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Before Leaving Office, Obama Commutes Chelsea Manning’s Prison Sentence

WASHINGTON (Reuters) – In one of his final acts before leaving office, President Barack Obama on Tuesday commuted the prison sentence of Chelsea Manning, the former U.S. military intelligence analyst behind the biggest breach of classified materials in U.S. history, the White House said.

Manning has been a focus of a worldwide debate on government secrecy since she provided more than 700,000 documents, videos, diplomatic cables, and battlefield accounts to the anti-secrecy group WikiLeaks – a leak for which she was sentenced to serve 35 years in prison.

Manning, formerly known as U.S. Army Private First Class Bradley Manning, was born male but revealed after being convicted of espionage that she identifies as a woman.

Manning, who is held at the Fort Leavenworth, Kansas, military prison, accepted responsibility for leaking the material, and has said she was confronting gender dysphoria at the time of the leaks while deployed in Iraq. Her sentence will now expire on May 17, the White House said.

Manning was working as an intelligence analyst in Baghdad in 2010 when she gave WikiLeaks a trove of diplomatic cables and battlefield accounts that included a 2007 gunsight video of a U.S. Apache helicopter firing at suspected insurgents in Iraq, killing a dozen people including two Reuters news staff.

Her attorney had argued her sentence exceeded international legal norms, and she has twice attempted suicide.

(Additional reporting by Ayesha Rascoe; Editing by Sandra Maler and Grant McCool)

IMAGE: Chelsea Manning is pictured in this 2010 photograph obtained on August 14, 2013.Courtesy U.S. Army/Handout via REUTERS

Crony Cabinet: Trump’s Commerce Pick Is No Stranger To Protectionism

WASHINGTON (Reuters) – When billionaire investor Wilbur Ross salvaged two North Carolina textile mills from bankruptcy in 2003 and 2004, one of the first things he did was head to Washington to immerse himself in trade law and policy.

China’s accession to the World Trade Organization had unleashed a flood of textile imports across U.S. borders, and Ross – now President-elect Donald Trump’s pick for commerce secretary – took an unusual hands-on approach, advocating for “safeguard” tariffs to help the ravaged domestic industry.

“He was not the first outside investor to come into the industry and buy a major asset. He was the first and to my knowledge only major outside investor who took on that same sort of attitude that the more home-grown CEOs had,” said Auggie Tantillo, who has lobbied for textile makers in Washington for almost 40 years.

Ross’ history owning and defending embattled steel and textile manufacturing companies that have relied on border duties to protect their industries means he will bring a unique approach to the commerce secretary job, departing from the traditional role of cheerleading for free trade and big business.

If confirmed by the U.S. Senate, Ross, 79, who is personally close to Trump, will be a lead player shaping U.S. trade policy, working alongside Robert Lighthizer, a lawyer known for his work with beleaguered U.S. manufacturers whom Trump has tapped as U.S. Trade Representative, and Peter Navarro, an economist and China hawk who will serve as a White House adviser.

Free trade advocates worry the Trump trade triumvirate will be too quick to use tariffs to keep imports out, raising costs for manufacturers that rely on imported parts – or even sparking retaliatory trade wars.

“The three of them – those guys put together – can create a lot of mischief,” said Dan Ikenson, a long-time trade policy economist now with the Cato Institute think tank.

Ross, who is set to appear at a Senate hearing on his nomination on Thursday at 10 a.m., did not respond to a request for comment.

A spokesman for Trump’s transition team said Ross would draw on his experience “saving and creating” manufacturing jobs if confirmed, and would push to expand exports and reduce imports.

“MR. PROTECTIONISM”

In a Senate questionnaire ahead of his hearing, Ross said he has owned or had a significant stake in more than 100 businesses over 55 years.

The Economist has called Ross “Mr. Protectionism,” a term Ross told CNBC he sees as “pejorative” and inaccurate because he said the threat tariffs would be a used as a negotiating tool.

Ross has worked with allies in trade unions and other industry groups hurt by imports to push for tariffs and quotas, even starting his own coalition in 2003.

Though the coalition was short-lived, Ross’s trade rhetoric about the trade deficit and currency manipulation has remained consistent – and was echoed on the campaign trail by Trump.

