Welcome to The Hill’s Morning Report. Happy Wednesday! Our newsletter gets you up to speed on the most important developments in politics and policy, plus trends to watch. Co-creators are Alexis Simendinger and Al Weaver (CLICK HERE to subscribe!). On Twitter, find us at @asimendinger and @alweaver22.







The pressure is ratcheting up on Speaker Nancy Pelosi Nancy PelosiHoyer: House should vote on COVID-19 aid — with or without a bipartisan deal Ruth Bader Ginsburg lies in repose at Supreme Court McCarthy threatens motion to oust Pelosi if she moves forward with impeachment MORE (D-Calif.) as the top figures within her caucus are leveling calls for President Trump Donald John TrumpBiden on Trump's refusal to commit to peaceful transfer of power: 'What country are we in?' Romney: 'Unthinkable and unacceptable' to not commit to peaceful transition of power Two Louisville police officers shot amid Breonna Taylor grand jury protests MORE’s impeachment, something she remains dead set against.

Pelosi, less than five months into her second stint as Speaker, is facing the biggest challenge in her leadership career as members of her own leadership team and top committee chairmen call for impeachment proceedings against the president because of the continuous stonewalling of investigative efforts by the White House.

As Mike Lillis reports, Pelosi has long seen impeachment as a trap that could cost Democrats the White House or congressional majorities after the 2020 election. Only weeks ago, she said that Trump was trying to “goad” Democrats into impeachment proceedings, but she has been unable to tamp down the calls.

Before starting her second stint as Speaker, Pelosi agreed to limit her tenure to four years, a scenario that invites challenges to her decision-making — even if she is expected to remain as Democratic leader into the next Congress.

According to The Hill’s Whip List, 27 House Democrats support launching an impeachment inquiry of the president.

The brand new impeachment calls, headlined by one from Rep. David Cicilline David Nicola CicillineClark rolls out endorsements in assistant Speaker race Races heat up for House leadership posts The folly of Cicilline's 'Glass-Steagall for Tech' MORE (D-R.I.), a member of leadership and of the House Judiciary Committee, stemmed from former White House counsel Don McGahn’s decision to defy a subpoena and not testify before the House Judiciary Committee on Tuesday about what he told special counsel Robert Mueller Robert (Bob) MuellerCNN's Toobin warns McCabe is in 'perilous condition' with emboldened Trump CNN anchor rips Trump over Stone while evoking Clinton-Lynch tarmac meeting The Hill's 12:30 Report: New Hampshire fallout MORE.

As Scott Wong reports, Democrats are set to discuss the matter at a closed-door caucus meeting on Wednesday morning. To be sure, scores of Democrats on Tuesday said they backed Pelosi’s cautious approach on impeachment and did not wish to move forward on the divisive issue for now. Among those who have done so publicly are House Majority Leader Steny Hoyer Steny Hamilton HoyerOVERNIGHT ENERGY: California seeks to sell only electric cars by 2035 | EPA threatens to close New York City office after Trump threats to 'anarchist' cities | House energy package sparks criticism from left and right House energy package sparks criticism from left and right Hoyer: House should vote on COVID-19 aid — with or without a bipartisan deal MORE (D-Md.), Rep. Hakeem Jeffries Hakeem Sekou JeffriesDemocratic leaders: Supreme Court fight is about ObamaCare Pelosi: House will stay in session until agreement is reached on coronavirus relief Races heat up for House leadership posts MORE (D-N.Y.), the No. 5-ranking House Democrat, and Rep. Ro Khanna Rohit (Ro) KhannaThe Hill Interview: Jerry Brown on climate disasters, COVID-19 and Biden's 'Rooseveltian moment' Congress needs to prioritize government digital service delivery DeJoy defends Postal Service changes at combative House hearing MORE (D-Calif.), a top progressive figure and a Pelosi ally.

It is unclear whether those backing impeachment proceedings would have a majority in the House if a vote took place this week. However, support is clearly growing, despite efforts by Pelosi and her allies to contain it.

Politico: Vulnerable Democrats split as impeachment pressure mounts.

Jonathan Allen: The impeachment dam isn't breaking on Pelosi — yet.

Dana Milbank: Slow-walking impeachment may look weak. But restraint is Democrats’ greatest strength.

