Overnight Defense: Trump revokes Brennan's security clearance | Brennan fires back: 'I will not relent' | Defense firms bullish on 'Space Force' | Treasury targets Chinese, Russian firms for helping North Korea

Overnight Defense: Trump revokes Brennan's security clearance | Brennan fires back: 'I will not relent' | Defense firms bullish on 'Space Force' | Treasury targets Chinese, Russian firms for helping North Korea
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Happy Wednesday and welcome to Overnight Defense. I'm Rebecca Kheel, and here's your nightly guide to the latest developments at the Pentagon, on Capitol Hill and beyond.


THE TOPLINE: Weeks after first threatening to do, President TrumpDonald John TrumpTrump rallies in Nevada amid Supreme Court flurry: 'We're gonna get Brett' Trump: 'Good news' that Obama is campaigning again Trump boosts Heller, hammers 'Wacky Jacky' opponent in Nevada MORE on Wednesday revoked the security clearance of former CIA Director John BrennanJohn Owen BrennanNew book: Putin tried to reinforce Trump’s belief in a ‘deep state’ undermining him Retired admiral resigned from Pentagon advisory committee after writing open letter to Trump Rand Paul ramps up his alliance with Trump MORE.

In a statement read by White House press secretary Sarah Huckabee Sanders at Wednesday's press briefing, Trump accused Brennan of leveraging his status as a former government official to make "unfounded and outrageous" charges about his administration.


"Mr. Brennan's lying and recent conduct characterized by increasingly frenzied commentary is wholly inconsistent with access to the nation's most closely held secrets and facilities, the very aim of our adversaries, which is to sow division and chaos," Trump said in the statement read by Sanders.

Trump is also reviewing access to classified information for several former intelligence officials.

They include former Director of National Intelligence James ClapperJames Robert ClapperFBI memos detail ‘partisan axes,’ secret conflicts behind the Russia election meddling assessment Foreign hackers a legitimate concern for ballot machines, says cybersecurity expert Dem strategist: 'Genuine concern' Russia will escalate interference efforts in 2018 MORE, former FBI Director James ComeyJames Brien ComeyFBI memos detail ‘partisan axes,’ secret conflicts behind the Russia election meddling assessment New grounds for impeachment? House Dem says Trump deserves it for making society worse Sessions gets unexpected support - from a Democrat who wants to impeach Trump MORE, former National Security Administration Director Michael Hayden, former Deputy Attorney General Sally YatesSally Caroline YatesTime for sunshine on Trump-Russia investigation New Yorker disinvites Bannon from festival following backlash White House confirms Brennan's security clearance has been revoked MORE, former National Security Adviser Susan Rice, former FBI Deputy Director Andrew McCabeAndrew George McCabeCBS in talks for miniseries based on Comey book EXCLUSIVE: Trump says exposing ‘corrupt’ FBI probe could be ‘crowning achievement’ of presidency Former FBI Deputy Director Andrew McCabe lands book deal MORE, former FBI agent Peter Strzok, former FBI lawyer Lisa Page and Department of Justice official Bruce Ohr.

Why it matters: Wednesday's move was widely viewed as an effort to retaliate against a vocal critic of the administration.

Brennan has been outspoken against Trump, regularly eviscerating him on Twitter.

All the people listed as under consideration for having their security clearances revoked in the future have also criticized Trump publicly or previously come under attack from the White House.

But Sanders denied that Trump was punishing Brennan for his criticism of the president.

"Not at all," she said in response to a reporter's question.

Brennan's reaction: Brennan hit back on Twitter, saying Trump's decision should "gravely worry all Americans."

"This action is part of a broader effort by Mr. Trump to suppress freedom of speech & punish critics. It should gravely worry all Americans, including intelligence professionals, about the cost of speaking out," Brennan tweeted. "My principles are worth far more than clearances. I will not relent."

Other reaction: Former CIA chief Michael Hayden said the action appears designed to change how former officials talk about Trump.

"The way that [White House press secretary] Sarah Huckabee Sanders rolled this out was almost in a tone to be threatening to the rest of us," Hayden said Wednesday on CNN's "The Lead with Jake Tapper."

