Generate - Axios
Top Stories


Good morning and welcome back to Generate!

Before we dive in, Axios recently launched a couple of terrific new weekly newsletters. Axios Science brings you news and graphics from the frontiers of medicine, space, neuroscience, physics and more. And our Future of Work newsletter is a smart, concise look at the latest in robots, artificial intelligence, jobs, and global economics.

You can sign up for them both right here. Onward . . .

Wind group launches ad blitz for the Trump era

My colleague Amy Harder has a scoop this morning in the Axios stream about the wind industry's positioning in the Trump era. Here are some key points...

A nonprofit group backed by the wind industry is launching a seven-figure advertising blitz in D.C., touting the renewable energy's American bona fides, seeking to capitalize on President Trump's driving mantra of America First.

Why it matters: The campaign, launched by the group American Wind Action, shows how the wind industry is going big on defense as it confronts a president whose comments on wind tend to be negative — if he talks about it at all. It also shows how the renewable energy sector is taking on a bigger role on the advocacy front where groups funded by fossil fuels have traditionally dominated.

The details: The advertisements will run on cable, radio and digital outlets across D.C., with the president, his new administration and Congress as the target audience. The ads will run on Fox and Friends, which Trump watches regularly, along with other influential cable shows.

Click here for the rest of the story.

A "sobering" report on the oil glut

The latest edition of International Energy Agency's popular monthly oil market report is out this morning. Main takeaways:

Supply and demand: IEA's first detailed projections for 2018 shows global demand picking up speed a little, growing by 1.4 million barrels per day on the strength of demand from developing countries, notably India and China.

  • They predict that demand will average 99.27 million barrels per day and crack the "psychologically important" 100 million threshold in the fourth quarter.
  • But global supply growth will slightly outpace demand growth, with IEA projecting that non-OPEC nations led by the U.S. will boost supply by 1.5 million barrels per day next year, which brings us to...

OPEC's challenge: IEA warns that "our first outlook for 2018 makes sobering reading for those producers looking to restrain supply."

  • The global glut isn't going away anytime soon, despite OPEC's push to lower inventories. Commercial stocks in OECD countries rise by almost 19 million barrels in April, and they're now 292 million barrels above the five-year average.
  • Even if OPEC nations continue complying with the production-limiting deal, "stocks might not fall to the desired level until close to the expiry of the agreement in March 2018."
  • U.S. production is surging, with 2018 output projected at another 780,000 barrels per day higher than this year.

Why Paris only got a Capitol Hill cameo

Rex Tillerson's first public Capitol Hill testimony as secretary of State featured very little discussion of the Paris climate change accord, but that doesn't mean the appearance didn't yield any information.

Tillerson's candor: He didn't raise the topic in his prepared remarks to senators in a pair of hearings, but also didn't hide the fact that he was among the administration players on the losing side of the internal stay-or-go debate.

  • "My view didn't change. My views were heard out. I respect that the president heard my views, but I respect the decision that he has taken," Tillerson told Senate Foreign Relations Committee Ranking Democrat Ben Cardin in response to a question.

Cameo appearance: Cardin bashed the decision to abandon Paris, but overall the climate pact and the budget proposal to gut State climate initiatives scarcely surfaced over hours of testimony before the Foreign Relations panel and an Appropriations subcommittee.

Why it matters: It's another sign that climate change is not the tip of their Democrats' spear when it comes to taking on the Trump administration — they devoted far more time to Russia and other issues.

Democrats' strategy: When they did raise Paris, Democrats signaled that they're making it part of a broader political and policy critique of what they call the Trump administration's ill-conceived pullback from engagement with allies.

  • Sen. Chris Murphy called it part of a "big step back" from U.S. leadership in general.

On tap today: Tillerson will appear before the House Foreign Affairs Committee this morning and a House Appropriations subcommittee in the afternoon.

Tillerson continues pushback on Russian pipeline

Near the end of his second hearing on Tuesday, Tillerson took a harder line against a big and controversial Russian energy project — the proposed Nord Stream 2 gas pipeline that would run to Germany.

