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Inside the real trade fight

Ross, Tillerson, Trump and Mnuchin. Photo: MANDEL NGAN/AFP/Getty Images

The Trump administration is at war with itself over a highly controversial plan to impose massive tariffs on steel and aluminum. Using an arcane law, the plan would describe the global glut of both metals as a national security threat to the United States.

Trump's senior advisers — Gary Cohn, Steven Mnuchin, Rob Porter, James Mattis and Rex Tillerson — think it would be a calamity if the president uses this law, called Section 232, to introduce steel and aluminum tariffs. They argue it would alienate allies in Europe and Canada, blow up the World Trade Organization, and send shockwaves through global markets.

Meanwhile, trade advisor Peter Navarro and Commerce Secretary Wilbur Ross support the potential tariffs, arguing the American steel industry will collapse without them. Their voices are lonely ones, but still quite powerful — in large part because they validate Trump's deeply held convictions.

The clock has started: On Thursday, Ross formally submitted to Trump the results of his department’s “investigation into the effect of steel mill product imports on U.S. national security.” That starts a 90-day clock for the president to decide whether to take action.

  • In the meantime, some of Trump's advisers hope the administration can take sufficiently aggressive actions against China — using a trade law known as Section 301 — to satiate the president’s protectionist impulses.
  • Given Trump’s unpredictability, it’s impossible to guess whether that strategy will work. But here's what might help: according to sources familiar with his thinking, Trump's top trade negotiator, Robert Lighthizer, isn't as committed to the 232 strategy as most believe. He's much more focused on targeted actions against China, which he views as the ultimate economic threat to the U.S.
  • Potential punitive steps against China could include wide-ranging tariffs on Chinese-made products (especially consumer electronics) or new legal limits on China’s ability to invest in American companies in order to steal sensitive IP.

Our tip: A not-insignificant proportion of the steel and aluminum problems — global overcapacity — can be traced back to China and its transshipments. Some administration officials believe that appropriately targeted action on those could minimize damage from broader actions and still be considered consistent with the overall strategy of countering Chinese economic aggression.

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Why Trump added a streetfighter to his legal team

Screenshot via Fox News

A new addition to President Trump's legal team — Joe diGenova, a former U.S. attorney who is well-known in Washington and has argued for the president on Fox News — reflects three White House realities.

The state of play: (1) The White House is digging in for a fight that looks to be longer and messier than officials had expected. (2) This is another example of the president responding to televised cues. Trump has spent most of his adult life in litigation, and obsesses about legal positioning in the same way that he is consumed by his press coverage. (3) It's another pugilistic voice at the table, and suggests that this weekend's attacks on Mueller won't be the last.

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Facebook reaches a tipping point

Illustration: Rebecca Zisser/Axios 

Of all the news crises Facebook has faced during the past year, the Cambridge Analytica scandal is playing out to be the worst and most damaging.

Why it matters: It's not that the reports reveal anything particularly new about how Facebook's back end works — developers have understood the vulnerabilities of Facebook's interface for years. But stakeholders crucial to the company's success — as well as the public seem less willing to listen to its side of the story this time around.