Good morning! Funds are rolling in for Trump’s future presidential library. Only they’re not exactly coming from willing donors. The president has settled personal lawsuits with ABC and Meta for a reported $40 million and is currently seeking a casual $10 billion — with a “b” — from CBS.

In other news, the White House recognized Black History Month and Pennsylvania's favorite rodent meteorologist predicted six more weeks of winter.

TARIFFS

📦️ All gas, no breaks as Trump launches trade war

Going hog wild. Going hard in the paint. Fulfilling campaign promises. Whatever you want to call it, President Trump is doing it. Get your syrup and guac today because starting Tuesday, most imports from Canada and Mexico will be hit with a 25% tariff. Imports from China will face an extra 10% tax.

• Energy imports from Canada, including oil and natural gas, will pay a lower, 10% premium.

What is a tariff? Tariffs are taxes on international trade. When something is shipped into the U.S., it’s typically hit with a tariff. In 2023, that cash accounted for about 1.8% of federal revenue. Prior to the U.S. adopting an income tax in 1913, however, tariffs often funded almost the entire federal government. Trump is a big fan of that system. He has said he’d love to return to something similar but admitted that his tariffs could cause “some pain” for Americans in the short term.

• Opponents believe tariffs raise the prices of key goods, driving up inflation and hitting consumers where it hurts.

• Tariff proponents believe they protect domestic manufacturing. They say the higher import prices will lead to more goods being produced in the U.S.

How is he doing this? Normally, tariffs — like all taxes — have to be adjusted by Congress. To create these new tariffs, Trump declared a national economic emergency. A 1977 law called the International Emergency Economic Powers Act allows the president to, among other things, impose tariffs during emergencies.

• Trump said America's three largest trading partners (China, Canada, and Mexico) have "failed" to stop the flow of fentanyl or illegal immigration across the border.

• Trump's disaster declaration also avoids tariff restrictions in the 2018 U.S.-Mexico-Canada free trade agreement.

What’s been the response? Canadian Prime Minister Justin Trudeau slapped a matching 25% tariff on U.S. imports into Canada. He made it clear this was reluctant, saying Canada "didn't ask for this." Trudeau also emphasized the long U.S.-Canada relationship and noted that Canadians have always “grieved with” the American people amid tragedies like 9/11, hurricanes, and wildfires.

• Mexican President Claudia Sheinbaum also said she would impose retaliatory tariffs but gave no details.

• China also slammed the move but avoided a tariff tit-for-tat. During the 2024 campaign, Trump floated a 60% tariff on Chinese products.

• The economies of Canada and Mexico are far more reliant on the U.S. than the other way around. So things could get rough for them fast.

Future: Trump’s order says the tariffs will remain in place until the fentanyl and immigration emergencies are taken care of. But he could readjust if he can squeeze out some sort of concessions from affected countries. Oooor maybe he's holding out for the big dream: making Canada "our Cherished 51st state."

GOVERNMENT

🔥 President Trump is cleaning house at the Department of Justice (DOJ). Proponents are calling the firing spree a "bloodbath," as opponents say the purge is "deeply alarming." The DOJ fired federal prosecutors who investigated the January 6 riot. Originally hired as temps, Biden made them permanent on his way out the door. The Trump DOJ says the move frees up resources for different employees. Trump also fired top FBI execs — including the heads of field offices in D.C., Las Vegas, and Miami — and is considering more terminations. Elsewhere, dozens of Department of Education employees are on leave as part of Trump's anti-DEI efforts.

💰️ Elon Musk and his team at the Department of Governmental Efficiency (DOGE) are making their mark. At the Treasury, Sec. Scott Bessent gave DOGE read-only access to the federal payments system to keep an eye on spending. Over at the U.S. Agency for International Development (USAID), two execs are now on leave. They refused to allow DOGE access to classified systems, allegedly for not having proper security clearance. Musk later called USAID, the foreign aid agency, "a criminal organization" that needs "to die." USAID's website is down as of Sunday evening.

📡 Under new chair Brendan Carr, the Federal Communications Commission (FCC) is investigating some major news outlets. Federal funding to PBS and NPR comes with the stipulation that the networks operate as nonprofits. But the FCC believes their local broadcasts "could be violating federal law by airing commercials." Elsewhere, CBS handed over a transcript of its October interview with Kamala Harris. A conservative group filed a complaint alleging CBS gave Harris an illegal handout via a too-favorable edit.

