POLITICO Nightly: Why Democrats can’t take the win on U.S. Steel

 

BY GAVIN BADE A sign at the entrance of U.S. Steel's Great Lakes Steel Plant seen on Sept. 12, 2023 in River Rouge, Mich. | Aaron J. Thornton/Getty Images for Industrious Labs STEEL DEAL POLITICS — This week could have been a huge victory lap for Democrats and the Biden administration’s industrial policy. Instead, fear of Trump’s megaphone has them stumbling for a coherent message. On Monday, U.S. Steel announced it would be acquired by Japan’s Nippon Steel for over $14 billion. The deal puts an end to months of negotiations over the fate of the moribund U.S. industrial giant, but it has ignited a firestorm in Washington. On its face, the steel deal could show the strength of the U.S. industrial economy under Biden. The president’s infrastructure package and Inflation Reduction Act both contained huge incentives for construction firms to buy American-made steel for new bridges, factories and clean energy products. And Biden has kept Trump-era tariffs on steel and aluminum in place for most of the world, protecting U.S. Steel and other domestic producers. Those policies helped turn U.S. Steel — considered a hollow husk of the American industrial economy only a few years ago — into a highly investable asset. Nippon is paying a 40 percent premium on U.S. Steel’s stock price in the purchase, and the deal is the Japanese smelter’s first major foray into the American market. Global firms don’t do that without expectations of hefty returns. That could be cause for celebration: a venerated industrial firm from one of our most reliable allies is paying a huge premium to access the fruits of America’s new economic policies. Encouraging foreign investment in the U.S. has always been one of the stated goals of Biden’s new industrial policy — a reversal of decades of outsourcing — and here’s a chief example of the policies paying off for workers and investors alike. Instead, Rust Belt Democrats are running in the other direction — seemingly scared by the simple fact that Nippon is a Japanese company, and not American. Pennsylvania Sens. John Fetterman and Bob Casey have urged Biden to block the deal on national security grounds. Sen. Sherrod Brown (D-Ohio) — facing a tough reelection next year — has lamented that the company wasn’t sold to U.S.-based Cleveland Cliffs instead. Moderate and progressive Democratic House members across the Midwest have piled on, as has Biden’s former economic adviser Brian Deese. Biden, who must run the industrial swing state gauntlet of Michigan, Pennsylvania and Wisconsin to win reelection, has been listening. Late Thursday afternoon, the White House weighed in with a statement saying that the president believes the planned purchase deserves “serious scrutiny” because of potential national security and supply chain concerns. Most of these arguments are wrong-headed. A deal with Cleveland Cliffs, for instance, was on the table months ago. But the U.S. company was handily outbid by its Japanese opposition — offering $35 per share to Nippon’s $55. Any deal with Cleveland Cliffs likely would have raised antitrust concerns — the combined company would have owned 80 percent of U.S. blast furnace capacity — and could have resulted in redundancies and layoffs due to the firms’ overlapping footprints. The national security concerns are even thinner. When Trump invoked national security arguments to impose tariffs on imported steel in 2018, the goal was to protect domestic production, not shut out any foreign ownership. The Japanese government is also among the most steadfast U.S. allies in the world and a crucial regional bulwark against China. Union concerns do give some pause. The United Steelworkers had previously supported an acquisition by Cleveland Cliffs and has spoken out against the Nippon deal. But their current contract with U.S. Steel stipulates that any new buyer must agree to a new labor agreement before completing the acquisition. If Nippon is so hungry for a deal that it will pay a 40 percent premium, some concessions to the union don’t seem out of reach. So, why the outcry from Democrats? Trump’s specter lurks behind all of these policy discussions, even though he and his allies have yet to weigh in on the deal. Still chastened by Trump’s 2016 victory in the industrial Midwest, Democrats have bent over backwards for years to appear more “America-first” than the 45th president. That’s the main motivation behind Biden’s aggressive manufacturing policies in the IRA, his preservation of Trump’s tariffs on China, and his decision — with hefty pressure from Midwestern Democrats — to pull back on Indo-Pacific trade talks last month in San Francisco. The November elections chastened Democrats even further, after voters in a rural Michigan town threw out their local government due to its support for a Chinese-owned battery factory — despite the thousands of jobs it promised an impoverished region. The subtext is the same when it comes to the U.S. Steel deal. Even when the economics could be on their side, Democrats are so afraid of appearing like Clinton-era globalists that they will disavow any investments that come with a foreign flag — even one of our closest allies. Those protestations won’t protect Democrats from GOP attacks. In Pennsylvania, Casey has already been fending off accusations that he’s soft on China from his Republican challenger David McCormick – despite the fact that Casey is one of the most hawkish Democrats on China and has worked for years to increase oversight of American banks’ activities in the Chinese economy. If Democrats are to recapture the economic narrative, they might do well to take a page from Dan Kildee, the labor-friendly, veteran Democratic congressman from Flint, Michigan, who is retiring next year. “What we’ve learned is you make the right decisions about the right policies, no matter what [Republicans] are going to turn it into a political question,” Kildee said when asked last week about trade policies in Congress. “So, just do the right thing and we’ll handle the politics later.” 