Middleboro Review 2: POLITICO NIGHTLY: Indicted

Friday, March 31, 2023

POLITICO NIGHTLY: Indicted

With additional reporting from Kelsey Tamborrino

Former President Donald Trump was indicted today for his alleged role in a scheme to pay hush money to a porn actress during the 2016 presidential campaign. | Brandon Bell/Getty Images

BREAKING NEWS — It’s the moment everyone knew was coming. Even so, a New York grand jury’s decision today to indict Donald Trump is about to reshape the 2024 elections.

There is the GOP presidential primary, where every Republican contender must immediately decide just how tightly to embrace the first current or former president ever indicted. And they’ll need to fine-tune their messaging in the absence of many soon-to-be-disclosed details of Trump’s alleged role in a scheme to pay hush money to a porn actress during the 2016 presidential campaign.

One of Trump’s potential longshot challengers, former Arkansas Gov. Asa Hutchinson, has already said Trump should quit the race if he is indicted. Yet Trump’s enduring popularity with the Republican base means Hutchinson will be in the minority.

Trump’s main competition at the moment, Florida Gov. Ron DeSantis, may have set the tone with a quick-out-of-the gate statement that ensures he remains in the good graces of the party grassroots yet preserves his ability to privately advance a message that the political and legal drama surrounding Trump makes him unelectable in a general election.

“The weaponization of the legal system to advance a political agenda turns the rule of law on its head. It is un-American,” DeSantis said in a tweet . “The Soros-backed Manhattan District Attorney has consistently bent the law to downgrade felonies and to excuse criminal misconduct. Yet, now he is stretching the law to target a political opponent. Florida will not assist in an extradition request given the questionable circumstances at issue with this Soros-backed Manhattan prosecutor and his political agenda.”

DeSantis was careful not to mention Trump by name. But other prominent Republicans — ranging from House Speaker Kevin McCarthy to Ohio Sen. J.D. Vance to failed Arizona gubernatorial candidate Kari Lake — did, characterizing the indictment as an abuse of power and a political persecution.

With several other separate criminal investigations of Trump still ongoing, the argument surrounding Trump’s electability — which is being pushed by former New Jersey Gov. Chris Christie, among others — becomes a lot more compelling. The question is whether it’s enough to overcome Trump’s solid, unmovable base in a primary. That calculation, in turn, could ripple through the primary, shaping the size of the GOP field and the party’s tolerance for low-performing candidates who end up splintering the vote.

An indictment — or conviction — would not bar Mr. Trump from running. And polling suggests an indictment wouldn’t dent Trump’s popularity among his supporters. The effects on the rest of the party, however, are a different story. Trump’s polarizing politics led to the loss of the House, Senate and White House on his watch. The party’s fortunes in the politically essential suburbs have nosedived since his 2016 win. His prominent role in the 2022 elections helped torpedo the party’s chances in a campaign cycle that once seemed to offer the promise of huge GOP gains.

Now, Trump again figures to loom over the 2024 election landscape, whether or not he captures the presidential nomination. In down-ballot races, GOP candidates will be at risk of having their message drowned out by consistent questions about Trump. Republican primaries will again likely be marked by MAGA loyalty tests.

For candidates in competitive congressional and statewide elections, at the end of that gauntlet comes a general election with a broader electorate — the broader electorate responsible for keeping Trump’s approval ratings below 50 percent during his entire term in office.

Tesla cars recharge at a charging station in Corte Madera, Calif. | Justin Sullivan/Getty Images

OUT OF GAS — Outside of certain circles in Brussels and Washington, it hasn’t received much notice. But Friday is looming as a tension-filled day as the Biden administration readies release of proposed guidelines detailing how it will interpret domestic sourcing requirements for electric vehicles looking to qualify for subsidies under the new climate law.

The issues surrounding the guidance are a bit esoteric, but the stakes are exceptionally high, writes Kelsey Tamborrino . The much-anticipated guidance from the Treasury Department comes after months of competing pressures from U.S. allies hoping to take advantage of the potentially lucrative tax credits and the Democratic senator who helped craft the provision. And it offers a major test for an administration that has promised to electrify the U.S. transportation fleet — while bringing manufacturing jobs and supply chains home.

