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Presented by Morgan Stanley: Playbook is POLITICO's must-read briefing on what's driving the day in Washington Aug 28, 2018 View in browser
By Jake Sherman, Anna Palmer and Daniel Lippman

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DRIVING THE DAY
GOOD MORNING MOUNTAIN VIEW! ... THE PRESIDENT GOOGLES HIMSELF AND ... @realDonaldTrump at 5:24 a.m.: "Google search results for 'Trump News' shows only the viewing/reporting of Fake New Media. In other words, they have it RIGGED, for me & others, so that almost all stories & news is BAD. Fake CNN is prominent. Republican/Conservative & Fair Media is shut out. Illegal? 96% of..."

... at 5:34 a.m.: "....results on 'Trump News' are from National Left-Wing Media, very dangerous. Google & others are suppressing voices of Conservatives and hiding information and news that is good. They are controlling what we can & cannot see. This is a very serious situation-will be addressed!"

TRUMP TAKES OVER MCCAIN'S WEEK ... LAST NIGHT, while sitting with evangelical leaders, PRESIDENT DONALD TRUMP finally addressed SEN. JOHN MCCAIN'S death. He said "our hearts and prayers are going to the family of Sen. John McCain." "We very much appreciate everything that Sen. McCain has done for our country," he said.

IN REALITY, Trump has already made this story about him. His silence -- and flip-flopping on the flag -- has kept Washington (and particularly the media) on edge. Any other president would've just lowered the flag to half-staff for the week, issued an effusive statement and moved on.

TRUMP IS MAKING PLAIN what we already knew: He never much liked McCain, and he's not really concerned what anyone thinks about his behavior. TRUMP seems fully confident that his supporters haven't cared for McCain in any way since 2008 -- when they concluded his constituency was mostly reporters and middle-of-the-road Republicans. In some ways, Trump's candidacy and presidency are a direct response to the candidacies of McCain and Mitt Romney.

... HERE'S A THOUGHT FROM JOHN HARRIS: McCain is deeply admired for martial virtues. But for two generations politicians who represent martial virtues haven't done well in presidential politics.

START WITH RONALD REAGAN, who spent World War II in Hollywood, then led the conservative movement at a time when true military experience was still the norm at the top ranks of national politics.

FOR THE PAST QUARTER-CENTURY, the presidency has been held by people who either took steps to avoid Vietnam service (Bill Clinton, George W. Bush and Trump) or were too young to serve (Barack Obama).

CLINTON, BUSH AND OBAMA all beat people who had seen serious combat in World War II or Vietnam.

IN AN AGE IN WHICH MOST POLITICAL AND MEDIA ELITES have no military experience, there does seem to be a romantic longing for what people imagine the military and its values represent: physical toughness, valor, moral clarity, as against a general climate of softness, selfishness and blurred lines of right and wrong.

THE REACTION TO MCCAIN'S DEATH represents that longing. But in real life, when people who claimed that their biographies represent such virtues actually faced the electorate at the presidential level, the response has been harsh. Opponents made them look obsolete and out of touch (as Clinton did to Bush 41 and Bob Dole, and Obama did to McCain) or portrayed them as self-righteous phonies (as partisans of Bush 43 did to John Kerry in 2004 and to some extent to McCain in the 2000 primaries).

THE IDEALIZED PORTRAIT OF MCCAIN -- an unyieldingly honest man who placed principle over self -- is surely appealing, and at his best the Arizona senator's life really did approximate that ideal.

BUT THE REASON MCCAIN'S DEATH HAS RESONATED so deeply is that everyone recognizes that Trump -- a supremely transactional figure for whom truth and everything else is infinitely flexible and subordinate always to self-interest -- is the more authentic representative of the age.

