Breaking a promise?

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British Prime Minister Boris Johnson is set today to do what he's often been accused of — fail to keep his word. As Emily Ashton reports, Johnson will deliver on a policy pledge he made in his first speech as prime minister and unveil a long-awaited funding overhaul of Britain's "broken" social-care system. But to do so, he'll likely renege on a "guarantee" in his 2019 election manifesto not to raise taxes, a pledge that helped the Conservative Party to a sweeping majority. That's stirring discontent among Johnson's own lawmakers, including those in cabinet. They worry about the electoral consequences of a levy that may slug low-paid and younger workers in order to fund care for elderly people, some of whom already enjoy generous pensions and own expensive homes. Among those most affected would be long-time Labour Party voters who switched allegiance in 2019 to the Tories. With Labour opposing Johnson's plans for a rise in national insurance levies, a rebellion by about 40 Conservative lawmakers could be enough to sink them in parliament. That would strengthen party murmurings against his leadership and bolster the appeal of potential rivals such as Chancellor Rishi Sunak. Johnson's still facing other problems, including the economic impact of the Brexit divorce from Europe and Covid-19. An estimated shortage of 100,000 delivery drivers has left businesses warning of disrupted supply chains and shoppers increasingly noticing empty supermarket shelves. The prime minister has largely enjoyed a charmed relationship with voters unmoved by allegations from critics about his record of keeping his word. Taxes, however, could prove the deal breaker. — Tony Halpin

Boris Johnson at a news conference in London on July 29. Photographer: Andy Rain/EPA Click here to follow Bloomberg Politics on Twitter and tell us how we're doing or what we're missing at balancepower@bloomberg.net.

Global Headlines

Agenda trouble | Deepening divisions in U.S. President Joe Biden's Democratic Party are diminishing the odds of the passage this month of his $4 trillion economic agenda, something he needs for a boost as his popularity wanes. The timetable risks getting sidetracked by a rift between progressives and moderates over the size of the tax and spending package. Tricky role | Qatar has quickly established itself as the West's main line of communication to the Taliban. The U.S. and U.K. moved their Afghanistan embassies to Doha, with U.S. Secretary of State Antony Blinken and Defense Secretary Lloyd Austin visiting this week. Yet Fiona MacDonald and Simone Foxman write that a relationship painstakingly nurtured over the past decade could also become a liability for the small Gulf state. Sales pitch | German Chancellor Angela Merkel strongly endorsed Armin Laschet, her bloc's candidate to succeed her, while taking a swipe at his Social Democratic rival in an unusually direct intervention in the election race. Her feisty speech in parliament today comes as the SPD's Olaf Scholz emerges as a surprise front-runner, with Laschet failing to reach voters amid a gaffe-prone campaign. European countries could face severe drought twice as often in the coming decades if they fall short in cutting emissions, according to new research that shows how shifting rain patterns will expose more people to climate risk. As Jonathan Tirone reports, that will likely endanger agricultural yields, hydropower generation and river transportation. Test launch | South Korea joined only a handful of nations in the world capable of a submarine-based missile launch after a successful test last week, Jeong-Ho Lee reports. Major Chinese cities are already within South Korea's missile range after the recent end of restrictions set out in a U.S. agreement that also increased Seoul's ability to strike North Korea. Satellite imagery indicates North Korea is moving troops and vehicles to a Pyongyang staging area, South Korea's Yonhap News Agency reports, indicating it could hold a military parade this week. Best of Bloomberg Opinion Why Turkey Wants to Guard the Kabul Airport: Bobby Ghosh Xi Jinping May Be Leading China Into a Trap: Matthew Brooker Police Don't Deserve Impenetrable Legal Shield: Ramesh Ponnuru Citizens' war | A shadow government of ousted lawmakers loyal to Myanmar's detained leader Aung San Suu Kyi is calling on citizens to revolt against the military regime that took power seven months ago. The declaration by Duwa Lashi La, acting president of the so-called National Unity Government, signals an escalation in the military's decades-long conflict with various armed ethnic groups and comes as Myanmar struggles to contain Covid-19. Bloomberg TV and Radio air Balance of Power with David Westin weekdays from 12 to 1pm ET, with a second hour on Bloomberg Radio from 1 to 2pm ET. You can watch and listen on Bloomberg channels and online here or check out prior episodes and guest clips here. What to Watch Venezuela's government and opposition parties agreed to cooperate to respond to the Covid-19 and hunger crises using revenue from foreign assets, the first deal to come out of their political negotiations. Bitcoin faces the biggest test in its 12-year history as El Salvador becomes the first country to adopt it as legal tender today. President Jair Bolsonaro urged Brazilians to take to the streets today to show support for his government. The Independence Day rally is shaping up to be an all-or-nothing gauge of his chances of re-election. Finland's ruling coalition starts two days of talks on the 2022 budget proposal today, with the risk that infighting over spending priorities spawns a political crisis. The de facto rulers of Saudi Arabia and the United Arab Emirates held talks late yesterday, amid growing regional competition between the two countries. And finally ... Reality TV star Kim Kardashian's recent plug for a speculative digital token "may have been the financial promotion with the single biggest audience reach in history," but the U.K.'s financial regulator has quickly clapped back at such celebrity endorsements. Consumers risk being lured into the "cryptobubble with delusions of quick riches" by high-profile influencers, the Financial Conduct Authority's Charles Randell warned yesterday. Kim Kardashian in 2020. Photographer: Jean-Baptiste Lacroix/AFP/Getty Images

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