Welcome to The Hill’s Morning Report, and happy Thursday! Our daily email gets you up to speed on the most important developments in politics and policy, plus trends to watch, co-created by Jonathan Easley and Alexis Simendinger. (CLICK HERE to subscribe!) On Twitter, find us at @joneasley and @asimendinger.
Stay tuned: Fox & Friends will be airing portions of its pre-taped interview with President Trump all morning. Anchor Ainsley Earhardt says the president told her he is considering a pardon for his former campaign chairman Paul Manafort, who was convicted this week on eight charges of bank and tax fraud (Reuters).
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President Trump is treating his legal woes as if they’re a political problem, swinging back at investigators and former associates as the list of those who pose a potential threat to his presidency grows.
The legal jeopardy is coming from everywhere now, from longtime friends and allies; to aggressive prosecutors at the special counsel and in his home state of New York; and through potential civil suits over allegations the president violated campaign finance laws by paying a woman and a media company to stay quiet about alleged extramarital affairs.
There are no signs that special counsel Robert Mueller’s probe is about to wrap up.
Instead, the special counsel appears to have new momentum, with Trump’s former campaign chairman Paul Manafort convicted of tax and bank fraud and the president’s former attorney Michael Cohen pleading guilty on a range of charges. Cohen is offering through his attorney to provide more information to the special counsel.
The Hill: Mueller investigation gets new momentum.
The impeachment debate is in full bloom and the news media are digging into all of the president’s business and personal dealings, looking for new potentially damaging threads to tug on.
Chuck Todd: Time for outgoing Speaker Paul Ryan (R-Wis.) to consider impeachment hearings.
The Washington Post: Trump company approved invoices to Cohen relying on sham invoices to conceal the nature of payments.
The financial markets were spooked.
CNBC: Dow falls as Wall Street weighs Trump legal worries vs. strong earnings.
And the controversies are following Republicans on the campaign trail as they fight against the odds to maintain their majority in the House next year.
The Hill: GOP on heels after Cohen plea, Manafort conviction.
There are many reasons to believe Trump’s myriad legal fights will haunt him through his first term. His problems expand exponentially if Democrats take control of the House after November, giving them subpoena power in 2019.
It’s not easy to keep track of all the breaking news on these fronts but there were two significant developments on Wednesday, including a new intrusion by investigators into Trump’s business empire.
The Associated Press: New York state subpoenas Cohen in Trump Foundation probe.
Second, Cohen’s attorney, Lanny Davis, who is also an opinion contributor for The Hill, told CNN on Wednesday that Cohen wants to talk to Mueller about whether Trump knew in advance that hacked Democratic emails were going to be published ahead of the 2016 election. Trump has denied this.
“I don’t know if it’s a smoking gun or how decisive it is. What I’m suggesting is that Mr. Cohen was an observer and was a witness to Mr. Trump’s awareness of those emails before they were dropped, and it would pertain to the hacking of the email accounts.” – Davis.
The president spent Wednesday hitting back at Cohen over Twitter and in an interview with Fox News Channel, where he accused his former attorney of lying to prosecutors to get a reduced sentence (The Hill).
The president’s story has shifted on the hush money payments; he now says when he learned about the payments, he sought reassurance from Cohen that campaign funds were not used (The Hill). The resources for the payments “came from me,” the president told Fox News on Wednesday.
The Washington Post Fact Checker: Chronology of “a lie.” Trump’s assertions about Cohen and payments to Stormy Daniels.
Regardless, Trump and his legal team will argue that Cohen was wrong to plead guilty to two felony counts of campaign finance violations, because no laws were broken.
“Just because Michael Cohen has made a deal doesn’t mean anything with regard to the president.” – White House spokeswoman Sarah Huckabee Sanders
It is a sticky legal area and many believe it will be difficult for prosecutors to build a case against Trump on that front.
Alan Dershowitz: Did Trump violate campaign finance laws?
But Cohen, who has worked intimately with Trump and his businesses over the past 12 years, is committed to making the president’s life as difficult as possible.
Jonathan Turley: Cohen is a terrible witness but a huge risk to Trump.
As The Hill’s Niall Stanage reports, Trump’s allies are helping him fight back, but many are beginning to comprehend the seriousness of the situation.
The Memo: Team Trump takes up battle stations.
More from investigations … With a second trial looming in September, Manafort’s only hope to escape prison is a presidential pardon (The Hill) … Republicans warn Trump against pardoning Manafort (The Hill) … Manafort juror reveals that lone holdout prevented him from being convicted on all 18 counts against him (Fox News).