Good Tuesday morning. MCCAIN'S PARTING SHOT -- "We weaken our greatness when we confuse our patriotism with rivalries that have sown resentment and hatred and violence in all the corners of the globe," McCain said in his statement, which was read aloud at the Arizona state capitol by McCain's longtime aide Rick Davis. "We weaken it when we hide behind walls rather than tear them down, when we doubt the power of our ideals rather than trust them to be the great force for change they have always been." The full statement

ARIZONA REPUBLIC'S MARIA POLLETTA quotes Rick Davis: "I think a Hispanic woman probably would've been his pick for a successor if he would've lived long enough." AZ Central

TV THIS MORNING -- Sen. Lindsey Graham (R-S.C.) will be on NBC's "Today" live in the 7 a.m. hour.

THE SENATE SPEAKS ... ELANA SCHOR: "GOP senators ding White House over McCain flag dust-up": "Sen. Orrin Hatch (R-Utah) said that the Monday flap over White House flags rising while Capitol flags remained at half-staff for McCain 'should not have happened.' 'That should have been automatic,' Hatch told reporters. 'You do things that are sensible. And sensitive.' ...

"'I could not understand why the administration had the flag lowered for such a brief period of time,' Sen. Susan Collins (R-Maine) said. Asked if Trump was letting his strained relationship with the late six-term Arizonan get in the way of honoring McCain, Collins added: 'It certainly looks that way, but I can't speak for his motive. I'm just glad that the decision's been reversed.'" POLITICO

-- THE DEFENDERS KEEP ON DEFENDING: David P. Gelles (@gelles): "Sen. James Inhofe told reporters that Sen. John McCain was 'partially to blame' for the controversy over the lowering of the White House flag. Inhofe said McCain 'disagreed with the president in certain areas and wasn't too courteous about it.'"

Presented by Morgan Stanley:

Are supply and demand estimates masking a mismatch that could drive up oil prices? Morgan Stanley's Global Oil Strategist, Martijn Rats, says even though U.S. shale output is surging, demand for jet fuel, diesel oil and other middle distillates could push oil prices higher. Read more.

THE REPLACEMENT -- "Ducey aims to please Trump with McCain fill-in: The Arizona governor has grown closer to the White House since cautiously embracing the president in 2016, but can't risk alienating moderate voters," by Chris Cadelago, Daniel Strauss and Theo Meyer: "Arizona Republican Gov. Doug Ducey's decision to replace the late John McCain is as much about his own political future as it is about filling the seat of the six-term senator and decorated war hero.

"Republicans with knowledge of the governor's thinking say he'll have to remain deferential to Trump and the White House while also taking care not to alienate a statewide electorate ahead of a tough reelection fight in November. Ducey - a former Coldstone Creamery chief executive - was hesitant to publicly endorse Trump in 2016 but showed up to at least two closed-door campaign events for him before the election, said one Republican close to the governor." POLITICO

-- STEVEN SHEPARD and ELENA SCHNEIDER: "The last remaining puzzle piece on the 2018 Senate map: Arizona"

FLIP ALERT! ... "Manafort Sought Deal in Next Trial, but Talks Broke Down," by WSJ's Aruna Viswanatha: "Paul Manafort's defense team held talks with prosecutors to resolve a second set of charges against the former Trump campaign chairman before he was convicted last week, but they didn't reach a deal, and the two sides are now moving closer to a second trial next month, according to people familiar with the matter. The plea discussions occurred as a Virginia jury was spending four days deliberating tax and bank fraud charges against Mr. Manafort, the people said. That jury convicted him on eight counts and deadlocked on 10 others.

"The plea talks on the second set of charges stalled over issues raised by Special Counsel Robert Mueller, one of the people said. It isn't clear what those issues were, and the proposed terms of the plea deal couldn't immediately be determined." WSJ

JUST POSTED ... AMY CHOZICK profiles STORMY DANIELS for VOGUE ... with Annie Leibovitz photos.

BIG NEWS FOR 2018 -- "North Carolina's gerrymandered map is unconstitutional, judges rule, and may have to be redrawn before midterms," by WaPo's Robert Barnes: "A panel of three federal judges held Monday that North Carolina's congressional districts were unconstitutionally gerrymandered to favor Republicans over Democrats and said it may require new districts before the November elections, possibly affecting control of the House.