Ross called the 20-year-old North American Free Trade Agreement (NAFTA) with Mexico and Canada the “poster child for unbalanced trade and investment,” in a letter to The Wall Street Journal.

He has accused Mexico of importing auto parts from China for vehicles it shipped duty-free into the United States.

But his companies have also produced goods in Mexico. The 2007 annual report for his International Textile Group called NAFTA “advantageous to the company” because of its factories there.

And Ross supported the Central America Free Trade Agreement, saying he believed it fixed some of what he saw as loopholes in NAFTA.

Ross has drawn an unusual endorsement for his manufacturing chops – from the United Steelworkers union, which backed Trump’s Democratic opponent Hillary Clinton in the election.

Leo Gerard, president of the USW, in an interview last month said Trump’s team understands that trade remedy laws themselves need to be modernized to make it easier to impose sanctions and duties before industries are hurt and jobs are lost.

“We have a lot of suggestions for when there’s a new trade team,” Gerard told Reuters.

(Additional reporting by Andy Sullivan; Editing by Caren Bohan and Leslie Adler)

IMAGE: Billionaire investor Wilbur Ross, chairman of Invesco Ltd subsidiary WL Ross & Co, arrives at Trump Tower to meet with U.S. President-elect Donald Trump in New York, U.S., November 29, 2016. REUTERS/Mike Segar

How Will Castro’s Death Shape Trump’s Cuba Policy?

WEST PALM BEACH, Fla. (Reuters) – U.S. President-elect Donald Trump said on Saturday that his administration would “do all it can” once he takes office on Jan. 20 to help increase freedom and prosperity for Cuban people after the death of Fidel Castro.

But his initial reaction to Castro’s death sidestepped whether the incoming president would make good on a threat made late in his White House campaign to reverse President Barack Obama’s moves to open relations with the Cold War adversary.

Obama used his executive powers on a series of steps to ease trade, travel and financial restrictions against Cuba, arguing it was time to try diplomacy after the half-century-long economic embargo against Cuba had failed to shake the regime.

Trump’s first statement on Cuba policy since the Nov. 8 election, issued from his Palm Beach, Florida, resort where he and his family were spending the weekend after the Thanksgiving holiday, did not address whether he would roll back Obama’s measures because of concerns about religious and political freedom in Cub

“Though the tragedies, deaths and pain caused by Fidel Castro cannot be erased, our administration will do all it can to ensure the Cuban people can finally begin their journey toward prosperity and liberty,” Trump said in the statement.

“While Cuba remains a totalitarian island, it is my hope that today marks a move away from the horrors endured for too long, and toward a future in which the wonderful Cuban people finally live in the freedom they so richly deserve,” he said.

Trump has just begun to fill out the top ranks of his national security team, and has not yet named his top diplomat – the secretary of state – who will play a major role in formulating policy on Cuba.

He last week named Mauricio Claver-Carone, a political lobbyist who has strongly criticized Obama’s efforts to normalize relations with Cuba and supports maintaining the U.S. embargo against the island, to his transition team at the U.S. Treasury Department.

The agency is responsible for enforcing U.S. trade and travel restrictions on Cuba. Claver-Carone is director of the U.S.-Cuba Democracy Political Action Committee.

Claver-Carone was not immediately available for comment on Saturday.

Trump’s initial statement was viewed by some to mark a softening from his rhetoric on Cuba policy late in the campaign, one U.S. intelligence official told Reuters, speaking on the condition of anonymity.

“This may be one place where his business interests prod him to take a more pragmatic course, even if that angers the hard-core, anti-Castro elements of both parties,” the official told Reuters.

A second U.S. official noted the foreign policy advisers Trump has named thus far are not known to have any particular interest in Cuba. That may mean Trump’s economic team will have more sway over Cuba policy, which could lead to a more pragmatic approach, the second official said.

An aggressive policy by Trump would close off lucrative opportunities to U.S. businesses and hand them to European or Asian firms, and would hurt companies like American Airlines , due to start commercial flights to Havana on Monday for the first time in half a century.

WHAT WILL TRUMP DO?

Trump – a New York businessman and former reality TV star with an unconventional approach to politics – started his campaign saying he was open to lifting the long-standing embargo on trade with Cuba.