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 X (formerly known as Twitter) at @GavinBade. PROGRAMMING NOTE: We’ll be off next week for the holidays but back to our normal schedule on Tuesday, Jan. 2.   GLOBAL PLAYBOOK IS TAKING YOU TO DAVOS! Unlock the insider's guide to one of the world's most influential gatherings as POLITICO's Global Playbook takes you behind the scenes of the 2024 World Economic Forum. Author Suzanne Lynch will be on the ground in the Swiss Alps, bringing you the exclusive conversations, shifting power dynamics and groundbreaking ideas shaping the agenda in Davos. Stay in the know with POLITICO's Global Playbook, your VIP pass to the world’s most influential gatherings. SUBSCRIBE NOW .     WHAT'D I MISS? — Senate returns dozens of nominations to Biden to restart process in 2024, including Julie Su: The Senate sent back more than 50 nominations to President Joe Biden as it wrapped its work for 2023 on Wednesday, most notably that of acting Labor Secretary Julie Su. Those nominees will have to be resubmitted by the president and begin the Senate confirmation process anew, since the chamber didn’t approve them within the calendar year. The positions range from Cabinet-level posts like Su’s to appeals court judicial nominees to ambassadors, but also less visible roles like ones on the Merit Systems Protection Board and the European Bank for Reconstruction and Development. “It is clear Ms. Su lacks the necessary votes for confirmation,” said Sen. Bill Cassidy (R-La.), ranking member of the Senate HELP Committee. “I urge President Biden to put forward a nominee who is committed to fair enforcement of our nation’s labor laws and is capable of being confirmed in the Senate.” — Giuliani files for bankruptcy: Former New York City Mayor Rudy Giuliani filed for bankruptcy in New York today, as legal bills from his failed efforts to overturn the results of the 2020 election for former President Donald Trump pile up. The filing comes days after Giuliani, 79, was ordered to pay $148 million in damages to two former Georgia election workers who said their lives were upended after the former Trump lawyer falsely accused them of manipulating ballots during the 2020 election. — Harvard president Claudine Gay facing new plagiarism accusations: Harvard University President Claudine Gay is facing new plagiarism accusations as the news media and conservative activists scrutinize the academic record of the leader of America’s oldest university. An internal review from Harvard Wednesday night announced that while her actions did not rise to the level of serious wrongdoing under the university’s rules, Gay still used “duplicative language without proper attribution” in the writing of her 1997 dissertation, according to the student newspaper, the Harvard Crimson. The university told the paper that Gay, who earned her doctorate from Harvard in political science, would submit three additional corrections to her dissertation in response. NIGHTLY ROAD TO 2024 COLORADO CALL — Top officials with Donald Trump’s presidential campaign and the Colorado Republican Party spoke today to discuss plans of action after the Colorado Supreme Court’s decision to throw the former president off of the Republican primary ballot, reports POLITICO. The call, which involved Clayton Henson, a former White House aide who has been a liaison between the Trump campaign and state parties, was confirmed by Dave Williams, the chair of the Colorado GOP. Williams said that the Colorado GOP will appeal the Colorado court’s decision — holding that Trump was invalidated from appearing on the ballot because he’d incited an insurrection on Jan. 6 — to the Supreme Court. Depending on how the U.S. Supreme Court ruled, he said, the party would ask the Republican National Committee for a waiver to hold a caucus instead of a primary election. VEEP TOUR — Vice President Kamala Harris is visiting Nevada and South Carolina next month, two of the earliest states on the Democratic presidential calendar, where she’ll court voters she and President Joe Biden hope to win over, reports the Associated Press. Harris will meet with members of the powerful casino workers’ Culinary Union in Las Vegas on Jan. 3, which offers one of the most powerful endorsements in Nevada Democratic politics, the White House said today. Three days later, she plans to head to Myrtle Beach in South Carolina, home of the Democrats’ leadoff primary, to address an annual women’s retreat of the African Methodist Episcopal Church, the oldest historically Black denomination in the U.S. Harris has been touring the country to tout the administration’s accomplishments, most recently angling to energize younger voters during a multi-stop college tour. Next month she plans to embark on a nationwide series of events to rally voters to give Biden a second term and regain full control of Congress. AROUND THE WORLD Chair of the Joint Chiefs of Staff Air Force Gen. C.Q. Brown, participates in a virtual Ukraine Defense