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Canadian prime minister meets with Trump
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This is Washington Edition, the newsletter about money, power and politics in the nation’s capital. Today, White House correspondent Josh Wingrove looks at the meeting between the leaders of the US and Canada. Sign up here and follow us at @bpolitics. Email our editors here.

Tariff Standoff

As fresh starts go, it could have gone worse for Mark Carney.

Canada’s prime minister, fresh off an election victory, stepped right into the lion’s den today — that is, an Oval Office meeting with President Donald Trump. 

It’s been something of a rite of passage for leaders jockeying for Trump’s favor amid some sort of clash, whether over trade or aid. This particular meeting was a test of Trump’s intent to plow ahead with his tariffs plans.

The bilateral sessions have been testy in the past — the visit by Ukraine’s Volodymyr Zelenskiy most famously — but today’s was far from explosive. Trump jumped from topic to topic and generally heaped praise on Carney, steering clear of the “governor” insults he’d regularly tossed at Carney’s predecessor, Justin Trudeau. 

“Look, I have a lot of respect for this man,” Trump said after opening the meeting by flaunting the new gold trim he’d installed throughout the Oval Office.

Canada’s Carney meets with Trump

Carney looked to thread a needle — insisting at one point that Canada is not for sale, likening it to selling the White House. It was a rebuke of Trump’s musings about statehood that have enraged Canadians and fueled Carney’s campaign, a dynamic Trump noted gleefully.

Still, Trump pressed ahead. “Never say never,” he said about the idea of the US absorbing Canada. That prompted Carney to flip his head forward to cameras and silently mouth: “never, never, never.”

Carney later bit his tongue as Trump berated Trudeau and Chrystia Freeland, Trudeau’s former deputy prime minister, and repeated his intent to wean the US off of Canadian goods. The two snapped a photo smiling and giving a thumbs-up.

Carney had downplayed expectations, saying afterwards he wasn’t expecting a puff of “white smoke” to appear after the meeting. “I think we established a good basis today,” he said.

Still, the US president wasn’t giving any ground. Trump said flatly there was nothing Canada could do to convince him to lift the tariffs. Carney called for a more comprehensive discussion about bilateral cooperation, and both pledged to change the USMCA trade deal during its upcoming renegotiation window, with Trump even musing about whether he even wants it continued.

The governor talk is gone. But the trade fight remains. — Josh Wingrove

Key reading:

Don’t Miss

A divided Supreme Court cleared the way for the Trump administration to start discharging thousands of transgender servicemembers, including people who have served openly for years.

Treasury Secretary Scott Bessent said his department is on the federal debt limit “warning track” but refrained from offering a specific timeframe for when borrowing authority would run out.

The US trade deficit widened to a record in March with companies rushing to import products, including pharmaceuticals, as the Trump administration readied sweeping tariffs.

Trump said he would stop the US bombing campaign against Houthi rebels in Yemen effective immediately because they had “capitulated” — a claim the group denied.

The chairman of the House tax committee warned lawmakers from high-tax states demanding relief from a $10,000 cap on the state and local deduction that they will have to settle for an “unhappy” compromise.

House Republicans are considering establishing work requirements for able-bodied Medicaid recipients starting at age 18 and through age 64, though beneficiaries with dependents would be exempt.

House Speaker Mike Johnson said Republicans are more likely than not to kill a consumer tax credit for electric vehicles as they consider the future of hundreds of billions in tax incentives for sustainable energy.

Trump’s pick to oversee the Pentagon’s personnel policies said he regrets past comments that sank his earlier nomination to another role, including tweets in which he called Barack Obama a “terrorist leader.”

Instagram's automated software systems recommended that child "groomers" connect with minors on the app, making it easier for them to find victims, according to a 2019 internal document.

US Travelers who don’t yet have a new federally approved identification card should expect delays at the nation’s airports but will still be able to board domestic flights, Homeland Security Secretary Kristi Noem said.

The Trump administration declared Harvard University ineligible for new federal research grants in the latest escalation of a clash between the White House and the Ivy League school.

Watch & Listen

Today, Bloomberg Television’s Balance of Power early edition at 1 p.m. with host David Gura featured Sonali Basak’s interview with Bill Pulte, director of the Federal Housing Finance Agency, about the future of Freddie Mac and Fannie Mae.

On the program at 5 p.m., David and Julie Fine talk with Republican Senator John Cornyn of Texas about Trump’s defense budget, the federal debt limit and the GOP’s tax and spending plans.

On the Big Take podcast, Bloomberg senior markets editor and Opinion columnist John Authers unpacks how Warren Buffett changed investing, what it would take for successors to fill his shoes and whether Berkshire Hathaway is headed for a break-up. Listen on iHeart, Apple Podcasts and Spotify.

Chart of the Day

While imports of consumer goods climbed by the most on record in March as businesses stockpiled merchandise before Trump’s tariffs fully kicked in, imports from China, the main target of new US duties, fell sharply. Among the countries that had record imports in March was Vietnam. The ability to reroute goods from China through Vietnam may have boosted its exports to the US, as did efforts among US firms in recent years to develop closer integration with suppliers in Vietnam. Overall, imports from 10 countries hit record levels last month. The list of those countries was diverse. March imports from Mexico were the highest on record. Imports from a large number of European countries, including Germany, France and Italy, were also the highest on record, as well as those from India. — Alex Tanzi

What’s Next

The Federal Reserve will announce its decision on interest rates at 2 p.m. tomorrow, followed by a news conference with Chair Jerome Powell.

March data on consumer credit will be released tomorrow.

Treasury Secretary Scott Bessent testifies about the state of the international financial system before the House Financial Services Committee tomorrow.

Wholesale sales and inventories for March will be reported Thursday.

The Bureau of Labor Statistics’ productivity estimate for the first quarter will be released on Thursday.

The consumer price index for April will be reported next Tuesday.

Trump begins a three-day trip to the Middle East next Tuesday.

Data on retail sales for April will be released May 15.

The producer price index for April also will be reported May 15.

The University of Michigan’s preliminary reading of consumer sentiment for this month will be reported May 16.

Seen Elsewhere

  • Defense Secretary Pete Hegseth used the Signal app for official Pentagon business more extensively than previously disclosed and sent texts from an unsecured line in his office and from his personal phone, the Wall Street Journal reports.
  • A self-taught herpetologist from Wisconsin who allowed himself to be bitten by venomous snakes more than 200 times has put scientist on the path to developing a universal antivenom, according to the Washington Post.
  • Arizona has been able to recover just a fraction of $2.5 billion stolen in a Medicaid fraud scheme that targeted Native Americans seeking addiction treatment, despite indictments against more than 100 people, ProPublica reports.

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