In January, he said on Fox News that he was in favor of “opening it up” with Cuba, but wanted a better “deal” than Obama had made, comments he repeated in a debate with Republican rivals in March.

“I would want to make a strong, solid, good deal because right now, everything is in Cuba’s favor,” Trump said in March, saying he would “probably have the embassy closed” in Havana until a new deal was made.

When Obama visited Cuba later that month, Trump said in an interview with CNN that he “probably” would continue to normalize economic and diplomatic relations with Cuba, and would even open a Trump hotel in Cuba if the conditions were right.

“I think Cuba has certain potential, and I think it’s OK to bring Cuba into the fold, but you have to make a much better deal,” he said, noting he was worried Cuba would sue the United States for reparations for damage caused by its decades-long embargo on Cuba.

Cuba policy was not part of a major foreign policy address Trump delivered in April. After he secured his party’s nomination, his position shifted to a more traditional Republican position.

At a Miami rally in September, Trump said he would roll back Obama’s Cuban policy reforms unless Cuban leaders allowed religious freedom and freed political prisoners.

“The next president can reverse them, and that I will do unless the Castro regime meets our demands,” Trump told supporters.

His vice presidential running mate, Mike Pence, also took a hard line. “Let me make you a promise,” Pence said in Miami just days before the election. “When Donald Trump is president of the United States, we will repeal Obama’s executive orders on Cuba.”

On Saturday, Pence tweeted: “The tyrant Castro is dead. New hope dawns. We will stand with the oppressed Cuban people for a free and democratic Cuba. Viva Cuba Libre!”

PRESSURE FROM REPUBLICANS

Trump will face pressure to reverse Obama’s orders on Cuba from a bloc of mostly Republican Cuban-American lawmakers that has worked to keep tight restrictions on trade and travel with Cuba for years.

They believe Cuba’s government is still too repressive to ease economic and travel restrictions.

“The dictator has died, but the dictatorship has not,” said U.S. Senator Marco Rubio of Florida, a Cuban-American who ran against Trump to be the Republican presidential candidate.

“The future of Cuba ultimately remains in the hands of the Cuban people, and now more than ever Congress and the new administration must stand with them against their brutal rulers and support their struggle for freedom and basic human rights.”

But some Republicans want to continue with Obama’s opening. U.S. Senator Jeff Flake of Arizona, a leading Republican anti-embargo voice, said on Saturday that “more frequent and consequential ties between Cubans and Americans” would more likely boost income and sap the strength of the Castro government.

Democratic Congresswoman Kathy Castor, who represents a Tampa, Florida, district with a significant Cuban population, said she thinks Castro’s death could make it easier for the Trump administration to change its Cuba stance.

“While Fidel Castro was alive, there was an emotional impediment for greater engagement” from the Cuban exile community in Miami, Castor told Reuters. “That emotional impediment now is gone,” she said.

(Additional reporting by Letitia Stein in Tampa, Fla., and Idrees Ali, Patricia Zengerle, Matt Spetalnick and John Walcott in Washington; Editing by Bill Rigby and Jonathan Oatis)

IMAGE: A fan waves a Cuban flag outside of the Ciudad Deportiva de la Habana sports complex where the Rolling Stones’ free outdoor concert will take place today, Havana, March 25, 2016. REUTERS/Ueslei Marcelino

Sanders To Trump: Use Defense Contracts As Leverage For Carrier Jobs

WEST PALM BEACH, Fla. (Reuters) – U.S. Senator Bernie Sanders turned up the pressure on President-elect Donald Trump on Saturday about his pledge to try to stop an Indiana air conditioner manufacturer from moving 1,400 jobs to Mexico.

Both Sanders, who challenged Hillary Clinton for the Democratic nomination, and Trump seized on an announcement earlier this year by United Technologies Corp’s Carrier division that it would shift production to Mexico as an example of how trade deals hurt U.S. workers.

Sanders on Saturday warned “it is not good enough to save some of these jobs” and said Trump should use as leverage United Technologies’ defense contracts, Export-Import Bank financing, and tax breaks.

“I call on Mr. Trump to make it clear to the CEO of United Technologies that if his firm wants to receive another defense contract from the taxpayers of this country, it must not move these plants to Mexico,” the senator from Vermont said in a statement.

