What to Know in Washington: Mueller Testimony Sets Up Showdown

Special Counsel Robert Mueller agreed to testify publicly before two House panels, setting up a dramatic hearing that promises to reinvigorate the national debate over his findings on Russian election interference and possible obstruction of justice by President Donald Trump.

Judiciary Chairman Jerrold Nadler (D-N.Y.) and Intelligence Chairman Adam Schiff (D-Calif.) announced the July 17 joint hearing ahead of the first Democratic presidential debate today, where several of the candidates on the Miami stage are likely to remind viewers that they support an impeachment inquiry of the president.

The chairmen said that Mueller, who issued his report in April, would appear in an open session and that he had agreed to the appearance under subpoenas.

The session, sure to be televised live, sets up one of the most dramatic hearings of the Trump presidency — and a confrontation between Democrats who have been pursuing investigations of the president since they took control of the House and Trump’s Republican supporters who dismissed the inquiries as fishing expeditions.

Until now, the White House has stymied investigations by Nadler, Schiff and other House Democratic chairmen by refusing to let present and former officials appear. Soon after the Mueller hearing was announced, Trump’s Twitter post contained just two words: “Presidential Harassment!”

Lawmakers from both parties are likely to tread carefully in their questioning of Mueller, a former F.B.I director, federal prosecutor and decorated Vietnam War veteran with a reputation for scrupulousness. He has said next to nothing about his investigation beyond the report, and made it clear that he’d prefer to say no more. Read more from Billy House and John Harney.

Photographer: Andrew Harrer/Bloomberg
Mueller spoke at the Department of Justice in May.

Democrats Allowed to Probe Trump’s Finances: Meanwhile, Trump lost a bid to halt a lawsuit brought by 201 congressional Democrats who want a federal court to require that the president seek approval from lawmakers before he accepts any financial benefits from foreign governments. In two orders issued yesterday, U.S. District Judge Emmet Sullivan denied Trump’s request to halt the lawsuit so he could immediately appeal Sullivan’s earlier refusals to dismiss the case. Read more from Andrew Harris.

Happening on the Hill

House Approves Border Funds: The House passed its $4.5 billion emergency spending bill to address humanitarian needs of migrants at the southern border as Speaker Nancy Pelosi (D-Calif.) overcame a revolt by liberals in her caucus reluctant to grant the president’s request for the funds. The 230-195 vote capped a dramatic day in which leaders were forced to rewrite the bill to secure enough Democratic votes amid nearly united Republican opposition. Trump had threatened to veto the House bill even before Democrats added new provisions aimed at at improving conditions in migrant detention centers.

The Senate plans to consider its own $4.6 billion border spending bill this week. The bipartisan measure cleared the Senate Appropriations Committee on a 30-1 vote last week. That bill doesn’t contain provisions aimed at stopping the Trump administration from cutting off aid to Central America, and it also lacks the other child migrant protections liberal House Democrats fought to include.

With Congress aiming to leave Washington tomorrow, it will be difficult to reconcile the competing House and Senate versions this week. Read more from Erik Wasson.

Senate Finance Leaders Hit Roadblock in Drug Talks: Senate consideration of a bipartisan drug-pricing bill is likely delayed at least until later this summer, as Finance Committee leaders have yet to strike a deal. Chairman Chuck Grassley (R-Iowa) and top Democrat Ron Wyden (D-Ore.) said they’re meeting daily to discuss a slate of bills aimed at making changes to Medicare’s drug-benefit and physician-visit coverage to lower costs of prescription drugs. So far, they haven’t been able to agree on a final package. Alex Ruoff has more.

Panel Votes to Curb Arms Sales: The Senate Foreign Relations Committee has approved a bill that would amend the Arms Export Control Act to restrict the president’s ability to push through arms sales over congressional objections. The bill introduced by ranking member Bob Menendez (D-N.J.), would allow the president to declare a national emergency to expedite arms sales only for the U.S.’s “closest allies and partners.” The measure, co-sponsored by Sens. Lindsey Graham (R-S.C.), Rand Paul (R-Ky.) and Mike Lee (R-Utah), would not affect the 22 arms deals to Saudi Arabia and other countries expedited under an emergency declaration in May, according to Menendez. Read more from Daniel Flatley.

Two Progressives Seek End to Fossil Fuel Support: Two of the House’s most progressive Democratic newcomers will seek to stifle U.S. support of overseas fossil fuel plants at a House Financial Services Committee meeting today. Reps. Alexandria Ocasio-Cortez (N.Y.) and Rashida Tlaib (Mich.) are set to submit amendments to curb fossil fuel investment at the markup of a bill to reauthorize the U.S. Export-Import Bank through 2026.

