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President Trump has threatened and bludgeoned his way into an unwanted confrontation with the U.S. business community that could have far-reaching implications for the future of presidential power over trade.

Driving the news: Trump's blunt use of presidential leverage to force the Mexican government to harden its immigration enforcement appears to have caused an unintended side effect: U.S. business leaders have begun urgently discussing strategies to claw back the virtually unchecked trade powers that Congress has handed over to presidents during the past 80 years.

The big picture: Even though the business community is now breathing a sigh of relief that Trump won't be hitting Mexico with new tariffs, the last week of Trump's threats may have a longer lasting effect, according to industry sources who have met with corporate representatives in Washington, leaders of business associations, administration officials, members of Congress and their senior staff.

Trump's threat to impose rising tariffs on all Mexican goods to punish the Mexican government for soft immigration enforcement sparked a widespread panic in the U.S. business community and turned their conversations in an unprecedented direction, these sources said.

John Murphy, who runs international policy at the Chamber of Commerce, tweeted, "In the space of a few hours ... more than 140 business and agricultural associations signed this statement opposing tariffs on goods from Mexico."

"Maybe folks in the White House don't know this, but they freaked out a lot of people," a trade lawyer involved in these conversations told me.

"This is a real turning point because this is threatening tariffs using an emergency power," said another top industry source involved. "That's never been done before. Part of the resources that we want to direct our advocacy to ... is for Congress to take back authority over tariffs."

"We can get back on USMCA and try to pass the thing and we can all be hunky-dory, but I think you're going to see a longer term business community effort to help Congress reassert its authority on tariffs."

Legislation could go so far as requiring congressional approval of most presidential trade actions. (We're already seeing some efforts along these lines, led by Republican Sens. Chuck Grassley and Pat Toomey.)

Behind the scenes: Before Trump called off his tariffs on Friday night, a loose coalition of organizations supporting Trump's renegotiated NAFTA, the United States–Mexico–Canada Agreement, were discussing halting a multimillion-dollar campaign to support the passage of USMCA.

Instead, these business lobby groups and leaders of large corporations were discussing redirecting their money toward opposing Trump's tariffs and potentially to support efforts to claw back the president's trade powers, according to sources familiar with their internal discussions.

They will now return to funding a USMCA campaign, but the past week has shown them that they need to finally get serious about stopping this president — and future presidents — from unilaterally raising tariffs.

Why it matters: Trump can only credibly threaten foreign countries with abrupt tariffs because Congress has gradually given away its trade powers. Opponents of this trend say it's unconstitutional because taxing and commerce authority lies with Congress (as expressed in Article 1 of the Constitution).

Until fairly recently, only a wonky fringe in Washington cared about this issue. Few paid attention when Republican Sen. Mike Lee introduced legislation in early 2017 to "subject all executive branch trade actions (including raising tariffs) to congressional approval."

The bottom line: Over the past week, these previously fringy conversations entered the mainstream. Watch for a long-term, well-funded campaign to peel trade powers away from the president.

Business "freak out" spurs plans to tame Trump on trade

Trump's Mexico tariff scare appears to have caused an unintended side effect in the business community.

Donald Trump standing very tall next to a shrunken depiction of a man holding a whip and a stool.

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After a record economic expansion, the coronavirus pandemic sent the U.S. economy into a recession as unemployment soared to staggering heights. The country now faces urgent questions about how much stimulus is needed for reeling consumers and businesses, and what a recovery might look like.

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"Axios on HBO" got the first televised look inside Steve Bannon's Italian monastery — a breathtaking monument in a grand, cinematic setting outside of Rome — but in so doing we found that many of Bannon's other claims about his populist "movement" to roil Europe were overblown or false.

Why it matters: Over the past year, Bannon has received an extraordinary amount of international and U.S. media coverage for his European exploits. Bannon joined a group called "The Movement" — which the New York Times reported last year had enlisted Italy's most powerful politician Matteo Salvini.

Bannon also told the Times he would offer European populist parties the "fundamental building blocks for winning" in May's parliamentary elections, including, the Times reported, "expertise in polling, data analytics, messaging and get-out-the-vote efforts, along with the development of media surrogates and campaign war rooms with rapid response."

In his most dramatic move, Bannon leased a medieval monastery about two hours from Rome and announced he would use it to train up fearsome hordes of right-wing politicians who will eradicate globalism from Europe. 

Between the lines: Our reporting showed that only one of these claims turned out to be true — the existence of the monastery. (Though the Italian government now says it will evict Bannon from the monastery.)

