Economic headwinds stiffen as campaign season hits full swing

▪ Investigation launched into Amazon plane crash

President Trump predicted in a Labor Day message on Truth Social that Republicans would win “big” on Election Day. But Republicans are facing stiffening economic headwinds as election season kicks into high gear.

A record was set Monday as the average cost of a gallon of regular gas was above $4 on Labor Day for the first time ever. AAA recorded the price at $4.15 per gallon, more than 30 cents higher than the previous record of $3.82, set in 2012.

This came after the average price of diesel hit a new high Friday, a mark that was surpassed each day of the weekend .

AAA noted in its analysis that gas prices typically drop this time of year because of reduced demand, but the high cost of crude oil is keeping them elevated.

The soaring cost of energy has also fueled overall inflation, which ticked up to 3.4 percent year-over-year, according to last month’s Consumer Price Index (CPI) — well above the Federal Reserve’s 2 percent target and slightly higher than former President Biden ’s final months in office. Economists and politicians alike will be keeping a close eye on the new CPI numbers coming this week.

Costs on some goods are set to rise further after Canada’s 50 percent retaliatory tariffs took effect at midnight . Canadian officials have vowed to meet Trump’s 50 percent tariffs “dollar for dollar,” escalating the trade war between the two countries and posing a particular challenge for GOP candidates in border battleground races.

There’s also continued volatility in the global bond markets, a key indicator of economic anxiety, with yields ticking up at the start of the week.

The economic picture isn’t all bad news for Trump and his party.

The job market has continued to prove its resilience despite economic uncertainty. The economy added 162,000 jobs in August, well above the 53,000 that had been expected, as the unemployment rate held steady at 4.1 percent.

That is a key victory that Trump and congressional GOP candidates can tout on the campaign trail as part of their message that the economy is strong despite the high costs.

But these numbers also mean the Federal Reserve is more likely to raise interest rates, an idea that would be anathema to Trump, who has repeatedly called on the Fed to be more aggressive in lowering rates. The Hill’s Julia Shapero reports that the latest job numbers alleviate concerns that the higher rates are weakening the labor market, allowing the Fed to focus more on curtailing inflation.

The Fed has kept interest rates steady over its past five meetings, but traders are pricing a roughly 60 percent chance that the agency increases rates by a quarter point at its next meeting later this month.

That would be unwelcome, and untimely, news for Republicans. Still, the main driver of economic anxiety continues to be the Iran war.

The U.S. has touted its growing control over the Strait of Hormuz, which has allowed a steady, if limited, flow of oil out of the Persian Gulf. Iran appears determined to change these dynamics.

Mohsen Rezaei , the head of Iran’s Supreme National Security Council, told Iranian state-run media on Sunday that Tehran plans to announce a “restricted zone” by the strait in the coming days. Under the plan, any ship that enters the area with the intention of passing through the strait will be placed on a sanctions list and face “consequences.”

Rezaei said the zone will cover the region within the U.S. Navy’s blockade, extend toward the strait and continue into the Persian Gulf.

The escalation follows the latest round of tit-for-tat strikes between the U.S. and Iran since negotiations to reach a resolution to the conflict fell apart last month. U.S. Central Command hit three Iranian oil tankers located near Kharg Island and the Gulf of Oman on Saturday in response to Iranian attacks on U.S. Navy warships.

Energy Secretary Chris Wright said on Sunday that about two-thirds of the daily traffic that the strait had before the war is getting through.

The administration has also been touting the deal it made with Venezuela to gain control of 65 billion barrels of the country’s oil to help provide relief to consumers. But experts have signaled time may be needed before any impacts could be felt.

Despite these developments, the cost of crude oil has been back on the rise in recent weeks, inching past $90 per barrel .

That will give Democrats a powerful cudgel as candidates and political parties ramp up advertising, campaign stops and debates in the weeks ahead.

▪ The Hill Insider : Controversy swirls around Trump’s Venezuela partner.

▪ The Hill : Republicans divided over wisdom of Trump’s midterm convention.

▪ Axios : Iran war drives $100 billion in extra energy costs.

Emergency alerts are in place as Hurricane Lowell passes by Hawaii in the Pacific Ocean this morning, bringing heavy rain and strong winds to the islands of Kauai and Niihau. The Category 2 storm has sustained winds of more than 100 miles per hour.

The Trump administration has removed language critical of a Confederate memorial formerly located in Arlington National Cemetery, eliminating wording that said the monument “mythologized” the Confederacy and “sanitized” slavery, The Washington Post reported . The memorial was removed in 2023 as part of a congressional mandate, though the base and a sign marking it remain.

