Good morning, Power peeps. We're a day late to the news but happy almost pumpkin spice latte season!! Tips, comments, recipes... Thanks for waking up with us. 

The Campaign

HIS KIND OF RACE: Dan McCready is running a midterm campaign in a leftward-lurching 2020 world — and it may very well serve as a blueprint for the gaggle of moderate House Democrats looking to protect the seats they flipped in Trump country next November. 

The challenge: McCready, the Democratic candidate for the closely watched special election in North Carolina's 9th district on Sept. 10, is running in a seat that President Trump won by 12 points in 2016. Accordingly, he's focused on Medicaid expansion and lowering the costs of prescription drug prices. He opposes launching an impeachment inquiry into the president and has spent more time criticizing “the dysfunction of Washington” than Trump or the Republican Party. 

  • “Well, I just do my thing,” McCready told Power Up on the imaginary red lines he's drawn around his campaign talking points in a district that leans red. “This is not a career for me. I never even planned to run for Congress until I saw how divided Washington had become.”
  • “I think that the president needs to be defeated at the ballot box and any [impeachment] inquiries are dead on arrival with [Mitch] McConnell,” McCready told us. “So I'd rather see Congress focus on lowering prescription drug costs and stopping the war on public schools.” 

The two-year campaign: McCready has some hard-won experience in the field. After all, he's been running for this seat for 27 months: the former Marine initially lost the district by a slim margin last fall to Republican Mark Harris but amid allegations of election fraud, election officials ordered a new contest. Trump has campaigned for Harris and said the Democrat, predictably, wants open borders and “admires socialism.”

A sign of the times: Now, McCready is running against GOP candidate Dan Bishop for a seat a Democrat has not won in 56 years. While McCready sounded confident about his own chances, he abstained from weighing in on whether Democrats could win North Carolina in 2020 and was critical of the Democratic-controlled House. 

  • “People are ready for a different kind of leadership that gets us together,” McCready said. “I think that the House should do a lot more and show the American people that there are leaders in Washington.” 
  • McCready has “spent two years distancing himself from left-wing Democrats,” per my colleague Dave Weigel. “He pledged not to support Nancy Pelosi for House speaker. He opposed impeachment. He returned a donation from Rep. Ilhan Omar of Minnesota after she suggested that Israel's advocates were buying off Congress. In an interview, he also rejected an idea that had burned through the presidential primary: allowing noncitizens to be covered by Medicare.” 

McCready's race has also elicited comparisons to the 2017 special election in Pennsylvania's 18th district in which Conor Lamb pulled off an upset to win a district Trump captured by 20 points. My colleague Mike DeBonis obtained a Democratic Congressional Campaign Committee memo that “detailed the committee’s efforts ahead of the Sept. 10 election after Republican groups reserved nearly $4 million of television ads aimed at electing [Bishop].”

  • The strategy: “'The DCCC’s strategic investments in that race, also in a deep-red district, allowed [Lamb] to carry his own message to voters in Western Pennsylvania, where early, overt national Democratic investment would have been a net-negative for the campaign,' the memo reads, noting that the committee is currently spending 'well over' $2 million on the race.”

All about turnout: In recent weeks, the National Republican Congressional Committee and the Congressional Leadership Fund have poured $4 million into Bishop's race in an effort to catch up with McCready's fundraising advantage and reach voters in what's expected to be a low turnout race. 

  • “Pure panic”: DeBonis reports the DCCC's memo paints the GOP's recent splurge on ad buys as "nothing other than pure panic." The memo also "lays out a strategy of allowing the McCready campaign to use its own considerable resources to focus on television advertising — where, as a candidate, he is entitled to more favorable rates — while focusing committee resources on driving turnout among African Americans and members of the Lumbee tribe of Native Americans, key groups of Democratic voters." 
  • “I’ve always been focused on our campaign in North Carolina on the ground — it’ll be lost and won on the ground and won or lost in the old school way in connecting face-to-face with voters," McCready told Power Up. 
  • 2020 prep: “The memo noted that the committee is conducting “early research on African American voter motivation that will be road-tested in this race and scaled for the full battlefield in 2020.” 
At The White House

TRUMP SAVES CHRISTMAS FROM HIMSELF: “The White House on Tuesday said it would delay imposing tariffs on Chinese imports of cellphones, laptop computers, video game consoles, and certain types of footwear and clothing until Dec. 15, significantly later than the Sept. 1 deadline President Trump had repeatedly threatened,” our colleagues Damian Paletta and Heather Long report. The goal? To keep costs down during the holiday shopping season.

