Overnight Defense: Latest on marathon markup of $717B defense bill | CIA pick bolsters chances for confirmation | North Korea frees three American prisoners

View in your browser     Happy Wednesday and welcome to Overnight Defense. I'm Rebecca Kheel, and here's your nightly guide to the latest developments at the Pentagon, on Capitol Hill and beyond.   THE TOPLINE: The House Armed Services Committee's marathon markup of the $717 billion annual defense policy bill kicked off at 10 a.m. Wednesday and is still going strong. The National Defense Authorization Act (NDAA) markup frequently goes past midnight, sometimes past 2 a.m. and even in one recent year past 4 a.m. Staffers, lawmakers and reporters are crossing their fingers it won't go nearly that late this year. But several controversial issues that will eat up time -- including nuclear weapons, President Trump's military parade, transgender troops and troop deployments to the border -- have yet to be broached. Here's a look at some of the highlights so far: Aviation accidents: The committee endorsed establishing an independent commission to study military aviation safety after a series of deadly incidents, including a C-130 cargo plane crash last week that killed all nine on board. The panel approved by voice vote an amendment to its annual defense policy bill that would create the commission. The amendment was offered by the committee's ranking member, Rep. Adam Smith (D-Wash.), who compared the aviation accidents to the Navy's spate of ship collisions which led to internal investigations. "This crosses service lines, and personally, I don't think all of us are 100 percent satisfied with what the Navy came back to us on the accident that happened with the ships," he said. "I want to make sure that we have an independent commission that really looks at this. This is becoming a very large problem. It is costing the lives of the men and women who are serving us, and I don't think it's just the money." Trump administration travel: The committee voted down a proposal that would have required the Pentagon to report on the cost of Trump administration officials using military aircraft for travel. The amendment was voted down 30-31 during the panel's markup of the National Defense Authorization Act (NDAA). Two Republicans, Reps. Don Bacon (Neb.) and Steve Knight (Calif.), supported the measure, while another Republican, Rep. Walter Jones (N.C.), did not vote. Rep. Tom O'Halleran (D-Ariz.) offered the amendment, citing several times that Trump administration officials have used military aircraft for travel. "Some are indeed rightfully required to travel exclusively by [military aircraft] for national security purposes. But for everyone else there's rules," Halleran said. "That's why I and many other Americans have been outraged by report after report surfacing that senior administration officials are abusing ethics rules and improperly using military aircraft for travel." Stay tuned: Committee staffers said more than 400 amendments were filed on the bill. As of 6:11 p.m., the committee has gotten through five of six subcommittees' portions of the bill. Just the Strategic Forces subcommittee and the chairman's mark remain, but both of those are expected to take a hefty amount of time. The Hill's Ellen Mitchell will be keeping track of the debate throughout the night, so be sure to check back at the TheHill.com for updates.   HASPEL HAS HER DAY: Gina Haspel, President Trump's nominee to become CIA director, was grilled by the Senate Intelligence Committee on her background in the agency controversial post-9/11 interrogation program. The Hill followed along in a liveblog, available here to catch up on. Takeaway: Haspel had no major stumbles in her highly anticipated testimony, a performance that earned some muted criticism from Democrats but overall appeared to bolster her chances of being confirmed as the CIA's next director. Haspel, a career CIA officer who spent over three decades undercover, wavered little under questioning from Sens. Dianne Feinstein (Calif.), Kamala Harris (Calif.) and other Democrats about her role in the agency's controversial post-9/11 interrogation and detention program. She fiercely defended the agency's counterterror chops and her own "moral compass," as Democrats repeatedly pressed her on the morality of torture -- and criticized her for providing "legalistic" answers. Vows not to restart program: Haspel vowed not to bring back the spy agency's controversial interrogation program, addressing early in her Senate confirmation hearing a key point on her record that Democrats and other critics have scrutinized. "I can offer you my personal commitment, clearly and without reservation, that