A representative for Carrier declined to comment on Sanders’ statement.

Trump, who takes office on Jan. 20, said on Thursday that he was “working hard, even on Thanksgiving” to get the plant to stay and said he was “making progress” on the issue. Carrier Corp. confirmed it had “discussions with the incoming administration.” Neither side has provided details.

Trump had threatened to slap taxes on the company’s air conditioners made in Mexico and shipped back to the United States. A spokesman was not immediately available for comment on Sanders’ statement on Saturday.

Sanders said he would soon introduce legislation that would prevent companies that outsource from receiving federal contracts, grants and loans, and force companies that outsource jobs to pay a penalty tax and pay back tax breaks.

(Additional reporting by Nick Carey in Chicago; Editing by Jonathan Oatis)

IMAGE: Democratic U.S. presidential candidate Bernie Sanders speaks at a campaign rally in Salem, Oregon, U.S., May 10, 2016. REUTERS/Jim Urquhart 

President Obama: ‘Trump In For A Wake-Up Call When He Takes Office’

WASHINGTON (Reuters) – President-elect Donald Trump is in for a quick wake-up call and will have to adjust his temperament when he confronts the realities of his new job on Jan. 20, President Barack Obama said on Monday.

In a news conference at the White House, Obama said the freewheeling Trump could not be as outspoken as he was during the long and bitter campaign that ended last week with the Republican’s surprise win over Democrat Hillary Clinton.

Subdued and carefully choosing his words, Obama gave what appeared to be dispassionate advice to his successor free of much of the partisan rancor that marked the election campaign.

“This office has a way of waking you up,” Obama said. “Those aspects of his positions or predispositions that don’t match up with reality, he will find shaken up pretty quick because reality has a way of asserting itself.”

The two men met in the Oval Office last week to begin the transition of power. Obama said on Monday he believed Trump would be pragmatic in office and not approach the country’s problems from an ideological perspective.

“There are going to be certain elements of his temperament that will not serve him well, unless he recognizes them and corrects them,” Obama said.

“Because when you’re a candidate and you say something that is inaccurate or controversial it has less impact than it does when you’re president of the United States. Everybody around the world is paying attention. Markets move,” he said.

Obama declined to wade into a controversy over Trump’s appointment of right-wing firebrand Stephen Bannon as his chief strategist, saying it would “not be appropriate” for him to comment on Trump’s appointments.

But Obama, who criticized Trump’s temperament during the campaign, said it was important for Trump to send signals of unity after the hard-fought campaign. He said the political gifts that allowed the Republican to upset Clinton would be put to good use in the White House.

“I’ve been encouraged by his statements on election night about the need for unity, his interest in being president for all people,” Obama said. “In an election like this that was so hotly contested and so divided, gestures matter.”

GIULIANI TO STATE DEPARTMENT?

The president-elect, a businessman who has never held public office, and his transition team are working on picking members of his Cabinet and the heads of federal agencies.

Former New York City Mayor Rudy Giuliani has emerged as a leading candidate for secretary of state, a source familiar with the process said. John Bolton, a former U.S. ambassador to the United Nations, is also being considered for the job of the nation’s top diplomat, the source added.

Giuliani became one of Trump’s closest advisers during the campaign, functioning as his most vocal defender on cable news programs and introducing him at many rallies. Giuliani has also been mentioned as a possible attorney general or homeland security secretary.

A Trump transition team official denied media reports on Monday that Trump was seeking security clearance for three of his children and his son-in-law.

Such clearance would allow Trump to discuss matters of national security with his daughter Ivanka, sons Eric and Donald Jr. and son-in-law Jared Kushner. Federal law prohibits him from hiring family members to serve in his administration, but all four played key advisory roles through the campaign.

Trump has insisted that to avoid conflicts of interest, his children would run his sprawling business operations once he assumed the presidency.

ANGER OVER BANNON

Democrats, civil rights groups and even some Republicans slammed Trump for choosing Bannon as a key aide, saying it would elevate the white nationalist movement into the top levels of the White House.

Making his first appointments since last week’s upset win, Trump picked Bannon as his chief strategist and counselor, and Washington insider Reince Priebus as his chief of staff on Sunday, saying the two would share the task of steering his administration as “equal partners.”

