February 3 2025

1. Trump Orders Major Tariffs on Canada, Mexico, China Starting Tuesday
2. Manufacturing Towns Recovered from China Shock, But Workers Left Behind
3. US Threatens Panama Over Chinese Control of Canal
4. Trump Administration Ousts FBI, DOJ Officials Tied to Jan 6 Cases
5. OPINION: US Voluntarily Ending US-led Global Order
February 3, 1912: New U.S. football rules are set: field shortened to 100 yds.; touchdown counts six points; four downs allowed 

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FLASH…Foreign development agency USAID to close after skirmish with Elon Musks DOGE (Dept of Government Efficiency)…USAID budget over $40b/year…

Article Source: AP

1. Trump Orders Major Tariffs on Canada, Mexico, China Starting Tuesday

A. President Trump signed executive orders imposing a 25% tariff on imports from Mexico, a 25% tariff on imports from Canada apart from energy, which would face a 10% tariff, and a 10% tariff on imports from China. These tariffs would apply above and beyond existing tariffs. The tariffs are scheduled to take effect at the start of Feb. 4. With only two days before implementation, the tariffs look likely to take effect, though a last-minute compromise cannot be completely ruled out. The White House fact sheet on the tariffs and the executive orders highlight fentanyl and immigration as the motivation for the tariffs, but there are no explicit criteria provided for lifting them beyond cooperation on and an improvement in the immigration and fentanyl situations. In light of their potential economic effects and the fact that the White House has set general conditions for their removal, we think it is more likely that the tariffs will be temporary but the outlook is unclear. 

B. From UAW President Shawn Fain:  

"The UAW supports aggressive tariff action to protect American manufacturing jobs as a good first step to undoing decades of anti-worker trade policy….The national emergency we face is not about drugs or immigration, but about a working class that has fallen behind for generations while corporate America exploits workers abroad and consumers at home for massive Wall Street paydays. We need to stop plant closures, bring back American jobs, and stop the global race to the bottom immediately. Any tariff action must be followed with a renegotiation of the USMCA, and a full review of the corporate trade regime that has devastated the American and global working class.”  

C. President Donald Trump said he plans to speak Monday with Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum before steep new tariffs on U.S. allies and trading partners are scheduled to take effect early Tuesday.  

Editors note: The US has all the leverage here. The tariffs negative impact on Canadian GDP is estimated to be ~4%, with around 20% of the Canadian economy going to US exports. Likewise, the negative impact on Mexican GDP is estimated to be ~5-7%, with around 30% of the Mexican economy going to US exports. Conversely, the impact on US GDP is expected to be marginal (negative tenths of a percentage point). If the leaders of Canada and Mexico are rational, a deal will be reached and tariffs dropped.

Article Source: Goldman Sachs, @UAW, WaPo

2. Manufacturing Towns Recovered from China Shock, But Workers Left Behind

The flood of Chinese imports that started hitting America a quarter-century ago radically altered the U.S. economy. It upended manufacturing communities, hurt workers and their families, and sowed a discontent with globalization that changed the nation’s politics and helped usher President Trump into his first term. New research offers an unprecedented look at exactly how the “China Shock” rippled through the U.S., hitting manufacturing communities in the Southeast and parts of the Midwest particularly hard. It shows a remarkable change that occurred in the years leading up to the pandemic: Many of the places that were hit came back. The people who got hit did not. The economists found that, starting in the 2010s, most of the affected economies came roaring back, including the counties surrounding Hickory, N.C., and Dalton, Ga. But the recoveries didn’t come about as the result of a manufacturing revival. Instead, they were driven by expansions in industries such as healthcare, education, retail and restaurants. What’s more, the manufacturing workers who had been hit by the China shock—largely U.S.-born white and Black men without any college education—didn’t participate in these recoveries. The new data show that while some of these workers lost their jobs and struggled to ever find work again, the bulk of them remained employed until retirement. But as they aged out of the manufacturing workforce, they weren’t replaced. And even though they hung onto their jobs, their earnings growth stagnated. Not many manufacturing workers moved into nonmanufacturing jobs. And, surprisingly, manufacturing workers were even less likely to relocate following the China shock than they had been before. That cut against a general expectation among economists that at least some people would be more likely to pick up and go where they could find work.  Meanwhile, all the new service-sector jobs in these communities went mostly to workers unlike those who had filled the old manufacturing jobs. Many were young adults and legal immigrants taking their first jobs. Many of the immigrants were from Asia, while many of the other people filling service jobs were U.S.-born Hispanics. More of the new workers were women, and were college-educated.

