The Hill's Morning Report — Negotiations resume amid shutdown stalemate | Trump, Democrats trade shutdown blame in prime-time remarks | Report: Rosenstein preparing to step down | Pompeo makes surprise stop in Baghdad | House Dems move on guns, drug prices and GOP tax law | Warren leads Dem field in early polling | Dem candidates prepare for 2020 close-ups | Meet the most diverse Congress in history

Welcome to The Hill's Morning Report, and happy Wednesday! 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.   President Trump will meet with Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Charles Schumer (D-N.Y.) in the Situation Room today as the two sides resume negotiations aimed at reopening the federal government, which has been partially shuttered for 19 days now.   Last night, the president and the Democratic leaders took their cases directly to the public in highly anticipated prime-time remarks broadcast across all major networks and cable news outlets.   Both Trump and the Democrats ended their speeches by demanding the other side bring an end to the shutdown.   The Memo: Takeaways from Trump's Oval Office address.   Speaking from the Oval Office, Trump said the situation at the border represents a "growing humanitarian and security crisis" that can only be solved by Congress allocating $5.7 billion for a steel barrier along the border.   The president stopped short of saying he'd use emergency war powers to circumvent Congress by redirecting money from the military to build the wall.   Rather, he cast the border as a pipeline for drugs, violent criminals and human trafficking.   "Thousands of more lives will be lost if we don't act now. This is a humanitarian crisis — a crisis of the heart and a crisis of the soul." – Trump   Bottom line: Democrats are more united than Republicans on the shutdown and while Trump didn't declare a national emergency Tuesday night, that option has not been taken off the table. It could be Trump's only way out without caving.   The Hill: Trump describes border wall as a "choice between right and wrong."   Pelosi and Schumer followed, standing side-by-side for rebuttals.   The Speaker called Trump's remarks "full of misinformation and malice" and blamed his policies for deepening the "humanitarian challenge" at the border. Pelosi also highlighted the impact of the shutdown on federal workers and those who rely on government services.   "The fact is, President Trump has chosen to hold hostage critical services for the health, safety and well-being of the American people and withhold the paychecks of 800,000 innocent workers across the nation — many of them veterans." — Pelosi   Schumer described the president as a child who shut the government because he didn't get what he wanted.   "We don't govern by temper tantrum. No president should pound the table and demand to get his way or else the government shuts down." — Schumer     Meanwhile, pressure is rising on the president to come up with an endgame, as new cracks appear in the GOP coalition.   Trump and Vice President Pence will head to Capitol Hill to meet with Senate Republicans today.   The Hill: Pence urges Republicans to stand with Trump.   Senate Majority Leader Mitch McConnell (R-Ky.) is refusing to bring House-passed legislation that fully funds the government up for a vote, but at least three Republicans in his caucus are calling for a vote to reopen the government without additional funding for the wall.   The Hill: GOP senators skeptical of using national emergency for wall money.   House Republicans are growing restless, too.   Rep. Mac Thornberry (Texas), the top Republican on the House Armed Services Committee, said Tuesday he does not support using military funds to build the wall.   And Reps. Fred Upton (R-Mich.), Brian Fitzpatrick (R-Pa.) and Will Hurd, a Republican who represents a Texas district along the U.S.-Mexico border, have each vented their frustrations with the shutdown and Trump's demands for wall money.   Conservative groups, such the U.S. Chamber of Commerce and the network of groups affiliated with billionaire conservative Charles Koch, are also calling for an end to the shutdown, as are bipartisan governors' and mayors' groups from across the country, where the shutdown's impact is being felt.   The polling is moving against the president as he prepares for a Thursday trip to McAllen, Texas, for an event at the border.   Reuters/Ipsos: The shutdown is unpopular, and a majority of Americans blame Trump. PRRI: A majority of Americans oppose building a wall along the southern border. Politico/Morning Consult: 42 percent believe the U.S. faces a border "crisis" due to illegal immigration.   LEADING THE DAY CONGRESS: The 116th Congress has made history for its racial, gender and religious diversity. The new Congress has more African-Americans, Hispanics, Asian-Americans and openly LGBT members than any that has come before, as well as the first Muslim and Native American women to serve. Our colleagues put together this helpful guide to getting to know the most diverse Congress ever assembled (The Hill).   