (‘HCR 2048’), the ‘Military Families College Savings and Scholarship Protection Act,’ which is a legislative referral passed to protect the educational stability of military families,” the motion states.
HCR 2048 proposes adding a new section to Article XI of the Arizona Constitution. Under the measure, the state could not confiscate funds from the scholarship account of a child of a military family if the account is maintained under a state program that designates such students as eligible and allows the funds to be used for tuition or fees at eligible postsecondary institutions.
The measure defines a “child of a military family” as a student who is the child of a person serving on active duty in the U.S. armed forces, who was serving on active duty when the student’s eligibility was initially determined, or who was killed in the line of duty.
The proposed amendment also contains a nonseverability provision. If a future law or voter-approved measure violates the military-family scholarship protection, the entire conflicting law or measure would be void, and a court could not sever only the offending portion.
The House passed HCR 2048 initially on March 2, the Senate passed it on June 12 by a 16-13-1 vote, and the House passed the final reading on June 13 by a 31-22-7 vote.
Goldwater’s motion argues that Kupper and Figueroa have a right to intervene because the lawsuit directly threatens their ability to secure long-term constitutional protections for their children’s education funding.
“By seeking to keep HCR 2048 off the ballot, Plaintiffs directly threaten to block Proposed Intervenors’ ability to secure long-term constitutional protections for their children’s educational funding,” the motion states.
The filing also argues that the existing government defendants cannot adequately represent the families’ specific interests. Goldwater said Fontes is defending the measure as a neutral election administrator, while Kupper and Figueroa are defending the substantive validity of the proposed amendment because their children rely on ESA funds.
In its July 2 statement, the Goldwater Institute said, “The Arizona Constitution is clear: Arizona voters have the right to amend the state constitution, and the Military Families Protection Act would trump the activists’ efforts to cripple the scholarship opportunities currently afforded to Arizona military families and others.”
The lawsuit comes as ESA opponents are also seeking to place the Protect Education Act on the ballot. Save Our Schools Arizona says the proposal is intended to “reform Arizona’s universal ESA voucher program” and increase transparency and accountability.
The Protect Education Campaign announced last week that it submitted 421,451 signatures to the Secretary of State’s Office.
The Protect Education Act proposal would require unused ESA money to revert to the state and be directed to public schools, and it would bar families making more than $150,000 annually from joining the program. It would also ban ESA spending on non-educational or luxury items and require the Arizona Department of Education to report how much voucher funding each school receives.
HCR 2048 could conflict with the Protect Education Act because the proposed constitutional amendment would block future laws or ballot measures from changing the protected scholarship-account funds for military families.
Goldwater argued in its motion that the litigation is directly tied to that conflict, saying an adverse ruling could remove HCR 2048 from the ballot and leave the families’ ESA accounts vulnerable to “regulatory and financial rollbacks” under the competing Protect Education Act.
“Without HCR 2048, Proposed Intervenors’ educational accounts will remain highly vulnerable to systemic legislative and political volatility, including the exact regulatory and financial rollbacks slated under Plaintiffs’ competing ‘Protect Education Act,’” the motion states.
Kupper and Figueroa are asking the court to allow them to enter the case as defendants, either as a matter of right or by permission. They also said they intend to file a motion to dismiss the plaintiffs’ claim rather than expand the litigation with counterclaims.
The case is assigned to Maricopa County Superior Court Judge Joseph Kreamer.
One year after President Donald Trump signed the Working Families Tax Cut Bill into law, U.S. Rep. Andy Biggs (R-AZ05) defended the legislation as a cornerstone of the nation’s economic recovery, arguing it prevented what he described as a massive tax increase while expanding tax relief for families, workers, and small businesses.
In an exclusive interview with AZ Free News earlier this week, Biggs, who is also running for Arizona Governor, said the legislation’s most immediate accomplishment was preserving tax relief that otherwise would have expired.