Article Source: WSJ

3. US Threatens Panama Over Chinese Control of Canal

US secretary of state Marco Rubio told Panamanian President José Raúl Mulino on Sunday to reduce China’s influence over the Panama Canal or face immediate consequences. Rubio met Mulino in Panama City and said US President Donald Trump had determined that China posed “a threat to the canal” and had violated a treaty concerning its neutrality, according to state department spokesperson Tammy Bruce. Unless the situation changed, the US would “take measures necessary to protect its rights under the Treaty”, wrote Bruce. On Sunday night, Trump told reporters: “China is running the Panama Canal. It was not given to China, it was given to Panama foolishly. But they violated the agreement and we’re going to take it back, or something very powerful is going to happen.” The US built the 82km canal connecting the Pacific and the Caribbean more than a century ago and controlled it and an adjacent stretch of territory until it signed a treaty in 1977 for a gradual handover to Panama, which was completed in 1999. Mulino on Sunday acknowledged US concerns over the ports and noted that his government had launched an audit of the port concessions, which have a nearly 40 per cent market share, amid speculation in Panama that they may be cancelled. It is not clear, however, whether the cancellation of the Chinese concessions would be sufficient to satisfy Trump, who has called the canal fees “a complete rip-off” and demanded that the US take back the canal.

Article Source: FT

4. Trump Administration Ousts FBI, DOJ Officials Tied to Jan 6 Cases

Trump administration officials ordered eight senior FBI employees to resign or be fired, and asked for a list of agents and other personnel who worked on investigations into the Jan. 6, 2021, attack on the U.S. Capitol, people familiar with the matter said, a dramatic escalation of President Trump’s plans to shake up U.S. law enforcement.  On Friday, the Justice Department also fired roughly 30 prosecutors at the U.S. attorney’s office in Washington who have worked on cases stemming from Capitol riot, according to people familiar with the move and a Justice Department memo reviewed by The Wall Street Journal. The prosecutors had initially been hired for short-term roles as the U.S. attorney’s office staffed up for the wave of more than 1,500 cases that arose from the attack by Trump supporters.  Trump appointees at the Justice Department also began assembling a list of FBI agents and analysts who worked on the Jan. 6 cases, some of the people said.

Article Source: WSJ

5. OPINION: US Voluntarily Ending US-led Global Order

It's becoming clearer and clearer that we're looking at a seismic shift in the US's relationship with the world, between:  1) The US dismantling its foreign interference apparatuses (like USAID), 2) Marco Rubio stating that we're now in a multipolar world with "multi-great powers in different parts of the planet" and that "the postwar global order is not just obsolete; it is now a weapon being used against us", 3) The tariffs on supposed "allies" like Mexico, Canada or the EU  This is the US effectively saying "our attempt at running the world is over, to each his own, we're now just another great power, not the 'indispensable nation'."  Hegemony was going to end sooner or later, and now the U.S. is basically choosing to end it on its own terms. It is the post-American world order - brought to you by America itself.  All in all this transformation may mark one of the most significant shifts in international relations since the fall of the Soviet Union. And those most unprepared for it, as is already painfully obvious, are America's vassals caught completely flat-footed by the realization that the patron they've relied on for decades is now treating them as just another set of countries to negotiate with.

Article Source: @RnaudBertrand

February 3, 1912: New U.S. football rules are set: field shortened to 100 yds.; touchdown counts six points instead of five; four downs are allowed instead of three; and the kickoff is moved from midfield to the 40 yd. line.

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Sources

1. https://apnews.com/article/trump-musk-usaid-c0c7799be0b2fa7cad4c806565985fe2

2. A Goldman Sachs
B https://x.com/uaw/status/1885867801480724548?s=46&t=nVb-5uC_WM3Cp0R0dGiqHQ
C https://www.washingtonpost.com/politics/2025/02/03/trump-presidency-news/

3. https://www.wsj.com/economy/us-manufacturing-jobs-china-shock-78e06c83?st=Kv2Moz&reflink=article_copyURL_share

4. https://on.ft.com/3EmLIGA

5. https://www.wsj.com/politics/trump-officials-target-agents-prosecutors-who-worked-on-trump-investigations-3a80b280?st=Dx2t9T&reflink=article_copyURL_share

6. https://x.com/rnaudbertrand/status/1886082749779607997?s=46&t=nVb-5uC_WM3Cp0R0dGiqHQ