"We have encouraged European countries and the EU to at least subject that pipeline to the full rigors of their regulatory process and have suggested to them that it's not in their long-term energy security interest to become more dependent on Russian natural gas, and have pointed out that the U.S. has an abundance of natural gas, and facilities now to ship LNG to Europe," he told an Appropriations Committee panel.

Why it matters: Tillerson went further this time than he did when asked about Nord Stream 2 during his confirmation hearing before the Senate Foreign Relations Committee in January.

At that session in January, he talked up how U.S. oil-and-gas exports can provide options to energy importing countries so they can avoid being captive to a "dominant source" (read: Russia), but avoided weighing in on the project.

Context: The Obama administration opposed the pipeline and also promoted U.S. gas as a counterweight to Russian energy, so Tillerson's comments signal a continuation of that policy. However, Tillerson's phrasing was softer than it was from Obama's State Department (more here and here).

On my screen

Utilities: Utility Dive has a detailed dispatch from the annual conference of the Edison Electric Institute, a big trade association for investor-owned utilities.

  • Multiple power companies are pressing ahead with the shift to low-carbon energy despite the rollback of climate rules, but "prolonged absence of regulatory pushes could slow decarbonization efforts."

Nuclear: The New York Times reports that the U.S. natural gas boom "has started pushing many of America's nuclear reactors into early retirement — a trend with adverse consequences for climate change."

Paris: The Congressional Research Service has a clearly written primer on legal questions raised by Trump's withdrawal from the international climate agreement. (And three cheers to the Federation of American Scientists for bringing CRS reports into the sunlight.)

Coal: Bloomberg uses BP's latest annual energy trends report to conclude that "it's the end of an era for coal." Global production fell by a record amount last year, while China burned the least amount in six years.

  • "The fortunes of coal appear to have taken a decisive break from the past," BP's chief economist Spencer Dale said in London, according to Bloomberg.

Latest on lobbying

A few new filings popped up in the Lobbying Disclosure Act database.

Oil: Gulfport Energy Corporation has brought on the heavyweight firm Akin Gump. Ryan Thompson, a former aide to GOP Sen. James Inhofe, will represent the company.

Pipelines: Otis Eastern Service has also tapped Akin Gump for work on "regulatory obstacles to pipeline construction."

Cars: The major trade group Global Automakers has hired Baker & Hostetler for "general representation, including policy issues related to international trade and tax reform."

Fuels: Lucas Oil has retained Brian Kelly for work on a range of topics.


NYPD responds to explosion of unknown origin at 42nd and 8th

This is a breaking news story and will be updated as we learn more.


Rohingya women say they’ve been raped by Myanmar military

Portraits of some of the Rohingya Muslim women taken during an interview with The Associated Press.

The use of rape by Myanmar's armed forces has been sweeping and methodical, AP found in interviews with 29 Rohingya Muslim women and girls now in Bangladesh.

Why it matters: "The testimonies bolster the U.N.'s contention that Myanmar's armed forces are systematically employing rape as a 'calculated tool of terror' aimed at exterminating the Rohingya people."

More from AP's Kristen Gelineau:

  • "They were interviewed separately, come from a variety of villages in Myanmar and now live spread across several refugee camps in Bangladesh. Yet their stories were hauntingly similar. The military has denied its soldiers raped any Rohingya women."
  • "Here are the accounts as told by 21 women and girls [ranging in age from 13 to 35]. They agreed to be identified in this story by their first initial only, out of fear the military will kill them or their families."