  • What it means: “The announcement, which came from the Office of the U.S. Trade Representative, ensures that Apple products and other major consumer goods would be shielded from the import tax until at least December,” Damian and Heather write. “The announcement effectively shields more than $100 billion in Chinese imports from tariffs until Dec. 15.”
  • But the exact list of products is odd: “White House officials did not explain how they decided which items to exclude and which ones to penalize,” Heather and Damian write. An example: “Certain 'men’s or boys’ shirts, of textile materials' are exempted from tariffs until Dec. 15, but 'men’s or boys’ shirts, knitted or crocheted, of cotton,' face tariffs in September."
  • Wall Street loved the news: “Tuesday’s announcement reflected a more cautious approach, and it moved stocks sharply higher. The Dow Jones industrial average jumped after the news and finished the day 373 points, or more than 1.4 percent, higher. The stock prices of Apple, Best Buy, Mattel and Macy’s were among those that rallied on the announcement.”

The takeaway: The biggest news of all is what the president said. “Trump has repeated the same mantra for months: The Chinese are paying the full price of his tariffs. It’s a line that the overwhelming majority of economists and business owners say is false, but Trump kept saying it — until Aug. 13,” Heather writes of the president's admission that tariffs could actually affect consumers.

On The Hill

THE STORY OF A RUSSIAN-BACKED PROJECT IN MCCONNELL'S BACKYARD: “In January, as the Senate debated whether to permit the Trump administration to lift sanctions on Russia’s largest aluminum producer, two men with millions of dollars riding on the outcome met for dinner at a restaurant in Zurich,” our colleagues Tom Hamburger and Rosalind S. Helderman write in a deep-dive on the construction of an aluminum-rolling mill in Northeast Kentucky. “The timing of their meeting shows how much a major venture in McConnell’s home state had riding on the Democratic-backed effort in January to keep sanctions in place.”

  • The details: Craig Bouchard, an American entrepreneur who was trying to build the mill, needed money and a sufficient supply of raw material. He eventually found out that Rusal, the Russian aluminum company, was the best match, but the U.S. had leveled sanctions on the company and its founder Oleg Deripaska, a reported close confidant of Vladimir Putin. 
  • After the meeting: “By the next day, McConnell had successfully blocked the bill, despite the defection of 11 Republicans,” Tom and Roz write. “Within weeks, the U.S. government had formally lifted sanctions on Rusal, citing a deal with the company that reduced the ownership interest of its Kremlin-linked founder, Oleg Deripaska. And three months later, Rusal announced plans for an extraordinary partnership with Bouchard’s company, providing $200 million in capital to buy a 40 percent stake in the new aluminum plant in Ashland, Ky.”
  • McConnell flatly denies he knew of Rusal's plans: “A spokesman for McConnell said the majority leader did not know that Bouchard had hopes of a deal with Rusal at the time McConnell led the Senate effort to end the sanctions, citing the recommendation of Treasury Secretary Steven Mnuchin.”
  • Democratic senators have called for a review of the deal: And it's creating headaches for McConnell. “The Rusal-backed project is one of several issues fueling broader scrutiny of McConnell’s posture toward Russia and its efforts to manipulate American voters,” Tom and Roz write.
Global Power

AN UPDATE FROM HONG KONG: “After late-night mob scenes marred a demonstration that paralyzed this city’s airport, protesters on Wednesday issued apologies seeking the international public’s sympathy and forgiveness as they fought to regain control over a narrative that seemed to be tilting in Beijing’s favor for the first time in two months,” our colleagues Gerry Shih and Timothy McLaughlin report. 

