THE TRUMP ECONOMY: Stocks took a steep and dramatic dive yesterday just one day after President Donald Trump refused to say whether his import tariffs and budget cutting policies will cause a recession.

  The S&P 500 dropped 2.7 percent, the biggest fall in what has become a three-week selloff. The index is roughly 9 percent below a record high set last month, and approaching what’s known as a “correction,” a 10 percent drop from a recent high.

  Trump’s threats and on-again, off-again tariffs on goods from China, Mexico, and Canada have created uncertainty among market investors … and they hate uncertainty.

  Trump dismisses that and says “uncertainty” is just something the money people say. He says he doesn’t watch the markets, although during his campaign he blamed Joes Biden every time stocks dipped. In the meantime, the IRAs, 401Ks, and life savings of average Americans are shrinking.

  The President also displays a profound ignorance about how tariffs work. They are ultimately paid by the people who buy foreign goods through higher prices. Yet Trump said on Air Force One, “We’re going to take in hundreds of millions of dollars in tariffs and we’re gonna become so rich we’re not going to know where to spend all that money, I’m telling you.”

BUT WAIT, THERE’S MORE: 

— A US district judge ruled yesterday that the Trump administration likely violated separation of powers by “unlawfully impounding” congressionally appropriated foreign aid money must pay nearly $2 billion in foreign assistance to humanitarian partners around the world. — Energy Secretary Chris Wright told a gathering of oil and gas executives yesterday that natural gas is preferable to renewable energy and climate change is merely a “side effect of building the modern world.”

  Wright is a former executive in the oil fracking industry who promised a welcoming crowd in Houston a “180 degree pivot” from energy policies and efforts to fight climate change.  He’s President Trump’s leader in a campaign to increase production of oil and gas while dismantling federal policies designed to curb global warming.

  “I wanted to play a role in reversing what I believe has been a very poor direction in energy policy,” Wright said at an annual energy conference. “The previous administration’s policy was focused myopically on climate change, with people as simply collateral damage.” He said, “Beyond the obvious scale and cost problems, there is simply no physical way wind, solar and batteries could replace the myriad uses of natural gas.” 

— A federal judge blocked the deportation of former Columbia University pro-Palestinian protest leader who was arrested by immigration officers on Saturday and sent to a detention center in Louisiana. Mahmoud Khalil is a legal resident with a green card whose American wife is expecting a baby. ICE says Khalil was detained for anti-Semitic activities.

— The Justice Department’s pardon attorney was fired a day after she refused to recommend restoration of gun rights for actor Mel Gibson, a prominent supporter of President Trump. Gibson lost his gun rights following a guilty plea to domestic violence.

THE WAR ROOM: Ukraine carried out it largest drone attack on Moscow so far just hours ahead of peace talks in Saudi Arabia. Russia says it shot down hundreds of drones but three people were killed. 

  Flying to Saudi Arabia for talks with senior Ukrainian officials, Secretary of State Marco Rubio said that Ukraine will have to give up on some territory taken by Russia since 2014 as part of any agreement to end the war.

  As winter begins to lift, Ukrainian forces say they have stalled the Russian offensive in the eastern Donetsk region and have started to take back small areas of land. Russia is still staging a reported dozens of assaults every day, the Ukraine military and analysts say, but after more than 15 months they are depleted and struggling to replace men and destroyed equipment.

 At the same time Russia claims it has recently taken several towns and villages. With US intelligence and military aid suspended to pressure Ukraine into peace talks, the Russians are beginning to take back some of their own territory in the Kursk region where Ukraine counter-invaded.

THE SPIN RACK:  The Black Lives Matter Plaza just a block from the White House is being dismantled under pressure from President Trump and conservatives to remove the giant yellow block letters that spell out the slogan in the street. The plaza on 16^th St. NW was created in 2020 following the killings of George Floyd and Breonna Taylor. Threatening financial penalties for the city, the White House called for the area to be renamed “Liberty Plaza.” — Britain’s King Charles III bought a $3.8 million estate next to Queen Camilla’s vacation home to stop it from being turned into a wedding venue.— In a world of screens, the Volkswagen car company is bringing physical buttons back to the dashboard. The company’s chief designer said their cars will still have screens but also buttons for “the volume, the heating on each side of the car, the fans and the hazard light – below the screen. It’s not a phone: it’s a car.”

BELOW THE FOLD: Businessman Paolo Zampolli, a Trump-appointed member of the board at The Kennedy Center who introduced the president to his third wife, Melania, shared with The NY Times some ideas for raising the profile of Washington’s cultural destination. Among the ideas.

• Valentino fashion shows 
• Open a Cipriani restaurant
• Send art to the International Space Station
• Franchise the Kennedy Center’s name in Europe, Asia, and the Middle East.
• Build a marina on the Potomac so patrons can arrive by yacht.

  President Trump made himself president of the Kennedy center board and has now appointed all of its members. In what may have been an accidental admission, Zampolli said, “I don’t think the MAGA movement has any relation to culture.”

-30-