The former Treasury official tapped to be President-elect Trump's top White House economist has offered clear clues to the coming revamping of U.S. industrial policy, Axios' Neil Irwin writes.

Why it matters: Steve Miran, Trump's designee to chair the Council of Economic Advisers, in a paper published last year, argued AI-era industrial policy should focus on minimalist barriers to factory investment — and maximalist demand from the defense industry. 

• Miran made plain Trump should undo President Biden's emphasis on subsidies for electric cars and labor, environmental, and other regulations that, in Miran's view, make the U.S. too inhospitable to manufacturing.

🔭 The big picture: This squares with what incoming Trump officials tell us will be a massive focus of the next two years — juicing AI-related infrastructure, from data centers to chip manufacturing to new energy sources. A lot of Trump advisers see this as a way to drive higher-than-expected growth, and create new higher-paying jobs outside of big city hubs. 

• It's also essential if America wants to retain its early AI edge — a clear but precarious U.S. economic and national security imperative.

"Bidenomics not only imposes onerous costs on industry in various ways — from incentives for unionization to special environmental restrictions — that raise the cost of production and work against the stated goal of expanding our industrial plant," Miran wrote for the Manhattan Institute, where he's a fellow.

• "[It] does so while targeting sectors of the economy for which there would be very little demand, absent government support to artificially lower prices," he adds in the paper, "Brittle Versus Robust Reindustrialization."
• "A more robust form of reindustrialization would instead combine aggressive supply-side reform with demand support from defense-driven procurement, which would produce enormous positive economic spillovers."

🥊 Reality check: Miran's will be one voice among many seeking to influence Trump on industrial policy, and the CEA job is more advisory than responsible for carrying out programs.

• Keep reading.

If Donald Trump succeeds in significantly reducing the U.S. trade deficit with China, he'll do so against the force of history — and of market expectations, Axios' Felix Salmon writes.

• Why it matters: By placing the trade deficit with China at the top of the list of things he wants to slash, Trump is facing off against trillions of dollars' worth of deeply entrenched global trade patterns.

🧮 By the numbers: The trade deficit with China — our imports minus our exports — has been larger than $200 billion since 2005. It reached a record high of $418 billion in 2018, Trump's second year in office.

🖼️ The big picture: The U.S. imports an astonishing array of goods from China, and it exports very little in the other direction.

• The tariffs imposed on China during the first Trump administration, which were then kept in place by President Biden, did relatively little to change that dynamic.

During Trump's first term, when imports fell, exports fell too, blunting the effect on the trade deficit.

• That pattern would likely be repeated if he follows through on his pledge to impose a 60% tariff on goods from China: Our exports would end up being similarly taxed in retaliation.

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On Opening Day of the 119th Congress, the House voted mostly along party lines to adopt rules protecting newly re-elected Speaker Mike Johnson (R-La.) from a potential ouster, Axios' Andrew Solender reports from the Capitol.

• Why it matters: The new rules decree that a vote on removing the speaker can only be brought if at least nine Republicans support a "motion to vacate." That's a significantly higher bar than in the 118th Congress, when any single member in either party could force such a motion.

House Democrats railed against the change, noting it's the first time in history that the minority party can't introduce a motion to vacate.

• Johnson, backed by President-elect Trump, was reelected 218-215 on the first ballot, after a cliffhanger delay by revolting hardliners. Axios coverage.

Being there: Speaker Emerita Nancy Pelosi (D-Calif.), 84, received applause — including from longtime rival Rep. Steny Hoyer (D-Md.) — on her return to the Capitol after last month's hip-replacement surgery at a U.S. military hospital in Germany. She fell while in Luxembourg with a congressional delegation.

• Pelosi got a standing ovation from her Democratic colleagues when she voted for Rep. Hakeem Jeffries (D-N.Y.), her successor as Democratic minority leader, to be speaker. The two, sitting across the aisle from each other, embraced in a quick hug before voting resumed. (AP)

Above: New Senate Majority Leader John Thune (R-S.D.), 63, in his office ahead of his first floor speech. He promised to preserve the filibuster, saying his priority as leader will be to "ensure the Senate stays the Senate."

