Trump overrules cabinet, plots global trade war - Axios
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Trump overrules cabinet, plots global trade war

By Mike Allen and Jonathan Swan.

The big picture

Evan Vucci / AP

With the political world distracted by President Trump's media wars, one of the most consequential and contentious internal debates of his presidency unfolded during a tense meeting Monday in the Roosevelt Room of the White House, administration sources tell Axios.

  • The outcome, with a potentially profound effect on U.S. economic and foreign policy, will be decided in coming days.
  • With more than 20 top officials present, including Trump and Vice President Pence, the president and a small band of America First advisers made it clear they're hell-bent on imposing tariffs — potentially in the 20% range — on steel, and likely other imports.
  • The penalties could eventually extend to other imports. Among those that may be considered: aluminum, semiconductors, paper, and appliances like washing machines.

Inside the room

One official estimated the sentiment in the room as 22 against and 3 in favor — but since one of the three is named Donald Trump, it was case closed.

  • No decision has been made, but the President is leaning towards imposing tariffs, despite opposition from nearly all his Cabinet.
  • In a plan pushed by Commerce Secretary Wilbur Ross, and backed by chief strategist Steve Bannon (not present at the meeting), trade policy director Peter Navarro and senior policy adviser Stephen Miller, the United States would impose tariffs on China and other big exporters of steel. Neither Mike Pence nor Jared Kushner weighed in either way.
  • Everyone else in the room, more than 75% of those present, were adamantly opposed, arguing it was bad economics and bad global politics. At one point, Trump was told his almost entire cabinet thought this was a bad idea. But everyone left the room believing the country is headed toward a major trade confrontation.

The motivation and potential fallout

The reason, we're told: Trump's base — which drives more and more decisions, as his popularity sinks — likes the idea, and will love the fight.

The problem, according to top officials who argued strenuously that the move is ill-advised: The trade war wouldn't just affect China. The collateral damage would include a slew of allies, including Canada, Mexico, Japan, Germany and the United Kingdom.

Watch for: Trump was warned — and White House officials anticipate — that an affected industry like automakers is likely to seek a court injunction within hours of any tariffs on steel.

More Axios: 2/3 of new manufacturing jobs are thanks to foreigners

From Axios Business reporter Christopher Matthews:

A significant majority of the 656,000 new manufacturing jobs created between 2010 and 2014 can be attributed to investment from countries like Japan, the U.K., and Germany, according to a Reuters analysis.

Why it matters: President Trump and some of his advisers are "hell-bent on imposing tariffs — potentially in the 20% range — on steel, and likely other imports," Axios reported Friday morning, though the majority of his cabinet opposes the plan. Trump's complaints about unfair trade practices are not unfounded, but there's a reason why trade arrangements are hard to reform: Attempts to gain advantage at the expense of trade partners risks upsetting cross-border supply chains that support millions of jobs. And it's states in Trump's southeast stronghold like South Carolina that have the most to lose from economically from disrupted global supply networks.

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Singapore has gone "beyond" UN to pressure North Korea

Trump with Singaporean PM Lee. Photo: Evan Vucci / AP

Prime Minister Lee Hsien Loong of Singapore said Monday "pressure" as well as "dialogue" between the U.S. and China are critical in handling the North Korean nuclear threat. President Trump commended Singapore for partnering with the U.S. to combat the threat, and Lee said his country has gone "beyond" the UN Security Council's resolutions to do so.

Trump also said Singapore Airlines signed a $13.8 billion deal with Boeing which will create 70,000 jobs in the U.S.

  • On North Korea: U.S. and Singapore share "an unwavering commitment" to combating the threat, Trump said.
  • On Lee's father, the former PM: Singapore made "rapid development from a poor island nation to an economic powerhouse under [Lee's] great father."
  • On U.S.-Singapore relations: The relationship is at its "highest point and it will continue," Trump said. Lee underscored that Singapore is the second-biggest Asian investor in the U.S.
Worth noting: The president did not take questions after the joint conference, though reporters asked about the Niger ambush and Trump's tweet about gold star widow Myeshia Johnson.
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Megyn Kelly refutes Bill O'Reilly's harassment denials

Megyn Kelly poses on the set of her new show "Megyn Kelly Today." Photo: Charles Sykes / Invision / AP

Megyn Kelly spoke out against her former Fox News colleague Bill O'Reilly on NBC News' Megyn Kelly Today this morning, stating, "O'Reilly's suggestion that no one ever complained about his behavior is false. I know because I complained."