Contact Group (UDCG) meeting, on Nov. 22, 2023, at the Pentagon in Washington. | Cliff Owen/AP THAWING RELATIONS — Gen. C.Q. Brown, chair of the Joint Chiefs of Staff, spoke to his Chinese counterpart Gen. Liu Zhenli this morning, ending a nearly year-and-a-half impasse between the two militaries, the Pentagon announced, reports POLITICO. Brown is the first senior U.S. military official to speak with his Chinese counterpart since the two countries’ leaders agreed in November to resume military communications after China froze all talks in retaliation for then-House Speaker Nancy Pelosi’s visit to Taiwan in August 2022. The two spoke during a video teleconference this morning, according to the Pentagon. Brown and Liu, China’s chief of the Joint Staff, discussed “the importance of working together to responsibly manage competition, avoid miscalculations, and maintain open and direct lines of communication,” according to a readout provided by the U.S. Joint Chiefs of Staff. Brown “reiterated the importance of the People’s Liberation Army engaging in substantive dialogue to reduce the likelihood of misunderstandings.” GLOOM AND DOOM — European leaders are increasingly concerned by the stalemated war in Ukraine, and with allies’ struggles in keeping ahead of new Russian arms production, reports POLITICO. A year that began with promises of a huge Ukrainian counteroffensive to match last year’s surprise push through hundreds of miles of Russian-occupied territory devolved into a bloody, yard-by-yard fight across hundreds of miles of front, that saw little territorial gain despite a massive human cost. “Russia has the capability and the ability to go on with this war for years,” Finnish Defense Minister Antti Häkkänen said during a visit to Washington this week where he signed a new defense agreement with the U.S. “Many are overestimating that the West is winning this, that Ukraine is winning.” This month, Häkkänen’s government announced it is doubling its production of ammunition, committing to send much of it to Ukraine as it struggles with thinning supplies from Western allies and the slow buildup of production capabilities in the U.S. and Europe. He declined to disclose how large the new output will be, or identify the exact munitions that will be involved. With about $25 million in seed money from the government along with multiyear contracts to guarantee that the work continues in the coming years, the project is also being funded by new investments from NAMMO, the Norwegian defense firm with a large presence in Finland. The production increases will reach their peak by 2027. Public and private investments, plus long-term purchase contracts will total $1.3 billion from 2024 to 2030. Those kinds of long-term contracts have proven a major hurdle for American and European governments, which have been reluctant to make guaranteed commitments to defense spending in future years. But without them, even some major defense companies have been reluctant to invest their own money in weapons critical to the war in Ukraine, fearing that the resolve of governments will eventually falter.   POLITICO AT CES® 2024 : We are going ALL On at CES 2024 with a special edition of the POLITICO Digital Future Daily newsletter. The CES-focused newsletter will take you inside the most powerful tech event in the world, featuring revolutionary products that cut across verticals, and insights from industry leaders that are shaping the future of innovation. The newsletter runs from Jan. 9-12 and will focus on the public policy-related aspects of the gathering. Sign up today to receive exclusive coverage of the show .     NIGHTLY NUMBER 65 percent The percentage of Americans who say they always or often feel exhausted when talking about politics, a record dissatisfaction that comes at a time in which only 4 percent of U.S. adults say that our political system is working “extremely well” or “very well” according to Pew Research Center. RADAR SWEEP CHAPLAIN PD — Meet the Los Angeles Police Department Chaplain Corps, 47 volunteer chaplains across multiple faiths aimed to build camaraderie within the police department and trust within their community. In first responder jobs where trauma is a near daily experience, LAPD has recruited Catholic, Buddhist, Jewish, Muslim, Toaist, Protestant and Interfaith leaders to be a listening ear in the department. The corps is just one instance in the trend of law enforcement bringing spiritual leaders into the force — there are more than 600 chaplains in police departments across 32 states, according to the general director of the United States Chaplain Corps. In this story for CNN, Mike Valerio looks at the members of the LAPD Chaplain Corps — including a motorcycle riding monsignor — and how the group is trying to destigmatize mental health issues in their police departments. PARTING IMAGE On this date in 1989: Demonstrators, protesting the United States military action in Panama, congregate outside the Federal building in Chicago. The protesters, made up of Central American human rights groups, were allowed to march inside the building for several minutes, then were forcibly removed when they refused to leave on their own. | John Swart/AP Did someone forward this email to you?  Sign up here .   Follow us on Twitter Charlie Mahtesian @PoliticoCharlie Calder McHugh @calder_mchugh   FOLLOW US

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POLITICO Nightly: How the Kremlin keeps dodging tough sanctions

 