under my leadership, on my watch, the CIA will not restart a detention and interrogation program," she told lawmakers on the Senate Intelligence Committee. Her pledge not to bring back the CIA's "rendition, detention and interrogation" program came during her opening remarks at her confirmation hearing. Says no to 'immoral' orders: She also said she would not make the CIA to carry out "immoral" activities, even if ordered to do so by President Trump. In an at-times testy exchange with Sen. Mark Warner (D-Va.), the Senate Intelligence Committee's top Democrat, Haspel said that the CIA was bound to uphold U.S. law and "American values," and that the country had determined that such interrogation practices run counter to those values. Asked by Warner if she would follow a hypothetical order from Trump to use harsh interrogation and detention practices, Haspel flatly said, "No." She said she would "not put CIA officers at risk" by reimplementing the controversial program again. But won't say what's immoral: She later declined to directly answer repeated questions on Wednesday about whether she views the controversial interrogation techniques used by the CIA following the Sept. 11 terror attacks as "immoral." Pressed repeatedly by Sen. Kamala Harris (D-Calif.) to provide a "yes or no answer," Haspel said that she supports the "higher moral standards" that the U.S. has embraced since renouncing the use of the techniques. "I believe CIA did extraordinary work to prevent another attack with the legal tools we were provided," she added, however. In a testy exchange, Harris accused Haspel of not answering her question. "Senator, I think I've answered the question," Haspel said. "No, you've not," Harris said. Dem support: At least one Democrat was convinced by the hearing, with Sen. Joe Manchin (W.Va.) announcing later Wednesday he will vote to confirm Haspel. Manchin is the first Democrat to come out in support of Haspel, bolstering her chances of being confirmed despite engrained opposition from progressive senators and allied outside groups. "I have found Gina Haspel to be a person of great character. Over her 33 year career as a CIA operations officer, she has worked in some of the most dangerous corners of our world and I have the utmost respect for the sacrifices she has made for our country," Manchin said in a statement.   NORTH KOREA DETAINEES FREED: Secretary of State Mike Pompeo came back from his North Korea trip with three American citizens who were detained there in tow. Trump first announced the news on Twitter on Wednesday morning. "I am pleased to inform you that Secretary of State Mike Pompeo is in the air and on his way back from North Korea with the 3 wonderful gentlemen that everyone is looking so forward to meeting," the president wrote. Trump said he would greet Pompeo and the three Americans at Joint Base Andrews at 2 a.m. Thursday morning. White House press secretary Sarah Huckanee Sanders said the Americans "appear to be in good condition and were all able to walk on the plane without assistance." Why Pompeo was there: This was Pompeo's second trip to North Korea to prepare for Trump's upcoming summit with North Korean leader Kim Jong Un. Sanders said in a statement that Trump views the detainee release "as a positive gesture of goodwill" ahead of the talks. Where and when: Pompeo's trip also apparently finalized the details of where and when the Trump-Kim summit will be held. Later Wednesday, Trump said those details will be announced "within three days." But he ruled out one place for the summit to happen: the demilitarized zone between the Koreas that he said previously he favored. In the early evening, CNN reported that the location of the summit will be Singapore.   IRAN FALLOUT: The international community on Wednesday grappled with Trump's decision to withdraw the United States from the Iran nuclear deal the day prior. France's foreign minister declared the Iran nuclear deal "is not dead" and said President Emmanuel Macron would speak with the Iranian president about preserving the deal. Iranian President Hassan Rouhani apparently told Macron on the call Wednesday that Europe has a "very limited opportunity" to save the Iran nuclear deal. "Under the current conditions, Europe has a very limited opportunity to preserve the nuclear deal, and must, as quickly as possible, clarify its position and specify and announce its intentions with regard to its obligations," Rouhani reportedly told Macron, according to the Iranian Students' News Agency. Meanwhile, Iran's chief regional rival, Saudi Arabia, reiterated its position that it will build a nuclear weapon if Iran does. The Agence France-Presse (AFP) reported that Saudi Foreign Minister Adel al-Jubeir said Wednesday that the country would do "everything we can" to build a nuclear bomb in that situation. The new U.S. ambassador to Germany Richard Grenell is also facing backlash from some quarters of the German government over his comments about companies from that country doing business in Iran. After Trump's announcement Tuesday, Grenell tweeted "German companies doing business in Iran should wind down operations immediately." If you missed it: Last night, The Hill looked at five takeaways from Trump's decision. Catch up on that here.   