Axios Sneak Peek
March 04, 2019
Welcome to Sneak Peek, our weekly lookahead for both ends of Pennsylvania Avenue, plus my best scoops. Please encourage your friends and colleagues to sign up.
- Secure tips: If you have a sensitive news tip and want to share it through an encrypted channel, reply to this email to get my Signal number.
1 big thing: Scoop — Trump campaign clarifies 5G policy after catching administration off guard
The Trump re-election campaign sparked widespread confusion inside the Trump administration and the cellular wireless industry on Friday night when it advocated for a nationwide "wholesale" 5G network, which is 180 degrees from official White House policy.
Driving the news: For months, 2020 campaign manager Brad Parscale had been arguing for this policy on Twitter, but he had been clear it was his "personal opinion." Now, Politico had a Trump campaign spokesperson, on the record, seeming to present a major government intervention in 5G as the campaign's official position.
- 5G stands for "fifth generation" wireless technology that promises to deliver mobile connections that are 100 times faster than the current 4G networks we rely on today. Verizon and AT&T have made huge business bets on building their own 5G networks on top of the current 4G networks.
The result? Mass uncertainty. Administration officials who work on 5G freaked out. And industry leaders were perplexed. Another wrinkle was that Parscale's personal position echoed the talking points of Declan Ganley, the CEO of private wireless company Rivada, which could benefit from Trump supporting the plan. (Peter Thiel is reportedly an investor in Rivada.)
- Over the past two days, Axios' Kim Hart, David McCabe and I had been trying to piece together what happened. We couldn't find any people who work on telecom policy inside the Trump administration who knew in advance from the Trump campaign that it would make this announcement.
The news: The Trump campaign is now walking back the statement from Kayleigh McEnany, national press secretary for Trump’s 2020 campaign, saying they did not intend to set new policy. A Trump campaign official said, "Brad Parscale has expressed his views on 5G as his own personal opinions. He has no financial interest in Rivada or any 5G provider."
- McEnany added: "The White House sets the policy on 5G and all issues. Naturally, the campaign fully supports the president’s priorities and his policy agenda. There is no daylight between the White House and the campaign."
Why it matters: It's highly unusual — if not unprecedented — for a presidential campaign to advocate for a different position from the sitting president's administration.
Behind the scenes: "Lots of policy folks were caught off guard," a senior Trump administration official told Axios. "And the industry thought it [the plan Parscale just endorsed] was dead."
- Another administration official who works on tech policy said, "Yes, we were surprised."
- As Politico reported, Trump's top economic adviser Larry Kudlow has distanced the administration from a government intervention in 5G. "The White House is officially behind this free-enterprise, free-market approach," he said last year, in the wake of Axios publishing leaked documents showing Trump's National Security Council was considering a national 5G network.
What's next? Parscale has been privately telling people that the reason why he tweets his personal advocacy for an "open wholesale market with a privatized company that is not a carrier" is because he believes it would be politically advantageous to Trump in 2020, per a source familiar.
"A 5G network that connected rural America to high-speed internet would increase turnout and let the president talk directly to rural Americans," the source added, paraphrasing Parscale's private views. (Parscale is correct in that there are concerns that wireless carriers don't have financial incentive to spend the billions necessary to build out to those rural areas because they won't get a good return on that investment.)
- On Feb. 21, Trump sent a pair of tweets that were intriguing given his previous lack of interest in the subject. "I want the United States to win through competition, not by blocking out currently more advanced technologies," he wrote. "I want 5G, and even 6G, technology in the United States as soon as possible."
- It's possible Trump's inspiration for these tweets came from an interview that aired on CBS "This Morning" shortly before he tweeted during that morning's Executive Time. CBS had just aired an interview with the Huawei CEO in which he said: "We are rolling out 5G and soon we’ll welcome 6G. In the future, I said there will be new equipment that is suitable for the United States."
2. Behind the new network idea: How we got here
People close to Trump and a politically connected private company have, for months, been laying out the broad outlines of the plan to create a national wholesale 5G network in op-eds and tweets.
- Trump's campaign manager Brad Parscale said last June that it would be an "open wholesale market with a privatized company that isn't a carrier," in his "personal opinion." Last month, he tweeted again about the need for a "wholesale" network.
- Declan Ganley, the CEO of Rivada Networks, has been pushing for the same concept.