BY GABRIEL GAVIN Presented by the Consumer Credit Card Protection Coalition A Russian cargo ship arrives at the port of Dunkirk in northern France on March 20, 2023. | Sameer Al-Doumy/AFP via Getty Images POWER PLAY — Smoke rose over Kyiv on Saturday as the city was hit with the largest drone strike since the start of the full-scale invasion , killing five and forcing Ukrainian civilians to huddle together in bomb shelters for more than six hours. While Russia rains down death in Eastern Europe, across the other side of the continent, EU nations are still divided over just how much they want to go after the Kremlin’s energy exports. The bloc’s long-awaited package of new sanctions is the twelfth it will have imposed on Russia in the past year and a half. A draft document seen by POLITICO revealed that key demands from Kyiv — lowering the $60 oil price cap to $30 per barrel, banning fuel refined from Russian oil in third countries , and ending the purchase of Moscow’s nuclear fuel — have struggled to find consensus in Brussels. That’s creating headaches in Washington, which wants its partners to move faster on cutting off Moscow’s flow of cash, but is loath to be seen to intervene politically on the other side of the Atlantic. Now, the State Department is taking unprecedented steps that could have a profound impact for European firms still doing business in Russia. Instead of targeting flagship exports like oil and gas, Ukraine’s European allies will focus on restricting trade in diamonds, iron and copper, which are of relatively little value to the Russian state. When it comes to energy, “we’ve reached the capacity of what we can do without shooting [ourselves] in the foot and harming our competitiveness," one EU diplomat claimed. The biggest omission is liquefied natural gas, the all-important fossil fuel that netted President Vladimir Putin’s regime an estimated $6.6 billion in sales in the EU this year alone. Countries like Spain and Belgium have actually even boosted their LNG imports by a massive 50 percent in 2023, compared to 2022. Meanwhile, hopes that Europe could agree to shut the door on Russia’s atomic energy sector given its dangerous occupation of Ukraine’s Zaporizhzhia Nuclear Power Plant — the continent’s largest — have failed to materialize. Hungary is expanding one of its own atomic power stations with Moscow’s help and populist Prime Minister Viktor Orbán has vowed to veto any sanctions that would hurt the industry, despite criticism from EU and Ukrainian officials alike. Unanimous support from all 27 member states is needed to impose new restrictions, meaning talks on the subject are now deadlocked. The standoff creates a challenge for Washington, which is trying to keep Ukraine’s allies united and maintain pressure on Russia’s economy. Earlier this month, the Biden administration took the unprecedented step of slapping sanctions on a major LNG project in Russia’s frozen Arctic region , despite the fact that European companies are actively involved in the project. Now, France’s TotalEnergies could have to decide whether to give up their stake or run the risk of serious consequences from the Treasury Department. It’s a surprise move that may indicate the U.S. is prepared to use its global influence while Europe seemingly drags its feet. Washington has also stepped well beyond the EU in sanctioning Alexey Miller , the CEO of state energy giant Gazprom, and has imposed restrictions on several senior Russian nuclear officials. While the Russian budget is facing a multibillion-dollar black hole as a result of the sanctions that have already been imposed, Putin is betting that he can hold the system together long enough for Western support for Ukraine to wane. Whether he is right or not depends on what European and American politicians do next — and, if they fail, they could find themselves worrying about more than the energy bill. Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com . Or contact tonight’s author at ggavin@politico.eu or on X (formerly known as Twitter) at @GabrielCSGavin .   A message from the Consumer Credit Card Protection Coalition: Some politicians are trying to defund data security by passing the Durbin-Marshall Credit Card bill, serving your private financial data to hackers on a silver platter. But you can stop them. Learn more and tell Congress to stop the Durbin-Marshall credit card bill.   WHAT'D I MISS? — House GOP denies Hunter Biden demand on impeachment inquiry testimony: Hunter Biden’s legal team demanded that he be allowed to testify publicly in response to a House GOP subpoena. Rep. James Comer (R-Ky.) quickly shot it down . A Biden lawyer sent a letter to the House Oversight Chair this morning, saying the president’s son would appear publicly before the committee on Dec. 13. That ran counter to a stipulation of the subpoena, which called for a private deposition with lawmakers and aides. “A public proceeding would prevent selective leaks, manipulated transcripts, doctored exhibits, or one-sided press statements,” Abbe Lowell, Hunter Biden’s attorney, wrote in the letter. He added that they were also amenable to any other date next month the two sides could agree on. Comer denied the request in a statement today, saying it “won’t stand with House Republicans.” — Jewish groups sue University of California over ‘unchecked’ antisemitism: Jewish groups are suing the University of California system, UC Berkeley and its leaders over what they are calling a “longstanding, unchecked spread of anti-Semitism.” The 36-page lawsuit, filed today by the Brandeis Center and Jewish Americans for