Contagion
Week of October 9-15, 2026
Published in conjunction with The Nation magazine, TRACKING THE CRISIS is a weekly round-up from The Democracy Collaborative tracking the administrative, legislative, and other actions of the Trump Administration as well as the many forms of legal and movement response from across a broad range of social, political, and economic actors. TDC is providing this service for collective informational purposes, as a tool for understanding the times during a period of disorientingly rapid flux and change in the U.S. political economy. This round-up is produced by humans, not by Artificial Intelligence. TDC should not be understood as endorsing or otherwise any of the specific content of the information round-up.
TRUMP TRACKER: Administration actions
Dire Straits: Attacks escalate in Hormuz waters as Iran sinks cargo ship; MBS in hiding, Saudi Arabia in crisis as Ansar Allah pounds Riyadh, Aramco infrastructure. Tanker traffic in the Strait of Hormuz is back to single-digit levels as Iran has stepped up its attacks on ships traversing the Strait along ‘unauthorized’ routes. The UK Maritime Trade Operations Centre (UKMTO) reported at least 15 attacks on tankers in the Strait of Hormuz between October 6 and October 14, with 11 attacks recorded in the last four days alone as analysts say Iran is stepping up the pressure on the Trump Administration ahead of the crucial midterm elections.
With Ansar Allah (known in the West as ‘the Houthis’) simultaneously escalating its attacks on Saudi Arabia’s critical production and commercial infrastructure, many fear that the U.S. war of choice in Iran has now “spiraled out of America’s control” into a wider regional conflagration with dire consequences for multiple critical facets of the global economy.
On Thursday, October 8, U.S. Treasury Secretary Scott Bessent imposed new sanctions in his campaign to isolate Iran economically, announcing restrictions on 17 vessels he said were part of Iran’s oil export ‘shadow fleet’. “No enabler of Iranian sanctions evasion is safe from the full force of Treasury’s authorities,” Bessent warned as he also announced a plan to seize $1 billion in crypto tied to Iran, and claimed the IRGC is “now panicking amongst themselves.”
However, an analyst with Kpler, a maritime trade monitoring firm, reported on speculation that some Gulf producers are quietly paying Iran up to 20% of their cargo value (estimated at $20-40 million per vessel) in undisclosed deals because “they cannot rely indefinitely on U.S. military escorts.”
Iranian attacks also continued expanding outside of the Strait itself; on Friday, October 9, the IRGC declared a complete blockade on the Strait of Hormuz, warning that “unauthorized vessels will be targeted anywhere in the region” as it claimed an attack on a tanker anchored in UAE’s territorial waters just 13 miles off the Dubai coast. The next day, the IRGC warned all vessels harbored in Ras al Khaimah, a northern UAE port closest to the Strait, to weigh anchor and move to Dubai harbor, saying they will be targeted if they do not comply. Hours later, a VLCC (Very Large Cargo Carrier) ship carrying 2 million barrels of Saudi oil exploded after it struck an Iranian naval mine in the U.S.-backed southern Omani corridor through the Strait, as video of the site showed the ship fully engulfed in flames.
On Sunday, the IRGC said three more tankers attempting to navigate the Strait via the southern corridor struck naval mines and sustained damage, as it warned that ships switching off their transponders while in the Strait would be treated as hostile targets. Separately, a drone attack hit the tanker Petro Dolphin off the coast of Oman, leaving two Indian sailors missing. CENTCOM claimed that it disabled an Iranian tanker in the Gulf of Oman Sunday, saying the ship “ignored repeated warnings” as it tried to run the U.S. blockade on Iranian ports.
Senior Iranian officials told Reuters that Iran has now “shifted tactics” in targeting unauthorized vessels trying to cross the Strait; while declining to provide details, U.S. military intelligence officials said they believe Iran is now using unarmed spotters in small boats to visually identify ships that have their transponders turned off. This week, three fishermen in a boat off the coast of Sirik in southern Iran were reportedly injured after a drone attack targeted their fishing vessel.
Iranian National Security chief Mohsen Rezaei took to X on Sunday claiming that despite Trump’s belligerent public rhetoric, the United States had accepted “some” of the seven concessions laid out by Iran last week as conditions for re-opening the Strait of Hormuz, but that Iran considers the response “inadequate,” warning Trump that “Iranian diplomacy has changed and there will be no return to the status quo ante.” Speaking to Iranian media, Rezaei claimed that Trump has hired “thugs” to help smuggle oil through the southern route, aided by the UAE military and CENTCOM. Trump “claims every day that the Strait of Hormuz is open,” Rezaei said to Iranian broadcaster IRIB, and “in response I say: ‘You are smuggling, but the strait is under Iranian control and we manage it.’”
Rezaei also threatened to attack the Gulf’s critical digital infrastructure, targeting undersea cables, data centers and AI facilities across the region if the United States decides to escalate. Iranian media outlet Tasnim also reported that Iran is considering forcing giant tech companies such as Google and Meta to obtain permits and pay ‘sovereignty fees’ to Iran in order to use the undersea data transmission cables that cross Iranian waters in the Strait of Hormuz and the Persian Gulf, as well as cables under Houthi control in the Bab el-Mandab Strait and the Red Sea, upon which 90% of international internet traffic between Europe and Asia relies.