Ocasio-Cortez’s amendment would impose an immediate prohibition on new fossil-fuel plants. Tlaib’s measure would commit the bank to reduce the greenhouse gas emissions of its financed projects by half in the next five years, with a 100% phaseout in 10 years. Read more from Tiffany Stecker.

Politics & Elections

Warren Gets Center Stage: Sen. Elizabeth Warren (D-Mass.) will be the only one of the top polling Democratic candidates on the debate stage tonight, giving her a chance to showcase her mastery of policy details without her main competitors available for rebuttal.

The liberal firebrand has steadily risen in polls over the last two months and is drawing crowds on the campaign trail by using an expansive portfolio of proposals on a series of issues to brand herself as a candidate with a plan. Warren has been focused on claiming the mantle of leader of the party’s progressive faction from Sen. Bernie Sanders (I-Vt.) and contrasting her plans for far-reaching changes in how the government operates with the more incrementalist approach of front-runner Joe Biden, which she has labeled “small ideas.”

Sanders and Biden and her other two main rivals, Sen. Kamala Harris (D-Calif.) and Pete Buttigieg will debate tomorrow night. Read more from Sahil Kapur.

First Democratic Debate: Where to Watch, What to Watch For

What the Candidates Care About: For most of the candidates, social media has been the preferred platform for announcing policy proposals and clarifying positions. Since the beginning of 2019, candidates who qualified for the first debate sent about 24,000 tweets—and about half of them mentioned at least one major campaign issue, according to a Bloomberg analysis of their Twitter posts. In total, issues were mentioned in candidate tweets 16,000 times. Jobs, the environment and social issues—including women’s rights, LGBTQ rights and race—have been the issues most discussed in their tweets—making up a combined 37% of topics mentioned. Read more from Allison McCartney.

Movers & Shakeups

Trump Protocol Chief Quitting Before G-20: The Trump administration official in charge of diplomatic protocol plans to resign and isn’t going to Japan for this week’s Group of 20 meetings, where he would have played a sensitive behind-the-scenes role, according to people familiar with the matter. Sean Lawler, a State Department official whose title is chief of protocol, is departing amid a possible inspector general’s probe into accusations of intimidating staff and carrying a whip in the office, according to one of the people. Read more from Jennifer Jacobs and Daniel Flatley.

White House Approaches Bullard on Fed Governor’s Job: Federal Reserve Bank of St. Louis President James Bullard said Trump’s White House has had “exploratory discussions’’ with him about taking a job as a Federal Reserve governor, adding he was not planning to leave his current job. “I’m happy in my current position,’’ Bullard told reporters in St. Louis before a lecture at his bank. “I like my board of directors here’’ and am already on the policy-making Federal Open Market Committee. “I think we are in good shape.’’

Trump has struggled to find candidates for the Fed who are acceptable to the senators who vote on whether to advance them through committee and later to confirm nominees. Conservative economic pundit Stephen Moore on May 2 was the latest Fed candidate to flame out, following businessman Herman Cain and economists Nellie Liang and Marvin Goodfriend. Steve Matthews has more.

Border Agency Head’s Exit Draws Bipartisan Alarm: The growing number of leadership vacancies at the Department of Homeland Security are drawing renewed fire from lawmakers after the exit Tuesday of the head of its border agency, and concerns over White House scrutiny of the acting DHS secretary. More than 20 senior leadership roles at the department are vacant, are being filled in an acting capacity, or have one person filling multiple positions, according to a Bloomberg Government analysis of the department’s website. Read more from Michaela Ross.

BLM Names Assistant Director: Nicholas Douglas, the former director of the U.S. Forest Service’s minerals and geology management office in Washington, has been named Bureau of Land Management assistant director of energy, minerals and realty management. “Nick’s expertise and experience in managing both mineral resources and staff from more than a decade in numerous Western states will be an asset to the bureau,” BLM spokesman Derrick Henry said. Read more from Bobby Magill.

What Else to Know

SCOTUS Weighs Scrapping Another Precedent: The U.S. Supreme Court’s conservative majority may be ready to overturn a longstanding precedent for the third time in recent weeks — perhaps foreshadowing the vulnerability of its rulings on abortion rights. The justices will rule as early as today on a business-backed bid to overturn decades-old decisions that give federal agencies broad power to say what their regulations mean. The case is one of eight rulings due before the justices’ term ends this week. The court also plans to rule on gerrymandered voting maps and the Trump administration’s bid to add a citizenship question to the 2020 census. Read more from Greg Stohr.