Bannon's relationship with Salvini is not what he sold it to be. "Axios on HBO" asked Salvini for an interview and he declined, so we drove six hours out of Rome to see if we could grab him at one of his rallies.

After the rally, I stood in the rope line with people who were waiting to take a photo with Salvini. I asked Salvini, on camera, whether he'd spent much time with Bannon and whether Bannon had been helpful. Salvini replied that he'd only spoken to Bannon twice in his life and that while Bannon had "interesting ideas" he had not used him as an adviser.

When I asked Bannon about this, he said he'd spoken to Salvini "maybe three or four times." He also admitted that because of European election laws he hadn't done anything like what he promised he would do for these European parties. (The Guardian first reported the legal problems with Bannon's European plans.)

Here are a couple of clips from the Bannon segment, but please watch the whole thing on HBO:

Confronting Bannon about his grand European claims 

What Bannon says he'll teach at his "gladiator school" in the medieval monastery

Exclusive: Inside Steve Bannon’s bizarre, exaggerated populism bootcamp

Axios found that many of Bannon's claims about his populist "movement" to roil Europe were overblown or false.

Jonathan Swan talking with Steve Bannon. Photo: HBO

Steve Bannon

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Exclusive interview: Google CEO Sundar Pichai defends YouTube practices

Google CEO Sundar Pichai said in an interview with "Axios on HBO" that YouTube is improving, but acknowledged the video service doesn't ensure the overall quality users have come to expect from its search and other services.

Why it matters: YouTube is probably the toughest issue facing Google right now, amid allegations it is fostering hate, enabling pedophiles and spreading misinformation.

"Look, we aren't quite where we want to be."

The interview aired Sunday, but was filmed before the company's most recent scandals and its most recent changes, though Pichai alluded to the changes that were announced last week.

We, you know, we rank content based on quality. And so we are bringing that same notion and approach to YouTube so that we can rank higher quality stuff better and really prevent borderline content. Content which doesn't exactly violate policies, which need to be removed, but which can still cause harm. 

Driving the news: Last week, the company announced three changes along those lines: prohibiting videos that espouse one group as superior to another, changing which videos are recommended to exclude more "borderline content," and limiting monetization for creators who frequently push the boundaries of YouTube's rules.

At the same time, the company came under fresh fire for its handling of Steven Crowder, a popular conservative YouTube host who frequently used racial and homphobic insults against Vox journalist Carlos Maza.

On Tuesday, following an investigation, YouTube said Crowder's comments — while "hurtful" — didn't violate company policy. A day later, following an outcry, Google suspended Crowder from the partner program that allows advertising, saying he engaged in "a pattern of egregious actions has harmed the broader community."

In the interview, Pichai declined to give YouTube a grade on its work, but acknowledged the company has a tougher time determining video quality than it does with search.

The bottom line: "It's a hard computer science problem," Pichai said. 

"It's also a hard societal problem because we need better frameworks around what is hate speech, what’s not, and how do we as a company make those decisions at scale, and get it right without making mistakes."

Go deeper: Check tomorrow’s Login our daily tech newsletter, for more from our exclusive interview with Pichai. Sign up here.

Exclusive interview: Google CEO defends YouTube practices

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From the Valley to D.C., Big Tech players like Facebook, Google and Amazon are under more scrutiny than ever as new technology develops and privacy and antitrust concerns grow in lockstep with companies’ ambitions.

A Harris poll for "Axios on HBO" finds that socialism is gaining popularity: 4 in 10 Americans say they would prefer living in a socialist country over a capitalist one.

Why it matters: Socialism is losing its Soviet-era stigma, especially among women. Popular Democratic socialists like Alexandria Ocasio-Cortez and Bernie Sanders are bringing new life and meaning to the term.

55% of women between 18 and 54 would prefer to live in a socialist country than a capitalist country.

But a majority of men prefer to live in a capitalist country.

The big picture: "It's been a truth of American politics for decades that women are to the left of men, and I think that's playing out in this poll," Axios' Felix Salmon noted on "Axios on HBO."

Between the lines: As the Harris poll results below show, the public has varying levels of agreement on what exactly constitutes a socialist political system.

State control and regulation of private property : 61%

State-controlled media and communication: 57%

Government ’’democratizes’’ private businesses — that is, gives workers control over them — to the greatest extent possible: 52%

Workers own and control their places of employment: 48%

What's next: "We've seen this pattern of behavior where women are turning out in higher numbers as voters and as candidates than we've ever seen. They're getting elected in higher numbers than before. They're pushing the conversation in different ways," Axios' Alexi McCammond noted on "Axios on HBO."