Iran’s attacks on ships in and around the Strait escalated even further later in the week as the IRGC began deploying its new anti-ship missiles against U.S.-escorted commercial ships in the region as well as “harder targets.” On Tuesday, a Singapore-flagged vessel was struck by a projectile and caught fire, while on Wednesday a UAE-owned cargo ship carrying 2,500 containers reportedly full of luxury perfumes and iPhones from Dubai sank after hitting a naval mine in the southern corridor off the coast of Oman. The IRGC warned of further escalation Thursday, declaring that “encounters with offending vessels will no longer be limited to the Strait of Hormuz and that any ship using an unauthorized passage anywhere in the region will be pursued and punished.”
A Reuters report this week details the extensive damage Iran has done to energy infrastructure across the Gulf region, striking at least 84 targets containing vital infrastructure and equipment across all Gulf countries with what a U.S. military analyst called “precision, targeting expertise, and patience.” After eight months of war, global energy supplies are dipping to dangerously low levels, including critical LNG exports for fertilizer and agriculture. With planting season in Asia just weeks away, a UN official warned on Wednesday that large parts of the world, including Asia and Africa, will face a food security crisis unless the United States and Iran can come to an agreement to move LNG and other fertilizer-related materials through the Strait of Hormuz.
Meanwhile, all eyes were on Saudi Arabia as continued waves of attacks from Yemen’s Ansar Allah pounded targets critical to the kingdom’s economy, including a large-scale attack on Riyadh’s King Khalid International Airport on Saturday that killed 13 people and injured hundreds, including a U.S. citizen. Ansar Allah also struck Saudi Arabia’s vast oil production infrastructure at Abqaiq, the world’s largest crude oil processing and stabilization facility, which processes 5% of the world’s oil supply. Trump said Saturday that he is now evaluating whether the United States will join the Saudi-led coalition to drive back Ansar Allah after the deadly airport attack. King Khalid International Airport will remain fully closed until at least Saturday, according to Saudi sources.
On Sunday, Saudi Arabia said it would launch a probe into why its early warning and air defense systems failed to activate during the attack on the Riyadh airport, as it continues to struggle with defending itself despite having spent billions of dollars on U.S.-supplied weaponry and advanced tactical systems as the world’s top purchaser of U.S. arms exports. Analysts say that Saudi’s vast arsenal of very expensive equipment was purchased for their “glitter factor” and with more conventional threats from Iraq or Iran in mind, whereas Ansar Allah’s guerilla tactics and use of cheap, home-engineered drones and low-flying missiles are capable of literally ‘flying under the radar’ of Saudi Arabia’s defense systems.
Saudi Arabia has also found itself bereft of reliable allies, despite its newly inked defense pact with Pakistan and Turkiye. While Israeli media and the New York Times have reported that Pakistan sent a limited number of jet fighters to aid the campaign against Ansar Allah in Yemen, Pakistan’s Foreign Ministry has officially denied the claim; as a critical diplomatic intermediary between the United States and Iran, Pakistan finds itself walking a fine line in an effort to avoid Iranian ire by formally joining in a conflict with a member of the Axis of Resistance. Turkiye and other Saudi allies have offered rhetorical support but have so far rebuffed the idea of joining the campaign against Ansar Allah in Yemen, while Iraqi Prime Minister Ali al-Zaidi on Wednesday refused to let Saudi Arabia use Iraqi territory for attacks on Yemen.
As a result, Saudi Arabia is facing a dire situation as Ansar Allah continues to launch barrages of drone and missile attacks on its territory, despite the Saudi-backed Yemeni government claiming it is gaining ground against Houthi forces in the southwest. Saudi-backed forces struck a Houthi-controlled oil depot in Sanaa on Tuesday, after which Ansar Allah announced that all Aramco oil facilities in Saudi Arabia will be legitimate targets and advised Aramco employees to evacuate their worksites. Hours later, Aramco’s headquarters in the eastern city of Dhahran was struck by a ballistic missile, as explosions hit both the Saudi and Yemeni capitals heading into Wednesday, when Ansar Allah claimed to have shot down a Saudi fighter jet.
On Thursday, the Saudi-backed Yemeni government claimed that a Houthi missile struck the presidential palace in Aden, resulting in the death and injury of several palace guards. Saudi monarch Mohammed bin Salman has reportedly retreated to a bunker surrounded by ‘hand-picked guards’ in the eastern part of the country as he weighs the country’s next steps.
The Wall Street Journal reported on Wednesday that Ansar Allah is now developing an advanced missile, allegedly with Chinese parts and with help from ‘regional allies’. Iran has publicly encouraged a diplomatic solution to the conflict, contacting Saudi Arabia on Tuesday with an offer to mediate talks between the two sides; according to Al Jazeera, despite its alliance with Ansar Allah, Tehran has an interest in not allowing the conflict to spiral out of control given its own delicate standoff with the United States.
The escalating situation on both straits has put the Trump Administration in a bind as it complicates his pledge to not engage in further military action to escalate his highly unpopular war until after the midterm elections. A report from the Jerusalem Post over the weekend revealed that Trump had privately encouraged Israel to strike Iran independently ahead of the midterms, reportedly hoping that Israel would “assume the political risk” of escalating the conflict. Haaretz reported Tuesday that Netanyahu had contacted Saudi Arabia with the prospect of joining the campaign against Ansar Allah, as Israeli officials indicated that such an operation could delay Israel’s own elections scheduled for October 27th.