- “Decisive action building a public-private partnership in the near term demands that we make shared spectrum available for a carrier-neutral, wholesale-only, nationwide 5G network to be built in the next two to three years across the entire country,” wrote Newt Gingrich in a Newsweek op-ed last month.
Rivada could stand to benefit financially from the new network, but Parscale — through a Trump campaign spokesman — and Gingrich, have both said they have no financial stake in the idea.
- "I refuse to accept any money on 5G because I believe it is the biggest national security challenge we face," Gingrich told Axios in a text message. "We are currently losing. A Huawei-dominated world communication system will be an enormous defeat and a deadly threat to our survival."
In a phone conversation with Axios' David McCabe, Rivada spokesperson Brian Carney said that the company had spoken with players in Washington about its idea — but said he was not aware of conversations that had taken place with Parscale or the Trump campaign on the subject.
- "There's no financial relationship between us and Newt. Full stop. Period," Carney said. "We have spoken to him about this stuff, because he came to think that we had a pretty good idea for how to deal with this thing."
- Ganley himself weighed in, saying on Twitter that "as best as I can tell there’s no distance between The White House & the Campaign because the whole 'Nationalisation' angle was & more than ever remains a Red Herring."
Here's how the public conversation evolved:
- January 2018: Axios reported that a senior National Security Council official circulated a proposal to effectively nationalize the fifth-generation of wireless technology, sparking condemnation from across government and industry.
- February 2018: Rivada Networks Ganley proposed a shared 5G wireless network in a Wall Street Journal op-ed.
- June 2018: Parscale tweeted that a "great 5G network, in my personal opinion, consists of an open wholesale market with a privatized company that isn't a carrier. Government doesn’t own or operate it but does provide the spectrum. An open bidding process for bandwidth! No more dead spots!"
- Feb. 19 and 22: Gingrich published op-eds supportive of a national wholesale 5G network.
- Feb. 21: President Trump tweeted that he wants "5G, and even 6G, technology in the United States as soon as possible."
- Feb. 21: Parscale tweeted that a "5G wholesale market from underutilized spectrum would drive down prices and improve rural availability."
- March 1: Kayleigh McEnany, the national press secretary for the president's campaign, told Politico that a "5G wholesale market would drive down costs and provide access to millions of Americans who are currently underserved."
3. House Dems to launch next wave of Trump investigations
House Judiciary chairman Jerrold Nadler (D-N.Y.) told George Stephanopoulos on ABC's "This Week" that "it's very clear that the president obstructed justice."
Why this matters: As Politico's Playbook team pointed out, "This is a big deal because impeachment is Nadler's purview."
What's next? Nadler laid out the House Judiciary's plan to investigate Trump. "Tomorrow we will be issuing document requests to over 60 different people," Nadler told Stephanopoulos.
- These people will include "individuals from the White House, to the Department of Justice, Donald Trump Jr., Allen Weisselberg to begin investigations to present the case to the American people about obstruction of justice, corruption and abuse of power," Nadler said.
4. House to vote on sweeping anti-corruption package
The House will vote on a sweeping 571-page bill this week that would strengthen federal ethics laws, expand voting rights and require presidential nominees to release their tax returns, Axios' Alayna Treene reports.
- Several Democratic House candidates made the For The People Act, also known has H.R. 1, a hallmark of their 2018 midterm campaigns, and the legislation was formally introduced on the first day of the new Congress.
Why it matters: "We have a broken political system and a corrupt finance system today," Fred Wertheimer, president of Democracy 21 and a longtime proponent of campaign finance reform, told Axios. "H.R. 1 is the most important reform legislation to repair our democracy since the post-Watergate reforms. ... There has never been a bill as broad in its scope and coverage as this bill, and we will work from here."
The bill's key provisions:
- Campaign finance: Create a small donor, matching-fund system for congressional and presidential candidates; expand the prohibition of foreign political donations; require super PACs and "dark money" political groups to make their donors public; and restructure the Federal Election Commission.
- Ethics: Mandate that presidents and vice presidents release 10 years of their tax returns; create an ethics code for the Supreme Court; and bar members of Congress from serving on corporate boards.
- Voting rights: Allow citizens to register to vote online and be registered automatically; require paper ballots in federal elections; make Election Day a federal holiday; prohibit voter roll purging; and end partisan gerrymandering by having independent commissions redraw congressional districts.
