EFTA00047167 CONTENT FROM GOLDMAN SACHS 10,000 SMALL BUSINESSES # What are the key issues impacting small businesses? Explore the "voice of small business" in our new infographic, which covers a range of small business perspectives on everything from the economy and healthcare to hiring and minimum wage. Gen. Mark Milley arrives in Bahrain on Monday. (Idrees Ali/Reuters) -- The top U.S. military officer voiced public support today for Esper’s decision to allow Gallagher to remain a Navy SEAL and to fire Spencer. “As far as I’m concerned, it’s case closed now,” Gen. Mark Milley, chairman of the Joint Chiefs of Staff, told reporters traveling with him in the Middle East, including Missy Ryan. “It’s time to move on and address the national security of the United States. … Esper made decisions for good reasons that are within his power. I’ll support the secretary of defense in those decisions.” -- Senate Minority Leader Chuck Schumer (D-N.Y.) said he spoke by phone with Spencer on Sunday night: “I told him he’s a patriot, that he served the Navy and the nation well and he will be missed,” Schumer said in a statement. “Secretary Spencer did the right thing and he should be proud of standing up to President Trump when he was wrong, something too many in this administration and the Republican Party are scared to do. Good order, discipline, and morale among the Armed Services must transcend politics, and Secretary Spencer’s commitment to these principles will not be forgotten.” -- Senate Armed Services Committee Chairman Jim Inhofe (R-Okla.) said Trump notified him personally that Spencer was being fired. “Both Secretary Esper and EFTA00047168 President Trump deserve to have a leadership team who has their trust and confidence,” Inhofe said in a statement, adding: “It is no secret that I had my own disagreements with Secretary Spencer over the management of specific Navy programs.” -- Other lawmakers offered praise for Spencer: -- Trump tweeted that he will nominate Kenneth Braithwaite, a retired Navy rear admiral who is currently the ambassador to Norway, to be Spencer’s replacement. Esper recommended him. -- In an interview Sunday morning on “Fox & Friends,” Gallagher said the Navy was only trying to take his Trident pin away as “retaliation” for Trump intervening on his behalf. “They could have taken my Trident at any time they wanted,” he said on a show the president often watches. “Now they're trying to take it after the president restored my rank.” Speaking of Rear Adm. Collin Green, who is in charge of the SEAL program as commander of the Naval Special Warfare Command, Gallagher said: “What the admiral is doing is showing complete insubordination.” Mabus, who served as Navy secretary under Barack Obama, said on MSNBC that he’s been stunned that a sailor on active duty is going on cable television to criticize his commanding officers. “It's so dangerous for good order and discipline … to get this politicized,” Mabus said Sunday on MSNBC. “You simply cannot have good order and discipline. You simply cannot hold people accountable. You simply cannot have the elite fighting force if you allow things like this to happen. If you set this sort of precedent, then how do you tell the next SEAL that is up on charges not to go public, not to try to undermine their superiors, not to try to change a military judgment and make it a political one?” -- The Post’s Editorial Board says Trump’s intervention in the Gallagher case, including Spencer’s ouster, dishonors the troops who uphold American values: “Restoring to service someone who was turned in by members of his unit who wouldn’t EFTA00047169 tolerate his behavior sends precisely the wrong message. … Most offensive is what Mr. Trump’s actions say about his view of the military. ‘We train our boys to be killing machines, then prosecute them when they kill!,’ he tweeted in October when he announced he would review these cases. Perhaps Mr. Trump has watched too many bad war movies, but if he were to consult with his military leaders or talk to the many fine men and women in uniform, they would tell him they are trained to engage in combat while following the laws of war and upholding the country’s ideals.” ## QUOTE OF THE DAY: A lawyer for Gallagher, Parlatore, welcomed last night’s news and expressed amazement at the turn of events that led to Spencer’s ouster. “This case is bananas,” he said. "Yes, you can quote that." (Ashley Parker and Dan Lamothe) Subscribe on Amazon Echo, Google Home, Apple HomePod and other podcast players. Welcome to the Daily 202, PowerPost's morning briefing for decision-makers. Sign up to receive the newsletter. Lawmakers react after a week of impeachment inquiry hearings EFTA00047170 ## THE IMPEACHMENT INQUIRY: -- A confidential White House review of Trump’s decision to place a hold on military aid to Ukraine has turned up hundreds of documents that reveal extensive efforts to generate an after-the-fact justification for the decision and a debate over whether the delay was legal, according to three people familiar with the records. Josh Dawsey, Carol D. Leonnig and Tom Hamburger scoop: “The research by the White House Counsel’s Office … includes early August email exchanges between acting chief of staff Mick Mulvaney and White House budget officials seeking to provide an explanation for withholding the funds after the president had already ordered a hold in mid-July on the nearly $400 million in security assistance … White House lawyers are expressing concern that the review