Israeli media reported that Trump and Netanyahu had also discussed joint U.S.-Israeli military operations against Iran to target its military and nuclear sites. On Wednesday, the Hormuz Report posted flight radar data showing a “massive surge” of U.S. C-17 military transports headed for Israel over the previous 36 hours, as Iranian officials claimed they were “100% certain” that a joint U.S.-Israeli attack was “imminent.”
Iran stepped up its preparations for renewed war throughout the week: ordering IRGC forces to evacuate several surface-level military bases, fortifying its underground nuclear production facilities and conducting at least 30 tests on its ballistic missile and drone systems as CNN reported that U.S. officials are weighing the decision to use its ‘Mother of All Bombs,’ the military’s most powerful non-nuclear weapon, against Iran’s underground nuclear and missile production sites.
IRGC Navy Commander Ali Azmaei warned that his forces are “counting down” to a potential maritime attack, saying he is ‘waiting’ for U.S. warships to approach the Strait of Hormuz “so we can sink them” with their new, long-range Qasem Bashir ‘carrier-killer’ missiles. The Wall Street Journal also reported on Tuesday that Iran has privately warned regional mediators that IRGC forces could launch ground invasions on neighboring countries in order to “aggressively target” U.S. military operating within their borders. In a formal address Wednesday, the Emir of Qatar advised its citizens to be “prepared for the worst-case possibilities” should fighting once again erupt against Iran and trigger a ‘worst-case scenario’ in the Middle East.
October surprise hits Europe: Trump’s fuel deal with Putin blows up NATO/U.S. alliance as Ukraine, Russia exchange strikes on energy facilities. On Friday, October 9, Trump shocked allies in Europe and Congress alike by announcing that he had struck a deal with Russia’s Vladimir Putin to supply 4 million tons of diesel to the ‘global market’ – despite multiple U.S. and EU sanctions placed on Russian oil since the start of the Ukraine war in 2022, the most recent of which was the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, which Trump signed into law just last month.
Although the full details of the deal remain vague, Trump announced that Russia would “immediately” supply 300,000 tons of diesel, with another 1.5 million tons scheduled to be released in November. CNBC reports the Treasury Department signed a six-month temporary waiver on sanctions on Friday, granting Russia a general license until April 2027.
Trump touted the Russian deal on Truth Social as a “very big and important” deal, and that as a result, diesel prices for U.S. consumers would be “COMING DOWN, IN RECORD NUMBERS, and FAST!” Oil market tracker The Hormuz Letter noted, however, that the initial release of 300,000 tons of diesel – if all of it stayed in the United States – would only amount to approximately 15 hours of supply at current U.S. demand rates; and the total to be released to the global market (36 million barrels) amounts to about 10 days of supply at U.S. demand rates, spread out over several months and shared with the global market.
The deal immediately sparked backlash throughout the already-strained NATO alliance, including of course Ukraine; an audibly furious Zelenskyy told Axios’ Barak Ravid on Friday that “it looks like a happy birthday present for Putin” and that the deal was “not fair and not honest.” Zelenskyy said that he had met with Steve Witkoff just days before, where negotiations for a ceasefire were being held in Miami, but that no mention of a deal had been discussed. An unnamed Trump Administration official told Axios the next day that Trump had decided to move forward with the deal after Ukraine “ignored several requests” to stop attacking Russian oil refineries. Trump has repeatedly blamed Ukrainian strikes for high oil prices globally, although the dual blockade on the Strait of Hormuz precipitated by Trump’s war on Iran affects a greater share of the world’s oil and diesel supply.
Hours after Trump’s announcement on Friday, Ukraine announced it would escalate drone and missile strikes on Russian energy infrastructure throughout the winter, and that Trump’s attempt to lower diesel prices before the midterms would “bear no fruit.” That same night, Ukrainian missiles struck the NZNP Rostovsky petroleum export terminal at Rostov-on-Don, the terminal from which shipments to the U.S. under the agreement would originate, causing a massive blaze.
Trump responded to the strikes Saturday by saying Ukraine “needs a new leader,” slamming Zelenskyy for not doing enough to end the war; “he could have made many deals and for some reason he never does,” Trump concluded on Truth Social. Hours later, Russia bombed the Ukrainian city of Zaporizhzhia, killing 20 people; Zelenskyy retorted on social media that the strike was Putin’s “thanks” for the lifting of sanctions.
The fuel deal also sparked bipartisan outrage from Congress, especially from hawkish Republicans, which had enthusiastically passed the Lindsey Graham sanctions legislation on Russia in September. Republicans from both houses attempted to take swift actions to reverse the deal. On Saturday, Republican Reps. Brian Fitzpatrick and Don Bacon introduced the Ronald Reagan Peace through Strength Act, which seeks to block all U.S. purchases of Russian oil; and on Sunday, four Republican and three Democratic Senators sent a strongly worded letter arguing that the diesel deal contradicted the original sanctions law authorized by Congress in 2022 at the start of the war with Ukraine. Five more Senators joined a statement released Tuesday urging Trump to rescind the deal, saying the deal was a “gift to our adversary and a betrayal of our allies.”