"The judges acknowledged that primary elections have already produced candidates for the 2018 elections but said they were reluctant to let voting take place in congressional districts that courts twice have found violate constitutional standards. North Carolina legislators are likely to ask the Supreme Court to step in.

"The court traditionally does not approve of judicial actions that can affect an election so close to the day voters go to the polls. But the Supreme Court has just eight members since Justice Anthony M. Kennedy's retirement last month; a tie vote would leave the lower court's decision in place. Senate hearings on President Trump's nominee to fill the open seat, Judge Brett M. Kavanaugh, commence Sept. 4." WaPo

-- THE NORTH CAROLINA CONGRESSIONAL DELEGATION is right now 10 Republicans and three Democrats. And there are some Republican power players: Rep. Patrick McHenry, the chief deputy whip, and Rep. Mark Meadows, the chairman of the Freedom Caucus, to name a few. Shaking up the map would put some heavy hitters in a tough spot.


THE NEW NAFTA ... "Trump embraces Mexico, threatens Canada with trade deal," by Sabrina Rodríguez, Adam Behsudi, Megan Cassella and Doug Palmer: "The United States and Mexico reached a two-way trade deal Monday, moving President Donald Trump one step closer to fulfilling a core campaign promise to revamp the North American Free Trade Agreement.

"The development, which happened after U.S. and Mexican trade officials met regularly for five weeks, could clear the way for Canada to return to the table to try to reach a final updated agreement in the coming days, according to three sources close to the negotiations. But Trump also warned that efforts to revamp the 24-year-old pact could result in two different agreements and threatened Canada with tariffs on automobiles if Ottawa didn't agree to negotiate 'fairly.' 'I think we'll give them a chance to probably have a separate deal,' Trump said, referring to Canada." POLITICO

UNDERSTANDING THE WHITE HOUSE'S TRADE POSITION ... MEGAN CASSELLA and SABRINA RODRIGUEZ of our trade team write in: "The announcement of the breakthrough between the U.S. and Mexico is certainly something for the administration to celebrate: Both sides worked extremely hard over the past year -- and especially over the last month -- to get this far, and it gives Trump a major policy win to tout on the campaign trail this fall.

"It also hands a get-out-of-jail-free card to Republicans who were trying in many ways to stay aligned with the president heading into the midterms but found themselves increasingly disillusioned with his trade policies. But we also shouldn't mistake Monday's announcement for what it's not: a concrete deal.

"If the Trump administration seriously tries to move forward with only a two-way deal with Mexico - leaving Canada on the sidelines - Capitol Hill and business groups are almost certain to push back by saying that Trump only had a mandate to renegotiate NAFTA, not to create a new U.S.-Mexico deal. Plus, Mexico is also resisting the notion that the development will ultimately result in a bilateral agreement, opting to call it an 'understanding,' not a deal. Mexican officials are operating with the full hope that Canada will re-enter talks today and have a full deal by Friday.

"If Canada is going to sign on, that means all three countries need to get on the same page over the next four days -- but it's not going to be easy. But a three-way agreement is the most certain way to ensure a deal gets to North American leaders' desks by the end of November."

TRUMP'S TUESDAY -- The president is having lunch with Defense Secretary Jim Mattis. He will also meet this afternoon with FIFA President Gianni Infantino.
PLAYBOOK READS


PHOTO DU JOUR: President Donald Trump bows his head as pastor Paula White leads the room in prayer during a dinner for evangelical leaders Monday at the White House. | Alex Brandon/AP Photo

KNOWING RUDY -- "In Defending Trump, Is Giuliani a Shrewd Tactician or 'Untethered'?" by NYT's Dan Barry, Benjamin Weiser and Alan Feuer: "The man identified these days as President Trump's lawyer seems vaguely familiar. It's in the way he feigns genuine laughter. How he clasps his hands. How he widens his eyes, as if he's just been handed a birthday cake with a firecracker for a candle.