State of play: The bill is expected to easily pass in the House — it's already secured 234 co-sponsors, in addition to Rep. John Sarbanes (D-Md.) who is leading the effort — but it will likely die in the Senate.
- Senate Majority Leader Mitch McConnell (R-Ky.), who has dedicated part of his career to blocking progressive campaign finance bills, and other Republicans have already vowed to block it. (McConnell describes it as a "sprawling proposal to grow the federal government’s power over Americans' political speech and elections.")
Yes, but those who have championed the bill are under no illusion that the legislation will pass this year, Wertheimer said.
- "We're not operating in any short time frame. We understand these battles are hard and take time, but we also believe that the flow of history is running in our direction," he said. "We know we start out without Republican support, but we will work to build that support."
Wertheimer said Democrats have a 3–5 year strategy for enacting this:
- "The House passing H.R. 1 will set the stage for enactment in the next Congress," he said. "If we haven’t reached the point by then, the fight will continue in 2021 and 2022. We think in 2023, at the latest, we’ll be able to enact this legislation."
The bottom line: In a September WSJ/NBC poll, 77% of surveyed registered voters said "reducing the influence of special interests and corruption in Washington" is either the most important or a very important issue facing the country.
5. Sneak Peek diary
The House will vote on the anti-corruption bill we mention in the item above.
- On Wednesday, Homeland Security Secretary Kirstjen Nielsen testifies before the House Homeland Security Committee on border security.
- Also on Wednesday, but behind closed doors, Michael Cohen returns to testify before the House Intelligence Committee. (He testified before the committee for 7.5 hours last Thursday, and chairman Adam Schiff said he plans to make Cohen's testimony public in the future.)
- On Thursday, Justices Samuel Alito and Elena Kagan testify before a House Appropriations subcommittee at a hearing on the Supreme Court budget.
The Senate will vote on four nominees this week, per a GOP leadership aide:
- Allison Jones Rushing to be a judge on the Fourth Circuit; Chad Readler to be a judge on the Sixth Circuit; Eric Murphy to be a judge on the Sixth Circuit; and John Fleming, of Louisiana, to be Assistant Secretary of Commerce for Economic Development.
President Trump's schedule, per a White House official:
- Monday: Trump welcomes the 2018 FCS Division I Football National Champions, the North Dakota Bison, to the White House. Trump also has lunch with Mike Pence and addresses the National Association of Attorneys General.
- Wednesday: Trump will attend the first meeting of the American Workforce Policy Advisory Board Meeting. In this new initiative — announced by Ivanka Trump and Commerce Secretary Wilbur Ross — "the chief executives of Apple Inc., Lockheed Martin Corp. and Walmart Inc., are among 25 prominent Americans who will shape Trump administration efforts to develop job training programs to meet the changing demands of U.S. employers," per Bloomberg.
- Thursday: Trump has lunch with Secretary of State Mike Pompeo. He also hosts the Czech prime minister at the White House.
- Friday: Trump meets with national security officials at the Pentagon.
6. 1 doubtful thing: Clean up on Aisle T
President Trump ignited outrage when he absolved Kim Jong-un of responsibility for the death of American college student Otto Warmbier, who left jail in North Korea in a terminal state.
- "I don't believe that he [Kim Jong-un] would have allowed that to happen; it just wasn’t to his advantage to allow that to happen," Trump said in a press conference after meeting with the North Korean dictator in Hanoi. "Those prisons are rough — they're rough places — and bad things happened. But I really don't believe that he — I don't believe that he knew about it."
- "He tells me that he didn’t know about it," Trump also said, "and I will take him at his word."
- Trump later said he'd been "misinterpreted," though his original words couldn't have been clearer.
Here's an exchange from today's Fox News Sunday between host Chris Wallace and Trump's national security adviser John Bolton:
- Wallace: But this is not the first time that the president has taken the
word of an autocrat over outside evidence.
- Bolton: It's not taking the word. He said I'm going to take — when he
says, "I'm going to take him at his word," it doesn't mean that he accepted
as reality, it means that he accepts that's what Kim Jong-un said.
- Wallace: So when he says "I take him at his word," it doesn't mean that he
believes Kim Jong-un?
- Bolton: Well, that's what he said — I think one way to prove that is to
give the United States a complete accounting.
The bottom line: Working for Trump often involves claiming the president didn't mean what he clearly said.