Principals

1. Trump’s tariff pledge
2. Trump ally scrutiny
3. Intel’s final chips grant
4. Israel-Hezbollah deal?
5. Gaetz set to escape
6. Chemical weapons meeting
7. DNC election

PDB: Jack Smith shuts down Trump prosecutions

Fed minutes to be released … Biden proposes rule for Medicare, Medicaid to cover obesity drugs … NYT: End of Trump cases leaves presidential immunity limits unresolved

Trump tariff threat worries allies

Trump spooked global markets and allies with his pledge to enact tariffs on China, Canada, and Mexico. The president-elect vowed a 25% tariff on products from Canada and Mexico as well as a 10% tariff on Chinese products, saying they were needed to pressure the countries to crack down on illegal drugs and migrants. The comments signal Trump will try to rewrite the trade pact with Canada and Mexico that his first administration negotiated. “Canada places the highest priority on border security and the integrity of our shared border,” a pair of Canadian officials said, while a former Mexican ambassador warned the move would “put North American relations in a downward spiral.” The proposal also has Republicans worried. “I’m troubled,” Rep. Adrian Smith, R-Neb., told Semafor. “Seems like a sledge hammer approach that could spike inflation and not really help grow domestic manufacturing. It does not seem particularly well thought out.”

— Morgan Chalfant and Kadia Goba

Trump campaign reviewed influence allegations

Boris Epshteyn, a longtime Trump adviser, is facing immense scrutiny following a review that accused him of seeking money to promote possible Trump appointees. Shelby Talcott reported that Trump’s transition team conducted a review of outside contractors and consultants that in part focused on Epshteyn, who faced claims inside the transition team that he attempted to trade on his closeness to Trump. CNN reported that the inquiry made “an initial recommendation that Epshteyn should be removed from Trump’s proximity,” a conclusion that Trump may ignore. The Washington Post later reported that Epshteyn sought money and investments from Trump treasury secretary pick Scott Bessent in exchange for promoting him in Trump’s circle (Bessent refused Epshteyn’s offers). Epshteyn denied allegations of improper behavior, calling them “false and defamatory.”

Intel’s final chips grant shrinks

The Biden administration reduced Intel’s grant for chips manufacturing to $7.9 billion, a move that a senior administration official denied was related to the company’s financial struggles. The decision to reduce the grant from the $8.5 billion initial target was “really driven” by a $3 billion award subsequently given to Intel for national security chip production, the official said, while acknowledging that “ongoing economic and market developments” did come up during the government’s due diligence process. Intel is building facilities to produce leading-edge chips and related technologies across Arizona, New Mexico, Ohio, and Oregon. The federal funding will begin flowing this year, though the company opted against taking the $11 billion in loans offered through the chips program. Intel’s financial challenges have quietly alarmed Washington policymakers, though the finalized grant will provide some relief.

— Morgan Chalfant

Gaetz ethics report on track to stay secret as some Dems balk

Rep. Sean Casten, D-Ill. isn’t backing down on forcing a vote to release the ethics investigation into alleged sexual misconduct by Matt Gaetz, just because the former congressman isn’t going to be Donald Trump’s attorney general. And even though some Democrats will likely end up voting to protect Gaetz — citing the precedent it might set to release details on a former member of Congress — Casten isn’t worried about that either. “If there are Democrats who are alleged to have had sex with children, we should investigate that as well,” Casten told Semafor. The Democrats who have already lost their appetite for the Gaetz report are privately worried about GOP retaliation and their own ethical issues. And don’t expect Republicans to support Casten’s push next week: at least one who’d previously said they’d want to release the report told us they’ve reversed course.

— Kadia Goba

Lebanon ceasefire deal imminent

Israel and Hezbollah are closing in on a deal to halt the fighting in Lebanon that could be finalized as soon as today. US and Israeli officials characterized both sides as close to an agreement, with Israeli ambassador to the US Michael Herzog saying “it could happen within days.” Israeli media reported that the war cabinet would likely approve the deal on Tuesday, while the Biden administration sounded decidedly more cautious. “We’re close,” John Kirby said. “Until you get everything done, you don’t have a deal.” A ceasefire deal would be a major achievement for President Biden in the final weeks of his administration, which has also unsuccessfully sought an agreement to end the year-long conflict in Gaza.

— Morgan Chalfant

US to up pressure on Russia over chemical weapons

The US wants to intensify international pressure on Russia over its use of chemical weapons in Ukraine, a senior State Department official told Semafor’s Mathias Hammer. At this week’s Organisation for the Prohibition of Chemical Weapons meeting in the Netherlands, which kicked off Monday, the US is calling on the more than 190 member states “to unite in demanding that the Russian Federation cease using chemical weapons as a method of war,” the official said. The annual conference follows the organization saying for the first time that Russia is using chemical weapons in Ukraine, where Kyiv has reported more than 4,000 incidents.

