The Trump administration's Signal fiasco has given Democrats an unexpected shot to go on offense, with a pair of hearings in the next two days.

• "Well, somebody f**ked up," Sen. Tim Sheehy (R-Mont.), a former Navy SEAL, told reporters today.

Why it matters: Grilling Trump officials on whether their secret Signal chats violated the Espionage Act won't end the Democrats' bitter infighting, but it's a heckuva distraction.

• Senate Intel gets first crack at DNI Tulsi Gabbard and CIA Director John Ratcliffe. The two were among the 18 people on the Signal group chat revealed today by The Atlantic's Jeffrey Goldberg.
• House Intel goes on Wednesday with the same crew. Top Democrat Jim Himes (D-Conn.) is already vowing to grill them on the story.
• Look for Dems to focus heavily on The Atlantic article at both hearings, per sources involved with the plans.

Zoom in: "This is one of the most stunning breaches of military intelligence I have read about in a very, very long time," Senate Minority Leader Chuck Schumer said today.

• House Minority Leader Hakeem Jeffries called Defense Secretary Pete Hegseth "the most unqualified person to ever lead the Pentagon in American history."
• Hegseth was in the Signal group chat revealed today, along with Vice President Vance, Secretary of State Marco Rubio and the chat's organizer, national security adviser Mike Waltz.
• In it, Hegseth shared potentially classified details of a strike plan in Yemen, including targets and timing, two hours ahead of time.

Hegseth called Goldberg "highly discredited," among other insults. "Nobody was texting war plans and that's all I have to say," Hegseth told reporters.

Between the lines: We're just a month removed from Senate Armed Services Chair Roger Wicker (R-Miss.) accusing Hegseth of a "rookie mistake" for comments on Ukraine.

• Wicker will demand briefings for his committee after today's news, he told CNN.

The bottom line: House Speaker Mike Johnson defended the officials, calling it a "mistake" that won't "happen again." He added that Waltz and Hegseth shouldn't be punished.

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— Justin Green, Andrew Solender, Stephen Neukam and Stef Kight

As it braces for the fight of its life, the private equity industry is launching a 7-figure ad campaign to make its case for how it boosts the economy.

Why it matters: Trump is taking aim at the tax treatment of "carried interest," and the private equity industry has the resources and self-interest to preserve the status quo.

• Tax writers have long eyed how private equity structures some of its compensation, which allows employees to pay capital gains rates on their "carried interest" instead of the higher income tax rate.
• It currently gets taxed as capital gains at 23.8% and not at the top regular income rate of 40.8%.
• The ad and education campaign, "Investing in America," is designed to appeal to Trump's broader desire to make America more competitive and grow its industrial base.

What they're saying: "President Trump's tax law struck the right balance in 2017," said Drew Maloney, the president and CEO of the American Investment Council.

• "A new 40.8% tax rate would be higher than China, Europe and Canada and would make the U.S. less competitive," he said.

Between the lines: Trump fixed the "carried interest" issue in 2017, when he required private equity workers to hold assets for three years before receiving the capital gains rate, the industry argues.

• Changing it could reduce the deficit by some $13 billion over 10 years, according to the Congressional Budget Office.

Zoom in: The AIC is highlighting just how many jobs it helps support in a new economic impact study from EY.

• The study reports that the U.S. private equity sector employed 13.3 million workers across the country and paid $337 billion in federal, state and local taxes from its firms and employees and the companies it invests in.

Zoom out: Corporate America is also worried about Trump looking for more revenue by preventing corporations from deducting their state and local taxes (SALT) from their federal returns.

• The so-called C-SALT is causing heartburn in C-suites, even if it has not gotten as much attention as individual SALT.

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— Hans Nichols

Schumer will gather Democrats with budget reconciliation experts on Wednesday, we scooped this afternoon.

Why it matters: Schumer wants to turn the page on the government funding fight that plunged Democrats into a bitter argument over the party's leadership.

• The GOP doesn't need Dems to advance their plans to cut taxes and slash spending.
• But the budget reconciliation process is one of the most consequential messaging opportunities in front of Schumer and Democrats.

— Stephen Neukam