ON TAP FOR TOMORROW The Senate Armed Services Committee will hold a confirmation hearing for the nominees to be deputy under secretary of Defense for research and engineering; assistant secretary of Defense for manpower and reserve affairs; assistant secretary of Defense for strategy, plans and capabilities; assistant secretary of the Navy for manpower and reserve affairs; and deputy administrator for defense programs of the National Nuclear Security Administration at 9:30 a.m. at the Hart Senate Office Building, room 216. https://bit.ly/2IgWgIG The Senate Foreign Relations Committee will hold a hearing on modernizing development finance at 10 a.m. at the Dirksen Senate Office Building, room 419. https://bit.ly/2jGkuxX   ICYMI -- The Hill: Trump incorrectly claims military pay hasn't gone up for 10 years -- The Hill: House panel approves bill to 'hack' the State Department -- The Hill: House panel approves bills to secure energy infrastructure -- The Hill: Kaine: Deadly Niger mission was unauthorized -- The New York Times: Militants kill 15 in Afghan attacks, as Taliban expand their control -- Associated Press: Americans were freed 1 hour before flight out of Pyongyang     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: Perry eyes using decades-old law to boost coal industry | California to mandate solar panels on new homes | Dem states push for court decision on Obama climate rule

View in your browser     PERRY EYES COLD-WAR ERA LAW TO HELP COAL INDUSTRY: Energy Secretary Rick Perry told lawmakers that the Trump administration is looking into using a Cold War-era law to prop up struggling coal and nuclear power plants. Speaking to the House Science Committee Wednesday, Perry named the Defense Production Act as something the Department of Energy (DOE) is "looking very closely at" as a way to secure the nation's energy grid. "That's approaching this from an economic standpoint and I think ... it's about the national security of our country, of keeping our plants, all of them, online, being able to deliver energy" in an emergency, Perry told the lawmakers "So, we're looking at a number of ways to approach this. I know the Defense Production Act is one of those ways to address [it] that we're looking at very closely as well." Bloomberg reported last month that White House aides were looking into how to best implement use the 68-year old law, which was passed by Congress in the midst of the Korean War. The law gives the government broad latitude to nationalize private industry in the name of security. Why it matters: Using the defense law is just one in a series of strategies that the Trump administration has considered or been pushed to use to boost coal and nuclear power. Officials argue that without coal and nuclear, the electric grid is in danger. But other power sources say the administration is just trying to help their favored fuels. Flashback: The Federal Energy Regulatory Commission rejected a plan earlier this year by Perry to require higher payments to coal and nuclear plants than their competitors. A big decision ahead: FirstEnergy Solutions, a major utility company that provides nuclear and coal power, has petitioned Perry to declare a grid emergency and order utilities to pay more for the coal and nuclear. Read more here.   PRUITT TOUTS REG ROLLBACK ON BIRTHDAY: Environmental Protection Agency (EPA) Administrator Scott Pruitt celebrated the agency's regulatory reform achievements and initiatives with a roundtable discussion with industry groups Wednesday. Pruitt met with over 80 partners of EPA's Smart Sectors Program to kick start Trump's "2018 Unified Agenda of Regulatory and Deregulatory Actions," the EPA said. Participants included the president of the Steel Manufacturers Association, Portland Cement Association, and the Real Estate Roundtable. Pruitt called the agenda a reflection of "the Trump administration's commitment to reducing unnecessary regulatory burdens." "EPA is advancing this agenda by listening and working in partnership with the regulated community to improve environmental protections for the American people while also promoting economic growth," he said in a statement. Pruitt was simultaneously celebrating another achievement: his 50th birthday. At the roundtable Pruitt reportedly told attendees he'd been celebrating all day. No word on whether the administrator will frequent his favorite D.C. dining spot, Le Diplomate, to celebrate his milestone tonight.   