In Europe, Trump’s announcement only served to deepen the rift between NATO and the Trump Administration that has been festering since the beginning of Trump’s second term; on Monday, European governments rebuked Trump over the deal, with several Eastern European governments saying it “doesn’t help” either the global price of oil nor the increasingly fragile transatlantic relationship between European nations and the United States. EU foreign policy chief Kaja Kallas said Saturday that Russia needed more pressure, not less, to end the war in Ukraine and that Europe would continue to enforce their sanctions on Russian oil. Erstwhile Trump ally Giorgia Meloni of Italy also criticized the deal, calling it a “very risky choice.”
On Sunday, Trump announced that an “energy ceasefire” had been worked out between Ukraine and Russia, whom he said agreed to halt strikes on each other’s energy and oil production infrastructure. Ukraine rejected Trump’s claim immediately, with Zelenskyy and Ukrainian officials both claiming that no one had heard of such a ceasefire until Trump announced it to the public. Putin made no public response, but simply bombed energy infrastructure in Kharkhiv just hours after Trump’s declaration, including the city’s CHP-5 thermal power plant that supplies Kyiv with energy and water management, leaving most of Kyiv without water or power.
On Monday, Ukraine stepped up its attacks on oil-bearing ships in the Black Sea, as drones struck two more ships off the coast of Bulgaria, leaving 11 missing. Zelenskyy discussed the attack as a direct challenge to Trump: “If they can guarantee the protection of our energy grid, we will not respond to their diesel infrastructure. Why doesn’t America then conclude a diesel deal with Ukraine? Let’s have such a deal with the president of the United States.”
Zelenskyy told reporters that the Trump Administration had threatened to stop sharing intelligence on Russian strikes with Ukraine if they did not stop targeting Russian refineries; and after a Russian ballistic missile attack on Kyiv on Tuesday, Zelenskyy claimed that Ukraine received no intelligence or early warning from U.S. forces.
Further confusing the international community were statements made by U.S. NATO Commander Alyx Grinkewich, who warned Ukraine Tuesday against continuing strikes on Russian refinery capacity or risk getting cut off from vital weapons and infrastructure provided by the United States.
Trump and U.S. officials doubled down on defending the deal amid growing bipartisan backlash, claiming that the move was intended to both bring down fuel prices for Americans and ‘soften’ Moscow on potential peace talks. When asked by reporters about the purported ‘ceasefire’ Trump announced earlier in the week, which both Russia and Ukraine denied agreeing to, Trump said: “Well they agree, you know why? Because I said you agree. That’s why. They agreed because I said they agreed.”
On Tuesday night, Ukraine launched 500 drones into Russia, causing a massive fire at an oil depot in Valuyki, Belgorod Oblast as Zelenskyy responded to U.S. threats to cut off intelligence and weapons support, vowing to “burn Russian refineries.” On Wednesday, Ukrainian drones destroyed Russia’s largest data center, part of a series of attacks intended to cripple Russia’s AI infrastructure buildout.
Also on Wednesday, Ukraine found that its internet access – provided by Elon Musk’s Starlink service – had suddenly been throttled, hampering its military operations as Russia launched another wave of strikes at the capital’s power grid, again with no warning or defense system, cutting power to 600,000 people in Kyiv. Musk, who had earlier criticized Zelenskyy over the weekend for going “too far” in hitting Russian energy, claimed that the military version of Starlink, called Starshield, was wholly controlled by the U.S. government, he had ‘no control’ over its operations in Ukraine, and that ultimately, it was Trump who made decisions over Ukraine’s access. Reuters reported on Thursday that the call to limit Starshield access for Ukraine came from the White House.
Zelenskyy responded by lashing out in anger at Trump Thursday in an exclusive interview with the Financial Times, where he expressed outright defiance, saying to FT that “the block [on refinery strikes] is out. We’re done.” Asked by the reporter whether he would still entertain halting energy strikes, Zelenskyy said that he would on the condition that the United States, “at a minimum,” provide him with more Patriot missile interceptors. CNN reported Thursday that a source close to the matter told them the attacks on Kyiv and Kharkhiv were successful because Ukraine has run out of Patriot missiles; but given the United States’ own reported shortages, there may not actually be any more to give.
Zelenskyy noted that it was when he asked for more air defense equipment this week that Ukraine’s Starlink access began to falter. “Business is interesting between the United States and Russia,” he added. “I think that they [America] want to have energy projects and… [that] of course for them is difficult to have when there is war in Europe.”
CPI report shows inflation spiking as food, energy prices leave nearly half of Americans unable to make ends meet; AI/private credit/bond market crises menace mainstream banking. In the nation’s last snapshot of economic data before the midterms, the Consumer Price Index (CPI) report this week indicated that inflation rose 3.7% in September, higher than economists expected and affecting a wider breadth of consumer products across the board. The rise in prices is being driven by spikes in energy costs, especially diesel, due to the conflicts in both Ukraine and Iran. Gasoline prices, now sitting at a national average of $4.50 per gallon, surged 9.1% in September, up 34% from the same time last year.
At the same time, BLS data released Wednesday revealed that on average, Americans have experienced effectively zero real wage growth since the start of Trump’s second term; and U.S. consumer purchasing power has in fact fallen at least 0.5% on average from August to September of this year. Over half of all adults – including 51% of wealthier Americans – say they have cut back significantly on discretionary spending in the past year; and 77% say they do not have enough money to cover emergency expenses.