At question is a total $7,500 tax credit included in the Inflation Reduction Act for electric vehicles with batteries manufactured or assembled in North America and with a portion of critical minerals — like lithium or graphite — extracted or processed in the U.S. or in a country that has a free trade agreement with the U.S.

The sourcing requirements came courtesy of Sen. Joe Manchin (D-W.Va.), whose support was necessary for passage of the law and who has been vocal about the U.S. industry’s dependence on China, which dominates electric vehicle supply chains.

Since the Inflation Reduction Act passed, companies have invested billions of dollars into electric vehicle manufacturing and battery facilities — but building that supply chain will take time.

In the meantime, automakers and environmental advocates warn that strict enforcement of the sourcing requirements will mean most electric vehicle models currently available will be ineligible for the tax credit, right when demand is on the rise. A lax approach, on the other hand, could undercut the buildout of domestic industry.

Treasury initially sought to tamp down some of the concerns by delaying sourcing guidance until this month. But it signaled its outlook with an earlier white paper that offered some flexibility on the definition of a U.S. free trade agreement — prompting quick condemnation from Manchin , who said the administration was ignoring congressional intent.

How the department ultimately defines a free trade agreement, what’s considered a “battery component” or “critical mineral” and how the law will be enforced — all hugely consequential questions — are what could be clarified Friday.

Treasury Assistant Secretary for Tax Policy Lily Batchelder told reporters last week the department has tried to ensure “a smooth transition” and will work with the private sector to make sure consumers can easily determine exactly which vehicles qualify and the amount of the potential credit.

“Given the extremely high concentration of Chinese control over critical mineral processing globally, strengthening our supply chains for critical minerals along with like-minded partners is vital for the growth of the clean energy economy,” Batchelder said.

POLITICO’s Zack Colman reported the U.S. and Europe are currently working on a critical minerals pact that would answer some outstanding questions and potentially allow European companies to share in the U.S. tax incentives. Although such an agreement won’t be reached in time for the proposed guidance this week, it could be incorporated into the final rule.

The process for crafting federal regulations requires an initial proposal that the public can comment on before it is finalized.

Manchin is already readying for a fight. The West Virginia Democrat spoke at an event Wednesday where he said he’s willing to go to court in order to force the administration to follow congressional intent of the law.

Manchin told reporters he is concerned with how the guidance will classify what steps in the supply chain are subject to the requirements — which he played a heavy hand in crafting. In particular, he’s concerned the administration’s interpretation could make it easier to source vehicle parts from abroad, rather than manufacture them in the U.S.

“I think they’re going to try to screw me on this, and I’m willing to go to court — I’m willing to stop it all because that’s not the intent,” Manchin said at the event.

Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com . Or contact tonight’s author at cmahtesian@politico.com or on Twitter at @PoliticoCharlie .

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WHAT'D I MISS?

— Bankman-Fried pleads not guilty to five new charges: Sam Bankman-Fried, the disgraced founder of the cryptocurrency platform FTX, pleaded not guilty today to additional charges alleging that he committed bank fraud and bribed Chinese officials . Bankman-Fried, who flew from his parents’ home in California where he is under house arrest, appeared in a Manhattan courtroom and entered the plea in response to the five new charges that federal prosecutors recently unveiled. He now faces a total of 13 criminal counts.

— Feds target alcohol pricing in new antitrust probe: The Federal Trade Commission has opened an investigation into the largest U.S. alcohol distributor , Southern Glazer’s Wine and Spirits, over practices related to how wine and liquor are priced and sold around the country, according to three people with knowledge of the probe. The FTC is investigating Southern Glazer’s Wine and Spirits for possible violations of the Robinson-Patman Act, a 1936 law prohibiting suppliers from offering better prices to large retailers at the expense of their smaller competitors, according to the people.

— House Republicans pass marquee energy bill in rebuke of Biden: House Republicans passed a sprawling energy bill Thursday, delivering their biggest legislative win since they took control of the chamber in January and setting up a clash with Democrats by pitting fossil fuels against President Joe Biden’s climate change agenda. The energy package won’t advance in the Democratically controlled Senate, but Republicans can use it as a cudgel ahead of the 2024 election, furthering their accusations that Biden’s opposition to fossil fuels helped produce last year’s record spike in gasoline prices, stoked inflation and continues to threaten voters’ pocketbooks.

