What to Know in Washington: Trump Deregulates, Like it or Not

Donald Trump campaigned on a promise to ease the grip of environmental rules he said were throttling businesses. But time and again, his deregulatory moves as president have drawn the ire of the very companies expected to benefit.

In the latest instance, the Environmental Protection Agency unveiled a proposal yesterday to weaken rules on methane leaks from oil wells — despite major oil companies insisting they don’t want the relief.

Similarly, automakers have begged the White House to alter course in its plans to weaken fuel efficiency standards and pick a fight with California. And power-plant operators say an administration effort to undermine requirements for mercury pollution controls may keep them from recouping the cost of equipment.

The willingness to defy traditional business interests extends beyond environmental regulation. Most notably, Trump has escalated a trade conflict with China, even as manufacturers and retailers complain that it will increase costs and retard growth in the U.S. And some of his efforts to change immigration policy have been condemned by chief executives from Apple, AT&T, Coca-Cola, and dozens of other businesses who say they could disrupt their operations.

Trump’s zeal to deregulate — even when the regulated industries advise against it — runs counter to the pro-business ethos of previous Republican presidents, whose policies may have been more aligned with commercial priorities. Yet the approach underscores Trump’s populist streak and is another reminder this “is not a typical Republican administration,” said GOP energy strategist Mike McKenna.

“What many fail to grasp — and what may be the most important characteristic of this administration — is that it is largely indifferent to arguments driven solely by commercial interests,” McKenna said. “They believe that consumers, workers, citizens are the most important reference points in decisions.” Read more from Jennifer A. Dlouhy.

Photographer: Al Drago/Bloomberg
Trump watches Secretary of Defense Mark Esper during a ceremony in the White House Rose Garden on Thursday.

On Lawmakers’ Radar

White House Prepares for Stopgap Measure: With lawmakers set to return to work in just over a week, the Trump administration has sent Congress a package of requested changes in funding levels for a September stopgap funding measure, a congressional aide said. The request for “anomalies” calls for changes to current funding levels to be inserted into a continuing resolution that would fund the government past Sept. 30, largely keeping funds at current levels. The decision to send the request is a sign the White House is prepared to rely on a stopgap measure to avoid a shutdown in October, Jack Fitzpatrick reports.

For the Department of Defense, the administration requested up to $20 million from Pentagon funds to help fund space development, Nancy Ognanovich reported.

The administration hasn’t publicized the request, but lawmakers regularly insert anomalies into continuing resolutions for programs that need funding increases or decreases. The Census Bureau, for example, frequently gets a boost in the run up to its decennial survey. Senate Appropriations Committee member Steve Daines (R-Mont.) said earlier this month he expects a stopgap measure.

The House has passed 10 of its 12 fiscal 2020 appropriations bills, but the Senate hasn’t passed any. Senate Appropriations Chairman Richard Shelby (R-Ala.) has said he hopes to get a large spending package, including Defense, Labor-HHS-Education and possibly Energy and Water appropriations, signed into law before the Sept. 30 deadline. In that scenario, other programs would then have to be covered by a continuing resolution.

Trump Tax Returns Case Won’t Be Fast-Tracked: House Democrats’ lawsuit seeking to quickly compel the U.S. Treasury Department and Internal Revenue Service to hand over Trump’s tax returns for the past six years won’t be decided any faster than any ordinary case, the federal judge hearing the dispute has ruled. U.S. District Judge Trevor McFadden late yesterday rejected the request by the House Ways and Means Committee that he fast-track resolution of their lawsuit filed last month, which the suing Democrats say would have increased the likelihood the litigation is resolved before a new Congress is sworn into office in January 2021. Read more from Andrew Harris.

Democrats Want Review of Religious Defense Rule: House Democrats are calling for the Labor Department to extend the public comment period on a proposal that would codify current religious defenses that federal contractors can use when accused of discrimination. House Committee on Education and Labor Chairman Bobby Scott (D-Va.) and Subcommittee on Civil Rights and Human Services Chair Suzanne Bonamici (D-Ore.) requested the deadline for comments on the proposed rule be extended to Oct. 16, according to a letter obtained by Bloomberg Law. The comment period is slated to close Sept. 16. Read more from Paige Smith.

Elections, Politics & Probes

Democrats Shut Out of Debate See End of the Road: Many of the 10 candidates who didn’t make the cut for the third Democratic presidential debate, now face a big decision — drop out or keep running at the end of the pack. Losing a spot on the stage means more than just being deprived of a powerful platform. It’s a signal to donors, supporters and primary-state voters that an already-struggling candidate has failed to break out. So what’s that candidate to do?