Analysis from around the web
Mollie Hemingway: Six takeaways on Manafort and Cohen’s legal woes.
E.J. Dionne: Trump meets his real enemy.
Renato Mariotti: Trump was winning on the investigations front. Now he’s losing.
Daniel McCarthy: Only the American people should decide Trump’s fate.
LEADING THE DAY
CONGRESS: The president’s alleged legal entanglements tied to federal campaign finance law and the guilty pleas filed on Tuesday by Trump’s former personal attorney do not point toward articles of impeachment, nor is impeaching Trump a priority for House Democrats, House Minority Leader Nancy Pelosi (D-Calif.) said on Wednesday.
“Impeachment has to spring from something else,” she told The Associated Press. If Democrats win the House in November, Pelosi said she prefers to see her party conduct oversight next year and to ensure that Mueller and his team are able to complete their investigation.
The Washington Post: Democrats lean on ethics, “self-enrichment” themes more than impeachment talk.
On Tuesday, Cohen implicated the president, telling a court that as a candidate and for election purposes, his client directed him in 2016 to arrange payments to two women in exchange for their silence about alleged affairs with Trump.
Cohen’s assertions that he violated the law at the direction of candidate Trump prompted the president’s progressive detractors to rethink the political foundation beneath Brett Kavanaugh’s nomination to the Supreme Court.
On Wednesday, Senate Minority Leader Charles Schumer (D-N.Y.) urged Senate Republicans to delay consideration of the president’s nominee to the high court because Trump has been implicated in a criminal pleading.
“It’s a game changer,” Schumer said.
Democrats’ logic is that the president’s pending pick to become a fifth vote in the majority on a court that could be called on to render judgment on Trump’s presidency and executive authority is in essence a conflict (The Hill). Senate Democrats have also been eager to find a way to delay Kavanaugh’s consideration this fall, believing that their objections on grounds of process and legal perspectives gained little traction with voters over the summer.
For House and Senate Democratic leaders, Cohen’s guilty pleas pose new challenges among those who sought to avoid the appearance of impeachment overreach while wooing independent and disaffected GOP voters this year. Democrats dodged the issue on Wednesday (The Hill).
West Virginia Democratic Sen. Joe Manchin, who is in a tough reelection battle in a state that voted overwhelmingly for Trump, has already met with Kavanaugh and frowns on the idea of delaying his Senate consideration. “Let’s do our job,” he said (The Hill).
Hawaii Sen. Mazie Hirono (D), on the other hand, said she canceled her scheduled sit-down with Kavanaugh “because I choose not to extend a courtesy to this president who is an unindicted co-conspirator … of meeting with his nominee” (The Hill).
Sen. Kamala Harris (D-Calif.), who is weighing a bid for the Democratic presidential nomination in 2020, pointed to a different potential conflict. She said should Trump decide to pardon Manafort, convicted on Tuesday on eight felony counts of tax and bank fraud, it would amount to obstruction of justice and a crime (The Hill).
The Hill: Billionaire Democrat Tom Steyer’s impeach-Trump organization plans a new advertising blitz following the Cohen and Manafort convictions. “How much more corruption do we need to see?” Steyer asked on Twitter.
The Hill: Impeachment debate moves to center of midterm fight.
The New York Times: When is an offense impeachable? Look to the Framers.
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CAMPAIGNS & POLITICS: Rep. Duncan Hunter (R-Calif.) isn’t going away quietly after being indicted along with his wife for misusing campaign funds, causing a new election headache for Republicans less than three months out from the midterm elections.
Speaker Ryan wants Hunter off his committee assignments but Hunter has refused and may have to be forced out (The Hill).
Hunter, who was one of Trump’s earliest backers in the House, says he is the victim of a Justice Department “witch hunt.”
The Hill: 10 ways Hunter allegedly misused campaign money.
Rep. Darrell Issa (R-Calif.), who represents a neighboring district and is not seeking reelection in November, is accusing the Justice Department of sitting on the indictment so that Republicans would not be able to replace Hunter on the ballot.
“I believe that the assistant U.S. attorney has totally screwed us … I believe that this is political misconduct by the assistant U.S. attorney, and I believe it simply because all deadlines, as far as I know, as far as I’ve been told, have passed … I don’t know how you make any kind of sense other than he sat on it for most of three years and certainly the last year … As far as I know, we’ve got no legal way for Duncan to get off the ballot and somebody else to get on. As far as I know that’s where we stand.” – Issa
Trump won Hunter’s district by 15 points in 2016 and the GOP can’t afford to lose the seat in November. California’s secretary of state says it’s too late to replace Hunter on the ballot. The nonpartisan Cook Political Report on Wednesday shifted the race from “Solid Republican” to “Leans Republican.”