"They're looking for someone, a candidate on either side, who'll support this idea of a socialist country that they want to live in."

Methodology: This survey was conducted online within the United States by The Harris Poll on behalf of Axios from April 16-18, 2019 among 2,024 adults ages 18 and older. 

This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. Results are weighted for age within gender, region, race/ethnicity, household income, education, and size of household where necessary to align them with their actual proportions in the population using U.S census data.

Editor's note: This story has been updated to include methodology and a link to the poll questions and crosstabs.

"Axios on HBO" poll: 55% of women prefer socialism

"They're looking for someone, a candidate on either side, who'll support this idea."

Photo: Ronen Tivony/SOPA Images/LightRocket via Getty Images

Axios on HBO

We always think of Trump as a New York guy, or the president in the White House. But at heart, he's a Florida Man with a Trumpian Florida life: big mansions and big money.

Why it matters: At Mar-a-Lago, we're seeing a whole new form of lobbying. People pay dues to the private club of the president of the United States, then try to influence him in person on government policy — all outside the normal watchdogs and strictures and surveillance of Washington. It's a stunning situation.

The big picture: "In the popular conception, he's a Manhattan real estate builder. But in some ways that's not really his world. Certainly not anymore. His world is Palm Beach," Axios' Jonathan Swan noted on "Axios on HBO."

"If you drew a circle around Mar-a-Lago, his private club, there is no more concentrated an area of political influence outside Washington, D.C."

Commerce Secretary Wilbur Ross owns a 16,000 square foot home in Palm Beach, according to South Florida Business Journal.

Labor Secretary Alex Acosta is from the area.

HUD Secretary Ben Carson has a home in Palm Beach Gardens.

Between the lines: Trump is "in his happy place at his club or at the golf course. He is completely relaxed. And that's when he's most receptive to ideas," Swan noted.

"It's this weird world where you've got him at the dining table people come up and talk to him and you get an invaluable piece of time with the most powerful person on earth."

As of mid-April, Trump had spent 99 days at Mar-a-Lago while president, NBC News reports.

Mar-a-Lago's initiation fee doubled in 2017, shortly after he was elected president, to $200,000 a year.

Trump routinely uses his own club to host foreign leaders, including Japanese PM Shinzo Abe and Chinese leader Xi Jinping.

He's also notably showed up at events taking place at his club, including crashing a wedding at Mar-a-Lago on the same night North Korea conducted a missile test in 2017.

The bottom line: The club has "all the accoutrement that make people sometimes describe Trump as a poor person's idea of a rich person," Axios' Mike Allen said.

"Gold ceilings, and gold lamps and gold floors and fringe. He gets to think of himself as the literal monarch. Everyone is there to pay obeisance to him. And he really doesn't have to accommodate the press."

Why Trump is a Florida Man

He's a Florida Man with a Trumpian Florida life: big mansions and big money.

This photo shows Donald Trump walking in Florida, with palm trees in the background as the light fades.

Photo: Brendan Smialowski/AFP/Getty Images

2024 will be an election year like no other, as President Biden seeks re-election amid economic uncertainty, two wars and questions about his age. His likely foe, former President Trump, faces felony charges and vows revenge on his political enemies. Meanwhile, Americans generally are dissatisfied with those choices and are divided over immigration, race, education and more.

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Israel still hasn't gotten a formal invitation to participate in the U.S.-led Bahrain conference, which will take place on June 25 and launch the economic part of the White House's Israeli-Palestinian peace plan. The U.S. told Israel that it must first get more confirmations from Arab and Muslim countries, according to Israeli officials.

Why it matters: Israeli officials say the fact that Israel still hasn't gotten a formal invitation is a sign of difficulties the Bahrain conference faces as a result of Palestinian pressure on Arab and Muslim countries not to attend. The officials told me the U.S. is concerned by the fact that Egypt, Jordan and other Arab and Muslim countries haven't published statements on their intention to attend the conference.

Details: A senior Israeli official told me President Trump's senior adviser Jared Kushner,  who heads the White House "Peace Team," told Israeli Prime Minister Netanyahu during their May 30 meeting in Jerusalem that the U.S. is waiting for more countries — mainly Arab and Muslim ones — to RSVP for the Bahrain conference. Only then will Israel be formally invited and will the U.S. make it public. 

Israeli officials told me Netanyahu has decided to send Minister of Finance Moshe Kahlon to the conference and that he informed Kahlon of this in a meeting last week. Kahlon is waiting to see if Israel gets an invitation in the next few days in order to decide whether to go to Washington before the conference to coordinate with Kushner and Treasury Secretary Steven Mnuchin. 