Fairness in Education, argues that Berkeley and its law school’s “inaction” on discrimination against Jewish students has led to a spread of antisemitism, and violence and harassment against them. Demonstrations and incidents on campus following the Oct. 7 Hamas attacks on Israel serve as examples of the discrimination, according to the complaint. — Democrat starts official clock for Santos expulsion vote: A fierce Democratic critic of Rep. George Santos has officially triggered another push to expel him — the most serious threat against the indicted lawmaker to date. The privileged motion introduced by Rep. Robert Garcia (D-Calif.) means the House must vote on expulsion within two legislative days. That’s almost exactly two weeks after the release of a damning bipartisan House Ethics Committee report that found “sufficient evidence” of Santos’ criminal wrongdoing.   Enter the “room where it happens”, where global power players shape policy and politics, with Power Play. POLITICO’s brand-new podcast will host conversations with the leaders and power players shaping the biggest ideas and driving the global conversations, moderated by award-winning journalist Anne McElvoy. Sign up today to be notified of new episodes – click here .     NIGHTLY ROAD TO 2024 CAN’T QUIT X — The Biden campaign and White House increasingly see the site formerly known as Twitter as a sewer. They just can’t quite leave the mess alone , writes POLITICO.. They say they no longer see the platform as a place where they can actually build useful voter relations or even engage in level political discourse. But even as they trash the site, they aren’t ready to quit it either. Aides continue to tweet — as does the president. They debated, internally, the merits of leaving the platform, but determined it would be a mistake to leave even the crass political debates unattended. Instead, they are adapting to the bare-knuckled nature of X by trying to shape it. Largely, they’ve used X to try and drive the conversation and slam their likely general election opponent. But aides to the president have begun more aggressively using the platform to call out reporters and news outlets, mock pundits and try to influence the news cycle. HOME FIELD DISADVANTAGE — Nikki Haley sees her home state as a launchpad. It could become her campaign’s crash site, writes NBC News. The former South Carolina governor has staked her hopes of wresting the 2024 Republican presidential nomination from former President Donald Trump on the idea that she can survive January contests in Iowa and New Hampshire that will thin the GOP field and then defeat him in a one-on-one battle here in her backyard. So far, she hasn’t made the sale. That’s at least in part because Haley has yet to give voters a reason to abandon Trump — the dominant political figure in the state for almost a decade — a recurring theme that emerged in interviews with almost two dozen Republican voters, current and former elected officials, county party chairs and Republican strategists. The same can be said for Florida Gov. Ron DeSantis and the rest of a field that Trump leads by more than 30 percentage points in recent polls of the state’s Feb. 24 primary. DISQUALIFYING TRUMP — The window is narrowing to try to knock former President Donald Trump off California’s March 5 primary ballot , reports POLITICO. Democrats across the country have launched several long-shot challenges to Trump’s ballot status over his role in the Jan. 6, 2021 attack on the U.S. Capitol. But the deadline for California Secretary of State Shirley Weber to certify which presidential candidates will appear on the ballot is just a month away. If Weber or the courts don’t act by Dec. 28, attempting to remove Trump could create major logistical challenges as the state prepares voter guides and other materials.   A message from the Consumer Credit Card Protection Coalition:     AROUND THE WORLD A man stands at a border checkpoint between Russia and Finland on Nov. 15, 2023. | Vesa Moilanen/Lehtikuva/AFP via Getty Images SHUT IT DOWN — Finland will completely close its border with Russia for two weeks after a surge of asylum seekers crossing the frontier, Finnish Prime Minister Petteri Orpo announced today . “This is Russia’s influence activity, and we do not accept that,” Orpo said at a press conference, according to Finnish news outlet Helsingin Sanomat. The two-week border closure will take effect between Wednesday and Thursday night and will end on December 13, the paper reported. Helsinki’s move follows a decision by the European border agency Frontex last week to deploy border guards and other staff, along with equipment, to bolster Finland’s border control activities amid accusations by Finland that Moscow is stoking the migrant influx. Tension between the two countries has escalated since Moscow launched its invasion of Ukraine in 2022, prompting Finland to join the NATO military alliance. On Monday, NATO Secretary-General Jens Stoltenberg accused Russia of using migration as a tool to pressure Finland. “NATO stands in solidarity with our ally Finland,” he said.   GET A BACKSTAGE PASS TO COP28 WITH GLOBAL PLAYBOOK : Get insider access to the conference that sets the tone of the global climate agenda with POLITICO's Global Playbook newsletter. Authored by Suzanne Lynch, Global Playbook delivers exclusive, daily insights and comprehensive coverage that will keep you informed about the most crucial climate summit of the year. Dive deep into the critical discussions and developments at COP28 from Nov. 30 to Dec. 12. SUBSCRIBE NOW .     