has turned up some unflattering exchanges and facts that could at a minimum embarrass the president. ... In the early August email exchanges, Mulvaney asked acting OMB director Vought for an update on the legal rationale for withholding the aid and how much longer it could be delayed. Trump had made the decision the prior month without an assessment of the reasoning or legal justification … Emails show Vought and OMB staffers arguing that withholding aid was legal, while officials at the National Security Council and State Department protested. OMB lawyers said that it was legal to withhold the aid, as long as they deemed it a ‘temporary’ hold … “Mulvaney’s request for information came days after the White House Counsel’s Office was put on notice that an anonymous CIA official had made a complaint to the agency’s general counsel about Trump's July 25 call to [Volodymyr] Zelensky … This official would later file a whistleblower complaint with the intelligence community’s inspector general … "The document research has only exacerbated growing tension between [White House Counsel Pat] Cipollone and Mulvaney and their offices, with Cipollone tightly controlling access to his findings, and Mulvaney's aides complaining Cipollone isn't briefing other White House officials or sharing important material they need to respond to public inquiries ... The emails revealed by White House lawyers include some in which EFTA00047171 Mulvaney urges Vought to immediately focus on Ukraine’s aid package, making clear it was a top priority for the administration. [Mulvaney's lawyer, Driscoll, declined to comment.] "The legal office launched this fact-finding review of internal records in a protective mode, both to determine what the records might reveal about internal administration conversations and also to help the White House produce a timeline for defending Trump’s decision and his public comments. Along with examining documents, the review has also involved interviewing some key White House officials involved in handling Ukraine aid and dealing with complaints and concerns in the aftermath of the call between Trump and Zelensky. Cipollone’s office has focused closely on correspondence that could be subject to public records requests, those which involve discussions between staff at the White House and at other agencies. Internal White House records are not subject to federal public records law, but messages that include officials at federal agencies are." -- Follow the money: Lev Parnas and Igor Fruman, the Rudy Giuliani associates who have been indicted, tried to recruit a Ukrainian energy executive to join them in a proposed takeover of the state oil-and-gas company. From the Wall Street Journal: The two men described the “company’s chief executive and [Marie Yovanovitch] as part of ‘this Soros cartel’ working against [Trump.] ‘You’re a Republican, right?’ Andrew Favorov, the head of natural gas for state-run Naftogaz, recalled the men … asking him, after their reference to investor and Democratic donor George Soros. ‘We want you to be our guy.’ … Mr. Favorov described the efforts of Messrs. Fruman and Parnas to enlist his help in an effort to oust Naftogaz CEO Andriy Kobolyev. Naftogaz is the most important company in Ukraine, representing nearly 10% of the country’s gross domestic product and supplying virtually all of the country’s natural gas. Mr. Favorov said he was bewildered by Messrs. Parnas and Fruman’s pitch to stage a takeover of Naftogaz and put Mr. Favorov in place as CEO. On one hand, the pair appeared to know little about the natural gas business; on the other it was clear to him they had significant political connections. ‘They don’t teach you how to deal with this in business school,’ Mr. Favorov said.” EFTA00047172 -- So many potential conflicts: Giuliani also discussed representing a state-owned Ukrainian bank in a legal dispute over the summer, even as he publicly pressed Ukraine on behalf of Trump. From Bloomberg News: “Though he ultimately did not take on the client, the talks expose his enthusiasm for foreign business and his willingness to insert himself in matters rife with potential conflicts. In fact, the Ukrainian bank is entangled in a legal dispute with its former owner who has ties to Ukraine’s president and is the subject of a federal investigation in the U.S. … [Giuliani] said he was approached by lawyers for Privatbank seeking to recover assets linked to the previous owner. They wanted to know if Giuliani -- who had written tweets critical of the man -- could assist their civil suit, Giuliani confirmed by phone on Thursday.” -- “What we still don’t know about the Ukraine affair,” by deputy editorial page editor Jackson Diehl: “Let’s start with the distinct possibility that Trump’s demand that [Zelensky] launch politicized investigations in exchange for military aid and a White House meeting was only the last of a series of quid pro quos he forced on Ukrainians.” Giuliani met with Zelensky’s predecessor at least twice in 2017 as Ukraine’s former chief prosecutor Yuri Lutsenko transferred an investigation into secret payments to Paul Manafort, effectively stalling it, and the U.S. released the sale of Jaevelin missiles to Ukraine. “Let's see: a White House meeting and weapons ... for favorable actions on an investigation? There's no proof. But no wonder Trump complained to Zelensky in their July 25 phone call that ‘I heard you had a prosecutor who was very good and he was shut down and that's really unfair.’ One of Zelensky's first acts had been to fire Lutsenko. “The prosecutor has also been blamed for Trump’s recall of [Yovanovitch]. But the full story behind her dismissal is still not known. … Trump began demanding Yovanovitch’s removal a year earlier, after meeting with [Parnas and -Fruman]. Why did Parnas and Fruman want the ambassador out? It’s still not clear. … One person who probably could shed light on this is Rick Perry. … According to testimony by U.S. Embassy staffer Holmes, Perry used a meeting with Zelensky to give him a list of ‘people he trusts’ on energy matters. The Times reported that these included a couple of Texas businessmen whom Perry wanted appointed to the EFTA00047173 supervisory board of the Ukrainian state gas company. That’s the same company Parnas and Fruman were trying to deal with. … We may eventually learn more about Ukraine from federal prosecutors in New York, who have already indicted Parnas and Fruman and are said to be looking at Giuliani. But you have to wonder if Democrats are making a mistake by not pursuing these matters themselves.” -- Rep. Devin Nunes (R-Calif.), the ranking member on the House Intelligence Committee, said reports that he met with ex-Ukrainian prosecutor general Viktor Shokin in Vienna to obtain information about the Bidens were false. Elise Viebeck and Felicia Sonmez report: “The allegation … was made by the attorney for [Parnas]. … On Fox News, Nunes declined to answer further questions about the accusation … A person close to Shokin also has denied the claim. … Nunes has also threatened to sue two of the news outlets that reported Parnas’s accusation. On Fox News, Nunes claimed that CNN and the Daily Beast were ‘likely conspiring to obstruct justice’ by basing their reporting on interviews with a lawyer for Parnas. … House Armed Services Committee Chairman Smith (D-Wash.) said Saturday that it was ‘quite likely, without question’ that Nunes would face an ethics investigation following media reports of a meeting with Shokin. … Several other Democratic lawmakers have said that Parnas’s testimony could be helpful to impeachment investigators or that Nunes should face an ethics probe.” -- Lordy, there are tapes? Parnas has provided the House Intelligence Committee with audio, photos and video recordings, but what these records show is unclear. From ABC News: “[The] tapes were provided as part of that congressional subpoena issued to Parnas, and the former Giuliani ally also provided a number of documents both in English and Ukrainian to the committee in two separate productions … However, some of the material sought by congressional investigators is already in possession of federal investigators within the Southern District of New York and thus held up from being turned over, according to sources familiar with the matter.” -- House Intelligence Committee Chairman Schiff (D-Calif.) said his panel will press ahead with preparing its impeachment report, even though several key witnesses have refused to testify. Felicia Sonmez and Elise Vlebeck report: “In an EFTA00047174 interview on CNN’s ‘State of the Union,’ Schiff said the evidence against Trump is ‘already overwhelming,’ although he stopped short of saying whether he would support impeachment himself. ‘Yes, we’d love to have these witnesses come in,’ Schiff said. ‘But we’re not willing to simply allow them to wait us out — to stall this proceeding — when the facts are already overwhelming.’ … Several key figures, including [Mulvaney], Vice President Pence, Secretary of State Mike Pompeo, former national security adviser John Bolton and [Giuliani], have declined to cooperate with the impeachment inquiry. A federal judge is expected to rule [today] on whether [former White House counsel Don McGahn] must testify under subpoena. ... "Schiff said Sunday that time is of the essence and that Democrats will continue to investigate even after they have submitted their report to the House Judiciary Committee. ... 'The investigation isn’t going to end,’ he said, adding that ‘we may have other depositions and hearings to do.’ He took particular aim at Bolton, arguing that the former national security adviser will have to explain why he chose to give his account of events ‘in a book’ rather than show the ‘courage’ that Fiona Hill, the former National Security Council Russia adviser, did in testifying before lawmakers last week. Schiff declined to say how long it might take impeachment investigators to finish their report, saying only that ‘we’ll take the time that’s necessary.'" -- Amid tensions between the Trump administration and Democrats, Pelosi and Treasury Secretary Steve Mnuchin must work out a spending deal. Luckily, they appear to maintain a good rapport. From the Journal: “While the Office of Management and Budget leads the administration’s efforts on spending, Mr. Mnuchin has emerged as the public face of the administration on Capitol Hill in the spending talks, which took a positive turn this weekend even as impeachment strains the broader relationship between the two branches. Mr. Mnuchin’s role speaks to the rapport and goodwill he has built up with lawmakers and, in particular, Mrs. Pelosi … Mrs. Pelosi has clashed with two of the administration's other top negotiators, [Mulvaney] and [Vought], with whom she refused to negotiate last summer's budget deal. … House Budget Committee Chairman John Yarmuth (D., Ky.) said … that Mr. Mulvaney would normally play a more visible role in the negotiations, ‘but I think Mick, he has other distractions.’”