The White House refrained from commenting on this story.

Go deeper: Kushner uncertain Palestinians are capable of governing themselves

Scoop: Why Israel still hasn't gotten a formal invitation to the Bahrain conference

The conference will take place on June 25 and launch the economic part of the White House's peace plan.

Trump signing a proclamation with Israeli leaders

Trump signs an order recognizing Golan Heights as Israeli territory in front of Prime Minister Benjamin Netanyahu. Photo: Michael Reynolds - Pool/Getty Images

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Jay Powell doesn't know what he's going to do with interest rates. He probably hasn't made up his mind about what he's going to do at the next meeting, which starts on June 18, and he certainly doesn't know what he's going to do on July 31 or September 18 or October 30.

Why it matters: Markets are pricing in significant rate cuts in the second half of this year. The consensus seems to be that the cuts will start in September, probably with a 50bp decrease, but there's no great confidence in that forecast.

The uncertainty is deliberate on the part of the Fed. Depending on how you look at it, it's either a relatively new development or rather old-fashioned.

Context: Powell and his colleagues could easily signal an expected future path for interest rates if they wanted to. In late 2011, then-chair Ben Bernanke introduced the "dot plot" as a way to communicate even more clearly just how long he expected to keep rates at zero. In general, the Fed has become more transparent and predictable over time, issuing longer statements and being more explicit about interest-rate policy.

What they're saying: Powell and his colleagues regularly stress "data dependence" in monetary policy and are increasingly vocal about their distaste for the dot plot. They're honest about the fact that they don't know where the economy is headed; they don't know what unemployment rate constitutes full employment; and they don't know where interest rates must be, over the long term, to ensure price stability.

After the crisis, the role of the Fed was clear: to rescue the economy and prevent it from imploding. Today, policymakers need to decide whether they should cut rates as a form of recession insurance, and whether they should frame any rate cut as a one-off or as the first of a series.

They need to determine how much attention to pay to markets, which will throw a tantrum if the expected rate cuts don't materialize — and also how much attention to pay to politics, in a world where Fed policy has become politicized to an unprecedented degree.

The bottom line: We're not going to go back to the world of the early 1990s, when the Fed wouldn't even say what level of Fed funds it was targeting. But in an uncertain world, expect Powell to continue to embrace constructive ambiguity.

The end of Fed predictability

The uncertainty is deliberate on the part of the Fed.

Federal Reserve

The 2020 Census could see the worst undercount of black and Latinx people in 30 years, according to a new study from the Urban Institute.

The big picture: The 2020 Census is already facing "unprecedented challenges and threats to its accuracy" as a result of demographic changes, underfunding, and complex and undertested process changes. That's not to mention the Trump administration's addition of a citizenship question, which will likely have a chilling effect on responses regardless of whether or not it's upheld by the Supreme Court this month. 

Commerce Secretary Wilbur Ross has defended the citizenship question as necessary to enhance the 1965 Voting Rights Act, despite the Census Bureau's own analysis that it could scare households with non-citizens into low response rates.

A 2015 study conducted by a now-deceased GOP gerrymandering strategist concluded that adding a citizenship question to the 2020 Census would "clearly be a disadvantage to the Democrats" and "advantageous to Republicans and Non-Hispanic Whites," according to court documents filed in a legal challenge.

That strategist went on to help write a draft Justice Department letter that argued the question was essential to enforce the Voting Rights Act, the same defense that Ross and the Trump administration have used.

Worst-case undercount/overcount projections, per the Urban Institute: 

Hispanic/Latinx people: - 2.2 million people.

Asians and Pacific Islanders: -305,200 people.

American Indians and Alaska Natives: -102,600 people.

Based on previous analysis by the Census Bureau, a number of groups have historically been underrepresented, a problem that is likely to be exacerbated by the increase of diversity and youth in the U.S. since 2010.

Those groups include young African American males and children. Children ages 0–4 could be miscounted by as many as 1.4 million people.

Those who rent rather than own homes, which tend to be people of color, are also at risk of being undercounted. People with multiple homes tend to be overcounted.

Robert Santos, the Urban Institute's vice president and chief methodologist: "Based on the factors we looked at, things do not look good. There’s still time to change that by doubling down on civic engagement."

Census spokesperson Michael Cook: "We are laser focused on utilizing these national and community partners to help educate the public about the 2020 Census. Our operations and our communications campaign are oriented to reach hard-to-count populations and encourage them to respond to the Census."