NIGHTLY NUMBER $35 billion The amount of money effectively being cut from the Defense Department budget , according to Deputy Defense Secretary Kathleen Hicks, as the Pentagon operates under a temporary funding measure that freezes spending at the previous year’s levels. RADAR SWEEP THE AIRBNB WARS — In New Orleans, Airbnb owners are at war with one another: The city tried to control short-term rentals through a lottery system that allowed one rental per carved up block. But the rule, designed initially to decrease short term rentals in the city, led to more chaos and confusion, especially after a federal judge halted the rule, which is still under review. Neighbors were pitted against each other in hopes to continue their rental side hustles. Now, the listings sit in limbo, with owners unsure whether they can create bookings or not as they await the judge’s final decision. In an article for WIRED, Amanda Hoover looks at how the city rule made a mess for Airbnb hosts around the city that is left frozen in place. PARTING IMAGE On this date in 2011: A veiled Egyptian woman casts her ballot in Maadi, a suburb of Cairo, as voting began in Egypt's first parliamentary elections since longtime authoritarian leader Hosni Mubarak was ousted in a popular uprising nine months prior. | Tara Todras-Whitehill/AP Did someone forward this email to you?  Sign up here .   A message from the Consumer Credit Card Protection Coalition: Your security is on hackers’ wish list this year and some lawmakers are trying to put defunding data security under the tree by passing the Durbin-Marshall Credit Card bill. If the Durbin-Marshall Credit Card bill becomes law, it could put millions of credit card transactions at much greater risk of hacking, fraud and identity theft. Washington should protect our private financial data, not make it easier for cyber criminals to hack into your wallet this holiday season. Learn more and tell Congress to say no to defunding data security by rejecting the Durbin-Marshall credit card bill.     Follow us on Twitter Charlie Mahtesian @PoliticoCharlie Calder McHugh @calder_mchugh   FOLLOW US

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POLITICO Nightly: The left goes to war with itself

BY CATHERINE KIM Massachusetts state Rep. Mike Connolly in 2017 in Cambridge, Mass. | Ryan McBride/AFP via Getty Images PURITY TESTS — The Democratic Socialists of America has seen a meteoric rise since 2015, when Sen. Bernie Sanders, a self-proclaimed Democratic socialist, began his first campaign for president. The movement has elected a slew of lawmakers to state legislatures and city councils across the country, and grown from 5,000 to 92,000 members in the span of less than a decade. But that growth has come at a cost. Infighting within local DSA chapters is making headlines across the country — a sign that the far-left faction of the progressive wing may be fracturing as a result of its success. The latest DSA meltdown came this week in Massachusetts, where the Boston chapter clashed with state Rep. Mike Connolly — who was elected as a DSA member — for working with establishment Democrats. Connolly’s offenses, according to DSA, include supporting a stabilized rent program that doesn’t align with the group’s platform and endorsing a non-DSA candidate in 2020. Before the group had a chance to expel him though, Connelly announced he was dropping his DSA affiliation, criticizing the group for failing to see the benefits of building broader coalitions. “Why continue with an organization whose new leadership has made it clear they oppose seeking common ground with state leaders or building broader coalitions to benefit working people?” Connolly wrote in a statement first shared with POLITICO . These ideological tests are also bad for constituents, as the energy spent on infighting ultimately “takes the service out of public service,” said Joe Caiazzo, a Massachusetts-based political consultant and top aide for the Bernie Sanders 2020 campaign. “The whole point of the progressive movement is to fight for a set of policy values that are going to make the lives of working people throughout this country better,” he said. “How on earth is inflicting a purity test going to help working people throughout the country?” The Connolly clash isn’t an isolated occurrence. Across the country, DSA chapters are roiling with conflicts between members who win elections and the hardliners who object to their legislative compromises. The ripple effects of the struggle between power and purity aren’t hard to find: In the Boston-area, where DSA had seen major wins on local city councils, the group is down to a single representative in the state legislature now that Connolly is out of the picture. In Nevada, the DSA takeover of the state Democratic Party in 2021 came to an end in this year’s state party election — a bitter conclusion to a brief reign marked by intense controversy (It didn’t help that Nevada was the only state where an incumbent Democratic governor lost last year ). The far left’s fractures come at a pivotal time for the movement. Dozens of progressives, many backed by DSA, won elections in the 2022 midterms — from city councils to Congress — and the hope is that these wins will provide a playbook for running on policies such as affordable housing and minimum wage. But just as progressive issues are becoming part of the mainstream debate in many places and the left is increasing its voice in the halls of power, the internal fights are damaging the brand. DSA has historically played a pivotal role in building the progressive coalition through grassroots organizing, says Caiazzo, but the focus on ideological purity will ultimately be their demise if they continue to make headlines for kicking out members who don’t reach their stringent standards. “At the end of the day, politics is about compromise,” he said. “If you’re not willing to compromise, then you don’t get to play on the team. And if you can’t play on the team, then there’s no way to ever win.” Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com . Or contact tonight’s author at ckim@politico.com or on Twitter at @ck_525 .   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 .     WHAT'D I MISS? — Microsoft, Activision defeat FTC’s bid to block $69B deal: A federal judge has sided with Microsoft and Activision Blizzard as they fought off the Federal Trade Commission’s attempt to block a deal between the two companies that would create a video gaming giant. Today’s ruling is a stinging rebuke for the FTC in the biggest test yet of its ability to police competition in fast-moving technology markets, a key priority for agency Chair Lina Khan, an antitrust hawk appointed by President Joe Biden in 2021. The FTC initially challenged the deal in its in-house court in December. — United Airlines CEO warns of more weather delays as climate warms: Air travelers should brace for even more of the delayed and canceled flights that have made flying so miserable recently, United Airlines CEO Scott Kirby said today — all because of climate change. “More heat in the atmosphere, thermodynamics 101 — we’re going to have more thunderstorms,” he said. As an example, Kirby said that almost a week of thunderstorms west of Newark Liberty International Airport crippled his airline’s operations ahead of the July 4th holiday. Kirby argued that no airline can withstand six straight days of storms that prevent flights from departing, especially at a hub airport like Newark. — Flores launches comeback bid for Texas House seat: Former GOP Rep. Mayra Flores launched a comeback bid today, months after she lost her South Texas district to Democratic Rep. Vicente Gonzalez by 9 points. Flores made her announcement on “Fox & Friends” while criticizing Homeland Security Secretary Alejandro Mayorkas’ work on the border. The National Republican Congressional Committee had been working to recruit Flores to make another run, commissioning a poll that showed she could win the district that President Joe Biden carried by nearly 16 points in 2020. NIGHTLY ROAD TO 2024 THE GEORGIA CASE — A grand jury that was sworn in today in Atlanta will likely consider whether criminal charges are appropriate for former President Donald Trump or his Republican allies for their efforts to overturn his 2020 election loss in Georgia, the AP reports. Fulton County District Attorney Fani Willis has been investigating since shortly after Trump called Georgia Secretary of State Brad Raffensperger in early 2021 and suggested the state’s top elections official could help him “find 11,780 votes,” just enough needed to beat Democrat Joe Biden. The 2 1/2-year investigation expanded to include an examination of a slate of Republican fake electors, phone calls by Trump and others to Georgia officials in the weeks after the 2020 election and unfounded allegations of widespread election fraud made to state lawmakers. Willis, a Democrat, is expected to present her case before one of two new grand juries being seated today. She has previously suggested that any indictments would likely come in August. DEBATE DODGER — Republicans are divided over whether former President Trump should show up at the first Republican presidential debate scheduled for Aug. 23 in Milwaukee, with some warning it would be a bad look for their party if Trump skips it. Some Republicans think Trump is holding off on committing to the debate to exert leverage over the rules and tickets to the event, reports The Hill. The Republican National Committee has announced that candidates will have to pledge to support the eventual GOP presidential nominee in order to qualify for the debate stage, a promise that Trump has so far refused to make. Trump’s absence from the debate would make Florida Gov. Ron DeSantis, who is running in a distant second place, the focal point of the evening. GOP candidates would concentrate their fire on DeSantis in hopes of displacing him as the leading alternative to Trump. A debate without Trump would deal a setback to former New Jersey Gov. Chris Christie (R), who has built much of his campaign on a promise to go toe-to-toe with the former president, something other candidates have shied away from. TRUTH IN FUNDRAISING — In the months before the 2020 presidential election, Roy W. Bailey, a Dallas businessman, received a stream of text messages from Donald J. Trump’s re-election campaign, asking for money in persistent, almost desperate terms. “Have you forgotten me?” the messages read, Mr. Bailey recalled. “Have you deserted us?” He is now raising money for Gov. Ron DeSantis of Florida, whose campaign has pledged to avoid the kinds of online fund-raising tactics that irritated Mr. Bailey and that have spread in both parties, particularly the Republican Party, in recent years as candidates have tried to amass small donors. No phony deadlines, Mr. DeSantis has promised donors. No wildly implausible pledges that sizable contributions will be matched by committees affiliated with the campaign. And no tricking donors into recurring