The choice of Priebus was seen as a conciliatory signal of Trump’s willingness to work with Congress. But critics blasted the selection of Bannon, who spearheaded a shift of the Breitbart News website into a forum for the “alt-right,” a loose online group of neo-Nazis, white supremacists and anti-Semites.

“There should be no sugarcoating the truth here: Donald Trump just invited a white nationalist into the highest reaches of the government,” said Democratic Senator Jeff Merkley, who called on Trump to rescind the choice.

The Democratic leader in the House of Representatives, Nancy Pelosi, said Bannon’s appointment sent “an alarming signal that President-elect Trump remains committed to the hateful and divisive vision that defined his campaign.”

Even some conservatives and Republicans voiced dismay on Bannon. Evan McMullin, who ran as a conservative independent presidential candidate, wondered on Twitter if any national Republican leaders would condemn the pick of “anti-Semite” Bannon.

John Weaver, a top strategist for Republican Ohio Governor John Kasich, tweeted that the “racist, fascist extreme right is represented footsteps from the Oval Office. Be very vigilant America.” Kasich was one of 16 Republican presidential hopefuls Trump defeated in the party primaries.

Priebus defended Bannon on Monday, calling him a wise and well-educated former naval officer and saying he had not encountered the sort of extremist or racist views that critics are assailing.

“He was a force for good on the campaign,” Priebus said on Fox News, adding they were in agreement on “almost everything” in terms of advising the president-elect.

Kellyanne Conway, Trump’s former campaign manager and a senior adviser, told reporters in New York she was offended by the reaction to Bannon, describing him as a “brilliant tactician.”

Police in New York on Monday were investigating two cases involving swastikas drawn or painted in public spaces, as civil rights activists said there had been a surge in hate crimes following last week’s election.

Local media reported hundreds of students walked out of a high school to protest Trump on Monday in Silver Spring, Maryland, and students gathered at the University of Washington in Seattle to protest Trump.

(Additional reporting by Steve Holland; Writing by John Whitesides and Ginger Gibson; Editing by Alistair Bell and Peter Cooney)

IMAGE: U.S.  President Barack Obama holds a news conference in the White House press briefing room in Washington, U.S., November 14, 2016.  REUTERS/Yuri Gripas

White House, Govt Agencies To Talk On Plans In Case Of Shutdown

WASHINGTON (Reuters) – The White House budget office was slated to hold a call with U.S. government agencies on Friday to plan for a government shutdown in case the U.S. Congress fails to pass a short-term funding bill by a deadline next week.

“It is our hope that this work will ultimately be unnecessary and that there will be no lapse in appropriations,” a spokeswoman for the White House Office of Management and Budget (OMB) said in a statement.

The federal fiscal year ends on Sept. 30 and Congress must pass a spending measure by then to keep the government open.

In recent years, lawmakers have seldom agreed on a full federal budget and instead have relied on stop-gap measures.

On Thursday, Republicans produced a bill which Democrats immediately rejected.

The OMB said there was enough time for Congress to pass a short-term funding bill, but “prudent management requires that the government plan for the possibility of a lapse.”

Republicans and Democrats annually fight about spending bills but normally reach a deal to avert a shutdown, particularly during election years. In 2013, the two sides failed to agree, and the government stopped operations for 16 days.

(Reporting by Roberta Rampton; Editing by Bernadette Baum)

Photo: An empty speaker’s lectern is seen in the rain outside the U.S. Capitol in Washington, October 10, 2013.   REUTERS/Jonathan Ernst

Obama On Trump: His Ideas Are ‘Uninformed Or Outright Wacky’

VIENTIANE (Reuters) – U.S. President Barack Obama hit back at Donald Trump on Thursday for criticizing his foreign policy record, saying the Republican nominee was unfit to follow him into the Oval Office and the public should press him on his “outright wacky ideas”.

Speaking in Laos at the end of the second of two Asian summits, Obama said the tycoon’s lack of leadership credentials was exposed whenever he spoke and American voters were aware of that.

“I don’t think the guy’s qualified to be president of the United States, and every time he speaks, that opinion is confirmed,” Obama told a news conference.

