Principals

1. Tariff tax plans hit reality
2. Lutnick’s trade role
3. The Gaetz report’s fate
4. Govt funding
5. Ukrainians sour on US
6. Nvidia earnings
7. COP29’s finance deadlock

PDB: New Biden admin AI task force

Biden turns 82 … Fed’s Barr testifies before House Financial Services Committee … US shutters Kyiv embassy over threat of air attack

Tariffs for tax cuts? Not so fast

Republicans appear cool to using tariffs to pay for tax cuts, Semafor’s Burgess Everett and Kadia Goba report. “I don’t want to do tariffs just to raise revenue,” said Rep. Greg Murphy, R-NC. Sen. Rand Paul of Kentucky said he’s listening, but doubted they’d get added to the tax bill. Many free traders are wary of the big macro effects of an across the board tariff — not to mention the politics of voting for what Paul says is basically a “sales tax” for foreign goods. People aren’t killing the idea entirely: If Trump is going to impose tariffs, there’s some thought that Republicans might at least get some revenue out of it. “I don’t know until I get something concrete from the president,” said Sen. Chuck Grassley, R-Iowa.

Lutnick tapped for commerce, trade role

Donald Trump’s choice of Howard Lutnick as commerce secretary indicates plans for broad tariffs — while raising questions about the president-elect’s plans for longtime adviser Robert Lighthizer. Trump said the Cantor Fitzgerald CEO would have “direct responsibility for the Office of the United States Trade Representative.” Lutnick has said the incoming administration would use tariffs as a bargaining chip with other countries. “We’ll make a bunch of money on the tariffs, but mostly everybody else is going to negotiate with us,” he said on CNBC. Lighthizer, a China hawk who has pushed a decoupling agenda, was a candidate for Commerce, and Trump had privately signaled likely plans for him to serve in an expansive trade role. One former Trump administration official suggested Lighthizer could be chosen to lead the National Economic Council or as ambassador to China.

— Morgan Chalfant

House Ethics panel to meet on Gaetz investigation

The House Ethics Committee meets today to discuss whether to release their investigative report on Matt Gaetz, Trump’s pick for attorney general. The evenly-divided, 10-member panel requires a simple majority to release findings that reportedly center around alleged sexual misconduct with a minor, which Gaetz has denied. At least one Democratic member has signaled they’ll vote to make the investigation public. “The Senate should have a chance to take a look at any evidence they think is relevant to the decision they have to make,” Rep. Glenn Ivey, D-Md., told reporters. Some Republicans would prefer to honor precedent, since the panel lost jurisdiction after Gaetz’s quick resignation following his nomination. One thing is certain: As Trump calls senators to push for Gaetz, today’s meeting won’t be the final word on the report.

— Kadia Goba

Congress might punt spending bill

Here’s a big lame duck question: Will lawmakers punt the hard work of a spending bill to next year? The prospect of a catch-all spending bill — also known as an omnibus — is not totally dead, but it’s looking unlikely. Conservatives dislike year-end spending bills and Republicans will have more leverage next year, making it a harder sell for them than during the 2022 lame duck. Even Senate Minority Leader Mitch McConnell sounded open to a short-term bill on Tuesday: “That’s yet to be determined as well. There are pros and cons both ways.” The upside for Republicans would be giving incoming President Trump and the Senate GOP majority more buy-in. But it could also barrel into the upcoming debt ceiling deadline and disrupt the new Congress. And there’s still disaster aid to take care of.

— Burgess Everett

Doubts grow in Ukraine about US, NATO membership

Ukrainians are souring on US leadership more than two years since the start of the full-scale Russian invasion. Just 40% of Ukrainians polled by Gallup in August said they approve of US leadership, down from a peak of 66% in 2022 at the onset of the war. More than one-third of Ukrainians (37%) disapprove of the job US leaders are doing. The share of Ukrainians who approve of Germany’s leadership, in comparison, remains steady around 50%. The survey — which, importantly, was conducted before Donald Trump was elected the next US president — also shows that Ukrainians are growing more doubtful about the likelihood of the country joining NATO or the European Union in the next decade.

Dara Massicot is a senior fellow at the Carnegie Endowment for International Peace and a former senior analyst for Russian military capabilities at the Pentagon.

Wall Street watches Nvidia earnings

It’s “Nvidia Day” again on Wall Street as the company prepares to release its third-quarter earnings later Wednesday. The advanced chipmaker, which has experienced massive growth amid the artificial intelligence boom, is facing high expectations for the report. Investors will be closely watching for what the company says about its next-generation Blackwell chip, following a report in The Information that said the chips were overheating. The company’s stock has remained high following Trump’s election victory, which powered a broader stock market surge. But the chipmaker could potentially be hurt by Trump’s planned tariffs if they trigger a trade war with China, where Huawei is struggling to close the gap with its competitors due to US export controls.

