Putting ICE on Ice, the E3 seize Russian assets, weirdness at the Fed, and an amazing project for children in Gaza
With Trump headed to the region, I was asked again and again by TV interviewers: What does he have to do to pressure Netanyahu to ensure that this deal is carried out — unlike in March, when Israel violated the previous deal? This question seems fair enough, because Netanyahu is a cheat. But for once, with the hostages expected to be freed, this is not where the pressure needs to be directed.
As I explained on Al Jazeera (above), it is the Arabs and especially Qatar, which has emerged as a critical player, who must be watched very closely to make sure the put the maximal squeeze on Hamas to actually disarm — as called for in the 20-point plan that they backed and that is what Israel has agreed to. If this doesn’t occur, the war could resume, possibly more brutal than before, with Trump’s backing. Especially as there’s no longer a Nobel Prize affecting things.
Earlier in the war, Netanyahu was focused on keeping his coalition intact at any cost, and therefore appeared his maximalist far-right partners. The war also delayed the reckoning for the colossal failure of October 7 and kept the focus away from his corruption trial and from his unpopular attempts to undermine democracy (his justice minister “does not recognize” the chief justice of the Supreme Court, and other officials have declared they’d ignore the courts).
But the story has flipped because elections are looming, within 11 months at the most and probably before. Even if Netanyahu could hold his coalition together, and he may not, it would deliver him no political salvation: the Israeli public wants closure. If Trump did need to pressure Netanyahu, by the way, it would be easy. The Israeli public trusts him far more than the prime minister and Israel cannot fight on without America. US Jews largely don’t vote for Trump anyway, and he cannot be reelected in any case (this, in contrast to President Biden, who seemed reluctant to upset US Jews in Pennsylvania in an election year — and watched the Dems dump him and then lose the swing state anyway).
If you doubt that Israelis prefer Trump to Bibi, see the below video of special envoy Steve Witkoff failing to read the room at Hostages Square in Tel Aviv this weekend, and (after basking in chants of “Thank You Trump”) daring to praise the PM as well. He seemed surprised at the angry boos, while Ivanka and Jared maintained their cinematically fascinating poker face.
Either way, Trump is arriving in Israel Sunday for a victory lap as everyone awaits the mass hostage release. From there, he is expected to continue on to Egypt for a “peace summit” in Sharm el-Sheikh — a gathering that has already drawn curiosity, and some quiet resentment, in Jerusalem. The summit will bring together regional and global leaders, among them Britain’s Prime Minister Keir Starmer, to discuss the next stage of the US-brokered Gaza plan, and the details of transitional governance in Gaza.
Israel itself has not been invited, nor the Palestinian Authority nor Hamas. This seems part of the choreography to let the Arab League and European partners take ownership of the reconstruction phase. It’s bizarre, but since it’s hard to argue with success, let’s just let it be, and see.
Putting ICE on Ice
For someone who has proved so useful in the Middle East of late — where his norm-busting, head-bashing, nonsense-talking double-dealing weirdness got results — Trump is a catastrophe at home. It’s fair to say that the federal government is now waging its own kind of low-grade war on American soil.
Recent days saw Operation Midway Blitz in which heavily armed ICE teams descended on Chicago neighborhoods using helicopters, flash-bangs, and “administrative warrants” that no judge ever signed. A local television editor was arrested while filming one of the raids. Several churches reported agents surrounding parish halls that were sheltering migrant families.
When Illinois refused to cooperate, Trump ordered in National Guard troops — then a federal judge temporarily blocked their deployment, citing the absence of any “danger of rebellion.” An appeals court has allowed the Guard to remain under federal control but barred active use until further review.
Civil-rights lawyers and journalists have now sued the administration for “extreme brutality” against protesters and press. That is very good, and basically needs to be ramped up. Federal agents are committing state felonies every day, breaking in an kicking down doors without a judge’s warrant, detaining citizens without probable cause, and on and on. These are crimes under state law, the states have jurisdiction, and even if federal courts eventually overrule state ones, legal challenges are a legitimate way to delay this nonsense and gum up the works. It could actually restrain rogue federal agents — in a way not unlike abortion doctors being cowed by legal harassment. When ICE officers face the prospect of state indictments for burglary, kidnapping, or assault, they’ll begin seeking real warrants. That’s how institutions learn boundaries.
Federal agents will claim immunity under the Supremacy Clause, insisting that state courts can’t touch them. They’re wrong. The Supreme Court’s In re Neagle (1890) makes clear that immunity applies only to lawful acts “necessary and proper” to federal duties.
I write all this as someone who warned the Democrats last year that they were badly dropping the ball on immigration and handing Trump a gift), who believes it’s OK to police borders and even expel illegals, and accepts a society wanting to limit the inflow of foreigners in order to protect a culture. But this is not the way.
Europe Finally Uses Its Leverage on Russia
It’s a major decision that slipped below the radar of many news consumers (and chroniclers): In their joint communique on Friday, Britain, France, and Germany — the so-called E3 — declared that they would “progress toward using the value of the immobilized Russian sovereign assets.”
