The Headlines - Inside Musk’s Government Takeover, and Frantic Tariff Negotiations

Episode Date: February 4, 2025

Plus, “Onyx Storm” smashes onto shelves.  On Today’s Episode:China Swiftly Counters Trump’s Tariffs With a Flurry of Trade Curbs, by Ana Swanson and Chris BuckleyInside Musk’s Aggressive Incursion Into the Federal Government, by Jonathan Swan, Theodore Schleifer, Maggie Haberman, Kate Conger, Ryan Mac and Madeleine NgoState Farm Seeks an Urgent Increase in California Rates After Fires, by Soumya KarlamanglaRebecca Yarros’s ‘Onyx Storm’ Is the Fastest-Selling Adult Novel in 20 Years, by Alexandra AlterTune in every weekday morning. To get our full audio journalism and storytelling experience, download the New York Times Audio app — available to Times news subscribers on iOS — and sign up for our weekly newsletter.Tell us what you think at: [e-mail]. 

From the New York Times, it's the headlines. I'm Tracy Mumford. Today's Tuesday, February 4th. Here's what we're covering. I don't want to use countries. I don't want to use names, but tariffs are very powerful, both economically and in getting everything else you want. President Trump hit pause yesterday on his plan for massive new tariffs on Canada and Mexico,

just hours before they were set to kick in. Trump's threat of a 25% surcharge had set off a chaotic scramble by both countries to try and avoid a potentially crippling trade war. Trump had demanded that they do more to stop migrants and fentanyl from getting into the U.S. And in phone calls with him yesterday, the Prime Minister of Canada and the President of Mexico both agreed to take action.

Mexico said it will send 10,000 troops to secure its side of the border. Canada said it will appoint a fentanyl czar and put $200 million into cracking down on the drug and fighting organized crime. While those tariffs are now on hold for one month, Trump moved ahead with a 10% tariff on China, and China immediately fired back, slapping its own tariffs on a range of American products like farm machinery and natural gas. Overall, the trade developments underscore Trump's willingness to pressure and intimidate foreign countries using tariffs.

He said this week that tariffs against Europe will definitely happen. But one trade expert told the Times that this new drumbeat of threats could backfire since companies and investors might be scared off by the uncertainty and pull back from the U.S US economy. She said, quote, trade policy is an economic weapon that becomes less powerful every time it is used. As Trump's administration has been shaking up the federal government, cutting programs and freezing spending, one advisor

has been behind a lot of the upheaval, Elon Musk. Musk is leading what's been labeled the Department of Government Efficiency with orders to drastically cut the federal budget. He's assembled a team of young engineers, at least one as young as 19, and they come from his companies like X or SpaceX, but have little to no experience in government policy. They've been working around the clock. Musk even had beds moved into a federal office building so that he and his team can sleep there when they work late. And over the last two weeks, the team has been sweeping through agency after agency. They've bombarded government employees with messages telling them that

they're lazy and encouraging them to quit. They've taken aim at USAID, which doles out foreign aid, calling it a criminal organization. And Musk bragged about feeding the agency into the woodchipper. Elon Musk is waging a largely unchecked and certainly unprecedented war against the federal bureaucracy. My colleague Jonathan Swan has been looking into how Musk is operating. He says one of the most unprecedented moves that Musk made was gaining access to the Treasury Department's payment system. It contains sensitive information about millions of Americans and data about almost all government payments. Jonathan says that Musk's unfettered access has raised questions about whether he might

use that data for his own interests. We've never seen anything like this. He's the richest man in the world. He's still a private citizen. He still retains his interests in all of his companies, which have billions of dollars of federal contracts. Many of these companies have been under investigations by the federal government. So he's effectively reviewing, auditing, embedding himself and his team

within the government that regulates his companies. It's a scale of conflict of interest that we've never seen before. And when we talk to senior administration officials, it's pretty clear that Musk effectively reports to no one. He keeps President Trump apprised of what he's doing. He tells him for sure, and he's obviously only doing this with Trump's blessing. But in terms of operating like a normal federal government employee and seeking approval, That's not how he's rolling. He is moving really fast, aggressively, and with the full authority of President Trump.

We don't have a fourth branch of government called Elon Musk, and that's going to become real clear. Meanwhile, there has been some pushback to Musk and his role in the administration's efforts to drastically cut government spending. This illegal, unconstitutional interference with congressional power is threatening lives all over the world. Yesterday, Democratic Congressman Jamie Raskin joined a protest outside of the USAID headquarters, which has been one of Musk's targets. Critics of the recent spending cuts say the Trump

administration is overstepping its authority by effectively gutting programs and funding that Congress authorized. In Southern California, a stretch of the iconic Pacific Coast Highway was reopened on Monday, almost a month after the Palisades Fire forced it to close. The wildfire tore through the hills above the PCH, jumped the lanes, and destroyed a long strip of houses between the highway and the beach. The mayor of Malibu urged people not to go gawk at the damage now that the road is open, saying in a statement,

"...please remember that what you are seeing is not just burned structures. It is someone's home, their memories, and their loss." As the cleanup and recovery from the LA fires continues, there's a new sign of how they've pushed California's fragile insurance market to the edge. Yesterday, State Farm asked regulators to urgently approve a roughly 20% rate increase for its homeowner policies in the state. The company says it's already paid out more than a billion dollars because of the fires,

and expects that number to go way up. It already raised rates by 20% less than a year ago. At the same time, State Farm and other insurance companies are trying to pull back from California altogether, citing the growing threat of wildfires and other disasters fueled by climate change. State Farm stopped writing new policies there last year because of what it called, rapidly growing catastrophe exposure. And finally, it's got romance, it's got dragons, it's got a decent chunk of America reading it right now. Oh my God, since finishing this book, I have become obsessed. it right now. The book Onyx Storm by Rebecca Yarros has become the fastest selling novel for

adults in 20 years. It sold more than 2.7 million copies in its first week and the top three slots on the Times hardcover bestseller list right now are all Yarros. Onyx Storm is her third novel in a series about dragon riders trained at a military academy. Fans were so hungry for the new book they lined up at midnight release parties late last month, something booksellers say they haven't seen since the heyday of Harry Potter and Twilight.

Onyx Storm's bestseller status cements the fact that the romance fantasy genre, aka Romanticie, with spicy sex scenes and supernatural elements, is not a fleeting trend. It also speaks to the power of book talk, reviews that are posted on TikTok and help some books go viral. Videos on Yarros and her books have been viewed more than a billion times. Those are the headlines today on The Daily, a play-by-play of Trump's last-minute tariff negotiations with Mexico and Canada. That's next in the New York Times audio app, or you can listen wherever you get your podcasts. I'm Tracy Mumford. We'll be back tomorrow.