Overnight Finance: Trump promises farmers 'better deal' on NAFTA | Clock ticks to shutdown deadline | Dems worry Trump pressuring IRS on withholdings | SEC halts trading in digital currency firm

View in your browser     Trump promises farmers a 'better deal' on NAFTA: President Trump on Monday promised he would get a "better deal" from Canada and Mexico in talks to overhaul the North American Free Trade Agreement (NAFTA).  "I am working very hard to get a better deal for our country, for our farmers and our manufacturers," Trump said during a speech to the American Farm Bureau's annual convention in Nashville.   The president said "it's not the easiest negotiation" because the country's North American neighbors are "making all of that money," but pledged he will "make it fair to you people again."  Trump tempered his fiery rhetoric on trade in front of the group of farmers and agribusiness leaders, who largely support free-trade agreements like NAFTA.  But his vague remarks will likely do little to reassure them about his past promise to "rip up" NAFTA and other pacts if they can't be renegotiated.  Farmers and Republican lawmakers from agricultural states have lobbied the president in recent months to keep the deal. The Hill's Jordan Fabian reports: http://bit.ly/2AGsJAb.   Clock ticks toward shutdown deadline: Lawmakers return to Washington on Monday with just 11 days left until the next deadline to avoid a government shutdown. Fights over immigration and figuring out top-line budget levels are dogging bipartisan negotiators seeking an agreement by the end of next week. Democrats' demand to increase defense and nondefense spending equally has also emerged as a key sticking point in the talks. Senate Majority Leader Mitch McConnell (R-Ky.) said he was "optimistic" lawmakers could reach a two-year deal to increase the budget caps, but it would require Democrats to send aside their demand for parity. "Any agreement must provide our armed forces with the resources they need to fulfill their missions. That means setting aside the misguided notion that new defense spending needs to be matched dollar for dollar by new nondefense spending," he said. Republicans argue that years of spending cuts have hollowed out the military, leaving it inadequately equipped to respond to a myriad of international challenges. But Democrats have shown no signs of backing down from the requirement that domestic and military spending be increased equally. The Hill's Jordain Carney and Cristina Marcos get you up to speed: http://bit.ly/2AH78YB.   Breaking news: Frontrunner to chair House Financial Services panel announces retirement: House Foreign Affairs Committee Chairman Ed Royce (R-Calif.) announced Monday that he will retire at the end of this year. Royce is now the eighth House panel chairman to opt against seeking reelection in 2018.  He would have potentially faced a tough path to reelection given that his district has become more competitive. Democratic presidential nominee Hillary Clinton won it by around 9 points in 2016 even as Royce, who has served in the House since 1993, won reelection by 14 points. Royce, a senior member of the House Financial Services Committee, was seen as a frontrunner to inherit the panel's gavel from Chairman Jeb Hensarling (R-Texas), who is also retiring. Without the Financial Services chairmanship, Royce have had to return to the House as a rank-and-file member and relinquish his Foreign Affairs gavel due to the GOP's rules limiting chairmen to three consecutive terms. The Hill's Cristina Marcos has more: http://bit.ly/2AHJ5bT.   Warren blasts Mulvaney for 'unjustified' actions at consumer bureau: Sen. Elizabeth Warren (D-Mass.) accused the acting director of the consumer bureau of using concerns about cybersecurity to sabotage the agency's oversight of the financial sector. Warren, in a letter released Monday, said acting Consumer Financial Protection Bureau Director Mick Mulvaney had been "hobbling the agency" by suspending data collection. "I fear that the freeze in data collection has in practice fundamentally changed how the CFPB interacts with its regulated entities," wrote Warren to Mulvaney, also the director of the Office of Management and Budget, and deputy director Leandra English on Jan. 4. I explain here: http://bit.ly/2AHYOaR.   