In plainer language: Europe has decided to turn Russia’s frozen billions into a tool of policy. After years of caution, since Russia invaded Ukraine in February 2022, the West is preparing to use roughly €300 billion (read: dollars) in Russian state reserves abroad as leverage — to help Ukraine and to push Moscow toward negotiations.
There are useful things to be done: The Europeans could invest the assets in top-rated EU bonds and channel the proceeds to Kyiv, with repayment ultimately tied to future reparations from Moscow (which preserves Russia’s legal claim to ownership while turning the immobilized reserves into collateral for action). Russia could retaliate with its own (lesser) asset seizure, which would be a total rupture of relations economically. It will be interesting.
The move is also remarkable in that the three central European powers are speaking in a single voice — both breaking with the hesitancy that defined Europe’s early response to the invasion, and on other issues. Legal doubts and financial fears had kept the money frozen: confiscating sovereign assets seemed unthinkable, a breach of international law and investor trust.
For an explainer on the thorny legal situation, watch the below:
But as the war grinds on, the E3 seem to be growing a spine, and a doctrine of coercive finance may be taking shape. In the coming days, AQL will examine what drove this sudden convergence, how it reshapes diplomacy, and what, exactly, is the E3 all about.
Putting ICE on Ice
For someone who has proved so useful in the Middle East of late — where his norm-busting, head-bashing, nonsense-talking double-dealing weirdness got results — Trump is a catastrophe at home. It’s fair to say that the federal government is now waging its own kind of low-grade war on American soil.
Recent days saw Operation Midway Blitz in which heavily armed ICE teams descended on Chicago neighborhoods using helicopters, flash-bangs, and “administrative warrants” that no judge ever signed. A local television editor was arrested while filming one of the raids. Several churches reported agents surrounding parish halls that were sheltering migrant families.
When Illinois refused to cooperate, Trump ordered in National Guard troops — then a federal judge temporarily blocked their deployment, citing the absence of any “danger of rebellion.” An appeals court has allowed the Guard to remain under federal control but barred active use until further review.
Civil-rights lawyers and journalists have now sued the administration for “extreme brutality” against protesters and press. That is very good, and basically needs to be ramped up. Federal agents are committing state felonies every day, breaking in an kicking down doors without a judge’s warrant, detaining citizens without probable cause, and on and on. These are crimes under state law, the states have jurisdiction, and even if federal courts eventually overrule state ones, legal challenges are a legitimate way to delay this nonsense and gum up the works. It could actually restrain rogue federal agents — in a way not unlike abortion doctors being cowed by legal harassment. When ICE officers face the prospect of state indictments for burglary, kidnapping, or assault, they’ll begin seeking real warrants. That’s how institutions learn boundaries.
Federal agents will claim immunity under the Supremacy Clause, insisting that state courts can’t touch them. They’re wrong. The Supreme Court’s In re Neagle (1890) makes clear that immunity applies only to lawful acts “necessary and proper” to federal duties.
I write all this as someone who warned the Democrats last year that they were badly dropping the ball on immigration and handing Trump a gift), who believes it’s OK to police borders and even expel illegals, and accepts a society wanting to limit the inflow of foreigners in order to protect a culture. But this is not the way.
Europe Finally Uses Its Leverage on Russia
It’s a major decision that slipped below the radar of many news consumers (and chroniclers): In their joint communique on Friday, Britain, France, and Germany — the so-called E3 — declared that they would “progress toward using the value of the immobilized Russian sovereign assets.”
In plainer language: Europe has decided to turn Russia’s frozen billions into a tool of policy. After years of caution, since Russia invaded Ukraine in February 2022, the West is preparing to use roughly €300 billion (read: dollars) in Russian state reserves abroad as leverage — to help Ukraine and to push Moscow toward negotiations.
There are useful things to be done: The Europeans could invest the assets in top-rated EU bonds and channel the proceeds to Kyiv, with repayment ultimately tied to future reparations from Moscow (which preserves Russia’s legal claim to ownership while turning the immobilized reserves into collateral for action). Russia could retaliate with its own (lesser) asset seizure, which would be a total rupture of relations economically. It will be interesting.
The move is also remarkable in that the three central European powers are speaking in a single voice — both breaking with the hesitancy that defined Europe’s early response to the invasion, and on other issues. Legal doubts and financial fears had kept the money frozen: confiscating sovereign assets seemed unthinkable, a breach of international law and investor trust.
For an explainer on the thorny legal situation, watch the below:
But as the war grinds on, the E3 seem to be growing a spine, and a doctrine of coercive finance may be taking shape. In the coming days, AQL will examine what drove this sudden convergence, how it reshapes diplomacy, and what, exactly, is the E3 all about.
Tariffs, Tumbling Markets and a Vanishing Fed
Markets ended the week with a jolt. On Friday, US stocks tumbled roughly 900 points in their steepest single-day fall since spring, wiping away weeks of slow optimism. For all the talk of “resilient markets,” confidence cracked. And the timing is revealing, because just as the Federal Reserve insists that its monetary tightening is working, the underlying illusion may finally be wearing thin.
