Dec 16, 2018

Axios AM

By Mike Allen
Mike Allen

Good Sunday morning.

📊 Breaking: 62% of Americans in an NBC News/Wall Street Journal poll say President Trump has not been truthful about the Russia investigation.

  • 10% say he got the message for a change in direction from the midterms.
  • "The dam has not burst on Donald Trump," said Democratic pollster Peter Hart. "But this survey suggests all the structural cracks."
1 big thing: Some activist Dems question Beto
Rep. Beto O'Rourke (D-Texas) speaks yesterday after touring the Tornillo international port of entry, where several thousand immigrant teens are housed. (Rudy Gutierrez/The El Paso Times via AP)

Beto Fever has spread to Iowa. Rep. Beto O'Rourke, 46, the losing but charismatic Senate candidate from Texas, comes in third this morning in a Des Moines Register/CNN/Mediacom poll, behind only Joe Biden and Bernie Sanders.

But Axios' Alexi McCammond has discovered a potential hurdle for the Beto bandwagon:

  • O'Rourke ran a decidedly progressive Senate campaign, especially for a Democrat running in deep-red Texas.
  • But now activists on the left are questioning his ideology and whether he's substantive and progressive enough to represent their party in 2020.

Why it matters: The left is where the energy is in today's Democratic Party. Nearly half of Democratic voters describe themselves as liberal, up 17 points from a decade ago, according to Pew Research Center.

  • After Bernie Sanders lost the nomination in 2016, the activist base that organized behind him will be even more demanding of all 2020 candidates.

Waleed Shahid, communications director for Justice Democrats, a progressive political action committee, who also worked with Sanders during the 2016 election, said: "I can’t remember anything from Beto's campaign that seems like a big policy idea."

  • "The thing I fear most about Beto is that he’s like Emmanuel Macron: super charismatic, runs a great campaign, really good at organizing and really good at speeches. But then on policy he's going to surround himself with Wall Street backers because he doesn’t have really strong ideas."

The problem for O'Rourke, some Democratic activists say, is that he didn't support bills they consider to be crucial to the progressive platform. And he was a member of the centrist, fiscally conservative New Democrat Coalition.

  • O'Rourke supports universal health care, but his campaign website doesn't mention Medicare for All and he didn't co-sponsor the House bill for it. (He's explained why on Facebook and said he's "exploring an alternative.")
  • He supports protecting Social Security, but he didn't sign the House bill for it.
  • He's not on the bill for debt-free college, which will become a litmus test for 2020 Democrats among progressives.
  • He supports reforming the current bail system, but not abolishing it completely.
  • On energy, he wants the U.S. to re-join the Paris climate accord. But that's not enough for Democratic activists who said they'll be looking for whether or not he endorses Rep.-elect Alexandria Ocasio-Cortez's Green New Deal.

Another progressive group leader, who asked to remain anonymous because the group hasn't decided who to endorse yet, said he's heard a constant refrain among activists: "I love Beto, but I also don’t know what he’d do as president."

2. Health care "bomb"

"An explosive court ruling to wipe out Obamacare has revived the acrimonious health care battle in Washington and tossed a political bomb in President Trump’s lap as he gears up to run for re-election," Bloomberg's Sahil Kapur writes:

  • "The case may not be resolved in the courts before 2020, legal experts said, which could make it a defining issue in the race for the White House and Congress."
  • "Democrats immediately jumped on the Friday night ruling to warn that health care coverage for millions of Americans was at stake."

The N.Y. Times reports that the Texas ruling "is so sweeping that many legal analysts believe it is likely to be overturned. The Supreme Court, in a 5-to-4 decision, has already upheld the Affordable Care Act’s legality."

  • But as Axios' David Nather pointed out yesterday: There’s no guarantee that a more conservative Supreme Court won’t just let the law die.
  • And The Times is right that the volatile debate will now be "center stage in a newly divided capital."

Be smart: Republicans now are going to debate whether they want to take a popular program away from voters — not where a party wants to be.

