| | |  | BY GAVIN BADE | | 
Sen. John Cornyn (R-Texas) at the U.S. Capitol on May 10. | Kevin Dietsch/Getty Images) | TALK IS CHEAP — Republicans in Congress love to talk tough on China — tougher, they’d emphasize, than Democrats and President Joe Biden. But on one key issue they may be going soft. On the table is how to regulate American investments in the Chinese economy. Defense officials have warned for years that U.S. banks are helping fuel Beijing’s military rise by pouring money into Chinese firms that turn around and give their tech to the People’s Liberation Army. It’s an obscure issue that nevertheless is front-of-mind for the Pentagon, Wall Street and K Street alike — since any new overbite would constitute the first time the U.S. has tried to regulate American companies overseas in such a broad manner. That would be a sea change in economic governance, as we reported last year . The Biden administration has been working for over a year to finish an executive order that would address the issue by setting up a new government review board that would evaluate — and potentially deny — investments that threaten national security. For a while, it seemed like many Republicans were on board, with powerful members like House Foreign Affairs Chairman Michael McCaul (R-Texas) and Sen. John Cornyn (R-Texas) signing on to bills that would codify the new outbound investment review board into law. McCaul and liberal Rep. Rosa DeLauro (D-Conn.) penned an op-ed together on the subject in the conservative Washington Examiner as recently as February. But in recent months, that momentum has slowed. This week, Cornyn and his co-sponsor Sen. Bob Casey (D-Pa.) released a scaled back rewrite of the Senate’s version of outbound investment review. The updated version would not empower the federal government to block investments — only forcing companies to notify the feds of risky deals. That opens up a conflict with the House’s more aggressive version, but that didn’t stop the senators from filing the bill as an amendment to the yearly defense spending bill, which Senate lawmakers could take up as early as next week. Meanwhile, House GOP support for outbound investment review is faltering under the opposition from Rep. Patrick McHenry (R-N.C.) and other Wall Street-aligned lawmakers. McHenry has made clear that he views any new government review board as an unacceptable expansion of federal power, and reiterated that to POLITICO this week, calling it a “terrible idea” that “won’t work.” (House appropriators also omitted funding for the Treasury Department to administer an investment review board in the funding bill they advanced this week.) Instead, some members of McHenry’s committee are taking a more modest approach outlined by Rep. Andy Barr (R-Ky.). His bill would expand the government’s ability to blacklist individual Chinese firms, blocking their access to American finance, but would stop short of a new government review board. “The approach I’m trying to persuade my colleagues to pursue is sanctions and not a clunky bureaucratic outbound capital regime,” he told POLITICO this week. “I think I’ve gotten more buy in for that approach.” That remains to be seen. The Financial Services subcommittee on national security plans to hold a markup at the end of this month. Barr is hopeful that his bill could get a vote that day, though McHenry stressed that no final decisions have been made. And even if his more modest approach wins favor there, the GOP China doves will still have to fend off future efforts from hawks like China Select Committee Chair Mike Gallagher (R-Wis.), who called Barr’s bill “a positive first step” but said lawmakers should go further. Those debates will come to a head in the coming weeks and months, as lawmakers in both chambers chew over China issues in committee. And the final text of Biden’s executive order (when it finally arrives) could scramble the conversation. But for now, even the most hawkish Republicans are optimistic they can avoid more internal discord, so watch this space. “I know there’s differences, but I think we all want to go in the same direction,” Gallagher told POLITICO this week. “It’s just a question of landing the plane.” Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com . Or contact tonight’s author at gbade@politico.com or on Twitter at @GavinBade .
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| | SUBSCRIBE TO POWER SWITCH: The energy landscape is profoundly transforming. Power Switch is a daily newsletter that unlocks the most important stories driving the energy sector and the political forces shaping critical decisions about your energy future, from production to storage, distribution to consumption. Don’t miss out on Power Switch, your guide to the politics of energy transformation in America and around the world. SUBSCRIBE TODAY . | | | | | | | — Biden administration unveils $39B of student debt relief as part of income-driven repayment fix: The Biden administration announced today that it would cancel $39 billion of student debt owed by more than 804,000 borrowers whose debts have been outstanding for more than 20 years. The Education Department said it was implementing its plan, announced in April 2022, to compensate borrowers for what it called “historical inaccuracies” and other failures in how the agency and its contracted loan servicers have managed the income-driven repayment programs. — Biden’s top legislative director to step down: Louisa Terrell, a top aide to President Joe Biden and his director of legislative affairs, plans to step down from her position , according to two people familiar with her plans. Terrell, who has been with Biden since the start of his presidency, played a key role during the first two years of his administration in getting his key legislative priorities passed, including the bipartisan infrastructure bill and last year’s Inflation Reduction Act. — Reserve troops who may be called up for Europe duty would serve ‘administrative’ functions, Kirby says: President Joe Biden’s authorization Thursday for the military to call up as many as 3,000 reserve troops to support operations in Europe would be for “administrative” support contributing to the existing rotational presence , National Security Council spokesperson John Kirby said. “These are people that are specialists in things like administrative functions, logistics, supply, maybe medical, dental, those kinds of things,” Kirby said in an interview with Fox News this morning. It is not yet clear if the military plans to actually deploy any of the 3,000 reserve troops.