A new report from Pew Research Center found that nearly half of all Americans now struggle to pay for basic needs such as food, housing, transportation, and medical care; with the proportion rising to as high as three-quarters among lower-income adults. Nearly a quarter of those who said there was too much economic inequality said the system had to be completely rebuilt, up from 14% in 2019.
A survey of food banks conducted by NBC this week showed food banks across the nation being overwhelmed with demand after Trump’s budget bill stripped millions of SNAP food assistance; with many having to start rationing food for growing numbers of needy families. Rising gas prices have added at least $400 or more to household budgets in nearly all states, with Utah, Colorado and Alabama leading the nation with more than $800 in additional transportation expenses. CNN has provided a calculator where consumers can determine, based on their own unique information, how much more they are now paying for basic necessities and consumer items.
The accelerating rise in prices has also raised the chance that the Fed will be compelled to hike interest rates later this month, which will further raise the cost of borrowing and/or restrict borrowing just days before the elections. Bearing the brunt of rising costs are small businesses, which according to a new survey is being “crushed” by pressures from multiple directions due to Trump policies such as the war, rising bond yields, tariffs and more. The New York Times profiled several Trump voters on the economy, finding that many are jumping ship over his failed promise to lower prices.
As National Economic Council (NEC) president Kevin Hassett attempted to spin the bleak data in a positive light, the IMF issued its starkest warning yet on Tuesday that nearly all positive market growth was attributable to the debt-fueled AI bubble which has grown to massive proportions; such that its inevitable collapse would carry serious risks for global economic stability.
Margin loan balances, according to Charles Schwab, have nearly doubled year-over-year; and particularly troubling to the IMF is the $1.4 trillion ‘circular financing’ strategy utilized by the ‘Magnificent Seven’ AI tech companies, where debt is being raised to pump capital into AI companies where “the revenue meant to service the debt is promised to the same entities providing the capital.” While on paper it makes global markets look robust, if (and when) those massive revenue commitments fail to materialize, warns the IMF, the losses will cascade across multiple involved sectors of finance simultaneously, spreading financial contagion throughout the economy, including commercial banking institutions once thought to be relatively insulated from risk.
Investors began to react to the looming risks this week, widening ruptures in the AI bubble as stock markets began to visibly crack through precipitous panic sell-offs of tech stocks. South Korea’s KOSPI and KOSDAQ indexes appear to be the first dominoes to fall, experiencing their ‘Black Thursday’ moment as panic selling of tech stocks triggered a severe crash in the overall markets, diving over 7.75% on Thursday and triggering emergency ‘circuit breakers’ intended to stop trade before the losses became catastrophic. AI companies Character.ai, which declared bankruptcy this week, and CoreWeave, which suffered a bond crash on Wednesday due to the increasing likelihood of defaults as benchmark yields continue to rise, are now being considered the canaries in the coal mine.
On top of these immanent risks, insurers, the IMF, and financial institutions issued warnings this week of the many other stochastic contingencies that could trigger a cascading collapse in the global financial system, including climate change, prolonged geopolitical/military conflict, or even the vagaries of AI-powered financial algorithms themselves, as more trading gets outsourced to automated platforms.
This week, the Carlyle Group issued a warning that private credit, which has been undergoing a ‘shadow bank run’ of redemption requests from investors over the past six months, could also be a linchpin that triggers a financial crisis due to its excessive exposure to the AI industry, which the firm estimates could be as high as 40 percent. Nearly all private credit loans are based on adjustable interest rate terms, which are particularly sensitive to rising benchmark U.S. Treasury yields, which hit multi-month highs this week with yields on short-term bonds accelerating faster than the long end, increasing the risk of inversion.
Last month’s collapse of Australian commercial real estate giant Bathla Group, which owed over $4.3 billion to private credit firms, is further accelerating a global pullback of investment in private credit from mainstream commercial banks, led by Goldman Sachs, UBS and JP Morgan as banking institutions put equity firms’ valuation of their private debt portfolios under greater scrutiny. Credit firm Moody’s reported this week that private credit borrowers may be turning to accounting tricks such as delayed interest payments and maturity extensions to avoid defaulting on their debts, potentially masking the true degree of private credit stress to an as yet unknown extent.
The Federal Reserve Bank of New York conducted an investigation this week into several of the largest banking institutions, including JP Morgan Chase, Wells Fargo, Barclays, and Morgan Stanley, to review their overall exposure, risk management strategies, and quality of collateral on their private credit holdings. As volatile bond yields continue to climb, putting pressure on borrowing costs, commercial banks will be compelled to claw back its standards on overall lending, further slowing economic expansion. On top of those risks, Bank of America was hit with $1.2 billion in penalties by the U.S. Treasury this week for failing to enforce anti-money laundering policies.
The IMF also warned in its report that mounting sovereign debt in the advanced capitalist economies also threaten overall global economic and political stability. France, which has been rocked by anti-austerity protests over the last couple of weeks, is one such canary in the coal mine, as its public debt climbs above 150% of GDP. While central bank and IMF orthodoxy over the last several decades have compelled governments to implement austerity policies as a response to debt crises, former Greek finance minister Yanis Varoufakis warned this week that such policies would further foment generalized social revolts that could deepen reactionary sentiment and strengthen the political power of far-right movements.