"He is, of course, Rudolph W. Giuliani, whose public utterances of late have people debating whether he is a shrewd manipulator of public opinion or just - befuddled. But all agree that he relishes the limelight, every microphone a corkscrew capable of unleashing the spirits of his considerable id.

"Indeed, he is working for the president free of charge. There Mr. Giuliani was again on Thursday, opining from a Trump-owned golf course in Scotland while dressed in green-plaid golf togs bearing the Trump name. When a reporter from Sky News asked whether he thought that impeachment of President Trump was inevitable, Mr. Giuliani defended his client with a few provocative assertions before closing with: 'You'd only impeach him for political reasons, and the American people would revolt against that.'" NYT

NBC'S HEIDI PRZYBYLA in Dearborn, Michigan: "Trump era is igniting a new wave of Muslim-American candidates": "For the first time in two decades, American Arabs and Muslims are stepping up to run for public office in record numbers, registering to vote and bundling money for candidates from their community, according to Jetpac, a nonprofit working to increase American Muslim civic engagement.

"With inflammatory rhetoric on immigration and his active push for a travel ban aimed primarily at Muslim-majority countries, Trump has put a national spotlight on the community's long running travails. Trump has called for the monitoring of mosques and appointed Cabinet members and political advisers who have disparaged Muslims.

"He's also likely put the final nail in the coffin for the community's waning support for the GOP, political experts say." NBC

Presented by Morgan Stanley:

Are we on a path toward $90 oil? Morgan Stanley's Global Oil Strategist, Martijn Rats, says even though U.S. shale output is surging, demand for jet fuel, diesel oil and other middle distillates could push oil prices higher. Read more about what this could mean for investors.

BOSTON GLOBE ... "Keep Nancy Pelosi in power? Many Mass. Democrats running for Congress are hesitant," by Matt Stout: "[I]n Massachusetts' busy slate of House primaries, support for the California Democrat is registering at barely a simmer, leaving uncertain how much support she will get from the reliably Democratic delegation after the November midterm elections. The Boston Globe asked each of the 24 Democrats on the Sept. 4 primary ballot in the state's nine congressional districts if they'd support Pelosi for speaker - should Democrats win the House - or for another term as the party's minority leader. Only one-quarter of them said they would.

"Of the six candidates who backed Pelosi, three are incumbents. Seven of the candidates said they won't back her, and 10 others - including four current representatives facing primary fights - were noncommittal, saying it was too early to make a pick. One Democrat did not respond." Globe

MEDIAWATCH -- "BuzzFeed News Asks Readers to Chip In With Donations: Digital-media company allows readers to donate between $5 and $100 to help pay for cost of newsroom; could be prelude to membership model," by WSJ's Benjamin Mullin: "BuzzFeed News is becoming the latest newsroom to ask its readers to help shoulder the cost of newsgathering. ... The donation feature asks readers to 'help us report to you' and calls upon them to join a community that will shape the future of BuzzFeed News.

"Contributors will get timely updates on big investigations and new programming from BuzzFeed News, a person familiar with the program said. If successful, it could be a prelude to a membership program with more perks, the person said, noting that the company has no plans to charge its readers for content." WSJ

-- "A million-dollar gift to journalism, without ties, and the reason for that," by David Beard in Poynter: "Craig Newmark, Craigslist founder and head of Craig Newmark Philanthropies ... [is] giving $1 million to Mother Jones, hoping to boost the investigative outlet's ability to combat disinformation campaigns against the American people. The unrestricted gift follows Newmark donations to ProPublica, the Center for Public Integrity, the Columbia Journalism Review and the university's Tow Center, Wikimedia and The Ground Truth Project, among others." Poynter

-- CNN'S OLIVER DARCY: "Bloomberg News reassigned reporter after Wells Fargo CEO called to complain"