CALIFORNIA TO MANDATE SOLAR PANELS ON NEW HOMES: California will soon become the first state to require all new homes be built with solar panels. The California Energy Commission voted unanimously, 5-0, Wednesday to change a state building code that would require all new homes be equipped with the renewable energy technology. The changes, which would go into effect in 2020, are expected to cost home-builders between $8,000 and $12,000 per house, but the commission says it will also save homeowners about $80 a month on heating, cooling and lighting bills.   Abigail Ross Hopper, CEO of the Solar Energy Industries Association, called the vote, "historic." "This is an undeniably historic decision for the state and the U.S. California has long been our nation's biggest solar champion, and its mass adoption of solar has generated huge economic and environmental benefits, including bringing tens of billions of dollars of investment into the state," Hopper said in a statement. "Now, California is taking bold leadership again, recognizing that solar should be as commonplace as the front door that welcomes you home. The state is already the nation's leader for solar capacity. Several California cities have already been mandating some solar power in new buildings. Why it matters: The decision comes as the Golden State is heavily pushing back against Trump administration initiatives focused on revitalizing the fossil fuel and nuclear industries. In February, President Trump implemented a 30 percent tariff on solar-panel technology imported into the country -- a move many U.S. solar companies say will impact their bottom line and increase manufacturing costs. Read more here..   More news from the Golden State ... HUGH HEWITT WARNED OVER PRUITT LOBBYING: Conservative commentator Hugh Hewitt is getting scolded over news that he pushed Pruitt to take action on a Superfund site in his home county. Emails obtained by the Sierra Club under the Freedom of Information Act show that Hewitt emailed Pruitt last year to set up a meeting with the law firm Larson O'Brien, where Hewitt works and which represents the Orange County Water District. The water district wanted the EPA to put more effort into a Superfund cleanup effort that the Obama administration had designated. Pruitt soon put the project on a short list of sites slated for "immediate and intense action." After Politico reported on the exchange this week, MSNBC, where Hewitt hosts the Saturday show "Hugh Hewitt," reprimanded him. "He was given a verbal warning as such activity is a violation of our standards," an MSNBC spokesman said in a statement. The spokesman said Hewitt had previously agreed not to discuss EPA matters on his show, since he considers Pruitt a friend and Hewitt's son works at the agency. The Washington Post, where Hewitt writes columns, is also seeking to clamp down on potential conflicts of interest amid the news. Read more here.   DEMS WANT RULING ON CLEAN POWER PLAN: A group of attorneys for Democratic states and cities is asking a federal appeals court to issue a ruling on former President Barack Obama's landmark climate change rule for power plants. The coalition, led by acting New York Attorney General Barbara Underwood, is fighting back against the Trump administration's request to delay the litigation over the EPA's Clean Power Plan for another 60 days. The Court of Appeals for the District of Columbia Circuit heard arguments in the case in September 2016. But President Trump took office before the court ruled, and federal attorneys successfully asked the judges to hold off on their ruling to let the administration work through its process of repealing the climate regulation. It has now been more than a year since the case was first delayed, and the attorneys for 16 Democratic states, six cities and a county are getting anxious. "EPA has neither completed a rulemaking nor even committed to a deadline for doing so," the attorneys wrote Wednesday to the court, saying they "reiterate their continued opposition to EPA's attempt to stave off judicial review of the legality of the Clean Power Plan based on EPA's plans to repeal (and possibly replace) the Plan at some undisclosed future date." Read more here.   