The Hill: Hunter indictment scrambles California race.
> While much of the focus this cycle has been on the House, four new polls suggest a wild finish in the Senate, where Republicans hope to grow their slim 51-49 majority.
Sens. Ted Cruz (R-Texas) and Bob Menendez (D-N.J.) find themselves in tougher than expected races, while Sen. Bill Nelson (D-Fla.) is suddenly in trouble.
NBC News: Cruz leads Rep. Beto O’Rourke (D-Texas) by 4 points. O’Rourke came out in support of NFL players kneeling for the national anthem this week, which could be a turning point in the race (The Hill).
Monmouth University: Menendez leads GOP businessman Bob Hugin (N.J.) by 6 points.
Florida Politics: Florida Gov. Rick Scott (R) leads Nelson by 6 points.
Meanwhile, Sen. Tammy Baldwin’s (D-Wis.) race has tightened significantly now that she has a Republican challenger, Leah Vukmir.
More from the campaign trail … The Democratic National Committee says it called the FBI to investigate a new hacking effort (CNN).
IN FOCUS/SHARP TAKES
➔ WHITE HOUSE & ADMINISTRATION: Republicans, backed by messaging at the White House on Wednesday, pointed to the murder of Mollie Tibbetts in Iowa as another example of why the party is working to halt illegal immigration. The suspect is said by officials to be an undocumented immigrant.
The White House released a video that capitalized on the nationwide coverage of the recovery of Tibbetts’s remains following the arrest of a suspect who allegedly killed the 20-year-old after stalking her while she was jogging (The Washington Post). The video message lamented her “permanent separation” from her family.
Trump, on the defensive following Tuesday’s convictions of his former personal lawyer and ex-campaign chairman, turned his attention to the tragedy in the Midwest. In a separate Rose Garden video message, he assailed Democrats for opposing his immigration policies and used Tibbetts as an exhibit.
“This is one instance of many,” he said. “A person came in from Mexico illegally and killed her.”
Iowa officials, including the state’s Republican senators, asserted Tibbetts’s murder was preventable (The Hill).
White House spokeswoman Sanders, too, led her televised press briefing on Wednesday with a spotlight on the college student who had been missing for more than a month.
> The Des Moines Register: Tibbetts’s accused killer is in Iowa legally, his lawyer said on Wednesday, calling Trump “sad and sorry” for weighing in. Later, the attorney said his client’s current immigration status is open to “interpretation” and remains a distraction from larger legal challenges the suspect faces (BuzzFeed).
> Democratic Sen. Elizabeth Warren (Mass.) was criticized for remarks during a television interview in which she said U.S. immigration enforcement policies should focus on “people who pose a real threat” (The Hill).
Federal Reserve: Can Trump fire Chairman Jerome Powell over policy differences? The Federal Reserve Act says a president can remove governors at the central bank “for cause,” but does not mention chairs, who serve four-year terms following Senate confirmation (The Wall Street Journal).
Health care: The Hill: The Trump administration is facing a key test with Mississippi’s Medicaid program. The state wants to be the first to impose work requirements on beneficiaries without expanding Medicaid under provisions of the Affordable Care Act.
International opioid distribution: The Hill. The Department of Justice charged Chinese nationals with illegal distribution of synthetic opioids.
> Attorney General Jeff Sessions moved to block two Ohio doctors from prescribing opioids to patients (The Hill).
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➔ TRADE: China tariffs: Fresh import duties took effect overnight in the United States and in China Thursday, worsening a trade dispute between the world’s two largest economies. Following the start on Wednesday of the first official talks between the two governments since early June, the Trump administration imposed additional 25 percent tariffs on another $16 billion worth of Chinese imports beginning just after midnight. Beijing retaliated dollar for dollar immediately afterward (Reuters).
NAFTA: On Tuesday, Mexico’s president-elect balked at including new energy language to the North American Free Trade Agreement (The Wall Street Journal) … On Wednesday, talk of a breakthrough in negotiations shifted from being “hours” away to perhaps, maybe, possibly next week (Reuters).
World Trade Organization: For the United States to remain in the WTO, the international governing body for trade rules, China might have to leave (The Wall Street Journal).