The bottom line: Political representation and federal funding are at risk of unfair distribution if the Census is inaccurate. The Supreme Court is expected to make a decision on the citizenship question in late June.

Go deeper: GOP strategist concluded citizenship question would disadvantage Democrats

2020 Census could be worst undercount of black and Latinx people since 1990

The Trump administration's addition of a citizenship question could have a chilling effect on response rates.

Commerce Secretary Wilbur Ross. Photo: Michael Kovac/Getty Images

Census

The niceties have ended: 2020 Democrats are breaking their own pledge not to go after one another. The attacks of the past week show what a long primary they're in for.

Why it matters: These jabs and skirmishes show a fracturing Democratic Party — exactly what some top Democrats wanted to avoid in order to maximize their chances of defeating President Trump.

Driving the news: Progressives and centrists are going at each other before any of them have stepped onto a debate stage. Virtually the entire field went after Joe Biden this week for supporting the Hyde Amendment, which bans the use of federal funds to pay for abortions in most cases.

Elizabeth Warren said he was wrong at her MSNBC town hall, and Kamala Harris and Kirsten Gillibrand tweeted that Hyde should be repealed.

Biden clearly felt the heat. He announced Thursday that he no longer supports Hyde because Republicans have taken “extreme laws in clear violation of constitutional rights" of Roe v. Wade. 

"If I believe health care is a right, as I do, I can no longer support an amendment that makes that right dependent on someone's ZIP code," he said.

John Hickenlooper and John Delaney got booed by a room full of progressives at the California Democratic Party convention for criticizing socialism, the Green New Deal and Medicare for All. 

That landed Delaney in hot water with Rep. Alexandria Ocasio-Cortez, who tweeted a hint that he should drop out of the race. 

Soon after Delaney responded by asking to debate AOC, Rep. Ilhan Omar stepped in to tell him (after AOC had already declined): “No means no.” 

And don't forget the candidates vs. the Democratic National Committee.

Jay Inslee went after the DNC when they denied his request to have a presidential debate solely about climate change. (He's making the issue the central focus of his campaign.)

“The DNC is silencing the voices of Democratic activists, many of our progressive partner organizations, and nearly half of the Democratic presidential field, who want to debate the existential crisis of our time,” he wrote in an email to supporters. 

Warren quickly joined in, saying Inslee is “exactly right,” and Beto O’Rourke jumped in, too. 

Between the lines: Of course there’s a difference between calling out fellow Democrats for thinking they’re not progressive enough and disagreeing with the DNC on debates. 

The bottom line: But if the last week is any indication, the gloves have come off and we should expect more Dem-on-Dem attacks to come. And the Trump campaign and the Republican National Committee will enjoy every minute of it.

The Dem-on-Dem attacks have begun

The jabs and skirmishes of the past week are clear examples of the fracturing Democratic Party.

A donkey kicking back and hitting another donkey while getting kicked in the head by a donkey

2020 presidential election

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Former Vice President Joe Biden is the top presidential pick of the Iowa Democratic caucuses, a CNN/Des Moines Register/Mediacom poll published Saturday night shows — but his nearest rivals are gaining ground.

By the numbers: The poll, conducted by Selzer & Co., shows 24% of those surveyed back Biden and 16% support Sen. Bernie Sanders (I-Vt.). Sen. Elizabeth Warren (D-Mass.) and South Bend, Indiana, Mayor Pete Buttigieg both enjoyed surges, polling at 15% and 14%, respectively. 

The big picture: The only other candidates to poll above 1% were Sen. Kamala Harris (D-Calif.) at 7% and Sen. Amy Klobuchar (D-Minn.) and former Texas congressman Beto O’Rourke, who were both backed by 2% of those surveyed. Nine candidates failed to register support in the poll.

Why it matters: As Iowa is the first state to caucus in presidential elections, it serves as an early indicator of which candidates could succeed at the national level. Selzer & Co. president J. Ann Selzer noted to the Des Moines Register, "We’re starting to see the people who are planning to caucus start to solidify." 

Go deeper: 2020 presidential election: Track which candidates are running

Iowa Democratic caucus poll: Biden leads, but top tier rivals gain ground

Warren and Buttigieg are surging, CNN/Des Moines Register/Mediacom poll shows.

.. While still unannounced, the former Vice President is reportedly close to officially entering the race for the 2020 US Presidential Elections. 

Democratic presidential candidate Joe Biden. Photo: Bastiaan Slabbers/NurPhoto via Getty Images

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