ON TAP THURSDAY: The House is expected to vote on the Nuclear Waste Policy Amendments Act, which is meant to move the Yucca Mountain nuclear waste site project forward and allow interim waste storage sites, among other steps. The bill is likely to pass easily, but its future in the Senate is unknown, at best. Interior Secretary Ryan Zinke will testify to the Senate Appropriations Committee's Interior and EPA subpanel on his fiscal 2019 budget request. The House Energy and Commerce Committee's energy subcommittee will hold a hearing on the state of the nation's electricity transmission infrastructure.   OUTSIDE THE BELTWAY: A video posted on Facebook helped Utah wildlife officials track down a suspected poacher, the Salt Lake Tribune reports. Pennsylvania regulators want lawmakers to allow them to audit natural gas companies' hiring of women and minorities, StateImpact Pennsylvania reports. Richmond, Calif.'s port has seen a spike in coal exports, CBS San Francisco Bay Area reports.   IN CASE YOU MISSED IT: Check out Wednesday's stories... -Dem states want court to decide on Obama climate rule -Hugh Hewitt scolded for Pruitt advocacy -California to be first state to mandate solar panels on new homes -DOE looking 'very closely' at Cold War-era law to boost coal, nuclear production     Please send tips and comments to Timothy Cama, tcama@thehill.com; and Miranda Green, mgreen@thehill.com. Follow us on Twitter: @Timothy_Cama, @mirandacgreen, @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.

Overnight Finance: Treasury probing how Stormy Daniels lawyer got Cohen's bank records | Mulvaney under fire over changes to student loan office | Rescissions package could tie lawmakers' hands on funding bills

View in your browser     Happy Wednesday and welcome back to Overnight Finance, which has unfortunately been passed over for a lucrative drone piloting license. 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.   THE BIG DEAL: The Treasury Department's inspector general is investigating how Stormy Daniels's lawyer, Michael Avenatti, obtained confidential banking records concerning a company controlled by President Trump's personal attorney, Michael Cohen. The inspector general's counsel, Rich Delmar, told The Hill that the office is looking into allegations that federally mandated reports filed about Cohen's banking transactions were "improperly disseminated." News of the Treasury investigation, which is focused on the release of Suspicious Activity Reports filed by banks that hosted accounts for Cohen, was first reported Wednesday by The Washington Post.  Delmar told The Hill that the Treasury probe is based on a New York Times report from Tuesday that revealed that a shell company set up by Cohen received more than $1 million from an American company linked to a Russian oligarch and several corporations with business before the Trump administration. The Hill's Luis Sanchez and I explain here.   Why it matters: Cohen's shell company, Essential Consultants LLC, struck a $130,000 nondisclosure agreement with Daniels, an adult-film star who claims she had an affair with Trump years ago. Avenatti on Tuesday went public with detailed claims about Cohen's banking history, including allegations that he received a $500,000 payment from a company controlled by a Russian oligarch in the months following the 2016 presidential election. Avenatti refused to reveal his source for this information and said investigators should reveal the Suspicious Activity Reports filed on Cohen's account. Banks are required under federal law to flag unusual transactions of over $10,000. Those reports are meant to point the Treasury's Financial Crimes Enforcement Network toward potentially illegal activity, such as money laundering or bank fraud. Experts told the Post that Avenatti's information could have come from a report filed by Cohen's bank.   ON TAP FOR TOMORROW The Mercatus Center hosts an event on labor force participation and training, 10 a.m. Brookings Institution hosts an event on economic mobility across generations around the world, 10:30 a.m.   LEADING THE DAY Mulvaney faces backlash over moving student loan investigation division: Mick Mulvaney, the acting head of the Consumer Financial Protection Bureau (CFPB), is facing criticism for folding the agency's student lending office, which handles investigations of abuse, into its education office.  In a memo to CFPB staff announcing the move on Wednesday, Mulvaney said the office of "Students & Young Consumers" within the Consumer Education and Engagement Division will be folded into the office of Financial Education. Mulvaney is moving the student loan investigation division inside the bureau's consumer information unit in an effort to shift the agency toward providing consumers with information about their legal rights and away from enforcing and writing consumer finance rules, The New York Times reported. CFPB provided The Hill with a copy of the memo and in a statement called the change a "very modest organizational chart change to keep the Bureau in line with the statute." The pushback: Consumer advocates see the change as an attack on the agency's duty to rein in abusive and predatory lending practices by for-profit colleges and student loan lenders. The Hill's Lydia Wheeler breaks it down here.   