Polluters are getting off easier under Trump's EPA

EPA Administrator Scott Pruitt speaks to the media during a June briefing. Photo: Pablo Martinez Monsivais / AP

"An analysis of [EPA] enforcement data by The New York Times shows that the administration has adopted a more lenient approach than the previous two administrations — Democratic and Republican — toward polluters," Eric Lipton and Danielle Ivory write on the front page:

  • "The Times built a database of civil cases filed at the E.P.A. during the Trump, Obama and Bush administrations. During the first nine months under [Administrator Scott] Pruitt's leadership, the E.P.A. started about 1,900 cases, about one-third fewer than the number under President Barack Obama's first E.P.A. director and about one-quarter fewer than under President George W. Bush's over the same time period."
  • "[T]he agency sought civil penalties of about $50.4 million from polluters for cases initiated under Mr. Trump. Adjusted for inflation, that is about 39 percent of what the Obama administration sought and about 70 percent of what the Bush administration sought over the same time period."
  • Get smart: "The E.P.A. ... can force companies to retrofit their factories to cut pollution. Under Mr. Trump, those demands have dropped sharply. The agency has demanded about $1.2 billion worth of ... injunctive relief ... in cases initiated during the nine-month period, which, adjusted for inflation, is about 12 percent of what was sought under Mr. Obama and 48 percent under Mr. Bush."

North Korean threat intensifies as it grows its bioweapons program

People watch a TV screen showing an image of North Korean leader Kim Jong Un. Photo: Ahn Young-joon / AP

"North Korea is moving steadily to acquire the essential machinery that could potentially be used for an advanced bioweapons program," the WashPost's Joby Warrick reports atop column 1.

Why it matters: "The gains have alarmed U.S. analysts, who say North Korea — which has doggedly pursued weapons of mass destruction of every other variety — could quickly surge into industrial-scale production of biological pathogens if it chooses to do so."

Details of prorgram expansion:

  • "Kim Jong Un's government also is dispatching its scientists abroad to seek advanced degrees in microbiology, while offering to sell biotechnology services to the developing world."
  • The takeaway: "Such a move could give the regime yet another fearsome weapon with which to threaten neighbors or U.S. troops in a future conflict."

Report: Mueller focusing on obstruction of justice around Flynn

Former Trump national security adviser Michael Flynn leaves federal court in Washington. Photo: Susan Walsh / AP

Robert Mueller and his team are focusing on the days after White House officials were told Michael Flynn was vulnerable to Russian blackmail, NBC News' Carol Lee and Julia Ainsley report, citing "two people familiar with Mueller's investigation".

Why it matters: This means Mueller's team could be working to determine if Trump obstructed justice and is likely seeking out what President Trump knew about Flynn's conversations with former Russian Ambassador Sergei Kislyak, and subsequently, when Trump learned Flynn lied about them.

That period: January 26 to February 13, 2017.

The focus reportedly includes interviews with White House Counsel Don McGahn, who briefed Trump and senior White House staff about Yates' report that Flynn had lied to White House officials on January 26 and that he was vulnerable to Russian blackmail, according to Sean Spicer. That included Flynn's lie to Vice President Pence, which is what Trump cited in his firing statements.

  • Yates testified before Congress that McGahn asked about Flynn's FBI interview but that she refused to answer questions about that.
  • McGahn briefed Trump and senior White House staff about Yates' report that Flynn had lied to White House officials on January 26, according to Sean Spicer including Vice President Pence, and that he was vulnerable to Russian blackmail.
  • The effort reportedly includes interviews with other White House officials as well.

Saudi Arabia set to lift ban on movie theaters

Visitors enter the Saudi Comic Con in February 2017. Photo: AP

Saudi Arabia will allow movie theaters to open in the country next year for the first time since the 1980s, per the AP. The government hopes to open 300 theaters with 2,000 screens by 2030, paving the way for a new industry — though it’s unclear what movies might play and edited they might be.

Why it matters: It’s part of a continuing social modernizing push to attract international investment by Crown Prince Mohammed bin Salman, who has announced an end to a ban on women driving and allowed rock concerts to be held in Saudi Arabia. That’s happening in conjunction with his controversial corruption crackdown, which is set to seize hundreds of billions from prominent businessmen for ailing Saudi coffers.


How Ajit Pai tore up the rulebook for the information age

FCC Chairman Ajit Pai has rewritten the rules of the information age so thoroughly that there's no mode of communication under his control where the rules aren't looser than they were a year ago. Here's a look at what he's done.

