BREAKING: “Trump says newly created US sovereign wealth fund could buy TikTok,” by Reuters’ Trevor Hunnicutt

LET’S MAKE A DEAL: Mexico staved off President Donald Trump’s tariffs for now, while Canada continues to fight back ahead of their midnight imposition, capping a tumultuous morning in North American diplomacy and markets.

Mexican President Claudia Sheinbaum and Trump said they’d struck an agreement to delay American tariffs for a month, in exchange for Mexico sending 10,000 National Guard members to the border to crack down on fentanyl trafficking. Both countries will continue negotiating over security and trade. The leaders characterized their conversation as “respectful” and “friendly.” (There are some instructive differences between their announcements: Only Sheinbaum said the U.S. would also crack down on guns going to Mexico, while only Trump said the Mexican soldiers would also stop immigrants.) Details from Victoria Guida and Megan Messerly

Trump allies trumpeted the news as a victory in which Mexico had caved, though Mexico has in fact taken similar actions in recent years.

To the north, Trump spoke this morning to Canadian PM Justin Trudeau and will do so again at 3 p.m. A top Canadian official tells NYT’s Matina Stevis-Gridneff they don’t feel great about the prospects of striking a deal today like Mexico did, though the negotiations are fluid.

Stock markets first plunged upon opening this morning on fears of the tariffs, before somewhat rebounding after news of the U.S.-Mexico agreement. As of publication, the S&P 500 was down 0.6 percent, the Dow down 0.1 percent and the Nasdaq down 1.1 percent overall, per the WSJ.

But in the absence of a deal with Ottawa, Canada is fuming over the coming tariffs. Ontario Premier Doug Ford announced that the American private sector would be barred from contracts with the province and that he’d “be ripping up” a contract with Elon Musk’s Starlink. And in the U.S., business groups and even some Republican politicians are sounding alarms about Trump’s continental trade war: Sen. Chuck Grassley (R-Iowa) begged Trump for an exemption.

The view from Beijing: China is also due to get slapped with tariffs tomorrow (at 10 percent), and its leaders are already planning how they’ll try to cut a deal with Trump. WSJ’s Lingling Wei scooped that Beijing plans to offer a return to the never-implemented “Phase One” deal it cut with Trump in 2020, which would see China ramp up its purchases from and investments in the U.S. It also intends to take a light touch with TikTok negotiations. It remains to be seen whether Trump will bite on China’s eagerness for dealmaking, as Republicans are divided over Phase One and China policy more broadly.

China also sees plenty of upside in how Trump is quickly retreating from/alienating allies around the globe, despite the pain from tariffs, NYT’s David Pierson, Keith Bradsher and Sui-Lee Wee report. Indeed, one effect of Trump’s protectionism may be a burst in trade agreements worldwide that don’t include America, NYT’s Patricia Cohen reports.

Interesting read: “Trump is using a nearly 50-year-old law to justify new tariffs. It may not be legal,” by Ari Hawkins: “But blocking the tariffs in court is likely to be difficult — and time-consuming. … That won’t stop a lawsuit from proceeding, most likely all the way to the Supreme Court, [former Commerce official Bill] Reinsch said, but it could be years before there is a conclusion to the legal battle.”

THE GIFT OF GABBARD: Director of National Intelligence-designate Tulsi Gabbard will come up for a vote tomorrow in the Senate Intelligence Committee, John Sakellariadis reports. It’s a pivotal make-or-break moment for her nomination with multiple GOP senators not publicly supportive yet. Sen. Todd Young (R-Ind.) is still undecided, per Semafor’s Burgess Everett.

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1. HOSTILE TAKEOVER: The Trump administration plans to fold USAID into the State Department and reduce its headcount, though it will continue disbursing humanitarian aid, CBS’ Sara Cook and Jennifer Jacobs scooped. Secretary of State Marco Rubio is now acting USAID administrator as well, ABC’s Will Steakin, Alex Mallin and Shannon Kate Kingston scooped.