NIGHTLY ROAD TO 2024

BEHIND CLOSED DOORS — Florida Gov. Ron DeSantis — who is expected to announce his presidential campaign following his state’s legislative session — has been privately reaching out in recent months to a bevy of potential supporters in New York , reports POLITICO’s Sally Goldenberg . DeSantis visited the Long Island estate of billionaire cosmetics heir and GOP donor Ronald Lauder several months ago, according to two people with direct knowledge of the sit down. DeSantis’ message was simple: He is the only Republican who could defeat Biden in a general election. In meetings with other wealthy businessmen, DeSantis has been even more explicit, portraying himself as an obvious choice for anyone frustrated by Trump’s legal troubles and antics.

TEPID ON TRUMP — Trump is gaining strength in 2024 primary polls. The same can’t exactly be said about his standing among Capitol Hill conservatives , report POLITICO’s Olivia Beavers and Burgess Everett. Interviews with more than 40 congressional Republicans — including 32 House Freedom Caucus members — show a surprising number of Trump’s once-ardent supporters going quiet about whether they back him, despite new polling that shows him widening his primary lead. The small share of conservatives willing to endorse Trump right now suggests that the former president’s power base in the Hill GOP is at a nadir, even as DeSantis and other rivals have yet to ramp up their outreach.

AROUND THE WORLD

TIKTOK’S GLOBAL BLITZ — The campaign to save TikTok has been years in the making . A POLITICO investigation revealed an effort by TikTok and its parent company, ByteDance, dating back to at least 2018, long before concerns about TikTok’s Chinese ownership reached their current pitch, writes Hailey Fuchs , Clothilde Goujard and Daniel Lippman .

In Washington alone, about three dozen people lobbied the federal government for ByteDance and TikTok in the last quarter of 2022, including former senators and House members, according to disclosure reports.

To lead its European strategy, the company in late 2019 recruited Theo Bertram, a former top lobbyist for Google and a veteran adviser to the U.K. prime ministers Tony Blair and Gordon Brown. In the fall of 2020, it appointed Caroline Greer, a seasoned lobbyist with experience lobbying for telecom companies and U.S. cloud firm Cloudflare, to head its Brussels operation.

The app remains a pervasive presence in the political world, even as the prospect of a U.S. ban grows more realistic by the week. Indeed, the app is so popular that the White House has repeatedly acknowledged it as an unavoidable channel for political communications.

PUTIN’S HOSTAGE — Russian security services detained Evan Gershkovich, a Wall Street Journal correspondent, in Yekaterinburg on suspicion of spying for the U.S. , sparking a stinging rebuke from the White House, writes Nicolas Camut and Kierra Frazier .

Gershkovich, who is a U.S. citizen, is “suspected of espionage in the interests of the American government” and accused of “trying to obtain secret information,” Russia’s Federal Security Service (FSB) said in a statement.

According to the Wall Street Journal, a Russian court has ordered the reporter to be detained until May 29. In Russia, the charge of espionage is punishable by up to 20 years in prison.

Detaining a foreign journalist marks a significant escalation in hostility toward foreign media from Moscow. Since President Vladimir Putin launched his brutal full-scale invasion of Ukraine last February, Russian authorities have made it increasingly difficult for foreign reporters to work in the country, denying and delaying visas and media accreditation, and requiring local support staff to register as “foreign agents,” forcing them to file burdensome paperwork.

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NIGHTLY NUMBER

26 percent

The percentage that the average Wall Street bonus decreased in 2022 compared to 2021, the largest percentage decrease since 2008. Bonuses are generally a large part of bankers’ annual salary; the decrease in bonus pools comes amidst continued recession fears and some layoffs across the sector.

RADAR SWEEP

FAKE NEWS — It’s Opening Day today across Major League Baseball, with all 30 clubs playing the first of what will be 162 games. It’s a day of optimism for fans across the sport, who all hope that their team might be better than expected, or that it might produce a new star. In 1985, Sports Illustrated took advantage of all of that excitement on April Fools’ Day to pull off one of the greatest pranks of all time. The magazine enlisted famed writer George Plimpton to write a long feature about a pitcher named Sidd Finch, “part yogi and part recluse,” who is showing signs of truly exceptional talent. Fans fell for it hook, line and sinker and started to get their hopes up about a new, potentially game-altering star. The only problem? He didn’t exist at all. Read Plimpton’s feature that set the baseball world on fire — for a brief moment — here .

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