COP29 finance deal in jeopardy

Negotiators at the COP29 climate summit are stalled on the conference’s main question — how to raise the huge sums necessary to fund developing nations’ energy transition — and the talks risk ending without a deal, Semafor’s climate & energy editor Tim McDonnell reports. Developing nations blame richer peers for the climate crisis, while wealthy countries say the trillions of dollars being demanded just aren’t there. The amount of money developing countries are asking for is ultimately only about 1% of global economic output, seemingly a small price to pay to save the planet, but disputes remain over the overall sum itself, as well as the accounting structures of how to raise the figure. “It’s not going well,” one delegate said.

Beltway Newsletters

Punchbowl News: Allies of former speaker Kevin McCarthy who sit on the GOP’s Steering Committee are facing challenges from allies of House Majority Leader Steve Scalise. If they win, it would give Scalise more influence on the panel, which decides committee assignments and recommends who chairs them.

Playbook: The Democrats’ generational divide is emerging as a key factor in the race to lead the DNC, as many in the party hope to move on from older leaders like Joe Biden and Nancy Pelosi.

WaPo: JD Vance will face a big test today when he accompanies attorney general nominee Matt Gaetz at meetings with senators as Donald Trump’s team tries to convince Republicans to confirm him.

Axios: Trump is taking a closer look at Sen. Bill Hagerty, R-Tenn., to potentially serve as treasury secretary.

Blindspot

Stories that are being largely ignored by either left-leaning or right-leaning outlets, curated with help from our partners at Ground News.

What the Left isn’t reading: Pennsylvania Gov. Josh Shapiro expressed support for the state Supreme Court’s ruling preventing counties from counting faulty mail-in ballots.

What the Right isn’t reading: Walmart acknowledged the retailer would probably raise prices on some goods if Donald Trump moves forward with plans to enact sweeping tariffs.

White House

President Biden is back in Washington after the G20 summit in Brazil. Yesterday, the leaders retook a group photo after Biden, Canadian Prime Minister Justin Trudeau, and Italian Prime Minister Giorgia Meloni missed the initial shot.

Congress

• House Democrats reelected Hakeem Jeffries as their leader, Katherine Clark as whip, and Pete Aguilar as caucus chair.

Transition

• Donald Trump said he would nominate TV personality Dr. Mehmet Oz to lead the Centers for Medicare & Medicaid Services and suggested plans for cuts at the agency. Oz will “cut waste and fraud within our Country’s most expensive Government Agency, which is a third of our Nation’s Healthcare spend, and a quarter of our entire National Budget,” Trump said in an announcement.
• Trump transition co-chair Linda McMahon has been nominated for the role of education secretary after being passed over for commerce secretary.
• Trump’s team is building its list of candidates to run financial regulatory agencies, Semafor’s Liz Hoffman and Rachel Witkowski reported.
• Trump attended a SpaceX launch in Texas with Elon Musk.

Outside the Beltway

• The Los Angeles City Council tentatively approved a “sanctuary city” law to bar city workers and resources from taking part in immigration enforcement by the federal government.

Business

• Comcast plans to spin off its cable networks, including MSNBC and CNBC, into a separate company. — WSJ

Courts

• Manhattan District Attorney Alvin Bragg plans to oppose Donald Trump’s bid to dismiss his hush-money case in New York.
• Damian Williams plans to step down as the US attorney for the Southern District of New York before Trump takes office. — Bloomberg

Foreign Policy

• President Biden authorized antipersonnel land mines for Ukraine to strengthen its defenses against Russian forces, but arms-control groups criticized the move. — WaPo
• The Biden administration is referring to Edmundo González Urrutia as the president-elect of Venezuela, its strongest acknowledgment so far that he defeated President Nicolás Maduro in that country’s presidential election in July. — Bloomberg

Technology

• The Biden administration is establishing a government task force through which agencies will collaborate on research and testing of artificial intelligence models to address national security concerns, a senior Commerce official said. The task force will be headed up by the US AI Safety Institute housed at the Commerce Department.

Media

• MSNBC “Morning Joe” hosts Joe Scarborough and Mika Brzezinski met with Donald Trump last week because they were “credibly concerned that they could face governmental and legal harassment from the incoming Trump administration.” — CNN
• Former Washington Post executive editor Sally Buzbee landed a job at Reuters.

Principals Team

• Editors: Benjy Sarlin, Elana Schor, Morgan Chalfant
• Reporters: Burgess Everett, Kadia Goba, Shelby Talcott, David Weigel

Advisors close to Donald Trump are pushing for a renewed US-Africa policy that rows back some of what they see as overly progressive or “woke” diplomacy under the Biden administration, Semafor’s Yinka Adegoke reported.

This would involve promoting evangelical Christian conservative interests and reversing pro-LGBT+ policies in dealings with countries like Rwanda, in what one person described as a “God, gays and guns” approach.