“I think what you’re seeing is, the biggest success, is you stopped a $4 trillion tax increase,” Biggs said. “That would have been economically really, really bad for the country—maybe the death knell.”
Biggs said extending the 20 percent deduction for qualifying small businesses and preserving immediate business expensing provisions were among the bill’s most significant accomplishments. He also pointed to Treasury Department estimates indicating many families could see larger tax savings.
“According to the Treasury Department, the average family is going to see somewhere north of $2,000,” Biggs said, adding that other estimates range between $1,500 and $2,000. “That provides money to the economy and stimulus to the economy and helps the working men and women of this country.”
The congressman said some provisions are only beginning to show their long-term effects, particularly expanded domestic energy and natural resource development.
“I think people are getting… that a lot more federal land is being opened up for oil, gas, coal, minerals, whatever those natural resources are,” Biggs said. “Years from now, looking back, people will say, ‘Man, that really was one of the most critical things that could have happened for us.'”
Biggs also cited provisions eliminating federal taxes on tips, reducing taxes on overtime income, and providing tax relief for seniors receiving Social Security benefits as measures designed to increase disposable income while stimulating economic activity.
Critics of the legislation, such as Arizona Senate Minority Leader Priya Sundareshan (D-LD18), have argued it disproportionately benefits higher-income Americans and could increase the federal deficit, as reported by The Center Square. Biggs rejected both claims.
“The problem that we have is not a revenue problem in Washington, D.C.,” Biggs said. “It is a spending problem.”
He argued that economic growth generated by lower taxes ultimately produces additional federal revenue.
“What you do get is more economic activity,” Biggs said. “More taxes ultimately get paid and go into the federal government.”
Looking ahead, Biggs said a future Republican Congress should consider additional tax reductions for businesses while encouraging domestic manufacturing and development of critical mineral resources.
“If you want to stimulate jobs,” he said, “you’d find a way to reduce some of the corporate tax policy… and pass those along to sole proprietors and small firms as well.”
Although Biggs described the legislation as comprehensive, he said one area he wished Congress had addressed more aggressively was healthcare policy.
“One thing that we didn’t take care of, in my opinion… is we did nothing really on healthcare costs in the One Big Beautiful Bill,” Biggs said.
He said he had introduced legislation to expand Health Savings Accounts and increase their portability, adding that Rep. Eric Burlison of Missouri had proposed similar but broader reforms.
“I would have liked to see us do more on tax policy related directly to healthcare as well,” Biggs said.
Speaking with KTAR’s Mike Broomhead Monday, Biggs also discussed fraud in Medicaid and the Indian Health Services program. In a post to X sharing a clip he wrote, “When we root this waste out, we’ll get taxpayer dollars back in the pockets of Arizonans so families and businesses can thrive.”
There’s still billions of fraud in Arizona, especially in Medicaid and our Indian Health Services program.
When we root this waste out, we’ll get taxpayer dollars back in the pockets of Arizonans so families and businesses can thrive.
Looking ahead to a possible Biggs administration, he said future state tax policy should continue focusing on healthcare affordability and higher education while complementing the broader economic approach established by the federal legislation.
“The affordability of housing” remains Arizona’s largest economic challenge, Biggs said, arguing that utility costs, water policy, and management of state trust lands all play significant roles in addressing long-term affordability.
Biggs, who declined to seek another term in Congress to run for Governor, said Arizona has already incorporated many of the federal tax provisions into state law, though he criticized Gov. Katie Hobbs for initially vetoing related legislation before later signing it.
Arizona families using the Empowerment Scholarship Account (ESA) program will no longer be required to submit curriculum documentation when purchasing general educational supplemental materials, such as basic school supplies, under a settlement agreement announced by the Goldwater Institute.
The agreement resolves a lawsuit brought by ESA parent Velia Aguirre against the State of Arizona, the Arizona Department of Education (ADE), and Superintendent Tom Horne over the documentation requirements.