A Saudi-led coalition is vowing to respond after a wave of attacks from the Iranian-backed Houthis in Yemen targeted the kingdom’s oil facilities . More than 70 people were injured in the attacks, the latest escalation in a clash between Saudi Arabia and the Houthis.

An Amazon cargo plane sits at the Miami International Airport (MIA) after it overshot the runway, Sunday, Sept. 6, 2026. (AP Photo/Lynne Sladky)

‘UTTER DEVASTATION’ : An investigation is underway after five people were killed and five others were injured when an Amazon cargo plane overran the runway at Miami International Airport on Sunday.

Three of the injured people were in critical condition, while two were hospitalized with less severe injuries.

The National Transportation Safety Board said it is sending a team to Miami led by the agency’s chair, Jennifer Homendy , to conduct the investigation. She said Monday that all five people killed were inside a van, which was carrying seven people from a cleaning company, or an SUV that were outside of airport property.

She called the scene at the crash “utter devastation.”

The flight was arriving from San Juan, Puerto Rico, when it overran the runway around 2 p.m. and continued across a road used by warehouse workers and other businesses surrounding the airport. The plane burst into flames upon impact, and more than 60 Miami-Dade Fire Rescue units responded to the crash.

The Associated Press reported that federal investigators are likely to focus on whether the plane touched down too late to stop safely. Video of the landing appears to show the plane passing over a significant portion of the runway before touching down.

Experts told the outlet that the typical landing zone for a plane is within the first 3,000 feet of a runway, and if the plane was beyond that area, it should have aborted the landing.

The Miami airport isn’t equipped with lightweight, crushable material that’s been installed at more than 120 airports nationwide to safely stop planes that go past the end of a runway, AP reported.

▪ CBS News : Witnesses describe ‘surreal’ moment the plane crashed.

FIGHT TO THE END : Voters are heading to the polls in New Hampshire on Tuesday in one of the last primary contests of the cycle, which will set up a key Senate battle for November.

Rep. Chris Pappas (D-N.H.) has long been viewed as the favorite to win the Democratic nomination for retiring Sen. Jeanne Shaheen ’s (D-N.H.) seat. He’s trying to fend off a challenge from the left from scientist Karishma Manzur . Polling has shown Pappas as the clear frontrunner, but some surveys have suggested the race may be tightening.

Primary polling has come under increased scrutiny in recent weeks after high-profile misses in Michigan and Wisconsin, so the race could certainly be one to watch as results come in this evening.

Whoever wins the Democratic nomination will likely face former Sen. John Sununu (R-N.H.), who is the favorite for the GOP nod for his old Senate seat. He’s facing opposition from former Sen. Scott Brown (R-Mass.) but is expected to easily win.

Democrats are favored to hold the seat in November, but Sununu has given Republicans some hope of pulling off an upset.

▪ The Hill Insider : Five primaries to watch this week.

▪ The Hill : Democrats seek to counter GOP’s midterm convention.

NEW DEBATE : New Mexico Gov. Michelle Luhan Grisham (D) slammed the president for his post floating renaming her state to “New America,” in the latest fight of Trump’s renaming frenzy.

Trump posted a map on Sunday labeling the state as “New America” after the spread of a debunked claim online that he had issued an executive order renaming it. While he hasn’t taken any official action, his post follows the other moves he’s made to rename longtime geographic landmarks, including most recently issuing an order to rename Lake Ontario to “Lake America.”

Last year, Trump issued an order to rename the Gulf of Mexico to the “Gulf of America” in a move that stirred significant controversy.

Lujan Grisham noted in a post responding to Trump that the name “New Mexico” has existed long before the U.S.

“While the White House wastes time coloring on maps, Nuevo México is busy doing the work,” she said.

▪ The Hill : Trump posts map with American flag emblazoned over North America.

▪ NBC News : New Mexico Democrats push back.

The president will participate in a Steel Across America event at 10:35 a.m. He will sign executive orders at 1 p.m.

The Senate will meet at 1:15 p.m. for a pro forma session.

The House will convene at 2 p.m. for a pro forma session.

Pentagon spokesman Sean Parnell speaks during a press briefing at the Pentagon, Wednesday, July 2, 2025, in Washington. (AP Photo/Mark Schiefelbein)

CROWDED FIELD : Defense Secretary Pete Hegseth may have a favorite to lead the Army following Dan Driscoll ’s resignation last week, but his pick has some other notable competition.