donations. This strategy is one of the subtle ways Mr. DeSantis’s team is trying to contrast him with Mr. Trump , who has often cajoled, guilt-tripped and occasionally misled small donors, writes the New York Times. AROUND THE WORLD Turkish President Recep Tayyip Erdoğan and Swedish Prime Minister Ulf Kristersson shake hands next to NATO Secretary-General Jens Stoltenberg in Vilnius this week. | Henrik Montgomery/TT News Agency via AP IN THE CLUB — Biden administration officials today celebrated Sweden’s ascension into NATO and promised that Ukraine will one day be on the same path, writes Matt Berg . Fourteen months after applying to the military alliance, Stockholm’s bid got the green light from Turkey on Monday after months of being blocked by President Recep Tayyip Erdoğan. Sweden is now on track to become NATO’s 32nd member. “It sends two messages. First of all, our alliance is stronger, it’s bigger with two new members — Finland and now Sweden, and it’s more united than ever,” Secretary of State Antony Blinken said on CBS. “In terms of Russia’s aggression against Ukraine, it’s sending a very strong message to Putin that he’s not going to outlast us, he’s not going to outlast Ukraine, and the sooner he ends this war of aggression the better.” As part of the agreement, Turkish, Swedish and NATO officials explained that Stockholm had changed laws, expanded counterterrorism cooperation against the Kurdistan Workers’ Party and restarted arms exports to Turkey. Ankara and Stockholm also agreed to create a “new bilateral Security Compact” and that Sweden will present a “roadmap as the basis of its continued fight against terrorism in all its forms,” according to a joint statement from the officials. As part of the deal, NATO Secretary General Jens Stoltenberg also agreed to create a new post of “Special Coordinator for Counter-Terrorism” at NATO. UNWELCOME GIFT — Finland’s new prime minister has had his honeymoon period cut short by two racism scandals that have thrown his government into turmoil, writes Charlie Duxbury . Center-right leader Petteri Orpo, widely regarded as a dependable political operator, is already watching the uproar undercut one of his key strategic moves: The decision to team up with the far-right Finns Party in government. The Finns Party has long been seen as something of a wild card in Finnish politics, pushing a “Finland first” line, which has seen it advocate strong anti-EU and anti-immigration positions. Its leaders, from Timo Soini to Jussi Halla-aho to current chief Riikka Purra, have long kept headline writers busy with flamethrowing speeches and populist blog posts. After elections in April, Purra secured serious influence in Orpo’s new government, not least by taking the role of finance minister and deputy prime minister for herself during lengthy government formation talks. But shortly after the new coalition was announced on June 16, historical public statements by senior party players — including Purra herself — started coming back to haunt both the Finns Party and Orpo. Economy Minister Vilhelm Junnila was forced to quit after allegations that he had made a joke about Nazism. Now, Purra has found herself under pressure amid allegations that she used racist slurs in online blog posts in 2008 and encouraged violence against beggars in the form of spitting.   UNLEASH THE FUTURE OF HEALTHCARE WITH POLITICO, A 7/20 INTERACTIVE EVENT: Imagine a future where rare genetic diseases are not only treatable, but potentially curable. Where our approach to chronic illness takes a monumental leap forward. That future is already taking shape in the form of next-generation health care treatments such as gene therapy. Join POLITICO on Thursday , July 20 and delve into the burgeoning field of gene therapies, which hold the power to redefine our health care landscape. Are you ready to explore this new frontier in health care? Don't miss this chance to be part of the conversation. REGISTER NOW .     NIGHTLY NUMBER $250 million The amount of money that Bank of America is paying — between fines of $150 million and reimbursements of customers of $100 million — for “double-dipping” on overdraft fees, withholding reward bonuses on credit cards and opening accounts without customer consent . It is one of the largest financial penalties in years against Bank of America and comes on the heels of the Biden administration’s mandate to Consumer Financial Protection Bureau Director Rohit Chopra to go after “junk fees.” RADAR SWEEP THE WORLD OF ANTONOFF — If you’ve listened to any pop music within the last five years, you’ve probably heard the stamp of super-producer — and frontman of Bleachers — Jack Antonoff. He’s worked with artists from Taylor Swift to Lorde to Sara Bareilles. But at a certain point, all of that music started to converge, according to Mitch Therieau ’s critical essay in The Drift. Therieau traces Antonoff’s influence through the 2010s and early 2020s and arrives at conclusions not just about the producer and his musical sensibilities but also about our broader cultural moment. PARTING IMAGE On this date in 1944: Labeled with large tags and carrying their possessions in hand bags, these London children, part of 15,000 moved from the range of German bombs, stand on a railroad platform ready for evacuation. | AP Photo Did someone forward this email to you?  Sign up here .   Follow us on Twitter Charlie Mahtesian @PoliticoCharlie Calder McHugh @calder_mchugh Katherine Long @katherinealong   FOLLOW US

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