• Nine new senators were sworn in — four Democrats and five Republicans. A sixth Republican, Jim Justice of West Virginia, announced last month that he'll wait to enter the Senate until after his successor as the state's governor, Republican Patrick Morrisey, is sworn in on Jan. 13.

Pics, bios of new senators.

Frigid air partially tied to the polar vortex over the Arctic is set to bring some of the coldest air in several years to locations east of the Rocky Mountains during the next two to three weeks, Axios' Andrew Freedman writes.

• This cold will be noteworthy for its duration more than its intensity, however.

Threat level: But first, a high-impact winter storm will bring more than a foot of snow beginning Saturday to places unaccustomed to such amounts, including the Kansas City metro area and areas near St. Louis.

• A strip of damaging ice accumulations will strike areas just south of the snow shield, potentially knocking out power to millions of people from Nebraska to West Virginia.
• Meanwhile, the heaviest snow since at least 2022, and possibly longer, is forecast for Washington, D.C. and Baltimore, with "major" impacts anticipated Sunday night through early Tuesday, according to the National Weather Service.

Zoom out: The storm will help pull more bitterly cold Arctic air southward on its heels, as blustery winds kick in from the northwest. Most of the U.S. will see temperatures dip down to the freezing mark during this cold snap.

Yesterday's resignation of longtime Washington Post editorial cartoonist Ann Telnaes adds to soaring newsroom angst, as scores of tenured journalists depart amid exasperation with leadership, Axios' Sara Fischer reports.

• Why it matters: Because The Post has seen an unprecedented number of senior defections in the past few months, new departures feed into a broader narrative of systemic issues at the company.

Telnaes, a Pulitzer Prize winner, quit after claiming one of her cartoons was killed because it targeted The Post's owner, Jeff Bezos.

• "As an editorial cartoonist, my job is to hold powerful people and institutions accountable. For the first time, my editor prevented me from doing that critical job," she wrote on Substack.
• The cartoon shows Bezos kneeling alongside several Big Tech CEOs handing money to a towering figure meant to resemble President-elect Trump.

The other side: David Shipley, The Post's editorial page editor, said in a statement that he respects Telnaes "and all she has given to The Post.'

• "But I must disagree with her interpretation of events," Shipley continued. "Not every editorial judgment is a reflection of a malign force. My decision was guided by the fact that we had just published a column on the same topic as the cartoon and had already scheduled another column — this one a satire — for publication. The only bias was against repetition."

📝 Zoom out: Telnaes' exit comes on the heels of several major departures within The Post's newsroom.

• Two of The Post's star political reporters, Ashley Parker and Michael Scherer, moved to The Atlantic this week. Tyler Pager, a rising talent, was poached by The New York Times as a White House reporter.
• Pager will join former Post managing editor Matea Gold, who announced last month that she's moving to The Times as deputy Washington bureau chief. Gold, a well-liked senior figure within the Post newsroom, left late last year after being passed over for executive editor.

Several opinion editors stepped down from The Post's editorial board last year after the paper's endorsement of Vice President Harris for president was spiked at the 11th hour, at the behest of Bezos.

• Axios hears other star reporters are in discussions to depart.

🧐 What to watch: The Post's new CEO and publisher Will Lewis, who assumed the role a year ago, has yet to formally announce a new executive editor to replace Sally Buzbee, who stepped down in June.

• Last month, Murray named managing editor Krissah Thompson to be editor of WP Ventures, formerly the "Third Newsroom," which will house multimedia and social-media teams.

See the cartoon.

New Orleans blood donors lined up for hours to support victims of the Bourbon Street terror attack, Axios New Orleans' Chelsea Brasted reports.

• Why it matters: Some of the victims continue to undergo surgeries, Blood Center CEO and president Billy Wheels tells us.

🫶 One of the donors was a man who pulled up his shirt to show what he said was a graze wound from a bullet during the attack. The man, who declined to give his name, says he works at Prohibition on Bourbon Street.

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