Sources familiar with the process told The Hill’s Filip Timotija that Hegseth’s choice, Pentagon spokesperson Sean Parnell , is one of at least four candidates being considered for Army secretary. Others in consideration include at least two current officials — Marc Andersen , an assistant secretary of the Army, and Derrick Anderson , an assistant secretary of defense.

Rep. Brian Mast (R-Fla.), the chair of the House Foreign Affairs Committee and an Army veteran, is also in the field.

Trump has chosen Adam Telle , the assistant secretary of the Army for civil works, as the acting Army secretary , a move that Timotija reports caught some current officials by surprise. When Trump will nominate a permanent replacement to Driscoll or whether Telle will serve in the role for the long term is unclear.

“Every senior leader in [the] Pentagon knows that Secretary Hegseth’s preferred pick is Sean Parnell,” a senior Pentagon official said. “Sean’s well-respected across the Department, and viewed as a solid choice.”

One official said Parnell has been in touch with the White House about the position in recent days, and four sources with knowledge of the matter said he has support from multiple senior White House officials and some of the president’s outside advisers.

But some officials said Parnell could have a tough time being confirmed.

Parnell previously ran for Senate in Pennsylvania with Trump’s support but withdrew from the race in November 2021 after losing a court battle over custody of his children. The case included allegations of abuse from his estranged wife. Parnell has denied the allegations and said online in 2024 that he had been “vindicated.”

▪ Reuters : White House reviewing candidates to replace deputy defense secretary.

▪ The Hill : USS Abraham Lincoln heads back to US after Thailand stop.

German Chancellor and Christian Democratic Union (CDU) party leader Friedrich Merz give a press statement after visiting UPM Biochemicals with Saxony-Anhalt State Governor and top candidate Sven Schulze in Leuna, Germany, Thursday, Sept. 3, 2026. (AP Photo/Matthias Schrader)

FIGHTING ON : German Chancellor Friedrich Merz vowed to plow ahead with the country’s democratic values and firm stance against Russia after a far-right party won a major victory in a state election for the first time since the Nazi era.

Merz acknowledged that the victory for the right-wing Alternative for Germany (AfD) in the small eastern state of Saxony-Anhalt was “the most serious election defeat” that his own center-right Christian Democratic Union suffered in years. But he said he would remain as the leader of Germany, as “giving up is not an option for me.”

AfD, a party whose regional branch in Saxony-Anhalt is considered a right-wing extremist group by Germany’s domestic intelligence agency, finished well ahead of the other parties in the regional election Sunday. It fell just short of a majority and may need partners from other parties to form a governing coalition.

That would normally be difficult, as Germany’s mainstream parties have refused to work with AfD as part of a so-called “firewall” to prevent the party from gaining power. But AfD is only three seats short of a majority and may reach out to the far-left BSW party.

Despite being on opposing sides of the political spectrum, AfD and BSW both share anti-immigration and Russia-friendly sentiments.

That could pave the way for AfD’s candidate, Ulrich Siegmund , to become governor of the state.

Merz doubled down on economic reforms that he says are necessary to get Germany’s sluggish economy going despite their unpopularity. Still, he said officials must do better to justify the reforms, including to the country’s pension system, “not just rationally but also emotionally.”

▪ The Hill : Siegmund thanks Elon Musk after win.

▪ The Associated Press : AfD’s victory tests ‘firewall’ against the far right.

The 2028 Democratic presidential nominee will likely be a governor , John Kenneth White writes in The Hill.

Remember Frances Perkins this Labor Day, a champion of workers’ rights , Amanda Hatch writes in The Hill.

Rob Reiner appears at the Human Rights Campaign’s dinner in Los Angeles on March 22, 2025. (Photo by Jordan Strauss/Invision/AP, File)

And finally … The late actor Rob Reiner received a posthumous Emmy Award over the weekend for his guest appearance on FX’s “The Bear” before his death.

Reiner won the award for outstanding guest actor in a comedy as part of the ceremony for awards given out a week before the main Emmys ceremony, which is set to air on Sept. 14. He appeared in three episodes of the show that aired last year.

Deadline reported that Wendy McLendon-Covey , who presented the award, accepted it on his behalf , saying “We all wish he was here” as the audience gave a standing ovation.

Reiner and his wife, photographer Michele Singer , were found dead in December at their home in Los Angeles. Their son, Nick Reiner , is facing two counts of first-degree murder. He has pleaded not guilty.

Rob Reiner is the first posthumous winner of an Emmy in an acting category since Raul Julia , who won for “The Burning Season” in 1995 following his death the prior year, CNN reported .