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The 4 most important policy stories of the week, explained

Outgoing Secretary Of State Rex Tillerson Speaks At The State Department After President Trump Fired Tillerson Via Twitter Earlier In Day Alex Wong/Getty Images

This was a week thick with palace intrigue from the White House that also featured a dramatic mass mobilization of American children on behalf of gun control legislation. But in terms of events with concrete consequences for the policy world, several low-key developments in Congress and the executive branch may have more impact than the stories that dominated the headlines.

New, stricter cigarette regulations could dramatically decrease the lethality of what’s still America’s No. 1 cause of preventable deaths, while new, less strict bank regulations could have the opposite impact on the stability of the financial system. And while the fate of much of the Trump administration’s personnel issues remains up in the air, we’ll definitely be getting a new secretary of state. Meanwhile, the US House of Representatives will also be getting a new member — a Democrat elected from a district deep in Trump country.

Here’s what you need to know.

Rex Tillerson finally got fired

After months of rumored unhappiness, Trump finally pulled the trigger and fired Secretary of State Rex Tillerson — dispatching him with a tweet rather than having anyone actually tell him.

  • The replacements: CIA Director Mike Pompeo has been tapped to replace Tillerson at the State Department, while Deputy Director Gina Haspel receives the nomination to serve as CIA director.
  • Haspel may have confirmation problems: Haspel’s backstory supervising a Bush-era “black site” at which torture took place — and in subsequently destroying video evidence — could be trouble for her confirmation. Sen. Rand Paul (R-KY) says he’s opposed to her, and Sen. John McCain (R-AZ) also sounds skeptical.
  • More changes rumored: Trump’s White House has seen a lot of departures recently, but Tillerson’s sacking has Washington filled with rumors that more high-level appointees will be fired soon, as Trump feels more secure in his office.

Democrats won a very red House seat

Former prosecutor Conor Lamb won a special election to represent Pennsylvania’s 18th Congressional District in the US House of Representatives. It’s a seat that Trump won by 20 points (and Romney by 17), touching off a new round of optimism among Democrats about the coming midterms.

  • GOP spin: Republicans appear to have settled on the narrative that Lamb won because he ran as a kind of crypto-Republican, going so far as to describe him as pro-life (he’s not).
  • An economics-focused campaign: What’s true is that Lamb ran as moderate on guns (for universal background checks, against an assault weapons ban) and energy (pro-fracking) and simply didn’t talk much about immigration, criminal justice, LGBTQ rights, or other hot-button culture war issues. Instead, he slammed the Trump tax cuts, promised to defend Social Security, embraced universal health care, and talked a lot about his support for labor unions.
  • What’s next? The race has little practical impact since the Pennsylvania House map is being completely redrawn for the November elections. If Lamb’s win demoralizes Republicans and leads to more GOP retirements, that could be a big deal, but so far, no retirements have materialized.

Good news at last for banks

Even in this era of rampant partisanship, 16 Democratic senators were able to cross the aisle and work with Republicans to pass a significant rollback of Dodd-Frank financial regulations. Hooray?

  • Great news for midsize banks: Proponents like to talk about the bill as providing relief for America’s small community banks, but it pushes the threshold for stricter regulation all the way up to $250 billion in assets — blessing both large regional banks like BB&T and many US subsidiaries of big global banking conglomerates like BBVA, Santander, and BNP Paribas.
  • May versus shall: Another potentially significant change is a small piece of wording altering current instructions that say the Federal Reserve may tailor its rules for the biggest banks in specific circumstances to say that it shall tailor them. This might mean nothing, but it also might create a nightmare of litigation every time the Fed tries to do anything.
  • What’s next? House Republicans are pushing a more sweeping deregulation. Perhaps they’ll back down and accept what the Senate has on offer. Or perhaps they’ll persuade Senate Democrats to swallow a bigger bill. Or perhaps the whole thing will collapse after all (this last option sounds ridiculous, but it wouldn’t be the first time intransigent House Republicans ended up helping liberals).

The FDA proposed reducing cigarettes nicotine content

In a break from the normal deregulatory trends of the Trump administration, the Food and Drug Administration rolled out a new proposal to limit the legal maximum nicotine content of cigarettes to a non-addictive level.

  • Big potential health gains: A new paper in the New England Journal of Medicine suggests this change could help 5 million additional adults quit smoking within a year and over the long run help cut the US smoking rate down from its current 15 percent to a mere 1.4 percent.
  • A global first: If the US goes ahead with this, we would be the first country in the world to regulate nicotine in this way — a long-tail consequence of a 2009 law signed by President Obama that for the first time authorized the FDA to regulate tobacco products.
  • What’s next? The rulemaking process is a slow grind, and the industry is sure to push back against this idea, especially since it would set a worldwide precedent. But a GOP administration that wants to make regulation stricter will almost certainly get its way in the end.

Correction: A previous version of this story misstated Sen. Paul’s state affiliation.

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