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Trumponomics Daily—Monday, February 13

The knives are out among Donald Trump’s top aides. That’s never an encouraging sign, but less than a month into his presidency, considering the rockiness of Trump’s rollout, it’s hardly surprising, either. First in line for the chopping block looks to be Michael Flynn, the president’s national security adviser. The former lieutenant general faces an uncertain future after new reporting suggests he lied both publicly and in private, to Vice President Mike Pence, about talks late last year with the Russian ambassador on lifting sanctions. He isn’t alone. Chief of staff Reince Priebus and press secretary Sean Spicer also appear to be on shaky ground with the boss, while Kellyanne Conway — officially counselor to the president, a title that comes without a formal portfolio — eyes a power grab amid the tumult.

Where does that leave Gary Cohn, the former Goldman Sachs No. 2 now Trump’s top economic whisperer as chairman of the National Economic Council? Cohn, the most capable and stalwart advocate for corporate interests in the president’s inner circle, has proven a low-key operator in the early days of the Trump era — perhaps not the worst strategy as Shakespearean drama rages around him. But he made a debut of sorts over the weekend with a pair of friendly profiles in the New York Times and the Wall Street Journal. The takeaway is that Cohn has Trump’s confidence and a wide lane to forge the administration’s approach to tax reform, infrastructure spending, deregulation, and an Obamacare replacement. That could narrow once Steven Mnuchin (a Goldman contemporary of Cohn’s; they both made partner in 1994) is confirmed as Treasury secretary, a figure who typically takes the lead on tax code changes. The test of his influence internally could come if he’s forced into a confrontation with the more protectionist voices on the team, namely chief strategist Steve Bannon and Peter Navarro, chairman of a newly-formed trade council whose precise role hasn’t been defined yet. For the time being, though, with the economic cabinet all but bare under a president not known for going deep on policy substance, Cohn is emerging as a consequential power center unto himself.

Tory Newmyer
@torynewmyer
tory_newmyer@fortune.com

Must Reads

Trump undertakes most ambitious regulatory rollback since Reagan [Washington Post]

The administration, working with Congressional Republicans, is leveraging a previously little-used law known as the Congressional Review Act to strip away federal regulations at an unprecedented rate.

White House Backs Away From Publicly Defending National Security Advisor Michael Flynn [Fortune]

The fate of one of Trump’s top aides hangs in the balance following revelations he misled the public and, it seems, the vice president, about the nature of talks he had with the Russian ambassador about lifting sanctions.

At Mar-a-Lago, Trump tackles crisis diplomacy at close range [CNN]

Trump tackled the first national security incident of his presidency over dinner on the patio at his private club, in view of fellow diners.

G.O.P. Lawmakers Like What They See in Trump. They Just Have to Squint. [NYT]

Congressional Republicans have decided by and large to abide Trump’s provocations to pursue their common interest in overhauling taxes, regulations and the healthcare system.

Trump Sons Forge Ahead Without Father, Expanding and Navigating Conflicts [NYT]

Even as questions swirl about potential conflicts of interest, Trump’s two adult sons are forging ahead with plans to expand the family business both in the U.S. and abroad.

While Trump and Abe Bond, Their Deputies Talk Trade [Bloomberg]

Mike Pence and the Japanese finance minister could work toward a bilateral trade agreement, though no timetable is in place for those talks to start.

Number of the day

-15 points

Trump’s net approval rating, according to a new Gallup survey, has him underwater with voters. While other polls show his popularity remains in net positive territory, there’s no doubt Trump is beginning his presidency with historically meager support. If the trend holds, the big question for Democrats is whether they will be able to translate antipathy toward Trump into significant gains in the 2018 midterm elections.

Loose change

Is the U.S. Now Stopping Allies From Investing Here? [Fortune]

America’s Biggest Creditors Dump Treasuries in Warning to Trump [Bloomberg]

Mnuchin looks to Wall Street to fill key Treasury roles [Politico]

Chuck Grassley: It’s Time The H-1B Visa Program Puts Americans First [Fortune]

Trump Aide: Kellyanne Conway’s Endorsement of Ivanka’s Brand Was ‘Lighthearted’ [Fortune]

Thousands March Across Mexico to Protest Trump and Their Own President [Fortune]

Trump impeached? You can bet on it [Politico]