“The most important thing for the public and the press is to just listen to what he says and follow up and ask questions about what appear to be either contradictory or uninformed, or outright wacky, ideas.”

Trump declared on Wednesday during a televised forum attended by military veterans that Russian President Vladimir Putin had been a better leader than Obama.

Trump said the progress of U.S. military generals had been stymied, or “reduced to rubble” with Obama as commander-in-chief and Democratic nominee Hillary Clinton as his first secretary of state. It was the first time Trump and Clinton had squared off on the same stage since securing their nominations in July.

Obama said he believed his foreign policy legacy would be one of success, particularly his so-called “rebalance” to Asia. He said Asian leaders would be puzzled by Trump’s remarks, and Americans would know who to choose as president on Nov. 8.

“I have confidence that if, in fact, people just listen to what he had to say, look at his track record or lack thereof, that they’ll make a good decision,” he said.

(Reporting by Roberta Rampton; Writing by Amy Sawitta Lefevre and Martin Petty; Editing by Clarence Fernandez)

Photo: U.S. President Barack Obama holds a news conference at the conclusion of his participation in the ASEAN Summits in Vientiane, Laos September 8, 2016. REUTERS/Jonathan Ernst

Disparate Crises Distract From Obama Bid To Sign Off On Asia Shift

ABOARD AIR FORCE ONE (Reuters) – Barack Obama starts his last trip to Asia on Saturday as U.S. president, aiming to put a final stamp on his signature policy shift toward the Pacific but distracted by crises ranging from Brexit to the battle against Islamic State.

With the clock ticking down on his presidency, Obama will attend a G20 summit in China, a visit that will underscore the challenges he has faced with a rising world power that is both an economic partner and strategic rival.

His final meetings in the region with Chinese President Xi Jinping could set the tone for his White House successor, who will be elected in November and take office in January.

Obama will seek to highlight his legacy of stronger ties with Southeast Asia, particularly during the first-ever U.S. presidential visit to Laos, and his success in elevating the issue of climate change on the world stage.

But there will be few bright spots in talks with fellow world leaders, who are grappling with the sagging global economy, fallout from Britain’s vote to leave the European Union, increasing suspicion of globalization, the fight against Islamic State militants and territorial disputes in East Asia.

During his past nine trips to Asia, Obama has sometimes been distracted by other international developments from the emphasis he sought to place on boosting U.S. military and economic ties to the fast-growing region, leading critics to doubt whether the U.S. commitment will last.

The latest visit coincides with the race to succeed Obama in the Nov. 8 presidential election, where Democratic nominee Hillary Clinton, his former secretary of state and co-architect of his Asia strategy, has opposed his Trans-Pacific Partnership trade deal, raising concerns among the 12 nations in the pact.

Republican nominee Donald Trump has alarmed allies like Japan and South Korea by suggesting they should pay more for their security and even develop their own nuclear weapons to protect against the threat posed by North Korea.

Derek Chollet, a former defense adviser to Obama, said one of the challenges the United States faces is reassuring governments in Asia that the United States means what it says when it comes to rebalancing towards the region.

“Asia partners are suspicious that even if we really mean it, that we’re easily sidetracked,” said Chollet, author of “The Long Game,” a book about Obama’s foreign policy.

LOW EXPECTATIONS FOR OBAMA-XI TALKS

Obama will start his visit on Saturday with China’s Xi. The leaders have forged cooperation on combating climate change and curbing Iran’s nuclear drive but have failed to narrow their countries’ main differences.

Irritants include U.S. accusations of Chinese cyber hacking, disputes over trade and Beijing’s pursuit of contested claims in the South China Sea.

Michael Green, a top Asia adviser to former Republican President George W. Bush, said he did not expect the Obama-Xi meeting to yield much. “No grand joint declaration as we saw early in the administration, no celebration – perhaps some agreements on climate change – but a pretty rough and scratchy relationship,” Green said.

Obama faces another tricky meeting when he holds talks with NATO ally Turkish President Tayyip Erdogan, with relations strained over strategy on Syria’s civil war and concerns about Erdogan’s crackdown on opponents after July’s failed coup.

White House aides have left open the prospect of an informal encounter with Russian President Vladimir Putin, which whom Obama is sharply at odds over Syria and Ukraine.