The Morning Report is created by journalists Jonathan Easley jeasley@digital-release.thehill.com & Alexis Simendinger asimendinger@digital-release.thehill.com. Suggestions? Tips? We want to hear from you! Share The Hill’s reporting and newsletters, and encourage others to SUBSCRIBE!
OPINION
Voters must eradicate the Trump plague from American politics, by Maria Cardona, opinion contributor with The Hill. http://bit.ly/2MryV9T
Trump should come clean, by Rich Lowry (Politico). “He has to decide whether he’s going to worry chiefly about fighting off an impeachment push and winning again in 2020, or forestalling the threat of getting indicted sometime in 2021 should he lose his reelection.”
WHERE AND WHEN
The House is out until after Labor Day.
The Senate convenes at 9:30 a.m. and resumes consideration of the nomination of Lynn A. Johnson to be assistant secretary for family support at the Department of Health and Human Services.
The president hosts a roundtable discussion about the Foreign Investment Risk Review Modernization Act, which toughened the process used to evaluate and address national security-related concerns tied to foreign investment into the United States, particularly Chinese investment. Lawfare published an explainer HERE.
Vice President Pence is in Houston and will participate in a campaign event for Rep. John Culberson (R). Later, he’ll tour the Johnson Space Center and talk about the administration’s space policy. Then he flies to New Orleans, where the vice president will tour the National World War II Museum and meet with veterans. This evening, Pence headlines a political event in the Big Easy alongside House Majority Whip Steve Scalise (R-La.).
The Democratic National Committee holds its summer/fall meeting in Chicago through Aug. 25, 50 years after the turbulent 1968 Democratic National Convention in that city. On the DNC’s agenda is a key decision about the party’s “superdelegates.”
Invitation from The Hill: Sept. 12, newsmakers discuss “A Healthy Start: Infant and Early Childhood Nutrition,” featuring Reps. Nanette Barragán (D-Calif.) and Bobby Scott (D-Va.), and Food and Nutrition Service Administrator Brandon Lipps from the U.S. Department of Agriculture. The Hill’s Editor-in-Chief Bob Cusack kicks off a conversation about maternal, infant and early childhood nutrition, and progress toward the goal of healthier eating. RSVP HERE.
ELSEWHERE
> Hawaii this morning is feeling the rain and winds of category 4 cyclone “Lane,” the worst weather threat to hit the islands in more than a quarter century (CNN).
> Academy-award winner Sissy Spacek interviewed about portraying a woman with dementia on ensemble television’s “Castle Rock,” and the industry’s “heyday we’ll be talking about in 20 years” (Vulture).
> The go-go market is now the longest in U.S. history. It’s been 3,454 days since the Standard & Poor’s 500 hit its low of 666 on March 9, 2009. Can the record continue? (Wall Street Journal)
THE CLOSER
And finally … It’s Thursday, time for another ripped-from-the-headlines Morning Report QUIZ CONTEST! Win some newsletter fame on Friday by answering all the questions correctly. Just send your best guesses to jeasley@digital-release.thehill.com or asimendinger@digital-release.thehill.com (and please put “Quiz” in your subject line.)
With the stock market on a record 9-year bull run, we thought we’d test your knowledge about Wall Street:
This former prosecutor from the Justice Department’s Southern District of New York put famed junk bond trader Michael Milken behind bars.
- James Comey
- Preet Bharara
- Rudy Giuliani
- Eliot Spitzer
What level of education does a person need to become a stockbroker?
- A college degree and passage through the Certified Financial Analyst program.
- A master’s in business administration or finance.
- No education requirements other than passing the Series 7 & 63 exams.
- No education or testing requirements at all.
When did the Dow Jones Industrial Average suffer its largest point drop in one day?
- On “Black Tuesday” during the stock market crash of 1929.
- The day the markets reopened following the Sept. 11 terrorist attacks.
- During the 2008 financial crisis when the first TARP bailout proposal failed in Congress.
- Earlier this year in the middle of a historic bull run.
This year, Stacey Cunningham became the first woman to lead the New York Stock Exchange (NYSE) in its 226-year history. Who was the first woman to hold a seat on the NYSE?
- Victoria Woodhull
- Muriel Siebert
- Catherine Kinney
- Adena Friedman
Why is a down market called a “bear” market? (There are competing theories but only one of these is among them).
- Because bears withdraw into hibernation in the winter time.
- Because bulls live in higher altitudes than bears.
- Because old-time traders of bearskin would sell skins they had yet to collect, a short-sell that bets on the price dropping.
- It just sounds right.