How the spending clawback could bite back: The Trump administration's push for Congress to rescind $15.4 billion in spending could have unintended consequences, potentially making it harder for lawmakers to find funding for legislation later this year. Many of the funds the administration wants to ax are unobligated, meaning they are leftover from programs that no longer exist or have not been reauthorized.  Traditionally, lawmakers have turned to the unobligated funds when they need extra cash for legislation, either because they have already hit the maximum amount allowed by budget caps or because they don't want to add to the deficit.  If Congress passes the rescissions package, which is far from certain, it could make it more difficult to pass other kinds of spending legislation throughout the year. Fiscal hawks, concerned about the explosion of deficits, think that's a good thing. The Hill's Niv Elis tells us why.   Trump bashes Cordray after former CFPB director clinches primary: Trump on Wednesday slammed former Ohio Attorney General Richard Cordray (D) as a "socialist" who "should not do well" in Ohio's gubernatorial election this November. Cordray won the Democratic nomination for governor on Tuesday, beating out former Rep. Dennis Kucinich.  "Congratulations to Mike Dewine on his big win in the Great State of Ohio. He will be a great Governor with a heavy focus on HealthCare and Jobs," the president wrote on Twitter, referring to Ohio Attorney General Mike DeWine, who won the Republican primary for governor on Tuesday. "His Socialist opponent in November should not do well, a big failure in last job!" Trump added, referring to Cordray. Cordray, the CFPB's first director, left the agency in November to run for governor in a move that set up a fight over who would serve as his successor in leading the CFPB. Cordray fired back at Trump on Twitter, saying the president's attacks would not push him to back down in the Ohio race. "Very telling that you think $12 billion dollars back to 30 million consumers is a failure, @realdonaldtrump," Cordray wrote. "I never backed down from you or Wall Street. All your name calling won't stop me from fighting those who want to cheat Ohio families, unlike @MikeDeWine."   Wall Street surges on higher oil prices: From Reuters: "Wall Street surged on Wednesday as surging oil prices boosted energy stocks following U.S. President Donald Trump's decision the previous day to quit a nuclear agreement with Iran. "Gains were broad and volume was high, with all but the utilities and telecom sectors advancing as investors who had moved to the sidelines in recent days ahead of Trump's decision returned to the market."   GOOD TO KNOW Former President Clinton is taking aim at the GOP tax law President Trump signed in December, calling it a "bullet aimed at New York and California." The chief of the Small Business Administration (SBA) on Wednesday touted the early impact of the 2017 tax cuts, citing a spike in loan applications to her agency. A law and lobbying firm that formed a strategic alliance with Michael Cohen, President Trump's personal attorney, says it has no knowledge of the controversial payments that he received from corporate clients through a shell company. Chinese telecommunications giant ZTE is ceasing all "major operating activities" after being hit by sanctions from U.S. regulators. Facebook will create a new team to explore potential applications of blockchain technology, the social media company confirmed on Wednesday. White House press secretary Sarah Huckabee Sanders said Wednesday that she isn't sure there will be an infrastructure bill this year, dealing another blow to lawmakers clamoring for a sweeping infrastructure package. Economic ties between the U.S. and Argentina are modest, yet Federal Reserve policy is wreaking havoc on Argentina. It also threatens Turkey, Indonesia and others, for the same reason: their imports, exports and a lot of their debt is denominated in dollars, according to The Wall Street Journal.   ODDS AND ENDS A federal judge has ordered rapper Jay-Z to testify next week as part of a Securities and Exchange Commission (SEC) investigation into the sale of his clothing brand more than a decade ago.     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.