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Eyewitness footage shows explosion at military industry factory in Isfahan, Iran.

Reuters

What We're Watching: Iran weapons depot targeted, fierce battles in eastern Ukraine, Czechs back pro-EU president, McCarthy-Biden debt limit meeting

What we know about the Isfahan attack

In what’s broadly believed to have been an Israeli attack, three drones hit an Iranian ammunition factory in the central city of Isfahan, Iran, on Saturday night. Iranian state media said damage to the site was “minor,” but phone footage suggests that the compound – used to produce advanced weapons and home to its Nuclear Fuel Research and Production Center – took a serious blow. An oil refinery in the country's northwest also broke out in flames on Saturday, though the cause remains unknown. Then, on Sunday night, a weapons convoy traveling from Syria to Iraq was also targeted by airstrikes. US reports attributed the Isfahan attack to Israel – which has in the past targeted nuclear sites in Natanz and hit Iranian convoys transporting weapons to Hezbollah in Lebanon. Indeed, this comes after Russia purchased hundreds of Iranian-made “suicide drones,” which it has used to pummel Ukrainian cities. While the deepening military alliance between Iran and Russia is a growing concern for Washington, it’s unclear if Uncle Sam played a role in the Isfahan hit – or whether Israel, which has to date refused to deliver heavy arms to Kyiv, agreed to carry out this attack in part to frustrate Iranian drone deliveries to the Russians. The escalation comes just days after CIA Director William Burns flew to Israel for meetings with his Israeli counterparts – and as US Secretary of State Antony Blinken heads to Israel and the West Bank this week. Crucially, it highlights the increasing overlap between Russia’s aggression in Ukraine and the longtime shadow war between Iran and Israel.

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Ukraine Corruption Scandals Won't Affect War Efforts | World In :60 | GZERO Media

Ukraine anti-corruption moves won't hurt war effort

Will resignations and a political shake-up in Ukraine negatively affect its war efforts?

No, not at all. This is anti-corruption efforts, getting rid of a bunch of people that are seen as problematic in terms of skimming money within the government. Russia's been more corrupt than Ukraine historically, but actually, it's quite close. There's a lot of work to be done, and as people start thinking about Ukraine attracting major funds from the Europeans, the Americans, others, multilaterals to rebuild the country, they really need to make sure that the money is going where it needs to, and that means running the economy well. So this is the effort that's being tried here, but it doesn't really matter with the war effort at all.

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Sri Lankan Commando Regiment members in Colombo, Sri Lanka.

REUTERS/Dinuka Liyanawatte

What We’re Watching: Sri Lanka’s shrinking military, mass shootings in America, McCarthy’s Taiwan visit, a common currency pipedream

Sri Lanka’s military downsize

In its latest bid to cut the economic fat, Sri Lanka's government announced that it will downsize its army, aiming to reduce the number of military personnel from 200,783 to 135,000 by next year and to 100,000 by 2030. Sri Lankan defense officials say the army is restructuring in order to boost its tech capabilities, primarily in cyberspace. But analysts highlight that this is part of President Ranil Wickremesinghe’s pledge to slash the bloated public sector, a precondition to unlocking a $2.9 billion bailout package from the International Monetary Fund. Crucially, military salaries make up around 37% of public wage costs. Cash-strapped Sri Lanka defaulted on its external debt for the first time in May 2022, after years of economic mismanagement led to acute fuel and food shortages – and forced Colombo to borrow heavily from India and China. With the bulk of Sri Lanka’s defense spending going to salaries rather than investment in equipment, this plan presents an opportunity for the country to correct its balance sheet. But some critics worry that Colombo, facing an internal terror threat, could be moving too hard too fast.

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General view of the US Department of the Treasury in Washington, DC.

Graeme Sloan/Sipa USA via Reuters Connect

US debt ceiling looms over a House divided

The US government surpassed its debt ceiling early Thursday, prompting the US Treasury Department to implement a series of temporary emergency measures to avoid a US government default. What does this mean and why does it matter?