Happy Monday and welcome back to Overnight Finance. I'm Sylvan Lane, and here's your nightly guide to everything affecting your bills, bank account and bottom line. See something I missed? Let me know at slane@thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N.   On tap tomorrow: Senate Banking Committee: Hearing on fighting money laundering and illicit finance, 10 a.m. http://bit.ly/2CxMxrl. House Financial Services Committee: Hearing on the Committee on Foreign Investment in the United States. "Evaluating CFIUS: Challenges Posed by a Changing Global Economy," 10 a.m. http://bit.ly/2CxBcHW. House Financial Services Committee: Hearing on "Legislative Proposals for a More Efficient Federal Financial Regulatory Regime: Part III," 2 p.m. http://bit.ly/2Cw04zI.   A look ahead: Lawmakers face a tight window to advance major legislation before election season kicks in and they head for the campaign trail. But Senate Majority Leader Mitch McConnell has expressed interest in holding a vote on a bipartisan bill to rollback the Dodd-Frank Act. Last month, the Senate Banking Committee approved the bill offered by Chairman Mike Crapo (R-Idaho), by a 16-7 vote. Nearly a dozen Democrats have sponsored the legislation. The Crapo bill seems likely to pass the Senate without issue, but House conservatives have already expressed opposition to the compromise. The bill would exempt small and mid-size banks from the most stringent parts of Dodd-Frank and scale back federal oversight of the financial system as a whole. But it contains no efforts to rein in the Consumer Financial Protection Bureau (CFPB), which would have poisoned the effort for Democrats. The bill's lack of restraints on the CFPB has already cost it support in the House. Several GOP members of the House Financial Services Committee told The Hill that they couldn't support a bill that doesn't touch the bureau, long loathed by Republicans and the finance industry: http://bit.ly/2AGh0lj.   Perdue calls on Canada to fully engage in NAFTA talks: Agriculture Secretary Sonny Perdue on Monday urged Canada to more fully engage in the push to complete an update of the North American Free Trade Agreement (NAFTA). Perdue, who called the upgrade of NAFTA a top priority for the Trump administration, specifically asked Canada to step up and "get in the game" to modernize the 24-year-old three-nation agreement, during remarks to the American Farm Bureau Federation's annual convention in Nashville, Tenn.  "All sides have to roll up their sleeves and get to work," Perdue said. He asked convention attendees to talk to Canada's Agriculture Minister Lawrence MacAulay "to get our partner to the north to get the deal done for them and for you." The remarks closely echo those of U.S. Trade Representative Robert Lighthizer, who said in the fall that he was "surprised and disappointed" by the resistance of Mexico and Canada to updating NAFTA. Both nations have complained that many of the U.S. proposals put forth early in the talks were non-starters. The Hill's Vicki Needham explains: http://bit.ly/2AGjG2l.   Blue-state officials plot response to GOP tax law: Elected officials in high-tax Democratic-leaning states are looking at creative ways to prevent the new tax law from raising their residents' bills. The new law, which passed in December with only Republican votes, caps the state and local tax (SALT) deduction at $10,000. GOP lawmakers said they hoped that would motivate high-tax states such as New York, New Jersey and California to curb their own taxes and spending. But politicians in blue states view the tax law as an attack on them, and are pushing back.  "We sort of have two choices. One choice is to step back and let this happen to us. Or the other is to get into the arena and fight like heck," New Jersey Gov.-elect Phil Murphy (D) said at a news conference Friday. "And this is New Jersey after all." The tax law is just one of the ways Republicans have taken aim at Democratic-leaning cities and states in recent months. The Hill's Naomi Jagoda has more: http://bit.ly/2AGMYxV.   