Be smart: While some of his deregulation has been bipartisan, his big-ticket proposals have divided the agency and the nation. He's actively courted fans of President Trump's populist rhetoric and inspired scorn on the left.

Why it matters: Many top Republican priorities have been mired in Washington gridlock since Trump took office. Not so at the FCC. Pai swiftly orchestrated the wholesale deregulation of the networks Americans use every day, which will likely alter the way people experience the internet, broadcast TV and even AM radio. Those changes will play out over years — not immediately.

Ascension and Providence consider mega hospital merger

Ascension CEO Anthony Tersigni is eyeing a large health system merger. Photo: Aijaz Rahi / AP

Ascension and Providence St. Joseph Health are in discussions to merge, which would create the largest hospital system in the U.S., the Wall Street Journal reports citing people familiar with the merger talks. The combined system would have 191 hospitals, numerous clinics and roughly $45 billion in annual revenue.

Why it matters: Although the Ascension-Providence deal is not guaranteed, it shows how health care has turned into the Wild West for mega-mergers. CVS Health is buying Aetna, Catholic Health Initiatives and Dignity Health are merging, and Advocate Health Care and Aurora Health Care are combining, among other deals. Yet, research shows mergers don't lower health care costs or improve care for patients.


Sneak Peek: Pence to the pyramids

Pence listens as Trump announces his Jerusalem move. Photo: Alex Brandon / AP

With President Trump's announcement on Jerusalem lighting up the Middle East, Vice President Mike Pence embarks Saturday on his first trip to Israel since taking national office.

The vice president will be gone for a week, with stops in Egypt and Germany:

  • Pence takes off from Washington, lands in Tel Aviv and goes straight to Jerusalem for a bilateral meeting with Israeli President Benjamin Netanyahu.
  • Pence then will light a menorah at the Western Wall.
  • An aide said that Pence's message in Israel will be that Trump, as he said in his speech recognizing Jerusalem as the capital, is committed to working for peace between Israelis and Palestinians.
  • Pence will use his meetings with leaders in the region to reaffirm the administration's commitment to work with partners throughout the Middle East and to "defeat radicalism."
  • On Monday, Pence will give the signature speech at the Knesset, the Israeli Parliament. The speech will be aimed at the region overall. Pence will emphasize that he is there on behalf of the president, and detail why Israel is a most cherished ally of the United States.
  • Pence will then fly to Cairo for a bilat with President Abdel Fattah el-Sisi. The two will discuss security and joint efforts to fight ISIS.
  • Pence will visit the pyramids and will talk with media with the ancient wonders as a backdrop.
  • Pence will fly home through Ramstein Air Base in Germany, and will do a meet-and-greet with troops.

The takeaway: A key theme for Pence's remarks and interviews will be U.S. efforts to stop persecution of Christians and other religious minorities in the region.

Go deeper: Palestinians won't meet with Pence.


Exclusive: Policy official leaving White House

The White House South Portico is adorned with Christmas lights. Photo: Manuel Balce Ceneta / AP

Paul Winfree is leaving the White House, according to a senior administration official with knowledge of the decision. Winfree, who declined to comment, has resigned from his position as Deputy Director of the White House Domestic Policy Council and Director of Budget Policy.

  • Why this matters: Winfree's departure is part of what we've been forecasting will be a wave of White House staff departures after year one of the Trump presidency. His last day in the White House will be Friday.

Winfree, a respected policy wonk with strong ties to the conservative movement, is the second senior official to announce a departure in three days. Deputy National Security Adviser Dina Powell told colleagues she's leaving to return to her family in New York.

What Winfree has been telling friends and colleagues:

  • He and his wife are expecting a second baby boy in a few weeks.
  • He'll return to the Heritage Foundation, where he will run economic policy.
  • He also plans to start his own policy consulting business. -
  • Starting in February, he will teach a seminar on policymaking at a top university, where he will draw on his experiences working in the White House, the U.S. Senate, and with think tanks.