Trump DOJ raids Rep. Ilhan Omar’s home as pre-midterm election interference intensifies. On Monday, October 10, Department of Homeland Security agents raided the home of Minnesota U.S. Representative Ilhan Omar. Omar, a Somali immigrant and outspoken advocate against Trump’s mass deportation program, has long been a target of the Trump Administration’s ire going back to the massive wave of ICE operations and confrontations in Minneapolis earlier this year, resulting in the deaths of U.S. citizens Renee Good and Alex Pretti.
Legal experts surmise that the premise used by DHS and DOJ to execute a search warrant at her home – speculations raised by Fox News and the New York Post last month that she may have lied about her age on the naturalization paperwork filed by her father under asylum terms in the early 2000s – is substantially quite weak on legal grounds. In a statement, the Justice Department said that the search was executed pursuant to an ongoing criminal investigation into Omar and her family.
Omar responded to the action on X, calling the search the “latest escalation” in Trump’s longstanding “campaign of political intimidation” against her and other political adversaries of the Trump Administration. “Make no mistake,” she wrote, “this is an attempt to target political enemies and weaponize federal law enforcement. For ten years, Trump has targeted me with baseless lies and smear campaigns… I will not be silenced.”
Analysts note that the action taken against a sitting member of Congress, just 22 days before she stands for re-election in the midterms, violates DOJ guidance that normally prohibits this kind of law enforcement scrutiny into political candidates or incumbents during election season, guidelines that are meant to avoid undue political interference in the democratic process.
On Wednesday, the Wall Street Journal pointed to an even more sinister motive behind the raid: according to U.S. officials who spoke with WSJ reporters, the DOJ investigation into Omar and members of her family, who were subpoenaed this week, is aimed at building a case to strip Omar of U.S. citizenship. Last week, the Trump Administration announced a mass effort to strip 40 naturalized U.S. citizens of their citizenship rights, in what U.S. Attorney Todd Blanche called “the largest denaturalization effort in U.S. history.”
On Wednesday, CNN reported that D.C. District Court Judge Matthew Scarbaugh had ordered the DOJ to limit the scope of its probe into Omar’s records before signing the search warrant. It has been standard practice for the D.C. courts to uphold protections for sitting members of Congress’ legislative work records as part of the Constitution’s Speech or Debate Clause.
In the American Prospect this week, analyst Whitney Curry Wimbish draws connections between the DHS raid on Ilhan Omar’s home and a new “nightmare” domestic spying program being fast-tracked by ICE called ERO ONE, a $100 million initiative to embed ICE agents in over two dozen cities, including the District of Columbia, to conduct in-depth investigations and surveillance into particular individuals to be identified by the agency. Monday’s raid, argues ex-military analyst Michael Wriston, is but a preview of what people may come to expect under ERO ONE; “Not just necessarily sitting members of Congress,” Wriston said, “but anyone, and especially members of the immigrant community… No one is safe. No one.”
On Wednesday, the Department of Homeland Security posted notice of a no-bid contract awarded to Nebraska company Pen-Link Ltd. to develop a “single platform that gathers live wiretaps, call records, email, financial records, and social media data” for Homeland Security Investigations, a sub-department within ICE.
ICE has become more active in the run-up to November’s elections, raising alarms of escalating federal interference in order to block the right to vote, intimidate Trump opponents before they hit the ballot box, and continue to sow doubt in the election process that, according to Steve Bannon, is a ‘core belief’ of the MAGA movement. The Intercept reported this week on officials within ICE who called the raid on Omar’s home just one of a series of “midterm panic moves” directed by the Trump Administration.
On Wednesday, the Trump DOJ sued the state of California in an attempt to block the ballots of up to 20,000 voters over suspicions of “noncitizen voting” in the heavily immigrant-populated state. CNN reported that the Justice Department threatened to take legal action against California election officials if they did not comply with a federal request to review and purge a list of so-called ‘noncitizen’ voters the DOJ allegedly found on Los Angeles’ voter rolls in August. Moreover, the Justice Department demanded that election officials refuse to send ballots to the alleged noncitizen voters and is requesting that election officials segregate ballots from voters on the list until their citizenship is confirmed.
The lawsuit follows on the heels of a 45-day surge of ICE raids in California that began last week, in which ICE agents were given license to “go after anybody.” Starting in San Diego, ICE agents involved in the surge, known internally as ‘Operation Safe California’, were reportedly explicitly directed to go after all people suspected of being undocumented immigrants, a change from the usual ICE justifications that claim a focus on arresting immigrants with criminal records. A recent ProPublica report has found that over 500 U.S. citizens have been wrongfully detained in ICE operations during Trump’s second term.
California officials and organizations, including the United Farm Workers, denounced the operation as a blatant attempt to intimidate minority voters ahead of the midterm elections. Governor Gavin Newsom shot back with a post on X, saying that “Donald Trump is using fear and panic as a weapon – putting families at risk, undermining our economy, and terrorizing communities. No President is above the Constitution. No one in this country is without rights. California will stand up for our communities and hold federal agents accountable. Know your rights and exercise them safely.”
