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MORNING REPORT

PRESENTED BY PHILIP MORRIS INTERNATIONAL

Friday, October 21

by Alexis Simendinger & Kristina Karisch

Biden stumps for Fetterman; Truss resigns

The watchword this morning, from the U.S. midterms to the U.K.'s Conservative Party, is turmoil.

Who's up? For how long? What (or who) has the answers? Pollsters and forecasters on both sides of the pond are trying to make sense of tight races and uncertain futures with three weeks until Election Day in the States and a new prime minister on the horizon in Great Britain.

President Biden on Thursday made a campaign stop in Pennsylvania, appearing with Senate candidate Lt. Gov. John Fetterman (D) in Pittsburgh and stumping for him at a fundraiser in Philadelphia. "He's got to win," Biden told donors.

Fetterman, who is running against Republican TV doctor Mehmet Oz, has an average 2.4 percentage point advantage in the polls according to Real Clear Politics (ABC News).

The president warned Democratic supporters that if Democrats don't maintain control of the House and Senate next year, "a lot's going to change."

We're at a point where there's not a lot of real Republicans left," Biden said. "The folks running this party are the MAGA Republicans. They have a very different view about the government role. They have a different view of the world and it's really consequential."

Biden said the election is not a referendum on his leadership. "It's a choice: What direction do you want to see this country going?"

Fetterman, who suffered a stroke in May and has resumed campaigning, told the donor audience gathered Thursday night that he wants to be the "51st vote" in the Senate. The 6'9" lieutenant governor, who prefers shorts and hoodies as his professional wardrobe, was dressed in a baggy suit and tie and joked to appreciative laughter that it's the only suit he owns.

"It's gonna be close," Fetterman said of his race against Oz, before pointing to his opponent's mansion in the Garden State. "Please send Dr. Oz back to New Jersey and send me to D.C. to be that 51st vote."

Across the country, Democrats worry that Republicans are gaining in deep blue strongholds, including New York and Oregon, writes The Hill's Caroline Vakil. Republicans are making competitive bids to take back governorships in both states, which have reliably gone for Democrats in presidential elections. The GOP gains could also extend to the House, where Republicans are making inroads in New York, California and Rhode Island, according to surveys.

In New York, a Quinnipiac University survey of likely voters released Tuesday found Gov. Kathy Hochul (D) with a 4-point lead over Rep. Lee Zeldin (R) — the tightest any nonpartisan poll has found the race to date. A Siena College Research Institute poll released on Tuesday found that Hochul had an 11-point lead, significantly lower than the 17-point lead the governor had in September.

The Cook Political Report with Amy Walter rates the New York race as "solid Democratic" (Forbes).

Politico: Democrats are putting money and resources into … Rhode Island.
The Washington Post: What voters in swing states are saying three weeks before midterms.

The Hill's Alexander Bolton reports from the campaign trail in North Carolina that National Republican Senatorial Committee Chairman Rick Scott (Fla.) predicts Republicans will likely control 52 Senate seats next year and have a pathway to a 55-seat majority, given recent polling that shows momentum among GOP candidates.

"It starts right here, we're going to get 52 Republican senators, we have to win here," Scott said at a get-out-to-vote event with Senate candidate Rep. Ted Budd (N.C.) at the Republican Black Community Center. "I think we can get 53, 54, 55."

Presidential hopefuls, meanwhile, are traveling to New Hampshire with early frequency, The Hill's Hanna Trudo reports. Lawmakers are campaigning for midterm candidates while introducing themselves to voters in the first-in-the-nation primary. It's a sign that just weeks before Election Day, the 2024 election is already on the horizon. And the roster of Democrats making the rounds includes some of the same names who ran for president in 2020, restarting the conversation about what the next few years could look like if Biden doesn't seek reelection — or possibly if he does.

The Hill's Emily Brooks breaks down five investigations to watch as the House GOP plots an oversight landslide if they win in November: Hunter Biden. The alleged politicization in the Department of Justice. The controversial withdrawal of troops from Afghanistan. The origins of COVID-19. Big Tech censorship.

The Hill: Biden says he's worried about more congressional assistance for Ukraine if Republicans gain House control.
NBC News: Will Congress give the Department of Justice another $34 million in December to continue prosecuting the Capitol rioters? That's what the department says it needs to continue its probe and prosecutions tied to Jan. 6, 2021.

The Washington Post: Former Vice President Mike Pence on Wednesday said he might prefer someone other than former President Trump in the next election. Asked whether he'd back the former president in 2024, Pence paused and with a wry smile told an audience at Georgetown University, "Well, there might be somebody else I'd prefer more."
The New York Times: Sentencing of former Trump adviser Stephen Bannon for willfully disobeying a congressional subpoena is scheduled today. The Justice Department recommended six months in prison and a fine.
The Hill: Potential 2024 GOP presidential candidates who are also authors find their books atop bestseller lists.
The Washington Post: Sen. Lindsey Graham (R-S.C.) must testify in 2020 election investigation, Georgia court rules.
The New York Times: How disinformation splintered and became more intractable.