A reader, David M. Gordon, wrote to me this week with a point that deserves a wider audience: quantitative tightening — the Fed’s much-touted effort to drain liquidity — may not have been nearly as tight as advertised. To understand why, it helps to recall what the Fed is trying to unwind. For more than a decade, and especially during the pandemic, the central bank created trillions of dollars through quantitative easing: buying government and mortgage bonds to flood the system with cash, lower long-term rates, and keep markets from imploding. The policy stabilized the economy but also inflated asset prices, rewarded risk, and ultimately helped push inflation to forty-year highs.
When inflation peaked in 2022, the Fed reversed course. Quantitative tightening was meant to do the opposite — shrink the balance sheet, reduce the money supply, and cool an overheated economy at a time when people were increasingly upset about inflation (in the US, but also in the UK and all over Europe). In practice, that meant letting bonds mature without reinvesting the proceeds, theoretically draining liquidity from the system.
But the tightening may be more illusion than reality. Even as the Fed’s balance sheet has shrunk on paper, it has quietly funneled liquidity back into markets through the reverse-repo facility (see explanations here), lending cash overnight in exchange for collateral. That mechanism kept the financial system flush. The Fed, in effect, has been tightening with one hand and loosening with the other.
Deft and possibly optimal from one perspective, a misleading racket from another: The Fed can claim discipline while quietly cushioning markets—preserving the fiction that it can fight inflation and sustain asset prices at the same time. The illusion holds only so long as investors believe it. Friday’s rout suggested that belief is fading.
Still, the Fed wasn’t the only culprit, and probably not the main one — at least on Friday. Trump’s renewed tariff threats against China (now we’re talking 130%) almost certainly contributed to the sell-off. The specter of fresh import taxes rekindled fears of global supply shocks and higher consumer prices — precisely the pressures the Fed seeks to tame. Trump, of course, doesn’t like the Fed, because of its independence, which is critical for market confidence.
That said, it’s worth noting that Trump’s tariffs have so far been more bark than bite. Previous rounds proved muted in their actual impact, softened by exemptions and gradual implementation. And we’ll soon see whether the Supreme Could will validate this White House usurping of what is purely a gift of Congress. To me it’s clear that the tariffs are illegal — yet this Supreme Court is certainly capable of declaring that two plus two is five.
A Ray of Light in Gaza
Going back to the Middle East for a second, let me now break with tradition on two counts, presenting a) a good-news story from the Middle East and b) one that was reported elsewhere — in this case, by the excellent Israeli newspaper Haaretz (story here).
At a time when Israelis and Palestinians have each dehumanized the other in startling numbers, this is a story of compassion and courage that offers a glimpse of what could yet be: In Gaza, amid devastation and grief, children orphaned or traumatized by the war are finding sanctuary, nourishment, and learning in a place called the Academy of Hope — funded in large part by individual Israelis.
In Deir al-Balah, mornings begin with children streaming into large tents painted with murals of cartoons and Smurfs. Some arrive in wheelchairs; others bear scars, visible and invisible. One twelve-year-old lost both parents in the fighting and now cares for three younger siblings, whom her extended family cannot feed — and at the Academy, she eats, learns, and simply becomes a child again.
The Academy opened in August 2025 with 600 students. Within weeks, a second branch in Khan Younis welcomed 1,500 more, and by December it aims to reach 5,000. Each site offers two hot meals daily, medical care, psychosocial support, and structured schooling from kindergarten through ninth grade.
What makes it extraordinary is not just the scale but the spirit behind it. The project, in a depressingly patriarchal and violent society, is run entirely by local women — teachers, nurses, and mental health professionals, many widowed by the war. One of them told Haaretz, “The Academy gave me a purpose. I can feed children, teach them, and at the same time, bring food home for my own family.”
The initiative was founded by Dr. David Hassan, an American neurosurgeon of Palestinian descent (see story about him here). “Every child is a world unto themselves,” he said. “We want them to live in a world where every child has access to the best care possible.”
Behind him stands a quiet miracle of cooperation. Over 200 Israelis are directly involved, and an estimated 90% of donations originate in Israel, often through small crowdfunding campaigns. Volunteers from Europe and the United States supplement the effort, with groups such as World Central Kitchen providing medicine, vitamins, and nutritional monitoring. A handful of Israeli doctors travel there at great risk, to deliver expertise in treating malnutrition and disease.
The logistics are arduous: every wheelchair, pill, and notebook must navigate a labyrinth of clearances and checkpoints.
Children not only receive food and schooling but create art, play soccer, and exchange video messages with Israeli peers filmed by volunteer filmmakers.
It is easy to despair, given the scale of the disaster between Israelis and Palestinians: Hamas claims almost 70,000 people have been killed in Gaza, mostly civilians, and we shall soon have a better idea; Israelis feel Oct. 7 was an act of willful savagery unequalled since the Holocaust. Here, then, a ray of light.
