Welcome to The Hill’s Morning Report! As 2019 begins, our newsletter 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, you can find us at @joneasley and @asimendinger. Lawmakers return to work on Wednesday seeking a solution to the spending fight that has shuttered a quarter of the government for going on 12 days now.

While there’s no agreement in sight, President Trump Donald John TrumpBarr criticizes DOJ in speech declaring all agency power 'is invested in the attorney general' Military leaders asked about using heat ray on protesters outside White House: report Powell warns failure to reach COVID-19 deal could 'scar and damage' economy MORE has invited the top two leaders from both parties in the House and Senate to the White House for a border security briefing today .

If it takes place, it would be the first time the president has met with House Minority Leader Nancy Pelosi Nancy PelosiPowell warns failure to reach COVID-19 deal could 'scar and damage' economy Overnight Defense: House to vote on military justice bill spurred by Vanessa Guillén death | Biden courts veterans after Trump's military controversies Intelligence chief says Congress will get some in-person election security briefings MORE (D-Calif.) and Senate Minority Leader Charles Schumer Chuck SchumerDemocrats scramble on COVID-19 relief amid division, Trump surprise Pelosi, Schumer 'encouraged' by Trump call for bigger coronavirus relief package Schumer, Sanders call for Senate panel to address election security MORE (D-N.Y.) since their lively Dec. 11 encounter in the Oval Office.

At that gathering for the cameras, Trump declared he would not back down from his demand of $5.7 billion for a border wall. He said he’d take full responsibility for the partial shutdown if Congress didn’t approve the funding. Trump subsequently blamed Democrats.

In a statement Tuesday night, White House press secretary Sarah Huckabee Sanders said the president believes a “Pelosi plan” to reopen the government is “a non-starter” because it “fails to secure the border and puts the needs of other countries above the needs of our own citizens.”

The dynamics of the spending fight will shift dramatically over the next 24 hours.

Lawmakers in both chambers close the books on the 115th Congress today.

On Thursday, the 116th Congress will convene. Democrats will have a majority in the House and are expected to elect Pelosi as Speaker for her second turn in the top job.

One of Pelosi’s first actions in the next Congress will be to bring legislation to the floor to fund the full government, but with no additional money for a border wall.

The California Democrat outlined her plan in a Tuesday letter to lawmakers:

“On Thursday, House Democrats will take action to end the Trump Shutdown, as we pass strong, bipartisan legislation to reopen government, which has already received strong bipartisan support in the Senate … The package contains two bills. One consists of 6 bills already approved by the Republicans in the Senate, which would reopen all government agencies except for the Department of Homeland Security with full fiscal-year funding until September 30. The second bill would extend the Department of Homeland Security’s funding through February 8th, which is the date the Senate voted for unanimously. It is important to note that these bills contain no new wall funding.”

Read more about the legislation incoming House Appropriations Committee Chairwoman Nita Lowey Nita Sue LoweyTop House Democrats call for watchdog probe into Pompeo's Jerusalem speech With Biden, advocates sense momentum for lifting abortion funding ban Progressives look to flex their muscle in next Congress after primary wins MORE (D-N.Y.) introduced HERE .

Unless Trump has a change of heart, the Democratic spending package would die on his desk and the impasse would continue. Both sides are bracing for a prolonged shutdown.

The Associated Press : Tops on House Dems’ to-do list: Try to end shutdown.

The Hill : Five fights awaiting Trump, Congress in 2019.

LEADING THE DAY





ADMINISTRATION & WHITE HOUSE: At the Pentagon, acting Defense Secretary Patrick Shanahan Patrick Michael ShanahanHouse Armed Services chairman expresses confidence in Esper amid aircraft carrier coronavirus crisis Boeing pleads for bailout under weight of coronavirus, 737 fallout Esper's chief of staff to depart at end of January MORE, who succeeded James Mattis James Norman MattisBiden courts veterans amid fallout from Trump military controversies Trump says he wanted to take out Syria's Assad but Mattis opposed it Gary Cohn: 'I haven't made up my mind' on vote for president in November MORE on New Year’s Day, described in a memo some of the aims he hopes to carry out under the president’s “vision” ( The Hill ), while other department-watchers compiled lists of challenges this year as Trump hunts for someone to lead the Pentagon after Mattis quit ( The Hill ).

> Shanahan is served by a new acting assistant for public affairs, Charles E. Summers Jr., named at the Pentagon to step into the role performed for Mattis by a spokeswoman who resigned suddenly on Monday while under internal investigation ( The Washington Post ).