The background: Kelly's assertion comes on the heels of O'Reilly's repeated denials of sexual misconduct during his time at Fox News. A NYT report was published over the weekend detailing his $32 million settlement agreement with a former Fox News analyst over a harassment claim.

More from Kelly: She also shared an email that she wrote to the co-presidents of Fox News in November 2016 after O'Reilly said in a CBS interview that "wasn't interested" in her discussion of Fox News' toxic professional climate in her memoir: "Perhaps he didn't realize the kind of message his criticism sends to young women across this country about how men continue to view the issue of speaking out about sexual harassment."

How O'Reilly responded to the latest report: Emily Steel and Michael S. Schmidt, the New York Times reporters who broke the story about O'Reilly's massive settlement agreement, shared some of their on-the-record interview tapes with O'Reilly with the NYT's The Daily podcast.

In O'Reilly's own words:

  • "We have physical proof that this is bullshit. Bullshit. Okay? So it's on you if you want to destroy my children further."
  • "This is crap. And you know it. It's politically and financially motivated. And we can prove it with shocking information."
  • "Leaks are not facts. Leaks are designed to hurt people, and surely you both know that."
  • "I've never had one complaint filed against me by a co-worker in any Human Resources department."

O'Reilly also went on the record with his former Fox News colleague Glenn Beck this morning and repeated a similar defense while arguing that there is a larger conspiracy meant to end his career, per Media Matters for America:

  • "The end game is, 'Let's link Bill O'Reilly with Harvey Weinstein.'"
  • "[T]hey don't care because this was a hit job to get me out of the market place. And then you'll have the left go, oh, he's paranoid, oh, yeah, yeah. OK. I could back that up 50 different ways. Media Matters is involved. CNN is involved. And it's beyond any doubt."

O'Reilly posted a statement on his website with a sworn affidavit from his accuser that he claims refutes the reports. He has promised to address the allegations further tonight on No Spin News, his nightly podcast.

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Lack of affordable housing killing jobs in Bay Area

A view of the San Francisco skyline from Alamo Square. Photo: Marcio Jose Sanchez / AP

The Bay Area saw its worst month for local employment since February 2010, losing 4,700 jobs in September, per Mercury News.

The backdrop: Employers in the Bay Area are finding it hard to fill positions due to limited housing and sky-high prices. Workers who can't find or afford housing close to their offices are pushed out of the area, and many of them don't want to bother with long commutes. "Housing is the chain on the dog that is chasing a squirrel," economist Christopher Thornberg told Mercury News. "Once that chain runs out, it yanks the dog back."

Go deeper: The national jobs picture for September

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Norway's electric car boom

Data: U.S. Energy Information Administration; Chart: Lazaro Gamio / Axios

Norway has, far and away, the largest percentage of cars that are electric compared to other nations, according to a new report released Monday by the U.S. Energy Information Administration.

The reason: The Norwegian government offers the largest monetary incentives for plug-in electric cars, per the report: "These incentives reduce the purchase price and the operational costs associated with PEV ownership and include an exemption from an acquisition tax ($11,600 savings) for both battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs)."

Why it matters: The trend toward electric cars is picking up speed all over the world, including in the biggest economies like China. Norway, whose wealthy government and economy has been built on oil production, offers an example of what factors drive adoption of electric cars.

Go deeper: The report, titled "Plug-in electric vehicles: future market conditions and adoption rates" is worth a read, or at least a scan.

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Trump meets with Singapore's Prime Minister at the White House

President Donald Trump greets Singapore's Prime Minister Lee Hsien Loong as he arrives at the White House. Photo: Andrew Harnik / AP

President Trump met with Lee Hsien Loong, the Prime Minister of Singapore, at the White House Monday where they spoke of the strength of U.S.-Singapore relations.

What's next: The leaders will participate in a bilateral working luncheon with Cabinet Secretaries and key White House officials later this afternoon, before making a joint statement in the Rose Garden.

