Russia, digesting U.S. diplomatic retaliation, pledges ‘harsh’ response

The entrance to the building of the Consulate General of Russia is shown in San Francisco, California, U.S., August 31, 2017. REUTERS/Stephen Lam

By Andrew Osborn

MOSCOW (Reuters) – Russia said on Friday it would respond harshly to any U.S. measures designed to hurt it, a day after the United States told Moscow to close its San Francisco consulate and buildings in Washington and New York.

The warning, from Foreign Minister Sergei Lavrov, came as Russia said it was weighing a response to the U.S. move that will force it to shutter two trade missions in the United States as well as the San Francisco consulate by Sept. 2.

“We’ll react as soon as we finish our analysis,” Lavrov told students in Moscow. “We will respond harshly to things that damage us.”

Separately, a top Kremlin aide complained the U.S. demarche pushed bilateral ties further into a blind alley and fuelled a spiral of tit-for-tat retaliatory measures.

U.S. President Donald Trump took office in January, saying he wanted to improve U.S.-Russia ties which were at a post-Cold War low. But since then, ties have frayed further after U.S. intelligence officials said Russia had meddled in the presidential election, something Moscow denies.

Trump, himself battling allegations his associates colluded with Russia, grudgingly signed new sanctions on Moscow into law this month which had been drawn up by Congress.

When it became clear those measures would become law, Moscow ordered the United States to cut its diplomatic and technical staff in Russia by more than half, to 455 people.

Lavrov hinted on Friday that Russia might look at ordering further reductions in U.S. embassy staff, suggesting Moscow had been generous last time by allowing Washington to keep “more than 150” extra people.

He said Russia had cut the U.S. numbers to tally with the number of Russian diplomats in the United States, but that Moscow had generously included more than 150 Russian staff who work at Russia’s representation office at the United Nations.

Lavrov said Moscow still hoped for better relations and blamed Trump’s political foes for the deteriorating situation.

“I want to say that this whole story with exchanging tit-for-tat sanctions was not started by us,” Lavrov said.

“It was started by the Obama administration to undermine U.S.-Russia relations and to not allow Trump to advance constructive ideas or fulfil his pre-election pledges.”

Barack Obama, then outgoing president, expelled 35 suspected Russian spies in December and seized two Russian diplomatic compounds. President Vladimir Putin paused before responding, saying he would wait to see how Trump handled Russia.

“We thought this administration could exercise common sense, but unfortunately the Russophobes in Congress are not allowing it to,” said Lavrov, who complained that the United States had only given Moscow 48 hours to comply with its latest demands.

(Additional reporting by Denis Pinchuk; Editing by Robin Pomeroy)

Trump to visit victims of unprecedented floods in Texas and Louisiana

Trump to visit victims of unprecedented floods in Texas and Louisiana

By Emily Flitter and Daniel Trotta

HOUSTON (Reuters) – U.s. President Donald Trump travels to Houston and Lake Charles, Louisiana on Saturday to meet victims of catastrophic storm Harvey, one of the worst natural disasters in U.S. history that is presenting a test of his administration.

While Trump visits, attention will also be focused on Minute Maid Park, where baseball’s Houston Astros play their first home games since Harvey devastated the fourth-most populous U.S. city. The Saturday doubleheader with the New York Mets is expected to be wrought with emotion and punctuated with moments to honor the dozens who died as a result of Harvey.

The storm, one of the costliest to hit the United States, has displaced more than 1 million people, with 50 feared dead from flooding that paralyzed Houston, swelled river levels to record highs and knocked out the drinking water supply in Beaumont, Texas, a city of 120,000 people.

Hurricane Harvey came ashore last Friday as the strongest storm to hit Texas in more than 50 years. Much of the damage took place in the Houston metropolitan area, which has an economy about the same size as Argentina’s.

For graphic on hurricane costs, click http://tmsnrt.rs/2vGkbHS

For graphic on storms in the North Atlantic, click http://tmsnrt.rs/2gcckz5

Seventy percent of Harris County, which encompasses Houston, at one point was covered with 18 inches (45 cm) or more of water, county officials said.

Trump first visited the Gulf region on Tuesday, but stayed clear of the disaster zone, saying he did not want to hamper rescue efforts. Instead, he met with state and local leaders, and first responders.

He was criticized, however, for not meeting with victims of the worst storm to hit Texas in 50 years, and for largely focusing on the logistics of the government response rather than the suffering of residents.

The White House said Trump will first travel to Houston to meet with flood survivors and volunteers who assisted in relief efforts and then move on to Lake Charles, another area hammered by the storm.

The Trump administration in a letter to Congress asked for a $7.85 billion appropriation for response and initial recovery efforts. White House homeland security adviser Tom Bossert has said aid funding requests would come in stages as more became known about the impact of the storm.

Texas Governor Greg Abbott has said that his state may need more than $125 billion.

The storm, which lingered around the Gulf of Mexico Coast for days, dumped record amounts of rain and left devastation across more than 300 miles (480 km) of the state’s coast.