Conservative media outlet The Washington Examiner, which broke the story, observed that the “decision to focus ICE resources throughout the sanctuary state is the latest effort by the Trump administration to unleash ICE in a blue state following surges to Minnesota, Illinois, New York, and Oregon.”
Election officials in Oregon and several other states, as well as Postal Service employees, are encouraging mail-in ballot voters to return their ballots as early as possible, recommending at least a week to 10 days before Election Day, in order to avoid being caught up in bottlenecks or other contingent delays that may result in the vote not being counted.
MOVEMENT TRACKER
Tohono O’odham nation faces DHS intimidation as sacred Saguaro cacti are threatened by border wall construction. The Tohono O’odham Nation filed an emergency injunction with the Washington, D.C. Circuit Court of Appeals late last week, aiming to stop the Department of Homeland Security from removing sacred and legally protected Saguaros to make way for construction of a wall along Arizona’s southern border. Tribal leaders say CBP notified them that removal of the protected plants would begin Monday, Oct. 12; the timing coincides with Indigenous Peoples’ Day, which officials say is disrespectful to all tribal nations.
A recent ProPublica report finds that the Tohono O’odham have faced intimidation tactics from DHS, including surveillance of prayer ceremonies and questioning of Tribal members. The Nation are bracing for the possibility of clashes between federal agents and tribal members who may seek to protect the threatened wildlife. Although Tribal Chairman Verlon Jose has called for peaceful resistance, the Nation’s emergency management office has set up a medical station near the border with emergency services, a mobile health center and dozens of Tribal police and fire personnel ready to attend anyone who needs assistance, be it due to interactions with law enforcement or simple dehydration.
Rep. Ramirez introduces bill to repeal Homeland Security Act, abolish ICE, DHS. Illinois Congresswoman Delia Ramirez introduced a new bill to the House on Tuesday, titled the Reimagining Safety Act, that would repeal the 2002 Homeland Security Act, eliminate Immigration and Customs Enforcement, Customs and Border Patrol, the Department of Homeland Security, and eventually immigrant detention altogether, instead establishing a civil court-based system run through the Department of Justice.
A new agency, the Department of Community Safety, would be formed to take on DHS duties like administering the Federal Emergency Management Agency, while other duties would be reallocated to relevant existing departments. Other expansive War on Terror-era powers would also be rolled back, such as the authority of the Secretary of State to declare “foreign terrorist” organizations, and the ability to place those without warrants or convictions on “no-fly lists.”
Ramirez said in a statement regarding the bill, “Every person dead in detention, shot or killed by ICE and CBP, every neighbor deported to a third country, every family separated… is a reason DHS must be dismantled and something new must take its place.” According to the ACLU, at least 58 people have died in ICE custody since Trump’s return to office, a dramatic spike over previous years. Approval ratings for ICE and CBP have dropped precipitously since January 2025, with a YouGov poll from July finding that a plurality of voters want the agency abolished.
Outrage in NYC after latest ICE shooting, congressional candidate shoved by NYPD at protest. Protests erupted in New York City this week after a local man was shot in the neck by ICE agents during a traffic stop in the Marble Hill neighborhood. Oscar Belgal, a 28-year-old from the Dominican Republic, was reportedly shot multiple times while driving his vehicle with his 5-year-old son in the back seat last Thursday afternoon.
Belgal survived the shooting, but his attorneys say he is being held in solitary confinement and has not received adequate medical attention, saying in a court filing Wednesday that Belgal still has a bullet lodged in his body – an echo of Wilber Rafael Garcés Pérez, the Houston man who had a bullet lodged in his back for nearly two weeks after being shot by an ICE agent during a traffic stop last month.
Protests in the neighborhood sprang up almost immediately after the shooting, as video footage of the immediate aftermath spread quickly online alongside accounts of Belgal’s terrified son crying for his father. Protests moved to the hospital where Belgal was being detained on Thursday evening, where the NYPD erected barriers and arrested five protesters in the course of their efforts to dispel the crowd. Repeat protests took place Friday and Saturday, with rallying calls for Belgal’s release, the abolition of ICE, and the resignation of the city’s police commissioner and disbanding of the NYPD’s Strategic Response Group which responds to protests in the city.
The outcry from New Yorkers was matched by outcry from a number of local politicians. Congressional candidate Darializa Avila Chevalier, whose district includes Marble Hill, personally participated in protests and was seen being shoved to the ground by a police officer in the chaos at one. Chevalier noted that, “It is my duty as someone who was elected to represent this district to echo the demands of people in my district,” and has gone on to advance calls for city police reform since the event. New York Rep. Alexandria Ocasio-Cortez said in a statement, “ICE is a rogue, lawless paramilitary and surveillance agency. It does not belong in New York City and it should not exist in the United States of America. Abolish ICE.”
Mayor Zohran Mamdani called the shooting “unconscionable” and said that “ICE is rotten to its core.” In a press conference, Mamdani stated that he had “been on the phone with President Trump and Secretary Mullin negotiating the release of the man ICE agents shot. Those negotiations were unsuccessful.” New York Governor Kathy Hochul raised immediate calls for accountability from the federal government, saying in a statement on X, “No child should ever have to experience the terror of gunfire, let alone wonder if they’ll make it home alive... New Yorkers have witnessed far too many acts of violence by a rogue federal agency and untrained agents that operate with impunity. Federal authorities need to provide answers, and they must do so immediately.”