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US Cannot Issue New Debt Until Congress Acts To Raise Debt Limit | GZERO Media

GOP partisanship could trigger first-ever US default

Jon Lieber, head of Eurasia Group's coverage of political and policy developments in Washington, DC shares his perspective on US politics:

What does it mean that the US has hit its borrowing limit?

Well, the US this week hit its statutorily created debt limit, meaning that because of all the money that it borrowed during the course of the pandemic and the fact that it's borrowing hundreds of billions of dollars a year spending more than it takes in tax revenues, it hit its $31.5 trillion debt limit, which means that the US is now in a situation that it cannot issue new debt until Congress acts to raise the debt limit. However, Congress does not want to raise the debt limit, and there are a couple episodes during 2011 and 2013 where Congress came very, very close to the date where it would've potentially defaulted for the first time ever by not making payments to creditors.

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Five Concessions McCarthy Made to Become House Speaker | US Politics In :60 | GZERO Media

Five concessions McCarthy made to become House speaker

Jon Lieber, head of Eurasia Group's coverage of political and policy developments in Washington, DC shares his perspective on US politics:

What did Kevin McCarthy have to promise to become the Speaker of the House?

Now Speaker of the House Kevin McCarthy survived a modern record of 15 votes to become speaker of the House earlier this week. He had to make some compromises to get there. Here are the top five changes to House rules that Kevin McCarthy agreed to in order to win the speakership.

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Speaker Vote Mess Sows How Ungovernable US House Is | US Politics In :60 | GZERO Media

Speaker vote mess shows how ungovernable US House is

Jon Lieber, head of Eurasia Group's coverage of political and policy developments in Washington, DC shares his perspective on US politics.

What are the implications of the House failing to elect a speaker this week?

Well, I'm down here at the US Capitol where Kevin McCarthy has failed on multiple ballots this week to receive the 218 votes that he needs to become House speaker. And if you're a political junkie, this is really your week. You've got multiple ballots, warring political factions, you've got backroom deals. But the reality is the implications of this in the real world aren't that great. It's a historical anomaly, hasn't happened for over 100 years, but the House wasn't going to pass that much meaningful legislation this year anyway. So a delay in organizing doesn't matter all that much. And whoever the speaker is, they're probably going to end up being pretty weak and any legislation they do achieve will just be either ignored or rejected by the Democrats who control the Senate.

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U.S. House Republican leader Kevin McCarthy (R-CA) reacts to the cheers of his Republican colleagues.

Reuters

What We’re Watching: Capitol Hill chaos, Putin’s biceps, Myanmar’s ‘vote’

The House speaker fiasco: Day 2

Another day, another letdown for Kevin McCarthy. For a second consecutive day, the Republican stalwart again failed to clinch enough votes from his own caucus to become House speaker, one of the most powerful jobs in US government. After six rounds of voting over two days – and a late-night team huddle on Wednesday in which McCarthy said he was willing to make significant concessions – 20 anti-establishment Republicans still refused to cast their ballot for McCarthy. Though they have some different demands, the broad consensus is that McCarthy is a creature of the swamp, slavish to special interests. What’s more, former President Donald Trump reportedly called on the group of detractors – a ragtag of his most ardent devotees – to “knock it off.” But the group shows no signs of backing down – for now – going so far as to say that Trump should have instead called on McCarthy to withdraw. Resolving the stalemate could still take days or weeks, and whoever prevails will emerge a weak leader with limited ability to control an unruly caucus. The last few days, however, have been a boon for President Joe Biden and the Democrats. Even Rep. Marjorie Taylor Greene, a Republican of the QAnon variety, has distanced herself from some far-right members of the GOP by supporting McCarthy’s bid. She said on Wednesday that the current House speaker fiasco “makes the Republican Party look totally inadequate and not prepared to run the country.”

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