Mexico squeezed

[Balance of Power]( From [Bloomberg Politics]( [FOLLOW US [Facebook Share]]( [Twitter Share]( [SUBSCRIBE [Subscribe]](  Mexican President Andres Manuel Lopez Obrador is [fighting on two fronts](. He’s had to crack down on migrants crossing the border with the U.S. in order to placate President Donald Trump. That’s sucked up the resources of Mexico’s security forces and [hit the government coffers](. He’s also facing [out-of-control drug cartels]( conducting murderous rampages. The Sinaloa cartel recently terrorized the northwestern city of Culiacan to win the release of kingpin Joaquin “El Chapo” Guzman’s son. The latest horror [was the killing]( of dual U.S.-Mexican citizens — including six children — who were in the wrong place at the worst possible time as their convoy traveled 60 miles from the Arizona border. AMLO, as the Mexican leader is known, has promised to end the gang-linked murders that have beset the country for more than a decade. But under his watch, homicides are on track to reach record levels and his popularity, while still high, is under threat. Ordinary Mexicans want him to restrain the cartels and make them feel safer. To do so, he may need to reassess the focus of a national guard largely diverted to immigration operations and [even keeping Uber drivers]( away from airports. That risks fresh ire from Washington. — [Rosalind Mathieson]( The Lebaron family at the burned car where relatives were killed in an ambush. Photographer: STR/AFP Global Headlines Just In:  French President Emmanuel Macron told the Economist that the North Atlantic Treaty Organization is in a state of “brain death” because Trump is undermining the military alliance. [Deal maker]( | Debate surrounding the House impeachment inquiry has focused on whether Trump withheld military assistance to Ukraine as part of a “quid pro quo.” [Yet testimony unsealed]( this week makes clear the initial deal focused on something else valuable to the new Ukrainian leadership: an Oval Office meeting with Trump if Kyiv announced it would investigate the president’s 2020 rival Joe Biden and other Democrats. - Rudy Giuliani [said his controversial work]( with Ukraine was done “solely as a defense attorney” for Trump, undercutting the administration’s claims the former mayor was advancing U.S. foreign policy. [Campaign struggles]( | After two [bruising days]( for the ruling Conservatives, U.K. Prime Minister Boris Johnson takes his election campaign to Scotland, where he's unpopular. As [Alex Morales]( and [Greg Ritchie]( write, the Tories are fighting for political survival in Scotland with a pro-Brexit message in a country that voted overwhelmingly to stay in the European Union. The opposition Labour Party has [its own problems]( after its deputy leader resigned and a prominent former MP endorsed Johnson. [Tariff relief]( | China said it and the U.S. agreed to roll back tariffs on each other’s goods in phases if they eventually reach a deal. Beijing's key demand has been the removal of punitive tariffs imposed by the U.S. and, if confirmed, it could provide a blueprint to de-escalating their trade war. China also gave three nationals maximum punishments for [smuggling fentanyl]( to the U.S., a move against the illicit opioid flow that Trump has made a bone of contention. - [Subscribe to Bloomberg’s Terms of Trade newsletter]( to receive all the big developments in your inbox each weekday. [Waning authority]( | As Chancellor Angela Merkel approaches the end of her term, many Germans are wondering who’s in charge. While Finance Minister Olaf Scholz’s bid to break a deadlock over European efforts to complete a banking union was announced with fanfare yesterday, he hadn’t cleared it with his boss. Two weeks ago the defense minister released a Syria peace plan without telling partners in the ruling coalition. Looming over it all is the question of who will follow Merkel when she steps down by 2021. [Desert dream]( | Kuwait witnessed rare demonstrations yesterday against perceived official corruption and mismanagement, including failures to provide quality services and infrastructure, [Fiona MacDonald]( reports. The government is focused instead on long-delayed plans to build “Silk City,” a massive new conurbation that’s key to efforts to diversify away from oil. Silk City is seen as a critical moment for Kuwait, a test-bed for participatory politics in a region dominated by near-absolute monarchies. What to Watch - Iran is nearing a [new atomic crisis]( after failing to cooperate with international inspectors investigating radioactive samples discovered at a site identified by Israel, the International Atomic Energy Agency’s top inspector told diplomats in a closed-door meeting in Vienna yesterday. - Trump confirmed Turkish President Recep Tayyip Erdogan will visit the White House next week, with Syria expected [to be high]( on the agenda. - Cambodia sent troops to its border and called on neighboring countries to arrest exiled dissidents [after accusing them]( of plotting a coup. Its actions could prompt the EU pull key trade privileges. - Merkel and NATO Secretary General Jens Stoltenberg are due to address the media today as the 30th anniversary of the fall of the Berlin Wall approaches, while Secretary of State Michael Pompeo visits Berlin as Germany defends the Open Skies treaty amid concern the U.S. may withdraw. Tell us how we’re doing or what we’re missing at balancepower@bloomberg.net. You can sign up [here]( for our new weekly newsletter about the African continent: Next Africa. [And finally]( ... Weeks after signing the Paris climate-change accord, Russia has ditched plans to set emissions targets for companies following opposition from businesses that faced fines for non-compliance. Advocates argued the measure would help shift the economy of the world’s fourth-largest carbon polluter toward greener industries. Critics called it unnecessary because Russia’s self-imposed Paris target is so low that it can increase greenhouse-gas emissions to 2030 and still meet the goal. President Vladimir Putin and scientists measuring a polar bear on an Arctic island, where Putin expressed concern for the impact of climate change on the bears, in a photo released in April. Photographer: Alexey Nikolsky/AFP/Getty Images   You received this message because you are subscribed to the Bloomberg Politics newsletter Balance of Power. You can tell your friends to [sign up here](.  [Unsubscribe]( | [Bloomberg.com]( | [Contact Us]( Bloomberg L.P. 731 Lexington, New York, NY, 10022