3. "The Best Place To Put Money? Your Mattress"

Major indexes drop in unison ... "For the first time in decades, every major type of investment has fared poorly, as the outlook for economic growth and corporate profits is dampened by rising trade tensions and interest rates," the N.Y. Times' Matt Phillips writes:

  • Why it matters: "Most years, financial markets are a mixed bag. A bad year for risky investments, like stocks, might be a great one for safe bets like government bonds. Or, if worries about inflation are hurting bond investments, commodities like gold tend to do well."
  • But now, stocks "around the world are getting pummeled, while commodities and bonds are tumbling — all of which have left investors with few places to put their money."

Be smart: "If this persists, or grows worse, it could create a damaging feedback loop, with doubts about the economy hurting the markets, and trouble in the markets undermining growth."

Bonus: Pics du jour
Mario Tama/Getty Images

Above, a man decorates the U.S.-Mexico border fence during a Posada Without Borders event yesterday in Tijuana, Mexico.

  • The binational Christmas event is held with religious leaders and faithful on both sides of the fence, sometimes allowing loved ones to view family members living on the other side.
  • The Getty Images photographer said that this year, family members and others were kept at a distance and not allowed to physically touch.

Below, Central American migrants, who had been traveling in a caravan, look for a spot to cross the Mexico-U.S. border to San Diego County from Tijuana, Mexico.

Guillermo Arias/AFP/Getty Images
Guillermo Arias/AFP/Getty Images

Above, Central American migrants cross the Mexico-U.S. border fence to San Diego from Tijuana.

Below, Central American migrants are taken into custody after crossing.

Guillermo Arias/AFP/Getty Images

Below, pro-Trump demonstrators protest near the U.S.-Mexico border in Imperial Beach, San Diego County, as seen from Playas de Tijuana, Mexico.

Guillermo Arias/AFP/Getty Images
4. Sentence of the day

"Two years after Donald Trump won the presidency, nearly every organization he has led in the past decade is under investigation," the WashPost writes.

  • Why it matters: "The mounting inquiries are building into a cascade of legal challenges that threaten to dominate Trump’s third year in the White House."

P.S. ... N.Y. Times' Michael Schmidt: "Mueller’s investigators and Mr. Trump’s lawyers were still negotiating as recently as this past week about whether Mr. Trump would sit for an interview."

5. Lingo: "Can't realize a profit" (CRaP)

Amazon has trained us "to buy everything from major appliances to daily staples online. Now it is having second thoughts about some of those sales because they don’t make money," according to The Wall Street Journal's Laura Stevens, Sharon Terlep and Annie Gasparro (subscription):

  • "Inside Amazon, the items are known as CRaP, short for 'Can’t Realize a Profit.'"
  • "Think bottled beverages or snack foods. The products tend to be priced at $15 or less, are sold directly by Amazon, and are heavy or bulky and therefore costly to ship — characteristics that make for thin or nonexistent margins."

"Now, as Amazon focuses more on its bottom line in addition to its rapid growth, it is increasingly taking aim at CRaP products, according to major brand executives and people familiar with the company’s thinking."

  • "In recent months, it has been eliminating unprofitable items and pressing manufacturers to change their packaging to better sell online, according to brands that sell on Amazon and consultants who work with them."

"One example: ... Coca-Cola will start shipping [some Smartwater] orders directly to consumers, sparing Amazon the expense of shipping from its warehouses."

6. 1 fun thing

"Michael Cohen" hugs "Donald Trump" on "Saturday Night Live" in "It's a Wonderful Trump," from Liberty Films and RKO Radio:

  • President Trump's guardian angel takes him to a world where he lost the election, Hillary Clinton is president, and everyone he knows is better off.
  • Robert Mueller is spending time with his grandchildren, Mike Pence is a deejay, Sarah Sanders is making a mint as a corporate flack, and Kellyanne Conway and her husband aren't fighting online.
  • YouTube
Mike Allen