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Leading the Day

➤ INTERNATIONAL

British Prime Minister Liz Truss resigned on Thursday and will be replaced next week by the Conservative Party, ending a damaging and chaotic 44-day tenure as the United Kingdom's leader, the shortest in its history.

The thumbs-down from the bond market for her mini-budget, including proposed tax cuts during a period of high inflation, then her policy about-face, sent the British pound and her party's approval ratings plunging this week.

In a brief statement, Truss said that "given the situation" she could not continue to deliver on her party's "mandate." Her critics quickly pounced to note that Truss could claim a fiscal ideology but never had a governing mandate.

The Conservative Party pledged to put to a vote two replacement candidates by Oct. 28. There was no immediate consensus about the economic and political skills needed to weather prolonged expectations for soaring prices, energy challenges, war in Ukraine and the frustrations of an impatient and distrustful populace.

Truss last month succeeded Boris Johnson, who announced his resignation in July after three tumultuous years in office. Johnson is rumored to be an eager contender for a comeback, which would be a dramatic reversal of fortune requiring nominations from at least 100 Conservative members of parliament.

The Washington Post and The New York Times: Here are possible contenders.

In Ukraine, the military wants to launch an offensive in coming days to retake the city of Kherson from Russian control while also trying to resist a furious Russian assault on the key eastern city of Bakhmut (The Hill).

Ukrainian President Volodymyr Zelensky said Thursday that his country had information that Russia had mined a dam near Kherson in what he said could be a "false flag" plan to blow up a hydroelectric plant in order to flood 80 Ukrainian towns, villages and cities, including Kherson, while falsely blaming the Ukrainian military for resulting devastation (The New York Times).

Russian-backed officials have said they intend to move as many as 60,000 civilians from Kherson to the eastern side of the Dnieper River, ostensibly to shield them from a Ukrainian counteroffensive. Kherson is a key target because the region is one of four Ukrainian provinces that connect Russia by land to the Crimean Peninsula, which Moscow has held since 2014 (The New York Times).

Russia's use of Iranian manufactured drones to try to gain an advantage over Ukraine's military forces, civilians and the country's infrastructure, including power, heat and water, has galvanized U.S. and allied governments to try to bolster Ukraine's air defenses. Iranian trainers allied with Russia and working to stave off Russian errors while using Tehran's weaponry are on the ground in Crimea to support Russian drone strikes against Ukraine, the White House said (The Hill and The New York Times). Iran denies involvement.

White House spokesman John Kirby told reporters that the Pentagon is exploring "potential air defense solutions for the Ukrainians," including movement of additional capabilities to Ukraine. "DOD is well aware of the threat and is working hard to see what they can do to help the Ukrainians deal with the threat," he said.

The Hill: Saudi Arabia is unfazed by U.S. backlash tied to oil production cuts as Russia reaps the benefits.

In Focus / Sharp Takes

➤ ADMINISTRATION

A federal appeals court ruled that the funding structure of the nation's most powerful financial watchdog agency, the Consumer Financial Protection Bureau, is unconstitutional. In a case brought by a payday lending group, a three-judge panel of the 5th U.S. Circuit Court of Appeals on Wednesday threw out a CFPB regulation governing those high-interest-rate lenders and ruled that the way the bureau is funded "violates the Constitution's structural separation of powers." The bureau draws its resources from the Federal Reserve, not from congressional appropriations (NPR and Bloomberg Law).

Senate Banking Committee member Elizabeth Warren (D-Mass.) — who as an academic urged the government to create the independent consumer financial watchdog and as a senator helped enact it — called the court's decision "lawless" and "reckless" on Twitter.

The bureau, created by Congress amid the wreckage of the financial crisis in 2010 to safeguard consumer financial interests, has not indicated whether it will appeal the decision. A spokesperson for the agency said in a statement that there's "nothing novel or unusual about Congress's decision to fund the CFPB outside of annual spending bills."

"Other federal financial regulators and the entire Federal Reserve System are funded that way, and programs such as Medicare and Social Security are funded outside of the annual appropriations process," the spokesperson said (Business Insider).

Meanwhile, the president's controversial student debt forgiveness policy continues, at least for now. Supreme Court Justice Amy Coney Barrett on Thursday without explanation denied an emergency bid to block the administration's program in response to a challenge filed by Wisconsin plaintiffs (The Hill).

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Opinion

Truss's resignation in the U.K. is a warning for Republicans, by Henry Olsen, columnist, The Washington Post. https://wapo.st/3VWRi75
A depressing return to a well-worn election playbook — because it works, by Mary C. Curtis, staff writer, Roll Call. https://bit.ly/3ShIOnF

Where and When

The House meets at 11 a.m. for a pro forma session. Members are scheduled to return to the Capitol on Nov. 14.

The Senate convenes Monday at 1:45 p.m. for a pro forma session. Senators make their way back to Washington on Nov. 14.

The president will travel to Delaware State University in Dover, Del., for a speech about student debt relief. Biden then heads to his home in Rehoboth, Del., where he will remain over the weekend. An interview with the president by MSNBC's Jonathan Capehart will broadcast at 7 p.m. ET.