Featured

EPA pulls scientists' climate change talks

Seals rest on rocks in Narragansett Bay off the coast of North Kingstown, R.I. Rhode Island. Photo: Steven Senne / AP

The Environmental Protection Agency has canceled three of its scientists' speaking engagements at the State of the Narragansett Bay and Watershed conference today in Providence, R.I., per the New York Times' Lisa Friedman. The conference coincides with the release of a 400-page report on the health of Narragansett Bay, which features "significant" discussion of how climate change has affected the bay. The agency helps fund the Narragansett Bay Estuary Program and the agency's scientists were involved in the report.

Why it matters: "The move highlights widespread concern that the EPA will silence government scientists from speaking publicly or conducting work on climate change," writes Friedman. Trump-appointed EPA administrator Scott Pruitt has maintained humans are not the main driver of global warming, and has removed most mentions of climate change from the EPA website.

What they're saying:

  • "It's definitely a blatant example of the scientific censorship we all suspected was going to start being enforced at EPA," John King, who works on the program, told the. "They don't believe in climate change, so I think what they're trying to do is stifle discussions of the impacts of climate change."
  • "EPA scientists are attending, they simply are not presenting, it is not an EPA conference," EPA spokesman John Konkus told the Washington Post in an email.
Featured

Amazon gets hundreds of city proposals to host HQ2

Amazon chief executive Jeff Bezos at a meeting with Donald Trump in 2016. Photo: Evan Vucci / AP

Amazon has been flooded with pitches from cities and regions that want to host its second headquarters, the company said Monday. The company received 238 proposals from "54 states, provinces, districts and territories across North America."

Why it matters: There's lots of competition for what Amazon is calling HQ2. While the new headquarters could bring 50,000 jobs that pay an average salary of $100,000 to the winning city, there are also potential downsides to hosting, including the possible cost of billions of dollars via tax breaks.

Go deeper: The New York Times recently covered the tactics cities are employing to court the project.

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Tillerson says Taliban could join Afghan gov. if they renounce violence

Secretary of State Rex Tillerson speaks with Gen. John Nicholson, left, commander of Resolute Support, and Amb. Hugo Llorens. Photo: Alex Brandon / AP

Secretary of State Rex Tillerson said Monday on a previously unnannounced visit to Afghanistan that he thinks moderate elements of the Taliban could participate in the Afghan government under certain conditions, per the AP. He said the Taliban should prepare to negotiate with the government since they'll "never win a military victory."

"There's a place for them in the government if they are ready to come, renouncing terrorism, renouncing violence and being committed to a stable prosperous Afghanistan... we are looking to engage with those voices and have them engage in a reconciliation process leading to a peace process and their full involvement and participation in the government," he said.
Why it matters: The strategy Trump laid out for Afghanistan focused primarily on military efforts, but this is a window into what Tillerson believes a diplomatic solution could look like.
Featured

Foxconn backs Bitcoin startup Abra

Rebecca Zisser / Axios

Abra, a Silicon Valley bitcoin startup primary focused on foreign exchange, has raised $16 million in new funding led by China's Foxconn.

Why it matters: This deal could help lead to a revolution in how people pay for consumer electronics and other household goods. Foxconn's investment does not have a strategic partnership attached, but Abra CEO Bill Barhydt believes that the inclusion of IoT chips in such things as flat-screen TVs – Foxconn now owns Sharp – could eventually be leveraged to enable pay-as-you go leasing programs transacted via Bitcoin.

Other investors in the Series B round: Silver8 Capital, Ignia, Arbor Ventures, American Express, Jungle Ventures, Lerer Hippeau Ventures and RRE Ventures.

Bottom line: Does Barhydt's vision seem far-fetched? Sure. Well, until you realize that a version of this has been underway for several years with M-Pesa and solar home-lighting systems in Kenya.

Featured

E-commerce warehouse jobs breathe life into the rust belt

Bethlehem, Pennsylvania is well acquainted with the struggles brought on by deindustrialization. The city was once home to America's second-largest steel producer, but its citizens struggled for decades with declining steel employment, before Bethlehem Steel went bankrupt altogether in the early 1990s.

But as the New York Times reports, the city as become a poster child in recent years for the new, e-commerce economy. Its proximity to New York and Philadelphia and its large pool of less expensive labor have made it an appealing place for online retailers to locate their warehouses and fulfillment centers.

Why it matters: Some economists argue that when you account for fulfillment center jobs, the retail industry is actually adding jobs, and that these positions pay better than those in brick-and-mortar stores.