The settlement, which took effect July 1, states that ESA families “shall not be required to submit a specific curriculum document” when purchasing items identified as “general educational supplemental materials” in the 2025–2026 ESA Handbook.
After pushing this bureaucratic abomination for 2 years, the office of Attorney General Kris Mayes has walked back its unlawful demands. No more permission slips needed to buy pencils and children's books:
The dispute began after Attorney General Kris Mayes’ office sent a 2024 letter to the ADE opening a public monies investigation into ESA spending approvals. The Attorney General’s Office said at the time that ADE guidance appeared to allow expenses beyond the statutory framework for the ESA program, including the approval of supplementary materials without documentation demonstrating a curricular connection.
In the letter, Mayes’ office asked the ADE to “promptly cease approving supplementary material expenses without the requisite documentation of a curriculum nexus,” and requested information on ESA spending for supplementary materials, curriculum materials, and textbooks from the 2019–2020 school year through the 2023–2024 school year.
The Goldwater Institute, which represented Aguirre, said in a September 2024 press release that the directive forced parents to justify purchases of basic school supplies and educational books. Goldwater said Aguirre had purchases such as “Where the Red Fern Grows,” a periodic table poster, and pencils rejected for failing to satisfy the curriculum documentation requirement.
Arizona law allows ESA funds to be used for several categories of educational expenses, including tuition at qualified schools, textbooks, tutoring, curricula, and supplementary materials.
The law defines “curriculum” as “a course of study for content areas or grade levels, including any supplemental materials required or recommended by the curriculum, approved by the department.”
After Mayes’ 2024 letter, the ADE posted guidance stating that supplementary materials, including common school supplies such as pencils, paper, glue, and crayons, required curriculum support. The ADE’s ESA support page stated that items previously allowed without curriculum documentation “now do require a curriculum.”
Goldwater filed suit in September 2024 on behalf of Aguirre and Rosemary McAtee, arguing that the documentation requirement imposed new burdens on families buying ordinary educational materials. Goldwater said at the time that parents were being required to show that each purchase was explicitly called for in a curriculum, including items such as pencils, erasers, flashcards, and children’s books.
Under the settlement, ESA families purchasing general educational supplemental materials must attest that the items are intended to support a curriculum or course of study for the qualified student and are not being purchased for another purpose. The agreement also requires ESA holders to indicate the curriculum or course of study the materials support by selecting categories such as reading or grammar, social studies, science, mathematics, physical education, art, vocational instruction, or other.
The agreement states that the ADE will not require a specific curriculum document as a prerequisite for approval or processing of general educational supplemental material purchases. It also provides that the ADE may require an ESA holder to enter the name of the curriculum or course of study in a text box when selecting “Other,” once technologically feasible or no later than the second quarter of fiscal year 2027.
The settlement does not eliminate the ADE’s oversight authority. Rather, it states that nothing limits the ADE’s ability to review or audit individual expenditures or ESA accounts, disallow expenses, seek repayment, or report an ESA holder to the Attorney General’s Office for investigation of fraud, misuse of funds, or unlawful expenditures.
The agreement also preserves the Attorney General’s authority to investigate or enforce the law in cases involving fraud, misuse of funds, or unlawful expenditures, and to request information in specific cases where there is a reasonable basis to believe a violation occurred.
The State disputed in the settlement agreement that the ADE enforced the alleged documentation policy and maintained that the ADE has the authority and obligation to confirm that ESA expenditures are allowable under statute and rules. The parties agreed to resolve the case to avoid the time, expense, and uncertainty of further litigation.
Goldwater characterized the settlement as a victory for ESA families.
“ESA holders shall not be required to submit a specific curriculum document when purchasing items identified as ‘general educational supplemental materials’ in the 2025–2026 ESA Handbook,” Goldwater wrote, quoting the settlement agreement. The organization said the change means families will no longer have to provide individualized curriculum documentation for ordinary educational purchases such as pencils and children’s books.