State Department: Secretary Mike Pompeo Michael (Mike) Richard PompeoThe Hill's Morning Report - Sponsored by The Air Line Pilots Association - Pence lauds Harris as 'experienced debater'; Trump, Biden diverge over debate prep Trump's foreign policy successes confound his detractors It's time for a Jackson-Vanik Amendment for China MORE, while traveling in South America this week met with Israeli Prime Minister Benjamin Netanyahu in Brasilia, Brazil. The secretary said the United States remains committed to Israel’s defense despite Trump’s decision to gradually remove U.S. military forces from Syria ( Bloomberg ). … Pompeo on Tuesday attended the inauguration of Brazil’s new far-right president, Jair Bolsonaro ( The Associated Press) .

> Egypt: Trump and Egyptian President Abdel Fattah al-Sisi discussed the stability of the Middle East by telephone on Tuesday, according to an Egyptian official ( Reuters ). The president and Sisi spoke about countering terrorism and increasing regional stability, as well as efforts to advance religious freedom in Egypt, according to a senior U.S. official.

Russia: Following last week’s detention in Russia of former U.S. Marine Paul Whelan, his family denied claims that Whelan is a spy. The espionage allegations in Moscow underscore fraying relations between Russia and the United States over a host of issues, including Russia’s election interference and U.S. economic sanctions imposed as punishment ( The Washington Post ). U.S. Embassy officials had not yet spoken with Whelan, according to his family ( The Associated Press ).

North Korea: Kim Jong Un would like to meet with Trump for a second summit anytime to discuss denuclearization, but speaks of a “new path” ( Reuters ). The president tweeted his reaction:

China: Trump’s chief trade negotiator, Robert Lighthizer Robert (Bob) Emmet LighthizerWhiskey, workers and friends caught in the trade dispute crossfire GOP senator warns quick vote on new NAFTA would be 'huge mistake' Pelosi casts doubt on USMCA deal in 2019 MORE, wants to keep the president from wavering as trade talks with Beijing resume with an eye toward a March deadline ( The New York Times ).

Ivanka Trump Ivana (Ivanka) Marie TrumpIvana Trump: Ivanka could 'definitely' be first female president The Hill's 12:30 Report - Presented by Facebook - Trump's West Coast campaign swing Ivanka Trump to campaign for father in four states this week MORE, a senior White House adviser, plans a push for global women’s economic development this year ( The Associated Press ).





IN FOCUS/SHARP TAKES





POLITICS: The calendar just turned to 2019, but Sen. Elizabeth Warren Elizabeth WarrenNo new taxes for the ultra rich — fix bad tax policy instead Democrats back away from quick reversal of Trump tax cuts It's time for newspapers to stop endorsing presidential candidates MORE (D-Mass.) is getting an early jump on the 2020 presidential race.

After announcing this week that she’d formed an exploratory committee, Warren will head to Iowa this weekend, with stops planned in Council Bluffs, Sioux City, Storm Lake and Des Moines, according to the Des Moines Register .

The field is going to get crowded in a hurry.

Expect a half-dozen Democrats or more to announce exploratory committees or outright presidential bids in the weeks ahead, with potential big names like former Vice President Joe Biden Joe BidenThe Memo: Warning signs flash for Trump on debates Senate Republicans signal openness to working with Biden National postal mail handlers union endorses Biden MORE, former New York City mayor Michael Bloomberg, Rep. Beto O’Rourke (Texas) and Sens. Bernie Sanders Bernie SandersSenate Republicans signal openness to working with Biden Hillicon Valley: DOJ indicts Chinese, Malaysian hackers accused of targeting over 100 organizations | GOP senators raise concerns over Oracle-TikTok deal | QAnon awareness jumps in new poll Schumer, Sanders call for Senate panel to address election security MORE (I-Vt.), Kamala Harris Kamala HarrisNational postal mail handlers union endorses Biden The Hill's Campaign Report: Biden asks if public can trust vaccine from Trump ahead of Election Day | Oklahoma health officials raised red flags before Trump rally Jim Carrey to play Biden on 'Saturday Night Live' MORE (Calif.), Cory Booker Cory Anthony BookerDemocratic lawmakers call for an investigation into allegations of medical neglect at Georgia ICE facility Black Voters Matter Fund deploying voter outreach caravans in 12 states to drive turnout Philanthropist Susan Sandler investing 0M in social justice organizations MORE (N.J.), and many others sizing up the landscape.