In the meantime, House Democrats are continuing to press on with the investigation. House Judiciary Committee Chairman Jerrold Nadler Jerrold (Jerry) Lewis NadlerDemocrats shoot down talk of expanding Supreme Court Schumer: 'Nothing is off the table' if GOP moves forward with Ginsburg replacement Top Democrats call for DOJ watchdog to probe Barr over possible 2020 election influence MORE (D-N.Y.) moved on Tuesday to subpoena former White House communications director Hope Hicks Hope Charlotte HicksSenate intel leaders said Trump associates may have presented misleading testimony during Russia probe: report Cuomo turned down Trump invitation to participate in April press briefing: report Trump shakes up White House communications team MORE, a longtime ally of Trump, and McGahn’s former chief of staff, Annie Donaldson, who created detailed contemporaneous notes of White House meetings and discussions, which she shared with Mueller’s investigation (The Hill).

Adding to Democratic heartache is Mueller’s decision to avoid a public hearing on Capitol Hill, something House Democrats called for almost immediately after his full report was released in April. Mueller and House Democrats have been unable to reach an agreement, with Mueller reportedly wanting to testify behind closed doors to avoid a public spectacle, something Democrats are not supportive of. Nadler has said that he plans to subpoena Mueller if it has to come to that. (CNN).

The Washington Post: Republican National Committee paid $2 million to a law firm employing McGahn.

Meanwhile, Republicans still believe that any impeachment action would be a political boon to the president. As Niall Stanage writes, Trump aides and Republicans believe that such a push would backfire, not unlike the situation that embroiled President Bill Clinton William (Bill) Jefferson ClintonEpstein podcast host says he affiliated with elites from 'both sides of the aisle' Ruth Bader Ginsburg lies in repose at Supreme Court Business groups start gaming out a Biden administration MORE, and play to the president's benefit.

As Trump watches on at the ongoing impeachment chatter, he continues to fight for his financial records to remain private after a federal judge ruled in favor of a subpoena by House Democrats. The ruling saw District Judge Amit Mehta reject nearly all of the president’s legal arguments, upholding the subpoena issued to Mazars, the president’s accounting firm. As Jacqueline Thomsen and Naomi Jagoda write, the president’s legal team is banking on the same arguments to block similar subpoenas, a sign that he could lose in court again.

The Washington Post: A confidential draft IRS memo says tax returns must be given to Congress unless the president asserts executive privilege.







LEADING THE DAY





CONGRESS: Congressional leaders and White House officials on Tuesday indicated that raising the nation’s limit on federal borrowing in order to avert default will be woven into a broader measure to keep the government funded when the fiscal year ends on Sept. 30.

However, White House officials had been urging Congress to raise the debt ceiling as soon as possible through a measure delinked from budget battles yet to come.

"We all agree the debt ceiling is going to be part of an overall deal, but we're not discussing that right now,” Senate Minority Leader Charles Schumer Chuck SchumerCruz blocks amended resolution honoring Ginsburg over language about her dying wish Senate Democrats introduce legislation to probe politicization of pandemic response Schumer interrupted during live briefing by heckler: 'Stop lying to the people' MORE (D-N.Y.) told reporters after meeting with Congress’s three other party leaders and the president’s senior advisers. Schumer and Pelosi released a written statement underscoring Democrats’ insistence on parity between any spending increases for defense, favored by Trump and the GOP, and hikes in domestic spending, such as for the U.S. census and veterans.

Pelosi and Schumer were joined by Senate Majority Leader Mitch McConnell Addison (Mitch) Mitchell McConnellFEC flags McConnell campaign over suspected accounting errors Poll: 59 percent think president elected in November should name next Supreme Court justice Mark Kelly: Arizona Senate race winner should be sworn in 'promptly' MORE (R-Ky.), House Minority Leader Kevin McCarthy Kevin Owen McCarthyMcCarthy threatens motion to oust Pelosi if she moves forward with impeachment Kate Schroder in Ohio among Democratic challengers squelching GOP hopes for the House McCarthy's Democratic challenger to launch first TV ad highlighting Air Force service as single mother MORE (R-Calif.), Treasury Secretary Steven Mnuchin Steven Terner MnuchinHillicon Valley: DOJ proposes tech liability shield reform to Congress | Treasury sanctions individuals, groups tied to Russian malign influence activities | House Republican introduces bill to set standards for self-driving cars Treasury: Trump's payroll tax deferral won't hurt Social Security Treasury sanctions individuals, groups tied to Russian malign influence activities MORE, acting White House chief of staff Mick Mulvaney Mick MulvaneyOn The Money: House panel pulls Powell into partisan battles | New York considers hiking taxes on the rich | Treasury: Trump's payroll tax deferral won't hurt Social Security Blockchain trade group names Mick Mulvaney to board Mick Mulvaney to start hedge fund MORE and acting White House budget director Russell Vought. Acting Homeland Security Secretary Kevin McAleenan joined for a portion of the discussions.