China will closely watch Obama’s first meeting with brash new Philippines President Rodrigo Duterte, slated for Tuesday at an East Asia summit in Laos. In July, the Philippines, with U.S. backing, won a challenge against China’s South China Sea claims at an international arbitration court.

Despite the longtime U.S.-Philippines alliance, Duterte recently insulted the U.S. ambassador, calling him a “gay son of a whore.” Evan Medeiros, Obama’s former top Asia adviser, said such comments plus Duterte’s skepticism about the U.S. relationship meant that trust needed to be rebuilt.

The White House has said Obama will not pull his punches over human rights concerns, which include thousands of extra-judicial killings since Duterte took office two months ago, according to date released this week.

Strains with Duterte could add to Obama’s difficulties in forging a united front on the South China Sea with Southeast Asian partners.

China may see an opportunity to “drive a wedge” between the United States and Philippines as Beijing seeks a bilateral arrangement with Manila over the South China Sea, Medeiros said.

Western diplomats in Beijing, however, said the Chinese government had its own difficulties reading Duterte.

“He seems to change his mind every 24 hours,” said one senior Western envoy, referring to Duterte’s China policy.

(Reporting by Roberta Rampton; Additional reporting by David Brunnstrom and Matt Spetalnick in Washington; Editing by Peter Cooney and Simon Cameron-Moore)

Photo: U.S. President Barack Obama boards Air Force One to depart for a visit to Papahanaumokuakea Marine National Monument at Midway Atoll, from Joint Base Pearl Harbor-Hickam, Hawaii, U.S. September 1, 2016. REUTERS/Jonathan Ernst

Obama Tries To Limit Fallout From British EU Exit Vote

U.S. President Barack Obama on Friday tried to limit the fallout from Britain’s vote to leave the European Union, which threatens to harm the U.S. economic recovery, derail his trade agenda and distract U.S. allies from global security issues.

Obama said he was sure Britain’s exit from the EU would be orderly and vowed that Washington would maintain both its “special relationship” with London and close ties to Brussels.

“While the UK’s relationship with the EU will change, one thing that will not change is the special relationship that exists between our two nations. That will endure,” he told an event at Stanford University, referring to close ally Britain. “The EU will remain one of our indispensable partners,” Obama said.

He spoke to outgoing British Prime Minister David Cameron and German Chancellor Angela Merkel after the stunning result of Thursday’s referendum, the biggest blow to the European project of greater unity since World War Two.

Obama vowed that the United States and Britain would “stay focused on ensuring economic growth and financial stability.”

The Brexit result rattled Wall Street and many other financial markets, with global stock markets losing about $2 trillion in value on Friday.

Obama had warned during a visit to London in April against Brexit, or Britain’s exit from the EU, in an unusually strong intervention into British politics.

“I must say we had looked for a different outcome. We would have preferred a different outcome,” U.S. Vice President Joe Biden, traveling in Ireland, said on Friday.

The historic divorce launched by the Brexit vote could sink hopes of a massive U.S.-EU free trade deal before Obama leaves office in January.

Negotiations on the Transatlantic Trade and Investment Partnership, or TTIP, were already stalled by deeply entrenched differences and growing anti-trade sentiment on both continents.

As well as the global economic consequences, Brexit makes it more difficult for Obama and the United States to corral its Western allies into joint action against challenges such as Islamic State, Russia and the rise of China, as the Democrat enters the final months of his presidency.

Britain’s exit could present the next U.S. president with a decision on whether to turn to other key European partners like Germany and France, essentially downgrading the United States’ special bond with Britain, whose foundation was laid in World War Two.

Senator Ben Cardin of Maryland, the top Democrat on the Senate Committee on Foreign Relations, called on Washington’s partners in Europe to keep their eye on foreign policy threats.

“We must maintain our trans-Atlantic consensus on how to deal with a resurgent Russia and the growing threat of ISIS,” he said. “I urge leaders in London, Brussels and across Europe to not lose sight of these threats and remain coordinated in our response.”

THE TRUMP FACTOR

The U.S. presidential election candidates are casting an eye across the Atlantic at the unlikely success of Britain’s “Leave” campaign, which has similarities with Republican Donald Trump’s insurgent bid for the Nov. 8 election.