On Thursday the Democratic National Committee announced that Tom Steyer, Michael Bennet, Tulsi Gabbard, Marianne Williamson, Steve Bullock, Bill de Blasio, Tim Ryan, John Delaney and Joe Sestak will have to sit out of the Sept. 12 debate in Houston.

“Drop out,” said Rebecca Katz, a Democratic strategist and founder of New Deal Strategies. “These candidates have had months, and in many cases two separate debates, to make their case to the American people.” Read more from Emma Kinery.

DNC to Recommend Rejecting Virtual Caucus: The Democratic National Committee will recommend rejecting the Iowa Democratic Party’s plan to institute virtual caucuses over cybersecurity concerns, according to two people familiar with the decision. The DNC’s action, expected to be formalized in a statement today, will come as a major disappointment to the Iowa Democratic Party, which spent months devising a plan to comply with the DNC’s order that caucuses must be more accessible. Read more from Tyler Pager.

Google, Twitter to Discuss 2020 Disinformation: Google, Facebook and Twitter have been invited by the head of the Federal Election Commission to explore ways to combat digital disinformation in the 2020 elections. The all-day symposium on Sept. 17 will examine new types of false information spread online that could be used to influence elections. In 2016, Russia used online platforms in a bid to support the candidacy of Trump, according U.S. intelligence agencies. Read more from Bill Allison.

Uber, Lyft, DoorDash Prepare for Possible Ballot War: Uber, Lyft, and DoorDash are putting $90 million behind a ballot measure strategy to ensure they don’t have to reclassify their California workers as employees. Ride-hailing and food-delivery companies that rely on contractors who aren’t guaranteed employment protections like overtime and unionization have been scrambling to address the threat posed by a state legislative proposal that would make it much harder to claim their workers aren’t employees. Assembly Bill 5 passed the state Assembly in May and is poised to go to Gov. Gavin Newsom (D) next month if it clears the Senate. Read more from Josh Eidelson.

Trade and Foreign Affairs

Brazil’s Bolsonaro to Meet Trump: Brazil’s Jair Bolsonaro will meet today with Trump to discuss the the Amazon rainforest, according to lawmaker Eduardo Bolsonaro, son of the president. Foreign Minister Ernesto Araujo is leading the trip to the U.S. Trump is already backing Brazil on the Amazon issue, the lawmaker told reporters in Brasilia.

Trump Cancels Poland Trip Due to Hurricane: Poland’s authorities put on a brave face as Trump called off a visit to Warsaw to commemorate the start of World War II because a big storm on the Atlantic was heading toward Florida. The government has for weeks played up Trump’s two-day trip, which was due to come during a parliamentary election campaign, as a sign of U.S. backing for its policies and close friendship with Polish President Andrzej Duda. “President Trump said that he considers his trip postponed not canceled,” Krzysztof Szczerski, a top adviser to Duda, told Onet.pl on today. The trip should be rescheduled for “the nearest months,” although “details haven’t yet been planned.” Read more from Wojciech Moskwa.

Trump Says Trade Talks Set: Trump said yesterday that the U.S. and China are scheduled to have a conversation about trade today without giving details. Trump’s comments followed signs from China that it wouldn’t immediately retaliate against the latest U.S. tariff increase and wanted to focus on removing new tariffs, to prevent a further escalation of the trade war. “There is a talk scheduled for today at a different level,” Trump said when asked in a Fox News radio interview if planned September talks with China are still on. Hours later, neither side had confirmed whether a conversation had taken place. Read more from Scott Lanman.

• Meanwhile, the largest U.S. business lobby urged Trump and Chinese President Xi Jinping to withdraw new tariffs starting Sunday and return to talks in good faith to end an escalating trade war that is threatening the economy. “At this moment of uncertainty, it is critical that our leaders take decisive steps to bolster the economy and avoid actions that could turn talk of recession into reality,” Thomas Donohue, chief executive officer of the U.S. Chamber of Commerce, said in a Washington Post o pinion piece yesterday. Read more from Mark Niquette.