VALLEY TALK - "Top Facebook communications exec Rachel Whetstone is departing for Netflix," by Recode's Kara Swisher: "Whetstone is the latest high-ranking executive to leave the massive social network in recent months. Her boss, Elliot Schrage, announced in June that he was planning on leaving the company; business development head Dan Rose said last week he was also departing. Whetstone is replacing former Netflix comms head Jonathan Friedland, who was fired earlier this summer from the digital entertainment company." Recode
PLAYBOOKERS
FIRST IN PLAYBOOK ... TRANSITION: Obama alum Adrian Saenz is joining the Latino Victory Project as executive vice president. Saenz served as special assistant to President Obama and deputy director of intergovernmental affairs and senior adviser for intergovernmental affairs.

BIRTHDAY OF THE DAY: Matthew Swift, chairman, co-founder and CEO of The Concordia Summit. What he's read recently: "I recently finished reading 'Bad Blood: Secrets and Lies in a Silicon Valley Startup,' by Wall Street Journal reporter John Carreyrou. It is the story about Theranos, the blood testing company founded by Elizabeth Holmes. I vividly remember meeting Elizabeth in Sedona, Ariz., at a conference, and ... I will never forget listening to her talk and thinking that if she had the technology she claimed to have, it would change the world. ... I think everyone should read this book to remember that our society and systems do not work without people having integrity and honesty.
Commerce and governance only work if there is a basic level of trust, and stories like that of Theranos really amplify this." Playbook Plus Q&A

BIRTHDAYS: Alex Skatell of IJR (hat tips: Anton Vuljaj and Gerrit Lansing) ... Bill Cohen, chairman and CEO of The Cohen Group and former secretary of defense and senator from Maine, is 78 ... Herald Group's R.C. Hammond (h/ts Taylor Gross and Matt Mowers) ... POLITICO's Marty Kady ... Kimberly Plumer ... AP's Ken Thomas ... Allison Lichter ... Tori Stilwell ... Pat Pelletier ... Robert Greenwald, founder of Brave New Films, is 73 ... Morgan Chalfant, recently promoted as national security reporter at The Hill (hubby tip: Raffi Williams) ... Hilary Halpern, associate at the Cypress Group ... Ryan McDevitt ... Ellen Carmichael ... Brian Horn ... Ellen Ratner ... Jessica Herrera-Flanigan, EVP
of gov't and corporate affairs at Univison Communications ... Darius Tandon (h/t Tracy Sefl) ... Mallory Blount, deputy press secretary at HUD, is 24 (h/t Alex Sarp) ...

... Sarah Carlson Brooke, director of NBC's "Meet the Press" ... Thomas Winslow, a principal on the mobilization and campaign management team at Precision Strategies ... Meghan Snyder ... Jim O'Brien, vice chair of the Albright Stonebridge Group ... Connor Ryan ... Rep. Julia Brownley (D-Calif.) is 66 ... Callie Strock ... Ann Marie Jablon ... Robert Simpson ... Scott Miller ... Michael Keefer ... Jay Wegimont ... Luke Bunting ... Luci Arveseth ... Abbie Sumbrum ... Lindsay Gill ... Arlet Abrahamian ... Rachael Dollar ... Charles Schneider ... Jennifer Cervantes ... Nick Tropin ... Square's Taylor Bolhack ... Steve Nichols ... Naila Alam ... David Gray ... Lane Roberts ... Kate Peyton ...
Carol Kelly (h/ts Teresa Vilmain)

Presented by Morgan Stanley:

Are traditional supply and demand estimates masking a mismatch between light oil supply and the demand for heavier oil needed for jet fuel and heating oil? Morgan Stanley's Global Oil Strategist, Martijn Rats, says even though U.S. shale output is surging, demand for jet fuel, diesel oil and other middle distillates could push oil prices higher. A rise in global demand coupled with other contributing factors-including regulations from the International Maritime Organization (IMO) that will limit use of high sulfur oil by shipping vessels-suggests that Brent oil prices can keep climbing, possibly reaching $90 a barrel by early 2020. Read more about what this could mean for investors.

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