"In other words, it looks to me like an attempt to make us change the things we are saying when we're asked questions on CNN or other networks," added Hayden, who also led the National Security Agency.

House Minority Leader Nancy PelosiNancy Patricia D'Alesandro PelosiTrump boosts Heller, hammers 'Wacky Jacky' opponent in Nevada Lawmakers consider easing costs on drug companies as part of opioids deal New grounds for impeachment? House Dem says Trump deserves it for making society worse MORE (D-Calif.) called Trump's decision to revoke ex-CIA Director John Brennan's security clearance a "pathetic attempt to silence" his critics.

"Revoking the security clearance of an honorable patriot is a stunning abuse of power & a pathetic attempt to silence critics," Pelosi tweeted shortly after White House press secretary Sarah Huckabee Sanders made the announcement.

Sen. Mark WarnerMark Robert WarnerRussia docs order sets Trump on collision with intel community Hillicon Valley: North Korean IT firm hit with sanctions | Zuckerberg says Facebook better prepared for midterms | Big win for privacy advocates in Europe | Bezos launches B fund to help children, homeless Bipartisan trio asks US intelligence to investigate ‘deepfakes’ MORE (Va.), the senior Democrat on the Senate Intelligence Committee, slammed Trump for setting "a dangerous precedent" by revoking Brennan's security clearance.

Warner suggested that Trump was trying to distract attention from other issues by targeting President Obama's former intelligence chief.

"This might be a convenient way to distract attention, say a damaging story or two. But politicizing the way we guard our nation's secrets just to punish the president's critics is a dangerous precedent," Warner said in a tweet.

Former Secretary of State John KerryJohn Forbes KerryRubio wants DOJ to find out if Kerry broke law by meeting with Iranians Time for sunshine on Trump-Russia investigation Pompeo doubles down on criticism of Kerry: The Iran deal failed, 'let it go' MORE accused the president of putting "petty politics ahead of patriotism."

"This is putting personal petty politics ahead of patriotism and national security, end of story," Kerry tweeted. "You expect this banana republic behavior in the kind of countries that the State Department warns Americans not to travel to, but not at home in the USA."

Former Director of National Intelligence James Clapper said Trump's decision to revoke the security clearance is an infringement of Brennan's First Amendment rights.

"Will the republic stand or fall on whether John retains his access to classified information? Of course not," Clapper said.

"The larger issue here, to me, throughout has been an infringement of First Amendment rights. And I think people ought to think seriously about that," he said.


MORE NORTH KOREA SANCTIONS: The administration Wednesday announced new sanctions targeting three companies accused of helping North Korea skirt international sanctions.

Of note, one of the companies is Chinese and another is Russian. The third firm is Singaporean.

The Treasury's Office of Foreign Assets Control (OFAC), which administers sanctions, banned the three shipping companies, as well as one Russian national, from the U.S financial system and froze any and all of their assets based in the country.

The specifics: Treasury accused China-based Dalian Sun Moon Star International Logistics Trading Co, its Singapore-based affiliate, SINSMS Pte. Ltd., and Russia-based Profinet Pte of helping North Korea import goods banned from the country under U.S. and United Nations sanctions.

Dailan and SINSMS are accused of helping North Korea import alcohol, tobacco and cigarette-related products by using falsified shipping documents and advising the Kim regime on how to evade shipping restrictions.

Profinet is accused of providing port services for North Korean-flagged vessels at least six times, including ships previously targeted with sanctions by the U.S. for illegally importing oil.

Profinet director general Vasili Aleksandrovich Kolchanov is also accused of personally orchestrating North Korea-related deals and coordinating with North Korean representatives in Russia.

Why it matters: There have been signs that Trump's so-called maximum pressure campaign on North Korea has softened as he has pursued talks. Among them are reports that China and Russia have loosened their sanctions enforcement.

But the new U.S. penalties appear to seek to stem those changes, punishing North Korea's economic benefactors as talks are uncertain on cementing a nuclear disarmament deal with North Korean leader Kim Jong Un.