U.S.-China Trade Talks: The U.S. is willing to suspend the next round of tariffs on an additional $300 billion of Chinese imports while Beijing and Washington prepare to resume trade negotiations, people familiar with the plans said. The decision, which is still under consideration, may be announced after a meeting between Trump and Xi Jinping set for Saturday at a Group of 20 summit in Japan. A broad outline of the Trump-Xi agenda was discussed in a phone call Monday between U.S. Trade Representative Robert Lighthizer , and his counterpart in Beijing, Vice Premier Liu He.

In an interview with CNBC today, Treasury Secretary Steven Mnuchin expressed optimism that a deal could be reached by year end, saying the two sides “were about 90% of the way there and I think there’s a path to complete this,” with a need still for “the right efforts.” Read more from Jenny Leonard, Shawn Donnan and Haze Fan.

While Trump has trade at the top of his G-20 agenda, key issues including Iran, North Korea and next year’s presidential election will vie for his attention and create opportunities for summit pitfalls. In addition to a meeting with Xi, Trump will also meet with the leaders of Russia and Turkey — two men who have outmaneuvered him in the past. The summit will unfold on Friday and Saturday as tensions between the U.S. and Iran continue to escalate. Read more on Trump’s trip from Margaret Talev.

Iran Faces Maximum Pressure: The U.S. and Iran are back where they were in 2012, a time when their foreign ministers still spoke by megaphone rather than telephone and Washington was trying to force Tehran to the nuclear negotiating table by inflicting as much economic pain as possible. But although applying “maximum pressure’’ on Iran appeared to work in 2012 — resulting three years later in a controversial nuclear deal between Iran and major world powers — so much else has changed that the trick may prove difficult to repeat. Read more from Marc Champion and Golnar Motevalli.

Meanwhile, Iran said today that the wreckage of an American drone shot down last week was found four miles inside its territorial waters, in one of its most detailed accounts of an incident that brought the two countries to the brink of war. “After the shooting down of the drone, initial actions were taken and its location was identified,” Brigadier General Majid Fakhri, the head of the Iranian Armed Forces’ Geographical Organization, was cited as saying by the semi-official Tasnim news agency. “The drone was definitely in the waters of Iran.” Read more from Abbas Al Lawati, Ladane Nasseri and Henry Meyer.

U.S. Gains in Fight Over North Korea Sanctions: A judge has handed U.S. authorities a potent weapon in a long-secret battle with China over alleged evasion of sanctions on North Korea, finding three Chinese banks in contempt of court for refusing to produce evidence in a criminal investigation. The ruling could give the U.S. new leverage in its confrontation with China over its aid to North Korea — power that officials have previously been reluctant to use against large Chinese financial institutions for fear of global shocks. Read more from Christian Berthelsen and Tom Schoenberg.

Companies Circumvent Huawei Ban: American technology companies have resumed selling certain products to Huawei after concluding there are legal ways to work with the Chinese telecom giant in spite of its inclusion on a Trump Administration blacklist. Micron Technology, the largest U.S. maker of computer memory chips, said yesterday that it had started shipping some components to Huawei after its lawyers studied export restrictions. Intel, the largest microprocessor maker, has also begun selling to Huawei again, according to a person familiar with the matter. It’s not clear how many other suppliers have reached the same conclusion. Read more from Ian King and Jenny Leonard.

Esper Renews Warning to Turkey on Russia S-400: Acting Defense Secretary Mark Esper reaffirmed the U.S. warning that it will stop providing F-35 fighter jets to Turkey if the NATO member goes through with its planned purchase of the Russian S-400 missile defense system. “If Turkey procures the S-400, it will mean they will not receive the F-35,” Esper told reporters en route to Brussels for a North Atlantic Treaty Organization conference yesterday. “It’s that simple.” Read more from Glen Carey.

U.S. Sues Omarosa for No Disclosure Report: Omarosa Manigault-Newman, who rose from contestant on Trump’s reality TV show to loyal aide to the president, was sued by the U.S. for failing to file a financial disclosure report, in violation of the Ethics in Government Act. The civil lawsuit, filed in Washington federal court, seeks a court order compelling her to file the report and pay a fine of as much as $50,000. It’s the latest twist in a head-spinning relationship that began with Manigault-Newman’s featured appearance in “The Apprentice” and ended with a 2018 book about the president she called “Unhinged.” Read more from Andrew Harris.

To contact the reporters on this story: Zachary Sherwood in Washington at zsherwood@bgov.com; Brandon Lee in Washington at blee@bgov.com

To contact the editors responsible for this story: Giuseppe Macri at gmacri@bgov.com; Loren Duggan at lduggan@bgov.com

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