So, what are they up to?   The new Democratic majority in the House has prioritized gun legislation, unveiling a universal background checks bill on Tuesday as one of their first major moves (The Hill).   Next up, House Democrats are eyeing smaller pieces of bipartisan legislation aimed at lowering drug costs before tackling sweeping, more controversial proposals, such as allowing Medicare to negotiate drug prices (The Hill).   House Democrats also want to undo certain provisions of the 2017 GOP tax law. Naomi Jagoda reports on early plans (The Hill). And they vow to be a legislative check on Trump's defense agenda and evolving foreign policies, particularly in the Middle East (The Hill).   Meanwhile, Senate Republicans, in control in the upper chamber, want to craft a new approach to health care before 2020, recognizing that voter anxieties about GOP efforts to repeal and replace the Affordable Care Act and Democrats' adroit focus during 2018 campaigns on protecting coverage of pre-existing conditions worked against Republicans (The Hill).   IN FOCUS/SHARP TAKES POLITICS: The influential liberal website Daily Kos has released its first straw poll of the 2020 Democratic presidential field, and Sen. Elizabeth Warren (D-Mass.), the first big name to actively campaign this cycle, is sitting at the top with 22 percent support.   Those who follow with double-digit support: Former Rep. Beto O'Rourke (D-Texas) at 15 percent, Sen. Kamala Harris (D-Calif.) and former Vice President Joe Biden at 14 percent, and Sen. Bernie Sanders (I-Vt.) at 11 percent.   It's very early and another two dozen candidates or more could still jump into the race. Still, the survey shows Sens. Cory Booker (D-N.J.) and Kirsten Gillibrand (D-N.Y.), and former Housing and Urban Development secretary Julian Castro have their work cut out for them, with each registering 3 percent support or less.   The next to get in is probably billionaire philanthropist Tom Steyer, who has an announcement planned today in Iowa (The Hill).   Harris, the California Democrat and first term senator, is inching closer to taking the plunge. She released a memoir and shuttered her state campaign arm this week ahead of a potential run.    Castro, meanwhile, became the latest Democrat to embrace "Medicare for all" legislation at a campaign event in Iowa (The Hill).   More from campaigns and politics … U.S. still leans conservative but liberals keep recent gains (Gallup) … North Carolina election fraud probed long before 2018 race (The Associated Press) … More than 1 million Floridians with felony convictions regained the right to vote on Tuesday, setting in motion a process that carries the potential to reshape elections in the country's largest and most unpredictable battleground state (The Hill).   ***   INVESTIGATIONS: Deputy Attorney General Rod Rosenstein, who is overseeing special counsel Robert Mueller's probe into Russian interference in 2016 election,  plans to leave his post at the Department of Justice in the coming weeks, according to ABC News. The report says that Rosenstein is not being forced out by the president, but that rather he has planned to step aside once a new attorney general is in place. The Senate will hold a confirmation hearing for Trump's nomination of former Attorney General William Barr next week. > Whoops. Attorneys for Trump's former campaign chairman Paul Manafort failed to redact portions of a court filing, revealing that Mueller has accused Manafort of sharing campaign information with a man who is believed to have ties to Russian intelligence and then lying about it to the special counsel (Bloomberg). Manafort and his attorneys dispute the allegations of lying to investigators (The Hill).   > Natalia Veselnitskaya, the Russian lawyer who met with Donald Trump Jr., Manafort and Jared Kushner at Trump Tower in 2016, has been charged with money laundering by federal prosecutors in New York. The charges are unrelated to the Trump Tower meeting, but the court filings revealed that Veselnitskaya has deep ties to senior Russian government officials (The New York Times). > The Supreme Court has received an appeal from a mysterious foreign company that could provide new clues about the Mueller probe (Bloomberg).   OPINION A wall can't be the only answer to uncontrolled illegal immigration, by Nolan Rappaport, opinion contributor, The Hill. https://bit.ly/2siOhkS   What if we paid people to donate their kidneys to strangers? by Megan McArdle, Washington Post columnist. https://wapo.st/2Fiuj1k   WHERE AND WHEN 📺 Hill.TV's "Rising" program, starting at 8 a.m., features Reps. Dan Kildee (D-Mich.) and Don Bacon (R-Neb.), sharing reactions to the president's speech, and A. Ashley Tabaddor, president of the National Association of Immigration Judges, discussing the shutdown's impact on the judges she represents. http://thehill.com/hilltv   The House convenes at 10 a.m. Pelosi and Schumer will hold a press conference at 11 a.m.   