| | NERVY NUMBER — Mike Pence’s campaign and super PAC raised just $3.85 million in the second quarter of 2023 , reports POLITICO’s Eric Bazail-Eimil, a relatively small haul as the former vice president struggles to gain traction in the crowded GOP presidential primary. Pence, who entered the race for president in early June, saw his campaign raise just over $1.1 million in the first three weeks of his campaign, while his super PAC, Committed to America, announced it raised just over $2.6 million dollars. Pence’s haul pales in comparison to the fundraising totals released by many of his Republican rivals, especially given Pence’s previous two appearances on a presidential ticket and access to donors. Florida Gov. Ron DeSantis, who officially announced his bid for president in late May, raised over $20 million in the first six weeks of his campaign, while former President Donald Trump and his PAC raised over $35 million in the second quarter. South Carolina Sen. Tim Scott raised $6.1 million in the second quarter and reported having over $21 million on hand. SKEPTIC SUMMIT — Conservative pundit Tucker Carlson sparred with Asa Hutchinson after inquiring about the former Arkansas governor’s vaccination status today , reports POLITICO’s Lucy Hodgman. Carlson, interviewing Hutchinson on stage at the conservative Family Leadership Summit in Des Moines, Iowa, asked the 2024 Republican presidential candidate how many Covid-19 vaccinations he had received and how he felt about his decision to do so in retrospect. Hutchinson confirmed that he had been vaccinated against Covid-19 and defended his choice as the “right decision of taking the vaccine for me,” but noted that others can “make a different decision.” But before Hutchinson gave his answer, he lobbed the question back to Carlson. “How many Covid shots did you take?” Hutchinson asked. “Zero,” Carlson responded to a round of applause from the audience. Before confirming he had been vaccinated, Hutchinson touted his opposition to vaccine mandates as the governor of Arkansas, pointing to a law he signed that prohibited vaccination mandates among government employees. In 2021, Hutchinson also OK’d a law allowing employees to opt out of vaccination requirements from businesses — although he called the debate on the opt-out bill “harmful to our goal of increasing vaccination rates in Arkansas.”
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Revelers celebrate around a float featuring Russian oligarch Yevgeny Prigozhin, co-founder of the Wagner Group, who has six arms with the flags of Ukraine, Germany, Europe, NATO, the U.S. and Britain, equating them all with nazis, during a street carnival parade in Düsseldorf, Germany in February. | Ina Fassbender/AFP via Getty Images | DONE AND DUSTED — Russian President Vladimir Putin has given his own account of a June 29 meeting with Wagner mutineer Yevgeny Prigozhin and his men in the Kremlin after the paramilitary group’s aborted mutiny, claiming he gave the fighters an opportunity to continue fighting in Ukraine, writes Zoya Sheftalovich . Speaking to a reporter from Russia’s state-controlled Kommersant newspaper on Thursday, Putin said 35 Wagner fighters accompanied Prigozhin to the three-hour meeting in the Kremlin last month. The Russian president said he offered Wagner troops several options, including continuing to operate under the command of someone he identified by the call sign “Sedoy,” meaning “Gray-haired,” whom they had served under for 16 months. Putin also attempted to play down the actions of the Wagner fighters who, under Prigozhin’s command, marched on Moscow on June 24, taking control of Russian territory and seeking the resignations of the president’s Defense Minister Sergei Shoigu and Chief of the General Staff Valery Gerasimov. Asked whether the Wagner Private Military Company would remain a fighting unit, Putin seemingly became agitated. “‘Well, the PMC Wagner does not exist!’” Putin exclaimed, according to Kommersant.
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$72 million The amount of money that President Joe Biden, the Democratic National Committee and their joint fundraising committees raised in the second quarter of this year , his campaign said today. Biden also revealed that 394,000 donors contributed to him, the DNC and their committees. He and the DNC had a combined $77 million in cash on hand as of June 30, when the latest fundraising period ended. In 2019, then-President Donald Trump and the Republican National Committee raised $105 million in the second quarter. In 2011, then-President Barack Obama and the DNC brought in more than $86 million. |
| | | IT’S A SCORCHER — How can we understand the latest heat wave in the United States that’s rocked 100 million Americans who are now under heat alerts? What’s happened is something called a “heat dome” that forms as a high pressure system in the air. As the air descends towards the ground, it condenses and heats up, capable of reaching over 100 degrees Fahrenheit when it reaches the ground. This descending cap self-perpetuates, discouraging the formation of clouds and raising ground temperatures even further. Matt Simon reports on the phenomenon for Wired.
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On this date in 1977: Firefighters fight a blaze above a row of looted stores in Brooklyn the day after a power failure that swept across New York City and led to widespread chaos and looting. | AP Photo | Did someone forward this email to you? Sign up here . | |
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