Vice President Harris has no public events today.

Treasury Secretary Janet Yellen will join Sen. Tim Kaine (D-Va.) in Herndon, Va., at 10:30 a.m. at the Virginia Innovation Partnership Corporation to champion administration investments in technology, innovation, clean energy and R&D. Yellen and Kaine will participate in a roundtable with local entrepreneurs and representatives from Virginia colleges and universities. They'll be joined by Rep. Gerry Connolly (D-Va.).

Secretary of State Antony Blinken will host a working lunch with French Foreign Minister Catherine Colonna at the Department of State at noon. He will hold a joint press availability with Colonna at 1:20 p.m.

Elsewhere

➤ PANDEMIC & HEALTH

Cutthroat work conditions and long hours are harmful to workers' mental and physical health, Surgeon General Vivek Murthy warned in a Thursday report. It's the first time the surgeon general's office has weighed in on the effects a toxic workplace can have on wellbeing, and comes as workers across the country reconsider their place in the workforce and the toll their jobs are taking on them (Forbes).

A flurry of new COVID-19 variants appears to be gaining traction globally, raising the possibility of a winter surge as people spend more time indoors amid dropping temperatures. Unlike in past years, where variants have popped up one by one, this year's surge could be linked to a combination of sub-variants spreading across the globe (CNN).

The Mercury News: How the end of federal COVID-19 funding early next year will shift costs to consumers.
The New York Times: In anonymous focus groups, these doctors admit they don't want patients with disabilities.
The Washington Post: The Adderall shortage is so bad some patients can't fill their prescriptions.

Total U.S. coronavirus deaths reported as of this morning, according to Johns Hopkins University (trackers all vary slightly): 1,067,190. Current U.S. COVID-19 deaths are 2,566 for the week, according to the Centers for Disease Control and Prevention. (The CDC today changed its tally of available data from daily to weekly.)

➤ SOCIAL MEDIA'S BILLIONAIRES

Rapper Ye — formerly known as Kanye West — is buying the right-wing social media app Parler, but it may do little to reignite the already floundering platform. But Ye, who has come under fire in recent weeks for racist and antisemitic comments that have resulted in bans from mainstream social media sites, is just the latest billionaire looking to invest in social media (The Washington Post).

Taken as a piece in a larger puzzle of the rich buying, creating and investing in social media apps, writes The Hill's Rebecca Klar, the purchase sets the stage for an online ecosystem shaped by the ideological views of ultra-wealthy men with outsized, consolidated power. The market of social media apps catering to a right-wing audience is crowded, as they offer spaces for the racism, antisemitism, misogyny and conspiracy theories that mainstream platforms prohibit.

Although none of the alternative platforms boast user numbers on par with the mainstream sites, as billionaires open their deep pockets, they're allowing the alternative companies to expand further into the tech market and operate without abiding by mainstream tech's rules.

The Hill's In the Know: Trump, West comments "shatter" the feelings of safety for Jewish people in the United States.
Politico: Parler was jubilant about West's purchase. Then the problems started.
The New Yorker: West's Parler games.

Tech billionaire Elon Musk, who is in talks to buy Twitter, plans to gut 75 percent of its workforce once he takes over, The Washington Post reports. The change would likely have a major impact on the site's ability to control harmful content and prevent data security crises.

Bloomberg News: Twitter tells staff there aren't plans for company-wide layoffs.

The Closer

© John F. Kennedy Presidential Library and Museum, Boston / Cecil Stoughton, White House photographs | President John F. Kennedy in the Oval Office on Oct. 31, 1963, with his costumed children, Caroline Kennedy (left, with cat) and John F. Kennedy Jr.

And finally … Congratulations to Morning Report Quiz winners! They Googled and guessed some Halloween headlines and one flashback to the White House in 1958.

🪓 But, apologies to puzzlers who encountered a software demon that balked at a decimal point, which meant a multiple-choice answer about inflation's impact on candy prices went from "13.1 percent" (correct) to "1 percent" in readers' inboxes. Puzzlers who were stumped, accused us of a ploy, rounded to 15 percent or submitted the correct answer, bravo! They suffered no penalty.

Navigating our trick-or-treat trivia to victory: Amanda Fisher, Randall Patrick, Ki Harvey, Joan Domingues, David Letostak, Candi Cee, Paul Harris, Pam Manges, Stan Wasser, Lou Tisler, Patrick Kavanagh, Richard Baznik, Robert Bradley, Sharon Banitt, Steve James and Kathleen Kovalik.

They all knew that the Top 10 most popular Halloween costumes in 2022, according to Google Trends "most searched" list, as reported this week by news outlets, included cheerleader, witch and Spider-Man, so the best answer was "all of the above."

Actress Jamie Lee Curtis recently spoke to The New York Times about her final film in a long-running horror franchise, "Halloween Ends."

Mamie Eisenhower is the former first lady who set the trend of decorating the White House for Halloween. 🎃