The Senate meets at 9:30 a.m.   The president participates in a signing ceremony for anti-human trafficking legislation at 11:30 a.m. He and the vice president will attend the weekly Senate GOP policy lunch in the Capitol at 1 p.m. The president and Pence also meet with House and Senate leaders from both parties at 3 p.m. in the White House Situation Room to discuss the government's funding impasse.   Secretary of State Mike Pompeo made an unannounced stop in Iraq overnight while visiting Arab capitals (The Associated Press and Reuters). He was in Jordan on Tuesday and will be in Egypt today to deliver a speech in Cairo. Then he heads to Bahrain, United Arab Emirates, Qatar, Saudi Arabia, Oman and Kuwait through Jan. 15.   The Federal Reserve at 2 p.m. will release minutes of the Federal Open Market Committee meeting of Dec. 18-19.     ELSEWHERE > States & Cities: New Democratic governors in blue and purple states are using inaugural addresses to take aim at the Trump administration, vowing to delink their states from Washington (The Hill). … New York Mayor Bill De Blasio (D) on Tuesday announced a $100 million health care plan for undocumented and low-income city dwellers (The New York Times). … California Gov. Gavin Newsom (D) announced a plan on Monday to seek a waiver from the federal government to explore a single-payer health care system, pool California's resources to bring down prescription drug costs and expand Medi-Cal coverage to all undocumented immigrants younger than 26 (The Mercury News).   > Environment: America's carbon dioxide emissions rose by 3.4 percent in 2018, the biggest increase in eight years, even as many U.S. coal plants ceased operations last year, according to a report released this week. The findings further complicate aims to address greenhouse gases and climate change in years to come (The New York Times).   > Trump Organization: The Washington Post published an overview describing the president's business, from ongoing investigations to expansion plans as 2019 begins. Find it HERE.   > Brick and mortar: Sears Holdings Corp, the 126-year-old U.S. department store icon, gained a day to try to land a takeover deal before bankruptcy and an auction deadline (Fox Business). Should Sears wind up liquidating its assets, including Kmart, the company would become one of the most high-profile victims of the rise of online shopping, potentially shedding 50,000 employees (Reuters).     > Raw foods: The first nudist restaurant in Paris is being forced to close because it cannot put enough bums on seats (Agence-France Presse).   THE CLOSER And finally … The ongoing shutdown, which is now the second longest in the nation's history, carries real-world consequences that grow by the hour. Americans from Florida to Maine and through Midwestern and Western states where voters generally support Trump's aims say they feel the effects.   Life-saving: Furloughed Food and Drug Administration employees fear the lapse in funding and staffing could cost lives, including through oversight, drug approvals and compassionate-care drug trial management (CNN).   Life without wages: Some federal employees around the country, especially lower wage workers, describe a precipice without paychecks. Now living "nothing to nothing" instead of "paycheck to paycheck," they say they cannot afford school lunches, day care, transportation and gasoline, rent and many other everyday expenses (Federal News Network; The Washington Post; The New York Times).   Travel delays and safety: Air travel has been impacted (The Associated Press). … In Maine, the shutdown interrupts key training for air traffic controllers, who may not be able to complete it (Portland Press Herald).   Border security: The Department of Homeland Security has furloughed workers employed in border security, and DHS canceled a trip to the southern border in Texas for its advisory council because of the shutdown. The January visits were supposed to help the council draft recommendations for Secretary Kirstjen Nielsen (The Daily Beast).   Love Act: The D.C. council passed an emergency bill supported by Mayor Muriel Bowser on Tuesday to allow the city to issue marriage licenses because the marriage bureau at D.C. Superior Court has been shuttered (The Washington Post).   Parks see wear and tear: Joshua Tree National Park in California needs several days this week to close and clean up restrooms and accumulated garbage before reopening by the weekend. With a skeleton crew of rangers to supervise during the shutdown, the park sustained wear from off-road driving and some defacement of the park's namesake Joshua trees by visitors (The Los Angeles Times). … Administration efforts to tap national park entrance fees to cover maintenance costs during the partial shutdown create budget questions because the fees cannot be replenished for planned purposes when the temporary funding lapses eventually end (The Hill).     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! 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