Trump’s rise was sustained by a similar brew of anti-establishment and anti-globalization sentiment and concern about immigration that helped the Leave vote.

“This is a protest vote against globalization and there is one presidential candidate who won the nomination who has put globalization in his crosshairs – and that’s Donald Trump,” Republican strategist John Feehery said.

Biden, in remarks prepared for a speech at Dublin Castle, took a swipe at Trump without mentioning him by name. He warned against “politicians and demagogues peddling xenophobia, nationalism, and isolationism.”

Brexit supporter Trump called the result a “great thing.” “People want to take their country back. They want to have independence in a sense. You see it with Europe, all over Europe,” Trump, 70, said in Turnberry, Scotland where he reopened a golf course.

Obama hopes his former secretary of state Hillary Clinton will win the November election and safeguard his legacy but economic volatility in the United States after Brexit could hurt her chances of beating Trump.

In response to Britain’s decision to leave, Clinton said the United States must first safeguard against any economic fallout at home at “this time of uncertainty” and underscore its commitment to both Britain and Europe.

The U.S. Federal Reserve sought to calm global financial markets by saying it was ready to provide dollar liquidity following the British vote.

After Brexit, the U.S. central bank’s ambitions for two rate rises this year now look unlikely. Traders of U.S.-interest rate futures even began to price in a small chance of a Fed rate cut, and now see little chance of any hike until the end of next year.

“One can forget about rate hikes in the near term,” said Thomas Costerg, New York-based economist at Standard Chartered Bank. “What I’m worried about is that the Brexit vote could be the straw that breaks the back of the U.S. growth picture.”

(Additional reporting by Doina Chiacu and Ayesha Rascoe in Washington,; Writing by Alistair Bell; Editing by Chizu Nomiyama and Bill Rigby)

White House Defends Deportations After Democratic Complaints

The White House on Friday defended its deportation policy after complaints from Democratic presidential candidates and congressional leaders that a sweep targeting Central American illegal immigrants is inhumane.

Reuters reported on Thursday that U.S. immigration officials plan a month-long series of raids in May and June to deport hundreds of Central American mothers and children found to have entered the country illegally.

White House spokesman Josh Earnest acknowledged that the deportation operations were consistent with President Barack Obama’s policy to focus on deporting criminals and recent immigrants who crossed the U.S. border illegally after Jan. 1, 2014.

“No one is removed if they have an ongoing, pending claim or appeal for asylum or some other form of humanitarian relief,” Earnest told reporters at a briefing.

“If this serves to discourage people from considering to make this journey, that would be a good thing,” Earnest said.

In 2014, a wave of children fleeing violence in Honduras, El Salvador and Guatemala surged across the U.S. border, inflaming the debate over how to deal with the more than 11 million undocumented immigrants living in the United States.

The planned new raids are in response to a renewed surge of illegal entries by Central American women traveling with their children.

In January, immigration officers rounded up 121 people, mostly women and children, in three states. That sparked criticism from Democrats running to replace Obama in the Nov. 8 presidential elections.

On Thursday, Democratic presidential front-runner Hillary Clinton reiterated her concerns about the new plans.

“I’m against large-scale raids that tear families apart and sow fear in communities,” Clinton said.

Democratic presidential candidate Senator Bernie Sanders said he opposed “the painful and inhumane business of locking up and deporting families” trying to escape violence in other countries.

In Congress, Senate Democratic Leader Harry Reid called on Obama to reconsider the plans and focus on addressing the instability in Central America.

Democratic representative Luis Gutierrez of Illinois, a critic of the Obama administration’s deportation policies, complained the administration was leaking word of the deportations to scare people away from coming to the United States.

“The last time they did this, people called my office about raids that were not existent because it creates panic, it creates fear, it’s terrible, it’s a terrible way to bring about policy on this issue,” Gutierrez told reporters.

“Stop talking about them as illegal immigrants. They are asylum seekers,” he said.
Additional reporting by Doina Chiacu and Richard Cowan; Editing by Chris Reese and Andrew Hay

Photo: Officers from U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO) are shown during an operation targeting criminal aliens and other immigration violators in Philadelphia, Pennsylvania, United States in this image released May 11, 2016.   Courtesy ICE/Handout via REUTERS