POLITICS

🔵 Democrats choose new leader after old guy loses to Trump

It’s a tough job, but somebody has to do it. Democrats elected a new party leader over the weekend at their annual winter meeting. Minnesota state party chair Ken Martin won the race with with 247 votes to his Wisconsin counterpart’s 135. He’ll succeed outgoing chair Jaime Harrison, who made headlines last week for saying Democrats should've stuck with Biden in 2024. Harrison stepped down after some less-than-desirable 2024 election results.

As chair of the Democratic National Committee (DNC), Martin will oversee official party business. That includes everything from fundraising and communications to the 2026 midterm elections and prepping for 2028.

• He’ll be aided by three new vice chairs. One of those? Twenty-four-year-old Parkland shooting survivor and activist David Hogg.

• On the other side, former North Carolina state chair Michael Whatley leads the Republican Party's RNC.

Cabinet: Over in Trump World, the Senate is slowly but surely confirming the president’s picks for top jobs. The Senate calendar has CEO Chris Wright teed up to become Energy secretary later today (and the ninth confirmed Cabinet member). Another handful of nominees could get the final thumbs-up later in the week.

• The Senate Finance Committee will vote Tuesday on whether to send health pick Robert F. Kennedy, Jr.'s (controversial) nomination to the full Senate.

• Meanwhile, Trump allies are working overtime to get Tulsi Gabbard confirmed as intelligence director after her touchy confirmation hearing last week.

TRIVIA

On this day in 1913, the Sixteenth Amendment was ratified and became part of the Constitution. The amendment gave Congress the power "to lay and collect" income taxes, ending the federal government's reliance on tariffs and other fees. Congress used this newfound power to quickly pass a new personal income tax. What was the top income tax rate in 1913?

Hint: It’s lower than today’s lowest rate.

BORDER

🌎️ Venezuela releases American hostages, will cooperate on border

Six American citizens are back home this week after some, ahem, unwanted vacations in Venezuela. President Trump's special envoy Ric Grenell met with dictator Nicolas Maduro in Caracas and came home with six freed hostages and a deportation deal.

Deportation flights: After Colombia balked at the finer details of the flights in January, its much less wealthy neighbor has agreed to play ball. According to Trump, it will receive "all Venezuela illegal aliens who were encamped in the U.S., including gang members of Tren de Aragua." Logistics of the arrangement are pending, but Venezuela will also provide transportation.

• Due to a rigged 2024 election, the U.S. doesn't recognize Maduro as Venezuela's rightful leader. The White House emphasized that Grenell's visit doesn't change that.

• The administration's immediate focus? Returning 400 Tren de Aragua gang members already in custody.

Revoking protected status: New Homeland Security Secretary Kristi Noem revoked the Temporary Protected Status (TPS) of more than 300,000 Venezuelans in the United States. Another 250,000 are still protected through September.

• The Trump administration says the program has been abused and believes most recipients can safely return home.

• Immigration advocates called the move illegal considering recent Biden TPS extensions. They also dispute the idea that Venezuela is safe.

Elsewhere, in Israel: As part of its ceasefire deal with Israel, Hamas on Saturday released the first hostage with U.S. citizenship. Keith Siegel is an Israeli-American from North Carolina, now home after 484 days in captivity.

BRIEFS

● Secretary of State Marco Rubio on Sunday made his first overseas trip to meet with Panama's president. He relayed Trump's belief that Chinese influence on the U.S.-built Panama Canal violates the 1977 treaty giving control to Panama.

● Most large companies are legally registered in business-friendly Delaware. But a few touchy state court moves have some fleeing for greener pastures in Nevada or Texas. Companies making or considering a move include Meta, Dropbox, and SpaceX.

● President Trump ordered two California dams open, moving billions of gallons through the state. He says the state is mismanaging its water, creating unneeded fire danger. But state officials disagree and say the move only hurts Central California farms.

● A legal Super Bowl is brewing after Louisiana indicted a New York doctor for prescribing abortion pills online to a pregnant minor in the Southern state. Also indicted is the girl's mom, with Louisiana claiming the girl was given the pills against her will.

QUOTE

ANSWER

For tax year 2025, Americans earning over about $12,000 will owe the feds somewhere between 10% and 35% of their income. Way back when this system began in 1913, the rates were... different. The entry-level rate — for incomes over the equivalent of a modern ~$95,000 — was a cool one percent. The top rate? Folks earning the 1913 version of a modern ~$16 million owed the feds a whopping seven percent of their hard-earned cash.