Rep. Tlaib introduces anti-Flock house bill. Michigan Congresswoman Rashida Tlaib has introduced a new bill that aims to limit the use of automated surveillance systems by blocking federal funds from being used on automated license plate readers (ALPRs), biometric surveillance, and facial recognition technology.
HR 10807, the “Get the Flock Out of Our Communities Act,” is co-sponsored by fellow Democrat Reps. Sylvia Garcia, Summer Lee, Ilhan Omar, Delia Ramirez, Nydia Velázquez, and Bonnie Watson-Coleman as part of a movement of bipartisan efforts to regulate or limit use of mass surveillance technologies like ALPRs. The bill would also make states and municipalities ineligible for certain federal funds unless they stop utilizing mass surveillance systems like Flock’s database.
Tlaib said in a press conference announcing the bill, “Federal funds should be used to invest in our communities in real safety solutions. We need good jobs, affordable homes, clean water, and reliable electricity. That’s what’s going to make us safer.” Recent polling shows that mass surveillance technologies like ALPRs are only becoming more unpopular, and scores of cities and counties across the country have cancelled ALPR contracts in recent months.
Hecklers disrupt Hegseth autonomous warfare panel, Trump campaign rallies. A group of protesters disrupted a panel featuring U.S. Defense Secretary Pete Hegseth at the Association of the U.S. Army’s annual meeting in Washington, DC on Wednesday, calling Hegseth a “war criminal” and a “Nazi.” Six protesters reportedly interrupted the panel at various points during its hour-long run, shouting condemnations of the war in Iran and the genocide in Gaza. One shouted, “You’re not a warrior, you’re a coward,” and another yelled at Hegseth, “We’ll see you at the goddamn Hague. You should be ashamed of yourself,” while being removed by security. The panel itself was intended to be a discussion of “Project Agincourt,” a Pentagon initiative to develop and acquire “autonomous warfare” systems.
A woman in a yellow jacket and a Primus t-shirt captured the internet’s attention after she was removed from a Trump rally in Syracuse last Friday. 73-year-old Sue Secaur was seen displaying double middle-fingers toward the president and shouting profanities while rally attendees chanted “USA! USA!” as sheriffs escorted her out of the event. Many online commenters expressed support for Secaur and some have even reportedly tried to send her money; she has asked that any who wish to do so make donations to the CNY Cat Coalition or the Center for Arts in Homer. Outside the rally, a large group of Syracuse residents gathered to protest Trump, with one organizer telling reporters, “What Donald J. Trump stands for is not what we stand for, it’s not what real citizens of Syracuse and Central New York stand for.”
In Ohio, several protesters were removed and one was attacked by Trump supporters at a Columbus rally. A woman wearing a shirt that read “RELEASE THE EPSTEIN FILES” was punched in the face and appeared to be restrained by a group of Trump supporters during a verbal confrontation at the rally before she was escorted out by police. No charges have been filed against the attackers. False AI images of the real attack quickly went viral after Trump mocked the protester’s appearance and accused her of being a paid actor.
French student protests raise specter of youth revolt for Europe; India’s Gen Z-led “Cockroach Janata” weather crackdown. France’s youth protests are continuing to grow as they enter their fourth consecutive week, with France24 reporting nearly half a million participants nationwide in Tuesday’s demonstrations.
Activist Greta Thunberg, who became famous as a teen for school strikes calling for climate action, made an appearance at the Paris protest to draw attention to the cause. Thunberg told journalists, “Young people are not being included in the conversation. Our future is being robbed away from us.” Her statements seem to echo the popular sentiment amongst the protesters, as protesters have been seen bearing signs with phrases like “Too young to be listened to, but old enough to be tear-gassed,” and l’Union Etudiante, a university-level student union, wrote on X of the protests, “They’re not listening to us, so we’re going to them.”
Protests have focused on poor conditions within the French school system, particularly in low income and marginalized communities, with students decrying facilities in severe disrepair, overcrowded classes, overlong school hours, and under-supplied and under-staffed schools. The wave of protest has been met with aggressive police response, as more than 7,000 protesters, mostly minors, have been detained so far, and several teens have suffered life-altering injuries caused by police stun grenades and other riot-control munitions.
Some have speculated that the harsh response has actually served to stoke protests; a lawyer for several arrested student protesters told journalists, “It politicizes you at an incredible speed. For many of them – for all of them – this was one of the first times that they’d taken part in a demonstration, coming together in a public space to voice demands they considered legitimate.” Solidarity protests have sprung up amongst youth across Europe, causing some analysts to speculate on the possibility of a broader “Gen Z revolt” for the continent.
India’s Cockroach Janata Party (CJP) faced its own police crackdown over the weekend, as authorities placed the capital city of Delhi on intense lockdown in response to a large protest co-organized by the party against the removal of 130 million names from the country’s voter rolls. Thousands were detained in connection with the protests, including CJP founder and leader Abhijeet Dipke and several other party leaders, prompting the Guardian to speculate that PM Narendra Modi “cannot arrest his way out of a democratic crisis.” Like other youth-led protest movements in the region in recent years, some protesters in India have adopted imagery related to the anime “One Piece,” with rising star activist Neha Bora seen sporting a shirt with the iconic straw-hatted skull that has become a symbol of resistance against corrupt and powerful institutions.