The news comes on the heels of Musk’s campaign to destroy the agency, as staffers were told today the headquarters was closed and they should work from home, per Carmen Paun. The announcement came from young Musk “Department of Government Efficiency” aide Gavin Kliger, per The Bulwark’s Sam Stein. Employees can’t access their emails, CBS’ Margaret Brennan and Sara Cook report. Musk had declared overnight that Trump had agreed with him the entire agency should be shut down, and he’s glorying in its demolition: “We spent the weekend feeding USAID into the wood chipper,” Musk wrote on X. “This is not about ending USAID,” Rubio said to the contrary today.

Major questions remain about whether the administration is allowed to do this. Democrats have argued that it’s illegal to fold USAID into the State Department without Congress. One former Trump official told CBS’ Jennifer Jacobs that the remote-work order “has no authority” and needs no compliance. And Sen. Brian Schatz (D-Hawaii) said he’ll block all State Department nominees until USAID is brought back online, WSJ’s Alex Ward scooped.

But for now, Musk’s successful campaign against USAID has introduced a new reality to Washington: the world’s wealthiest person partially dismantling the world’s single-largest source of assistance to the world’s most vulnerable people, in an effort to slash federal spending and save American taxpayers money. Musk called USAID “a radical-left political psy op.”

And there’s more: Trump later today will sign an executive order bringing back policies from his first term that pull the U.S. out of the U.N. Human Rights Council and block funding for the U.N. Relief and Works Agency in Gaza, Megan Messerly scooped. … Meanwhile, acting U.S. Attorney for D.C. Ed Martin today threatened to take legal action against anyone impeding DOGE.

2. IMMIGRATION FILES: Trump has already transformed huge swathes of America’s immigration system, including ending asylum at the southern border completely. But much more is still coming. WSJ’s Michelle Hackman reports that the administration is working on:

• Bringing back the Public Charge rule to limit poorer or less-educated immigrants from receiving Green Cards.
• Imposing travel bans on more countries than the group of mostly majority-Muslim nations he targeted the first time.
• Limiting H-1B visas for all but the highest-paying jobs.

And today is the day by which Trump ordered authorities to get ready to implement the 1798 Alien Enemies Act for mass deportations, Reuters’ Ted Hesson and Kristina Cooke report. The law has only been used before during wartime, but Trump hopes to use it to suspend due process rights for gang members and kick them out of the country without court hearings. That could face legal challenges.

But but but: Insufficient resources have already started to hamper the crackdown. Some of the more than 8,000 immigrants arrested since Trump took office have been released (to be monitored) because there’s not space to detain them, NBC’s Julia Ainsley scooped.

Related reads: “People left to navigate immigration court complexities alone after federally funded aid pulled,” by AP’s Kate Brumback … “‘We Will Fight Back’: Aid Workers Fear Closing a Camp on the Arizona Border Will Endanger Migrants,” by Arizona Luminaria’s Rafael Carranza with ProPublica

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3. NEW AT THE TOP: Treasury Secretary Scott Bessent will take control of the CFPB on an acting basis following Rohit Chopra’s removal as director, Bloomberg’s Saleha Mohsin and Paige Smith report. That could pave the way for the Trump administration to take a much friendlier approach to industry than Chopra did.

Related read: “Warren Questions Bessent Over Musk Access to Treasury Payment System,” by NYT’s Alan Rappeport

4. OUT OF THE WILDERNESS: “House Democratic Super PAC Creates $50 Million Fund Targeting Working Class,” by NYT’s Shane Goldmacher: The House Majority PAC’s approach is “fundamentally different [from the 2024 cycle]. It is not focused on a specific geographic cluster of competitive seats but rather on appealing to a demographic cohort of working-class voters — white, Black, Hispanic and Asian — who all across the country drifted away from the party in 2024. … The Win Them Back Fund will begin by spending extensively on research before eventually mounting advertising campaigns in key districts, as well as potentially investing in influencers.”