Trump Marks Start of Space Command: Trump yesterday marked the inauguration of a U.S. military command for space that’s designed to aid in missile tracking and space operations, countering what officials say are growing threats from Russia and China. “Spacecom will defend America’s vital interests in space — the next warfighting domain,” Trump said at a Rose Garden ceremony. Space Command, led by Air Force General John Raymond, becomes the 11th U.S. combatant command — joining others such as Indo-Pacific Command and Cyber Command. Read more from Alyza Sebenius.

U.K., France, Germany ‘Concerned’ About South China Sea: The U.K., France and Germany have called for restraint in the South China Sea amid reports that Chinese and Vietnamese vessels are facing off in the disputed waters over competing territorial claims. The tensions “could lead to insecurity and instability in the region,” they said in a joint statement issued yesterday. The three nations, without mentioning Vietnam or China, said the legal framework set out by the United Nations Convention on the Law of the Sea granting several claimants sovereign rights to the waters “must be carried out.” Read more from Philip J. Heijmans.

Trump’s Man in the Middle East: As the top American envoy to one of the world’s most volatile regions, David Friedman is anything but diplomatic. Trump’s ambassador to Israel broke the mold of non-partisan predecessors by outraging Palestinians with comments that the Jewish state has a right to annex some areas of the West Bank. In June, he inaugurated an archaeological dig under Palestinian homes at an event also attended by billionaire Sheldon Adelson, one of the largest donors to the Trump campaign. When Israel barred two Democratic congresswomen from visiting this month, Friedman backed the decision. Read more from Ivan Levingston and David Wainer.

Also Around the Administration

Trump’s Oval Office Gatekeeper Resigns: An aide and gatekeeper to Trump resigned from the White House staff yesterday, according to people familiar with the matter. Madeleine Westerhout, whose formal title was special assistant to the president and director of Oval Office operations, had worked for Trump since the transition. The president learned she’d shared details about his family and the White House during an off-the-record discussion with reporters, and the episode was part of what led to her sudden exit, the people said. The New York Times reported the news earlier yesterday. Read more from Josh Wingrove.

Pentagon Says Almost $3 Billion Committed for Border Wall: The Defense Department said since April 2018 it has set aside around $450 million for active duty and National Guard deployments to the southwest border to help the Department of Homeland Security. The Pentagon also said it has committed $2.5 billion to date for a border wall, according to an emailed statement from DOD. The department disclosed the dollar figures in response to a question from an earlier news briefing on how much the Trump administration’s effort to reduce the flow of migrants a t the border has cost the Pentagon, Kim Chipman reports.

Legal Trouble Could Follow Climate Reviews Guidance: Draft White House guidance that allows federal agencies not to consider the climate change impact of their decisions may entangle them in more lawsuits if they follow that advice. Environmental critics and industry supporters alike are concerned the June 26 guidance from the White House Council on Environmental Quality may not be enough to shield federal agencies’ decisions on infrastructure and energy projects from being reversed by the courts. The questions come as federal judges across the country are increasingly scrutinizing agencies’ environmental assessments for lack of analysis of climate change impacts. Read more from Abby Smith.

What Else to Know

Dorian on Course to Hit Florida as Category 4 Hurricane: Hurricane Dorian is now expected to become a Category 4 storm with winds reaching 140 miles per hour before it makes landfall on Florida’s east coast, in what would be the first major hurricane to hit the area in 15 years. The hurricane’s center was located about 260 miles east-northeast of the southeastern Bahamas as of 5 a.m. New York time, moving northwest with maximum sustained winds of about 105 miles per hour, according to the U.S. National Hurricane Center.

On its current track, Dorian is expected to approach the northwestern Bahamas on Saturday, and move near or over parts of that region on Sunday, the center reported. A hurricane watch has been issued for the northwestern Bahamas, indicating hurricane conditions are possible within that area over the next 48 hours. Read the latest from Brian K. Sullivan and Will Wade.

Lab-Grown Food Companies Join Forces: Five food companies that are producing cell-based food products, touted for making protein without the need of conventional animal farming, have formed a new coalition, Teaganne Finn reports. The Alliance for Meat, Poultry and Seafood Innovation, was announced yesterday, and has been created to allow the companies to “speak with a unified voice,” said the press release. Companies included in the alliance are BlueNalu, Finless Foods, Fork & Goode, JUST, and Memphis Meats.

Editor’s Note: Bloomberg Government’s What to Know in Washington will not publish on Monday, Sept. 2. We’ll return Tuesday, Sept. 3.

To contact the reporter on this story: Zachary Sherwood in Washington at zsherwood@bgov.com

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

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