Dems concerned Trump officials may pressure IRS on withholdings: The top Democrats on Congress's tax-writing committees are concerned the Trump administration may pressure the IRS to produce withholding tables that would benefit Republicans politically but ultimately cause people to owe taxes next year. In a letter to acting IRS Commissioner David Kautter on Monday, Sen. Ron Wyden (D-Ore.) and Rep. Richard Neal (D-Mass.) said they are worried that the Treasury Department "may unduly influence the new withholding tables for the 2018 tax year in a manner that will result in millions of taxpayers receiving larger after-tax paychecks this election year but ultimately owing federal income tax when they file in 2019." The IRS is expected to release guidance this month on tax withholdings from employee's paychecks that reflect the new tax law President Trump signed last month: http://bit.ly/2AH7bn5.   SEC halts trading of Chinese blockchain company: The Securities and Exchange Commission (SEC) on Monday halted trading in shares of a Chinese blockchain technology company. The SEC froze the purchase and sale of shares of UBI Blockchain Internet, a Chinese company that advertises blockchain programs and services. Blockchain is the distributed ledger system that serves as the foundation for bitcoin and other cryptocurrencies. The SEC said it froze trading of UBI shares because of potentially inaccurate information the company filed in its disclosures to the agency and "recent, unusual and unexplained market activity" around UBI stock since November. The trading suspension spans from 9:30 a.m. on Monday through 11:59 p.m. on Jan. 22. Founded in 2010 as JA Energy, the company changed its name to reflect its blockchain operations in November 2016. UBI was one of several companies involved or allegedly involved in blockchain or cryptocurrency technology that investors flooded with cash last year: http://bit.ly/2AH3QnS.   Trump: Hopefully Cohn will stay in admin for 'a long time' President Trump said Saturday that he hopes top White House economic adviser Gary Cohn will stay in his administration for "a long time." "I hope so," Trump said during a press conference at Camp David, when asked if Cohn would stay on. "Where is Gary?" Trump continued, turning toward Vice President Pence and top congressional Republicans standing by his side at the presidential retreat. Cohn, who was in the audience, said he did not hear the question. Trump invited Cohn to the lectern, saying his chief economic adviser was pleased with the passage of the GOP tax bill last month. "Now, if he leaves, I'm going to say: 'I'm very happy that he left.' OK? All right?" Trump continued, to laughs. "Come here, Gary." http://bit.ly/2AHiHPp.   SEC investigating Kushner business over use of visa program: The Securities and Exchange Commission (SEC) has launched an investigation into White House senior adviser Jared Kushner's family's real estate company regarding its use of a visa program, The Wall Street Journal reported Saturday. The SEC is probing Kushner Companies over its use of the EB-5 program, which provides green cards to immigrants who invest at least $500,000 in certain U.S. businesses. The commission subpoenaed the business for information about how it used the program in May, according to the Journal. The commission is working with a similar probe out of the Brooklyn U.S. attorney's office, which has been investigating Kushner Companies projects that were partially financed through the visa program. Spokespeople for the SEC and the U.S. attorney's office declined to comment to the Journal. http://bit.ly/2AGplp2.   In case you missed it over the weekend: US, South Korea begin talks to amend trade deal, by Vicki Needham Rep. Steve Womack said to have 'inside track' on Budget gavel, by Scott Wong Treasury aide McGahn, wife of White House counsel, to leave for House panel, by Sylvan Lane Cohn: Congress will 'hopefully' pass bank reg overhaul within months, by Sylvan Lane Economy adds 148K jobs in December, by Vicki Needham: http://bit.ly/2CUhDxE.   Op-eds from The Hill's Contributors: Tariffs would throw monkey wrench into humming economy Looming deadline will force Trump to take definitive stance on trade     Write us with tips, suggestions and news: slane@thehill.com, vneedham@thehill.com, njagoda@thehill.com, and nelis@thehill.com. Follow us on Twitter: @SylvanLane,  @VickofTheHill, @NJagoda, and @NivElis.         Did a friend forward you this email? Sign up for Finance Newsletters     Forward Finance Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.