Its initial list of targets notably omits New York seats and the three Republicans representing Kamala Harris-won districts. Instead, HMP is focused on GOP Reps. Nick Begich (Alaska), Eli Crane (Ariz.), David Valadao (Calif.), Ken Calvert (Calif.), Gabe Evans (Colo.), Mariannette Miller-Meeks (Iowa), Zach Nunn (Iowa), John James (Mich.), Ryan Mackenzie (Pa.), Rob Bresnahan (Pa.), Scott Perry (Pa.), Monica De La Cruz (Texas), Jen Kiggans (Va.) and Derrick Van Orden (Wis.).

5. HAKEEM JEFFRIES MAKES A MOVE: The House minority leader said today that Republicans will need to end Trump’s currently blocked federal funding freeze if they want Democratic votes to avoid a government shutdown, Nick Wu reports.

Meanwhile, the administration’s effort to offer federal workers so-called buyouts is likely illegal, some GOP officials tell CBS’ Jennifer Jacobs — but don’t expect Congress to assert itself on that.

6. SPORTS BLINK: Trump will sit down with Fox News’ Bret Baier for a Super Bowl pregame interview, the network announced. That will revive a tradition Joe Biden skipped the past two years (as did Trump once during his first term).

7. PAIN AT THE PUMP: “U.S. Frackers and Saudi Officials Tell Trump They Won’t Drill More,” by WSJ’s Collin Eaton, Benoit Faucon and Benoît Morenne: “[T]he president’s advisers concede that U.S. frackers won’t pump much more … The advisers say his best lever to bring down prices might be to persuade the Organization of the Petroleum Exporting Countries and Saudi Arabia, the group’s de facto leader, to add more barrels to the market. But Saudi Arabia has told former U.S. officials that it also is unwilling to augment global oil supplies.”

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Donald Trump’s $Trump meme coin has racked up as much as $100 million in trading fees.

MEDIA MOVES — Lachlan Cartwright and Ravi Somaiya are launching Breaker Media, a newsletter and podcast focused on power and culture in Downtown Manhattan, Semafor’s Ben Smith reports. Cartwright is an N.Y. Post, Daily Beast and Hollywood Reporter alum. Somaiya previously was senior digital editor for the Columbia Journalism Review and is an NYT and Vice alum. … Alex Seitz-Wald, a prominent political reporter at NBC, is leaving for the Midcoast Villager, a local news organization in Maine, per Smith.

TRANSITIONS — Sanjay Wadhwa is now a partner in Weil, Gotshal & Manges’ securities litigation and white-collar defense, regulatory and investigations practices. He previously was acting director of SEC’s Division of Enforcement. … Tracie Pough is now a partner at Ballard Partners. She most recently was chief of staff to Rep. Debbie Wasserman Schultz (D-Fla.). … Adam Brown is now digital manager for the House Science, Space, and Technology Committee. He previously was press secretary for the Congressional Western Caucus, and is an RNC alum. …

… Holtzman Vogel is adding Susan Greene as a partner, Drew Marvel as an associate (most recently deputy counsel at the NRCC), Rebecca Layne and Erica Leavitt as senior associates, and Jonathan Riches and Lori Low as of counsel. … Steve Scully is now a senior fellow at the U.S. Association of Former Members of Congress. He currently hosts SiriusXM’s “The Briefing with Steve Scully.” … Benjamin Easter is now legislative assistant for Sen. Ted Budd (R-N.C.). He previously was legislative correspondent for Sen. Mike Crapo (R-Idaho).

ENGAGED — Luke Zaro, chief counsel for the Constitution for the House Judiciary Committee, proposed to Natalia Brama, a legislative aide for Sen. Ted Budd (R-N.C.), last week at the Dominican House of Studies. They met in September 2023, when they both were running late and met at the door at a Shakespeare lecture put on by the Congressional Catholic Staff Association. After a coffee at Cups, they got to know each other on a long drive and hike put on by the CCSA, an outing that started at the same church where he proposed. Pic … Another pic

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