A White House official confirmed that the administration is now open to combining a debt limit increase and new defense and nondefense budgetary caps, report Alexander Bolton and Niv Elis.

> House and Senate members who sought additional details from the administration about intelligence that triggered public warnings about potential strikes by Iran against U.S. interests got their wish. They received information behind closed doors from 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, and Secretary of State Mike Pompeo Michael (Mike) Richard PompeoTreasury sanctions individuals, groups tied to Russian malign influence activities Navalny released from hospital after suspected poisoning Overnight Defense: Pentagon redirects pandemic funding to defense contractors | US planning for full Afghanistan withdrawal by May | Anti-Trump GOP group puts ads in military papers MORE, a hard-liner about Iran. Trump officials say administration efforts to deter Iran have worked (The Hill).

The Tuesday briefing occurred after Trump said he had "no indication" of threats or attacks by Tehran, contrary to administration statements for the past two weeks.

Jordain Carney reports that many superficial parallels between the run-up to the Iraq war in 2003 and the situation in Iran this year have lawmakers chattering about “eerie parallels.” Senators from both parties have admonished Trump that there is no appetite in Congress for a new military conflict in the Middle East, especially leading up to 2020 elections.

> Pelosi and Schumer are to meet with the president today for their second discussion since April about a potential $2 trillion infrastructure plan and how to pay for it. On Tuesday night, the White House said Congress must ratify the U.S.-Mexico-Canada Agreement before turning to an unrelated measure for U.S. roads, bridges, ports, energy grids and broadband. It’s yet another wrinkle in years of foot-dragging and disputes about priorities and revenue sources involving the nation’s crumbling infrastructure (Reuters).

> Republican leaders in Congress as well as the president are distancing themselves from Alabama’s new law banning nearly all abortions, with no exceptions for rape or incest. Alabama’s law potentially complicates a key message Republicans hoped to convey to voters: Democrats lead the party that is extreme on abortion (The Hill).

> Legislation to block tech companies from tracking users online is gaining momentum. On Monday, Sen. Josh Hawley Joshua (Josh) David HawleySenate GOP faces pivotal moment on pick for Supreme Court Renewed focus on Trump's Supreme Court list after Ginsburg's death What Facebook's planned change to its terms of service means for the Section 230 debate MORE (R-Mo.) unveiled a "Do Not Track" bill with tough penalties for companies that breach its protections. Efforts to create a “Do Not Track” registry have hit roadblocks for over a decade, but consumer advocates and tech industry critics are optimistic that’s about to change (The Hill). … Meanwhile in tech, GOP senators on Tuesday signaled they are divided over whether to pursue antitrust enforcement against the country's largest tech companies. Some Republican lawmakers who attended a Tuesday Senate Judiciary Committee hearing slammed the enormous market power of companies such as Facebook and Google. Other senators questioned whether "breaking them up" is a wise idea (The Hill).

> House GOP Leader McCarthy this year aided a California firm in his district, BYD Motors, a division of BYD Co., a large Chinese manufacturer, by blocking a bipartisan attempt to limit Chinese companies from contracting with U.S. transit systems. Through a spokesman, the congressman defended his advocacy on behalf of companies in his district and denied any link between BYD’s campaign contributions and his actions in Congress (The Washington Post).

***

POLITICS & CAMPAIGNS: 2020 Democratic candidates are starting to embrace litmus tests for potential judicial nominees, a political tool that was considered taboo for a long period of time as the importance of multiple issues takes hold in the race.

With several states pushing to enact laws restricting abortion, Democratic hopefuls are pushing to set more explicit ideological and jurisprudential conditions for would-be judicial nominees, according to Max Greenwood. Chief among those conditions: that any potential judicial nominee commits to backing the Roe v. Wade decision.

Those pledges underscore the extent to which presidential candidates have become comfortable with shattering what has historically been considered taboo in campaign politics.

Politico: Joe Biden Joe BidenBiden on Trump's refusal to commit to peaceful transfer of power: 'What country are we in?' Democratic groups using Bloomberg money to launch M in Spanish language ads in Florida Harris faces pivotal moment with Supreme Court battle MORE nets fundraising windfall in 2-day Florida swing.

CNN: Six takeaways from Beto O'Rourke Beto O'RourkeJimmy Carter says his son smoked pot with Willie Nelson on White House roof O'Rourke endorses Kennedy for Senate: 'A champion for the values we're most proud of' 2020 Democrats do convention Zoom call MORE's town hall.