Semafor has announced Carlyle Co-Chairman David Rubenstein, Citadel Founder & CEO Ken Griffin, former US Commerce Secretary Penny Pritzker, and KKR Co-Chairman Henry Kravis as Co-Chairs of the World Economy Summit on April 23-25, 2025.

Their participation reflects the extraordinary prestige of this unique event in Washington, D.C., which brings together US Cabinet officials, global finance ministers, central bankers and Fortune 500 CEOs for conversations that cut through the political noise to dive into the most pressing issues facing the world economy.

Join the waitlist for more information and access to priority registration.

Dems set Feb. 1 vote on new party chair

The Democratic National Committee will elect a new chair on Feb. 1, moving quickly to replace its leadership after the party’s defeats this year. Departing chair Jaime Harrison promised an “inclusive and transparent process that gives members the opportunity to get to know the candidates,” open to anyone who can get at least 40 endorsements from the 448 voting DNC members. Minnesota DFL chair Ken Martin told Semafor last week that more than 100 members have already supported him; former Maryland Gov. Martin O’Malley, who entered the race first, has fewer public commitments. The party will also sponsor and livestream four public forums; having members vouch for the candidates will likely prevent a repeat of the 2017 process, when fringe candidates got equal time onstage. The party’s rules and bylaws committee will meet on Dec. 12 to begin the process.

— David Weigel

Punchbowl News:

Punchbowl News: House Republicans are eyeing a mid-March end date for a short-term bill to fund the government.

Axios: Donald Trump is considering tapping a White House artificial intelligence czar when he takes office.

Playbook: One question to consider when weighing Trump’s tariff threat: Is he serious?

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: Donald Trump’s team is assembling a package of energy moves that would approve permits for new LNG projects and increase drilling on coastal and federal land, Reuters reported.

What the Right isn’t reading: A top Canadian general pushed back against the idea of removing women from combat roles.

White House

• White House national security spokesman John Kirby said the Federal Aviation Administration and National Transportation Safety Board are assisting an investigation into a cargo plane that crashed in Lithuania.
• The Biden White House is celebrating a new milestone: the private sector has invested $1 trillion in clean energy and manufacturing since the current president took office, which officials argue is a result of his policies.

Congress

• The Senate Democratic leadership elections are set for Dec. 3.
• There will be a record-setting number of Black members of Congress next year. — NBC
• Donald Trump preemptively endorsed Florida Chief Financial Officer Jimmy Patronis for the congressional seat vacated by Matt Gaetz.
• Rep. Lauren Boebert, R-Colo., is on Cameo.

Transition

• Donald Trump is considering tapping Kash Patel for deputy FBI director or a top role at the Justice Department, rather than for the Senate-confirmed role of FBI director.

Outside the Beltway

• Manhattan US Attorney Damian Williams plans to resign in December.
• K Street is flocking to Florida. — Business Insider

Business

• Macy’s said one of its employees hid as much as $154 million in expenses over three years, forcing the retailer to delay its latest earnings report.
• The Biden administration said it would lend $6 billion to Rivian Automotive for the EV maker to build a plant in Georgia.

Courts

• Special counsel Jack Smith moved to abandon federal cases against Donald Trump related to his handling of classified documents and Jan. 6. In a motion in Washington, he stood “fully behind” the allegations laid out in the indictment but said Justice Department policy prevents the prosecution of a sitting president. Smith still left the door open to the government resurrecting the charges after Trump leaves office.

Oversight

• Some government watchdogs are quitting. — Politico

Polls

• Americans’ confidence in the US economy improved after the 2024 presidential election, largely driven by an increase in confidence among Republicans, a new Gallup poll shows.

Technology

• TikTok CEO Shou Chew reached out to Elon Musk for insights into the Trump administration’s plans for tech policy. — WSJ
• Huawei is set to launch its latest smartphone this week.

Media

• The Israeli Cabinet voted to sanction Haaretz.

Principals Team

Editors: Benjy Sarlin, Elana Schor, Morgan Chalfant

Reporters: Burgess Everett, Kadia Goba, Shelby Talcott, David Weigel

Joni Ernst is a Republican senator from Iowa and the chair and founder of the new Senate “DOGE” Caucus.

Corporate executives have tasked their handlers with the job of transforming them into podcast-friendly figures by seeking out eclectic YouTubers and right-leaning online comic chat show hosts who can spread their message, Semafor’s Max Tani and Ben Smith reported. The shift is an acknowledgement that the public relations business has at times been slow to prepare itself for a world in which mainstream news outlets aren’t the only ones influencing public opinion, they wrote.