  • "The appeals, which included apologies to the police force, come as the struggle over public opinion reaches a climax. While Hong Kong’s protest movement has become steadily radicalized and fractured, the Chinese government has sharply ramped up a propaganda effort both in state media and on social networks to discredit and deflate a movement that to this point enjoyed wide support across Hong Kong society." 

After protesters seized and attacked two men and violently clashed with paramedics and police who attempted to evacuate the men, the leaderless protest movement apologized:

  • “After an entire night’s reflection, we decided to bravely face our own shortcomings, and sincerely apologize to city residents that always supported us,” one letter read. “To police who were affected last night, we will deeply reflect and confront our problems.”

TRUMP'S TEPID RESPONSE: "Lawmakers and government officials across Washington, including some of President Donald Trump’s top advisers, are growing increasingly alarmed about the unrest in Hong Kong," Politico's Nahal Toosi, Eliana Johnson and Maya King report. "One person, however, seems less concerned than most: Trump."

  • What Trump said: "'The Hong Kong thing is a very tough situation. I hope it works out peacefully. I hope nobody gets hurt. I hope nobody gets killed."
  • It's unclear how Trump would react to further escalation: "Aides to Trump, including his economic advisers, are watching events closely and worry that it could spiral out of control, according to a current and a former White House official. It’s not clear what, if anything, Trump wants to do in response, the sources said," Toosi, Johnson and King write.
  • One official compared the the situation to Tiananmen Square: "'It’s about as close to Tiananmen Square, potentially, that you’re going to get in the modern age,” the official told Politico of the protests that took place 30 years ago.
  • Trump's response increasingly differs from the rest of Washington: On both sides of the aisle. 

Trump ally Sen. Lindsey Graham (R-S.C.):

The People

EPSTEIN'S GUARDS WERE SLEEPING ON THE JOB: "The two staff members who were guarding the jail unit where Jeffrey Epstein apparently killed himself fell asleep and failed to check on him for about three hours, then falsified records to cover up their mistake, according to several law enforcement and prison officials with knowledge of the matter," the New York Times's Katie Benner and Danielle Ivory report.

  • The disclosures came amid a shakeup at the prison: "Two employees were placed on administrative leave and the warden of the jail, the Metropolitan Correctional Center in Manhattan, was temporarily reassigned, pending the outcome of the investigation into Mr. Epstein’s death, the Justice Department announced," Benner and Ivory write.
  • Falsifying a report could be a federal crime: "The two staff members in the special housing unit where Mr. Epstein was held — 9 South — falsely recorded in a log that they had checked on the financier, who was facing sex trafficking charges, every 30 minutes, as was required, the officials said. Such false entries in an official log could constitute a federal crime," Benner and Ivory write.
  • As for Epstein's reported fortune: "Prosecutors can still employ a powerful tool to try to compensate women claiming he sexually abused them: civil forfeiture," Bloomberg's David Voreacos and Neil Weinberg report.
  • But it won't be easy for his accusers to get money: "In Epstein’s case, the opaqueness of his finances and, in many cases, the minimal documentary evidence tying Epstein’s accusers to him will complicate matters. There’s also no guarantee that money will be left over for the accusers after Epstein’s creditors are paid," Voreacos and Weinberg write.
At the Pentagon

NEW JOB ALERT: "Alyssa Farah is leaving her job as Vice President Pence’s spokeswoman at the end of the month and will join the Defense Department as press secretary, starting in September," scoops our colleague Ashley Parker. 

  • "Farah began her tenure at the White House almost two years ago, as Pence’s press secretary, and for the past six months held that post while also serving as his communications director. During her time in Pence’s office, she also served as a senior adviser, accompanying the vice president on both foreign and domestic trips." 
  • About her new gig: "The Pentagon, like many other parts of the Trump administration, has had an uneasy relationship with the media. Far fewer news briefings have been held than during previous administrations, in what journalists and former officials have described as a decline in transparency and public engagement when there has been confusion at times over President Trump’s approach to the U.S. military’s role in the world."