> Kentucky Gov. Matt Bevin (R) fought off an unexpectedly tough primary challenge Tuesday night from Robert Goforth, a first-term state legislator, defeating him with 52 percent to Goforth’s 39 percent. Bevin, who first gained notoriety back in 2014 when he primaried McConnell for his seat, has been mired by poor approval ratings after a series of fights with teachers and public sector unions. According to a Morning Consult poll released in April, Bevin is the least popular governor in the U.S.

Bevin will face Attorney General Andy Beshear, who won a three-way primary fight for the right to take on the incumbent governor in November. Beshear topped Rocky Adkins, the state House minority leader, by six percent.

The Courier-Journal: Andy Beshear wins the Democratic primary for Kentucky governor

“In his victory speech, Beshear noted how Bevin barely received 50% of the vote in the GOP primary. He knocked the governor for name calling and bullying others, saying this race shouldn't be defined by attacks or national partisanship.

‘I will tell you what I see: This race is not about what's going on in Washington, D.C.,’ Beshear said. ‘It's not about right versus left. Folks, it's about right versus wrong.’"

> Fred Keller, a Pennsylvania state legislator, won his special election in the state’s 12th congressional district Tuesday night to replace former Rep. Tom Marino Thomas (Tom) Anthony MarinoWhy the North Carolina special election has national implications The Hill's Morning Report - Pelosi remains firm despite new impeachment push Republican wins special House election in Pennsylvania MORE (R-Pa.). Keller’s took home 70 percent of the vote in the deep red district (The Hill).

Keller’s win came after Trump held a campaign rally in Montoursville, Pa., on election eve. Once Keller is sworn into office, there will only be two vacant seats remaining in the House, both in North Carolina. The 9th district’s seat remains vacant as no winner was certified after the November election. The 3rd district is also without representation after the death of the late Rep. Walter Jones Walter Beaman JonesExperts warn Georgia's new electronic voting machines vulnerable to potential intrusions, malfunctions Georgia restores 22,000 voter registrations after purge Stacey Abrams group files emergency motion to stop Georgia voting roll purge MORE (R-N.C.).

Special elections for both seats will be held on September 10.

> Iowa Democrats are expecting a massive turnout on caucus night, bolstered by two dozen candidates pushing voters to the polls. As Reid Wilson reports, the party is conscious of screw-ups in 2008 and 2016 that led to grumbling from losing candidates, and they’re worried about outlets such as Fox News exploiting those divisions this time.

To avert disaster, they’ve embarked on an ambitious plan to lock down as many caucus sites and backups as possible — but even then, counting is likely to be slow if a thousand people turn out at a single precinct.

The Hill: Sen. Kamala Harris Kamala HarrisHarris faces pivotal moment with Supreme Court battle Nearly 40 Democratic senators call for climate change questions in debates Joe Biden has long forgotten North Carolina: Today's visit is too late MORE (D-Calif.) seeks Iowa edge with army of volunteers.







IN FOCUS/SHARP TAKES





INTERNATIONAL: Iranian President Hassan Rouhani on Tuesday rejected the idea of talks with the United States after Trump suggested Iran would ask for negotiations about sanctions relief and its nuclear program “if and when they are ever ready.” Rouhani was quoted by the state news agency as saying, “Today’s situation is not suitable for talks and our choice is resistance only” (Reuters).

> North Korea stepped up its campaign on Tuesday seeking the return by the United States of a seized cargo ship belonging to Pyongyang, warning Washington at a rare United Nations news conference that the Trump administration violated its sovereignty in a move that could affect “future developments” between the countries (Reuters).

> China: Remarks by President Xi Jinping on Monday about a “long march” ahead for his country was perceived as a sign that Beijing does not anticipate an end to the trade war with the United States anytime soon. “Now there is a new long march, and we should make a new start,” Xi told a cheering crowd in Jiangxi Province as he started a domestic tour that is seen as an attempt to rally the nation as trade tensions with the United States escalate (The New York Times).

> Brexit: British Prime Minister Theresa May Theresa Mary MayAre US-Japan relations on the rocks? Trump insulted UK's May, called Germany's Merkel 'stupid' in calls: report Bolton says Boris Johnson is 'playing Trump like a fiddle' MORE, whose weakened political status has encouraged U.K. voters to anticipate a successor, urged U.K. lawmakers on Tuesday to back her “new” Brexit deal, which would include a binding vote by Parliament in June on whether to hold a second Brexit referendum (The Washington Post). The prime minister defends her proposal before the House of Commons today (The Associated Press).