"Treasury will continue to implement existing sanctions on North Korea, and will take action to block and designate companies, ports, and vessels that facilitate illicit shipments and provide revenue streams to the DPRK," Treasury Secretary Steven MnuchinSteven Terner MnuchinOn The Money: Cohen reportedly questioned over Trump dealings with Russia | Trump hails economy | Tells workers to 'start looking' if they want a better job | Internal poll shows tax law backfiring on GOP Trump announces tariffs on 0B in Chinese goods Trump: China tariff announcement to come Monday afternoon MORE said Wednesday, using an acronym for North Korea's official name.

"Consequences for violating these sanctions will remain in place until we have achieved the final, fully verified denuclearization of North Korea."


DEFENSE SPENDING GRIPES: As the Senate prepares to consider the fiscal 2019 Pentagon spending bill, the White House is out with its statement of administration policy.

"The administration appreciates the funding in this bill to support execution of the National Security Strategy and National Defense Strategy, as well as the Nuclear Posture Review, South Asia Strategy, and vision of a free and open Indo-Pacific region," the statement said.

Still, the White House has several objections. One is that the bill would buy one more littoral combat ship than requested, for a total of two.

Another is that the bill would add far fewer troops to the military than the administration requested. The administration asked for more 15,600 active-duty troops, while the spending bill would pay for 6,961.

The statement also objects to a $532 million cut to the Afghanistan Security Forces Fund, a $406 million cut to the Counter-Islamic State of Iraq and Syria Train and Equip Fund and a $150 million to security cooperation funding.


SPACE FORCE COULD BE BOON FOR CONTRACTORS: Defense contractors are eagerly awaiting the launch of President Trump's new "Space Force," in hopes the Pentagon will go on a space-related shopping spree.

One of the driving forces behind creating a new branch of the military dedicated to space is addressing problems with the acquisition process. Supporters of Space Force say the acquisition process for space technology has been a mess without a dedicated military service.

The Trump administration has outlined its vision for Space Force in broad strokes, but most of the nitty-gritty details on issues such as acquisition won't be resolved until it releases a legislative proposal for Congress to create the new branch.

But contractors say if it is organized right, Space Force could be a boon to their businesses.

"It's pretty exciting for all of us in the industry to see the intense level of interest that this administration and our Congress has in space," United Launch Alliance (ULA) CEO Tory Bruno said recently. "I think there is sort of, at last, an appreciation of how vitally important space is to all of our lives and certainly to our country."

The organizational changes: Congress needs to approve the creation of a new branch of the military, but the Pentagon is planning to take a number of steps to lay the groundwork for Space Force.

Among them is the creation of a Space Development Agency to handle new space acquisition programs. The existing Air Force Space and Missile Systems Center would continue to handle legacy acquisition programs.

Todd Harrison, director of the Aerospace Security Project at the Center for Strategic and International Studies, said the Space Development Agency could open the field for newer and smaller companies to compete for the Pentagon's space contracts or allow companies that only focus on one area of national security space to expand into others.

The money: Pence said last week the administration will request $8 billion from Congress over the next five years for space acquisition.

With the Pentagon's budget standing at $716 billion, $8 billion over five years is relatively small, Harrison said.

It's also unclear what exactly that money intends to buy. That likely won't become apparent until the administration releases its fiscal 2020 budget request next year.

Sean O'Keefe, a former NASA administrator and Navy secretary, said contractors' reactions will depend on what the $8 billion entails.

"A contractor's going to look at this and say, 'Tell me what it is I ought be paying attention to. I don't know. I don't know whether to salivate or just look at and say it's the same $8 billion I've seen before,'" he said.

But the plan does point to a trend of increasing the nation's space budget in the future, which should please contractors, Harrison said.

"The trends are going in the direction that the military is going to be spending more and more on space capabilities," Harrison said. "There should be more opportunities for contractors."



The Senate Foreign Relations Committee will hold two confirmation hearings:

-- For David Hale, the nominee to be under secretary of State for political affairs, at 10 a.m. at the Dirksen Senate Office Building, room 419. https://bit.ly/2BfAxyu

-- For the nominees to be ambassadors to Slovenia, Moldova, Albania, Kosovo and Montenegro at 2:30 p.m. at Dirksen 419. https://bit.ly/2PhvEbg



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