In a press release on July 2, Matt Beienburg, Director of Education Policy at the Goldwater Institute, summarized the legal victory:
“This means no more manufactured paperwork from parents simply to appease the bureaucratic whims of politicians. No more wasted hours explaining why hundreds of individual items, like pencils or children’s literature, are necessary for a child’s education.
“Instead, parents will simply acknowledge via a single check box for a purchase order or reimbursement request that the purchases are intended to support the course of study for an ESA student. What was once the needless compounding of minutes into hours to comply with the attorney general’s demands will now be two clicks of a mouse.”
The parties agreed to file a stipulation dismissing the case with prejudice within 10 days of executing the settlement.
Senate President and Republican candidate for attorney general Warren Petersen (LD14) has joined a court fight to ensure only citizens vote in elections.
Petersen filed an amicus brief alongside House Speaker Steve Montenegro (R-LD29) in a case where progressive advocates are challenging the Trump administration’s effort to centralize citizen data across multiple agencies in the name of voter identification verification and even immigration enforcement.
The League of Women Voters (LWV) and several of their local chapters, along with the Electronic Privacy Information Center (EPIC) and five citizens, sued the U.S. Department of Homeland Security (DHS), Social Security Administration (SSA), the Department of Justice (DOJ), and the Attorney General’s Office over the data centralization last September.
These advocacy groups and private citizens claim the Trump administration’s data pooling violates the 1974 Privacy Act. Judge Sparkle Sooknanan with the U.S. District Court for the District of Columbia agreed with them in a ruling last month. The federal government has filed for a stay of judgment pending appeal.
Rep. Abe Hamadeh (R-AZ-08), announced his intent to file articles of impeachment against Sooknanan for the ruling, which he claimed was an overreach and weaponization of the judiciary against the executive.
“[This ruling] was a blatant and unlawful subversion of the President’s executive authority and a direct assault on election integrity,” stated Hamadeh. “Judges who weaponize their bench to interfere with the President’s constitutional duties must be held accountable.
Judge Sparkle L. Sooknanan’s egregious overreaching ruling blocking President Trump’s common-sense effort to verify the citizenship of those who want to vote in our elections was the final straw.
It was a blatant and unlawful subversion of the President’s executive authority and… pic.twitter.com/ezoLJJhiba
— Office of Congressman Abe Hamadeh (@RepAbeHamadeh) July 7, 2026
Petersen argued in their amicus brief that Arizona law relies on the federal Systematic Alien Verification for Entitlements (SAVE) system to process voter registration and government benefit inquiries.
The lawmakers cited the Purcell principle, a precedent established in the 2006 Supreme Court ruling involving former Maricopa County Recorder Helen Purcell that declares that the courts should avoid ruling to change election rules too close to an election.
Petersen and Montenegro argued voter confidence in Arizona and other states would be jeopardized if the court declined to withhold enforcement of its ruling while the appeal was underway. Other states impacted by the district court ruling hindering SAVE usage for elections, as well as immigration enforcement, include Florida, Indiana, Iowa, and Ohio.
“Making changes to an important election-integrity system at this late stage in the election season creates unnecessary confusion for election officials and the public,” stated the brief. “This court’s order altered an election-related process in the middle of elections around the nation and thus harms the states’ interest in maintaining voters’ confidence in the electoral process.”
Their brief also argued that the ruling would fly in the face of federalism, the mechanism on which states rely to exercise their laws.
Today, I filed an amicus brief in the DC district court supporting DHS’s efforts to ensure that only citizens are voting in our elections. It may not surprise you that the ACLU is in opposition. pic.twitter.com/63JC2MJP1U
Attorney General Kris Mayes and Secretary of State Adrian Fontes have stood opposed to the Trump administration’s data centralization and voter verification efforts as alleged breaches of privacy.
Today, Judge Susan Brnovich's dismissed the DOJ's lawsuit demanding our voter registration rolls. @AZSecretary and I will continue to defend the privacy of voters against federal overreach.