The Morning Report is created by journalists Alexis Simendinger and Al Weaver. We want to hear from you! Email: asimendinger@thehill.com and aweaver@thehill.com. We invite you to share The Hill’s reporting and newsletters, and encourage others to SUBSCRIBE!







OPINION





Why a trade war with China is a dangerous game for America, by Grover Norquist, president of Americans for Tax Reform, and Timothy Phillips, president of Americans for Prosperity, opinion contributors, The Hill. https://bit.ly/2VWP7or

Women’s civil rights are not a state issue, by Lois Shepherd, opinion contributor, The Hill. https://bit.ly/2VWP7or







WHERE AND WHEN





Hill.TV’s “Rising” program, starting at 8 a.m., features Khanna, Rep. Pramila Jayapal Pramila JayapalDHS opens probe into allegations at Georgia ICE facility Progressive Caucus co-chair: Whistleblower complaint raises questions about 'entire detention system' Buttigieg, former officials added to Biden's transition team MORE (D-Wash.), and Ryan Grim, The Intercept’s Washington bureau chief. http://thehill.com/hilltv

The House convenes at 10 a.m.

The Senate will meet at 9:30 a.m. and will resume consideration of Howard C. Nielson Jr. to be a United States district judge for the District of Utah.

The president meets with Democratic lawmakers this morning to discuss the potential for an infrastructure spending agreement. Trump presents the Public Safety Officer Medal of Valor this afternoon. In the evening, the president hosts a roundtable with political supporters and speaks to a fundraising reception in the Trump International Hotel in Washington.

The vice president will travel this morning to North Carolina to attend a Republican National Convention kickoff in Charlotte at 12:30 p.m.. Pence will tour Parkdale Mills, a textile company in Monroe, N.C., and deliver remarks at 3:10 p.m. The vice president will travel to Greensboro, N.C., to attend a Trump Victory political event.

Mnuchin testifies at 9 a.m. before the House Financial Services Committee about the state of the international financial system.

The Center for American Progress hosts its annual ideas festival in Washington beginning at 9 a.m. featuring a packed roster of Democratic speakers including Pelosi, Stacey Abrams of Georgia, a collection of Democrats from the House and Senate and at least two mayors (one current and one out of office) who gave serious thought to running for president in 2020, but decided against it. Information and live stream HERE.







ELSEWHERE





➔ Tech: Alphabet Inc.’s Google moved this week to voluntarily cut off most dealings with Chinese telecom company Huawei, a move that presents risks for Silicon Valley (The Hill). Meanwhile, the Trump administration reversed course on Tuesday and temporarily eased trade restrictions on Huawei at the same time that the founder of the world’s largest telecom equipment maker said the United States is underestimating and “bullying” the company (Reuters).

➔ State Watch: A coalition of 23 Democratic-led states, counties and municipalities is suing the Trump administration over a final rule that protects health care providers who refuse to provide care on the basis of their religious beliefs. The lawsuit, announced Tuesday, was filed by New York Attorney General Letitia James (D) and seeks to block the federal rule and have it declared unconstitutional (The Hill).

➔ In the Know: After a cringeworthy moment on Capitol Hill Tuesday when Housing and Urban Development Secretary Ben Carson Benjamin (Ben) Solomon CarsonState AGs condemn HUD rule allowing shelters to serve people on basis of biological sex Biden cannot keep letting Trump set the agenda The Hill's 12:30 Report: Trump heads to New Hampshire after renomination speech MORE appeared to think he’d been asked about an iconic cookie instead of an “REO” (real estate owned) foreclosure, Oreo had some fun at everyone’s expense, tweeting that the term stands for “Really Excellent OREO (cookie)” and adding that “everybody knows that.” Carson’s comment came in response to Rep. Katie Porter (D-Calif.) during a House Financial Services Committee hearing. He later joked about his response to the California Democrat, adding that he was sending some Oreos her way (The Hill).







THE CLOSER





And finally … Adopt a mustang and receive $1,000 from the government! No, not a four-wheeled sports car but a four-legged horse.

Available land in the United States can no longer sustain a growing population of wild horses, so the budget-conscious federal Bureau of Land Management, which rounds up thousands of horses and donkeys on designated land each year, began offering a financial incentive in March to people who can adopt and relocate wild horses.

To qualify, adopters must have enough grazing land and no history of animal abuse. Those approved get a wild horse, a $500 payment up front, and $500 one year later, with a cap of four horses per adopter.

The Humane Society and the American Wild Horse Campaign say the government’s round-ups can be dangerous for herds in the West, and they point to the risk that after adoption, horses may be illegally sold for slaughter. The groups say they would prefer the government focus annual efforts on fertility control (CBS News).