Overnight Defense: Pentagon endorses military sexual assault protest | $900M in security assistance to be withheld from Pakistan | House Foreign Affairs chair to retire

View in your browser     THE TOPLINE: The #MeToo movement came to the Pentagon's doors Monday, and officials said the department endorsed the protest. The Hill's Ellen Mitchell reports: The Department of Defense (DOD) on Monday endorsed a demonstration against military sexual assault held earlier in the day in front of the Pentagon. Roughly 40 military veterans, service members and supporters attended the #MeTooMilitary demonstration Monday morning at the Pentagon Metro Station. The group demanded accountability from Pentagon leaders on the handling of military sexual assault and harassment, according to Service Women's Action Network (SWAN), one of three nonprofit groups that helped organize the gathering. "No one should have to tolerate harassment as part of their military service," Pentagon spokesman Army Col. Rob Manning told reporters after the rally. Asked if the department supports the objectives of the protesters, Manning replied, "Yes." Speakers at the event included retired Col. Don Christensen, president of Protect Our Defenders; Monica Medina, a former special assistant to former Defense Secretary Leon Panetta; and Heath Phillips, a survivor of military sexual trauma. Pentagon staff, including chief spokeswoman Dana White, walked outside toward the end of the gathering to express their support. "The DOD continually works to eliminate sexual harassment and assault from the military," Pentagon spokesman Marine Corps Maj. Adrian Rankine-Galloway said in a statement to The Hill. Read the rest here.   PENTAGON FREEZES $900M FOR PAKISTAN: The Pentagon on Monday gave more details of what the Trump administration's decision to suspend security assistance to Pakistan entails. Also Via The Hill's Ellen Mitchell The Pentagon on Monday announced it was withholding $900 million in security assistance for Pakistan. The fiscal 2017 National Defense Authorization Act (NDAA) provides up to $900 million for Pakistan in Coalition Support Funds (CSF) between Oct. 1, 2016, and Oct. 1, 2018. "That amount has been suspended, not cancelled or reprogrammed, as we continue to hope that Pakistan will take decisive action against the terrorist and militant groups that we seek," Pentagon spokesman Lt. Col. Mike Andrews said in a statement to The Hill. Of the $900 million, $400 million can only be released if the department "certifies the Pakistan government has made significant progress against the Haqqani network," Andrews said. The Trump administration last week suspended security assistance to Pakistan -- including military equipment deliveries, transfers of security-related funds and reimbursements for counterterrorism operations -- due to its failure to combat terrorist networks within its borders. The cuts are estimated to be worth up to $2 billion in Pentagon and State Department dollars. Read more here.   HOUSE FOREIGN AFFAIRS CHAIR TO RETIRE: Another House Republican chairman is retiring at the end of their term, The Hill's Cristina Marcos reports. House Foreign Affairs Committee Chairman Ed Royce (R-Calif.) announced Monday he will retire at the end of the year. Royce is now the eighth House panel chairman to opt against seeking reelection in 2018. He would have potentially faced a tough path to reelection given that his district has become more competitive. Democratic presidential nominee Hillary Clinton won it by about 9 points in 2016 even as Royce, who has served in the House since 1993, won reelection by 14 points. He also would have had to return to the House as a rank-and-file member and relinquish his Foreign Affairs gavel due to the GOP's rules limiting chairmen to three consecutive terms. "In this final year of my Foreign Affairs Committee chairmanship, I want to focus fully on the urgent threats facing our nation, including: the brutal, corrupt and dangerous regimes in Pyongyang and Tehran, Vladimir Putin's continued efforts to weaponize information to fracture western democracies, and growing terrorist threats in Africa and Central Asia," Royce said in a statement. "With this in mind, and with the support of my wife Marie, I have decided not to seek reelection in November." The Hill's Cristina Marcos has the story here.   TRUMP NEARS PLAN TO BOOST ARMS SALES: The Trump administration is finishing work on a plan that would call for U.S. military attaches and diplomats to play a bigger role in advocating for arms sales, according to a Reuters report Monday. As soon as February, President Trump could announce a "whole of government" approach to increase arms sales that would also ease export rules on U.S. military exports and give greater weight to the economic benefits for American manufacturers in the approval process, according to the report. Under the plan, military attaches and diplomats would be called to "to act essentially as a sales force for defense contractors," according to Reuters. The Hill's Mallory Shelbourne has more in the report here.   