The New York Times : How Biden has paved the way for a possible presidential run.

Niall Stanage has a helpful early handicapping list of the top 10 Democrats to watch as the presidential election cycle kicks into high gear ( The Hill ).

More from campaigns and politics … The top five races to watch in 2019 ( The Hill ) … Chaos in North Carolina’s 9th Congressional District could delay final outcome for weeks ( The Charlotte Observer ).





OPINION





The president shapes the public character of the nation. Trump’s character falls short, by Sen.-elect Mitt Romney Willard (Mitt) Mitt RomneyThe Memo: Warning signs flash for Trump on debates GOP votes to authorize subpoenas, depositions in Obama-era probe Overnight Defense: Trump hosts Israel, UAE, Bahrain for historic signing l Air Force reveals it secretly built and flew new fighter jet l Coronavirus creates delay in Pentagon research for alternative to 'forever chemicals' MORE (R-Utah), The Washington Post. https://wapo.st/2RrHNy6

It’s time to get out of Afghanistan, by Robert D. Kaplan, The New York Times. https://nyti.ms/2F1TDZ9





The Morning Report is created by journalists Jonathan Easley jeasley@thehill.com & Alexis Simendinger asimendinger@thehill.com. Suggestions? Tips? We want to hear from you! Share The Hill’s reporting and newsletters, and encourage others to SUBSCRIBE!

WHERE AND WHEN





Hill.TV’s “Rising” program, starting at 8 a.m., features Anibal Romero, a Newark, N.J., attorney who represents five immigrants who say they worked at the Trump National Golf Club in Bedminster, N.J.; and Jacque Simon, public policy director for the American Federation of Government Employees union, talking about the impact of the partial shutdown on federal employees. http://thehill.com/hilltv

The Senate convenes at 4 p.m. and resumes consideration of appropriations legislation and partisan impasses.

The House meets at noon. The 116th Congress officially convenes on Thursday.

The president may hold a border security discussion with House and Senate leaders from both parties at the White House, seeking to confer for the first time since Dec. 11 with Democratic leaders about appropriations and policy disputes.





ELSEWHERE





> States & localities: 2019 ushered in new laws, including higher minimum wages, changes to tax requirements, allowances for hunting vests and bans on foam food containers and drinking straws ( USA Today , The New York Times , The Associated Press , The Washington Post ). Washington now bars anyone under age 21 from purchasing assault weapons ( The Washington Post ). … And states begin this year with ambitious new legislative agendas ( The Hill ).

> Space: A NASA explorer is believed to have reached the solar system’s outermost region on Tuesday, flying close to a space rock 20 miles long and billions of miles from Earth on a mission to gather clues about the creation of the solar system ( Reuters) .

> Catholic Church: The Vatican blocked U.S. bishops from moving to address the clergy sex abuse scandal because U.S. church leaders didn’t discuss the legally problematic proposals with the Holy See enough beforehand, according to a November letter obtained by The Associated Press . … Today, U.S.-based Roman Catholic bishops gather for a weeklong retreat near Chicago focused on the church sexual abuse scandal. Organizers say it will focus on prayer and spiritual reflection, not on crafting new policy ( The Associated Press ).

> Sports: On Tuesday, tennis champion Roger Federer, representing a Swiss team, beat the United States and fellow great Serena Williams in a mixed doubles Hopman Cup tennis competition, which they both described as great fun ( The Associated Press ).

> Russia: Ivan Fokin, an injured baby boy, was flown to Moscow Tuesday for medical care after being found alive Monday following a building collapse. He was located after he spent 35 hours under rubble in subzero temperatures. A blast that caused the collapse killed at least seven people and more than 30 others remain missing ( Reuters ). The baby’s mother survived.







THE CLOSER





And finally … It was a balmy 57 degrees in Washington, D.C., on Tuesday, but elsewhere in America, winter and water are making frozen magic. Lake Geneva, Wis., residents and visitors have been waiting for Ice Castles on the beach, expected to open Jan. 10 to large crowds.

“Our goal is to make Ice Castles be like the frozen version of going to Disneyland,” construction overseer Jesse Stone says of amusement fortresses that are also located in Utah, Minnesota, Colorado, New Hampshire and Alberta, Canada.

Water gets sprayed from sprinkler heads installed throughout castle locations each night, where it freezes, creating 5,000 to 10,000 crystal clear icicles that are then hand-harvested and used to build special worlds that celebrate the beauty of winter.