ON TAP FOR TOMORROW: A Senate Foreign Relations Committee subpanel will discuss the oversight and response to the attacks on U.S. diplomats in Cuba at 10 a.m. in Dirksen Senate Office Building, room 419. http://bit.ly/2m2jyFc The House Homeland Security Committee will hear from border security agents on a wide range of security issues at 10 a.m. in the House Visitor Center, room 210. http://bit.ly/2qw96Lq Former Deputy Secretary of State Antony Blinken will speak on "What to Worry About in 2018" at the Council of Foreign Relations at 12:30 p.m. Tuesday in Washington, D.C. http://on.cfr.org/2CGOhlw A House Armed Services Committee subpanel will hear from outside experts on China's pursuit of emerging and exponential technologies at 2:00 p.m. Tuesday in Rayburn House Office Building, room 2118. http://bit.ly/2CG6nnB   ICYMI: -- The Hill: Service member in anti-ISIS coalition dies in 'non-combat' incident -- The Hill: Trump discusses Iran, North Korea with France's Macron -- The Hill: Trump flexes foreign policy muscle as new year begins -- The Hill: Opinion: Transgender military service is as American as apple pie -- The Hill: Opinion: Jihadi 'catch and release' is a dangerous failure -- The Wall Street Journal: North and South Korea Prepare for Talks -- Reuters: In jab at rivals, Rouhani says Iran protests about more than economy     Please send tips and comments to Rebecca Kheel, rkheel@thehill.com, and Ellen Mitchell, emitchell@thehill.com. Follow us on Twitter: @thehill, @Rebecca_H_K, @EllenMitchell23         Did a friend forward you this email? Sign up for Defense Newsletters     Forward Defense Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.

Overnight Energy: Regulators kill Perry plan to boost coal, nuclear | 2017 sets new record for disaster costs | Cliven Bundy walks free

View in your browser     FERC SAYS 'NO' TO PERRY: The Federal Energy Regulatory Commission (FERC) unanimously rejected Energy Secretary Rick Perry's plan to prop up coal and nuclear power plants Monday. In a unanimous rebuke to a controversial piece of the Trump administration's energy policy, the five-person commission -- four of whom President Trump nominated -- said Perry and other supporters of the proposal failed to show that current electricity markets are not just or reasonable. Those findings that would be necessary in order to mandate the higher electricity payments that Perry sought in the notice of proposed rulemaking (NOPR). "The [Federal Power Act] is clear: in order to require [grid operators] to implement tariff changes as contemplated by the Proposed Rule ... there must first be a showing that the existing [grid] tariffs are unjust, unreasonable, unduly discriminatory or preferential," the commission wrote. "Neither the Proposed Rule nor the record in this proceeding has satisfied the threshold statutory requirement of demonstrating that the [grid] tariffs are unjust and unreasonable," it said. "In addition, the extensive comments submitted by the [grid operators] do not point to any past or planned generator retirements that may be a threat to grid resilience." Perry proposed the action in September. It would have required certain grid operators to pay power producers for their costs plus a reasonable profit, if the power plant at issue has at least 90 days of fuel on site -- a standard that only coal and nuclear could meet. Supporters said that coal and nuclear plant closures, which have been increasing in recent years due to cheap competition and regulations, threatened to make the electric grid less resilient and more prone to long blackouts. Perry said he was glad to start an important conversation about threats to resilience. "As intended, my proposal initiated a national debate on the resiliency of our electric system," he said in a statement. "What is not debatable is that a diverse fuel supply, especially with onsite fuel capability, plays an essential role in providing Americans with reliable, resilient and affordable electricity, particularly in times of weather-related stress like we are seeing now," Perry continued, promising to keep working with FERC on the matter. The American Council on Renewable Energy said FERC's dismissal was the right move. "We believe FERC has laid out a sensible approach to gathering the vital information needed to support any changes to electricity markets, and we are confident that, in the end, the record still will not support market intervention," Gregory Wetstone, the group's president, said in a statement. Read more here.   $306 BILLION IN MAJOR US DISASTERS IN 2017: The United States set a new record last year for the total cost of weather and climate change-related disasters that exceeded $1 billion, driven largely by wildfires and hurricanes. The National Oceanic and Atmospheric Administration's (NOAA) National Center for Environmental Information said in a Monday report that the 16 disasters that cost more than $1 billion added up to $306 billion. The total number of disasters tied with 2011 for a record, while the total cost was a new high. "The damage from Hurricanes Harvey, Irma and Maria alone are responsible for approximately $265.0 billion of the $306.2 billion," Adam Smith, an economist at NOAA, wrote in a blog post. "Each of these destructive hurricanes now joins Katrina and Sandy, in the new top 5 costliest U.S. hurricanes on record." The $306 billion total is also a new cost record worldwide for one country for a year. Smith attributed the new cost record to increasing wealth and population, as well as effects of climate change like drought and flooding. Read more here.   JUDGE DISMISSES CLIVEN BUNDY CASE: A federal judge on Monday dismissed the charges against Nevada rancher Cliven Bundy, his two sons and a militia member for their role in a 2014 standoff with federal officers. Judge Gloria Navarro dismissed the charges against the men "with prejudice," meaning they can't be put on trial again, The Arizona Republic reported. She said the conduct of prosecutors in the case had been "outrageous" and violated due process rights. Navarro also ordered Bundy be released from prison. Navarro last month declared a mistrial in the criminal conspiracy case against Bundy and his sons, saying federal prosecutors had improperly withheld evidence that could have changed the outcome of the trial. Read more here.   SCOTUS WON'T HEAR CASE OVER EPA JOBS REPORT: The Supreme Court Monday declined to hear a coal mining company's appeal arguing that the Environmental Protection Agency (EPA) must regularly report on the impact to coal jobs from its regulations. Murray Energy Corp.'s case was one of dozens the court declined to hear without any explanation. The rejection means that the previous ruling stands, in which the Court of Appeals for the 4th Circuit ruled that the EPA does not have to regularly produce the jobs reports. Murray Energy is headed by Bob Murray, an outspoken coal mogul and frequent litigant against the Obama EPA and others he has perceived as anti-coal, as well as a strong supporter of President Trump. The case started years ago, under the Obama administration, amid industry and Republican accusations the administration was killing thousands of jobs with its environmental rules. Read more here.   ON TAP TUESDAY I: American Petroleum Institute head Jack Gerard will give his annual "State of American Energy" speech. The event is the oil lobby's way to set its agenda for the year and celebrate its recent accomplishments.   ON TAP TUESDAY II: The House Energy and Commerce Committee's subpanel on energy will hold a hearing to kick off its consideration of ways to reorganize the Department of Energy. The hearing will include Deputy Energy Secretary Dan Brouillette, Under Secretary for Science Paul Dabbar and National Nuclear Security Administration head Frank Klotz.   Rest of Tuesday's agenda ... The House Natural Resources Committee's subpanel on federal land will hold a hearing on Rep. John Curtis's (R-Utah) bill to codify the two national monument units Trump created when he greatly reduced the size of the Bears Ears National Monument in Utah.   AROUND THE WEB: Sunoco Pipeline estimated Monday that its Mariner East 2 pipeline, whose construction was recently halted by regulators, would add $9.1 billion to the economy, the Philadelphia Inquirer reports. The National Park Service helped to release 400 cold-stunned turtles back into the Gulf of Mexico from Texas, the Associated Press reports. Wyoming's Supreme Court sent a case back to a lower court in a dispute between a coal company and an oil company with competing claims over the same land, the Casper Star Tribune reports.   IN CASE YOU MISSED IT: Check stories from Monday and the weekend ... - Energy nominee who wrote controversial op-ed on gay troops withdraws - Regulators kill Perry's proposal to prop up coal, nuclear power plants - Maine senators oppose Trump's offshore drilling plans - Judge dismisses charges against Cliven Bundy, orders him freed from prison - US sets new cost record for major disasters - Supreme Court rejects case over EPA coal jobs reports - Week ahead: House GOP looks to revamp Energy Department - Park Service official who ignored environmental rules picked for senior agency post: report - New Hampshire's GOP governor opposes Trump's offshore drilling expansion     Please send tips and comments to Timothy Cama, tcama@thehill.com. Follow us on Twitter: @Timothy_Cama, @thehill         Did a friend forward you this email? Sign up for Energy Newsletters     Forward Energy Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.