As water receded, many returned to survey the damage and left hundreds of thousands wondering how they can recover.

In Orange, Texas, about 125 miles (200 kms) east of Houston, Sam Dougharty, 36, returned on Friday where waist-high water remained in his backyard and barn.

His family’s house smelled like raw sewage and was still flooded to the ankles. A calf and a heifer from their herd of 15 were dead. The chickens were sagging on the top two roosts of their coop.

“We never had water here. This is family land. My aunt’s owned it for 40 years and never had water here,” he said.

Members of Army National Guard conduct high water rescue operations in the aftermath of Tropical Storm Harvey in Wharton, Texas, U.S. in this August 31, 2017 handout photo. Senior Master Sgt. Robert Shelley/Air National Guard/Handout via REUTERS

Members of Army National Guard conduct high water rescue operations in the aftermath of Tropical Storm Harvey in Wharton, Texas, U.S. in this August 31, 2017 handout photo. Senior Master Sgt. Robert Shelley/Air National Guard/Handout via REUTERS

FROM THE SHELTER TO THE STADIUM

Harvey came on the 12th anniversary of Hurricane Katrina, which killed about 1,800 around New Orleans. Then-U.S. President George W. Bush’s administration was roundly criticized for its botched early response to the storm.

Some of the tens of thousands of people forced into shelters by Harvey will attend the Astros game where Houston Mayor Sylvester Turner will throw out the first pitch and a moment of silence in planned for those who perished.

Sports have helped other cities rebound from catastrophe, such as when the New York Mets played the first baseball game in their damaged city 10 days after the attacks of Sept. 11, 2001, or when the New Orleans Saints returned to the Superdome in 2006 for football a year after Hurricane Katrina.

In the Harris County area of Clear Creek, the nearly 50 inches (127 cm) of rain that fell there equated to a once in a 40,000 year event, Jeff Lindner, meteorologist with the Harris County Flood Control District, said.

Some 440,000 Texans have already applied for federal financial disaster assistance, and some $79 million has been approved so far, Abbott said.

The storm shut about a fourth of U.S. refinery capacity, much of which is clustered along the Gulf Coast, and caused gasoline prices to spike to a two-year high ahead of the long Labor Day holiday weekend.

The national average for a gallon of regular gasoline has risen more than 17.5 cents since the storm struck, hitting $2.59 as of Saturday morning, motorists group AAA said.

Meanwhile a new storm, Irma, had strengthened on Friday into a Category 3 hurricane on the five-step Saffir-Simpson scale. It remained hundreds of miles from land but was forecast to possibly hit Puerto Rico, the Dominican Republic and Haiti by the middle of next week.

(Additional reporting by Richard Valdmanis, Ernest Scheyder, Ruthy Munoz, Peter Henderson and Andy Sullivan in Houston, Steve Holland in Washington, Julia Simon in New York, Jon Herskovitz in Austin, Texas, and Brendan O’Brien in Milwaukee; Writing by Jon Herskovitz and Dan Whitcomb; Editing by Jacqueline Wong)

Trump says ‘talking not the answer’ on North Korea, Mattis disagrees

A missile is launched during a long and medium-range ballistic rocket launch drill in this undated photo released by North Korea's Korean Central News Agency (KCNA) in Pyongyang on August 30, 2017. KCNA/via REUTERS

By Idrees Ali and Soyoung Kim

WASHINGTON/SEOUL (Reuters) – President Donald Trump on Wednesday said “talking is not the answer” to the tense standoff with North Korea over its nuclear missile development, but his defense chief swiftly asserted that the United States still has diplomatic options.

Trump’s comment, coming a day after Pyongyang fired a ballistic missile over Japan that drew U.N. and other international condemnation, renewed his tough rhetoric toward reclusive, nuclear-armed and increasingly isolated North Korea.

“The U.S. has been talking to North Korea, and paying them extortion money, for 25 years,” Trump wrote on Twitter. “Talking is not the answer!”

When asked by reporters just hours later if the United States was out of diplomatic solutions with North Korea amid rising tensions after a series of missile tests by Pyongyang, U.S. Defense Secretary Jim Mattis replied: “No.”

“We are never out of diplomatic solutions,” Mattis said before a meeting with his South Korean counterpart at the Pentagon. “We continue to work together, and the minister and I share a responsibility to provide for the protection of our nations, our populations and our interests.”

Trump, who has vowed not to let North Korea develop nuclear missiles that can hit the mainland United States, had said in a statement on Tuesday that “all options are on the table.”

North Korea said the launch of an intermediate-range ballistic missile (IRBM) on Tuesday was to counter U.S. and South Korean military drills and was a first step in military action in the Pacific to “containing” the U.S. island territory of Guam.

The 15-member U.N. Security Council condemned the firing of the missile over Japan as “outrageous,” and demanded that North Korea halt its weapons program. The U.S.-drafted statement, which did not threaten new sanctions on North Korea, urged all nations to implement U.N. sanctions and said it was of “vital importance” that Pyongyang take immediate, concrete actions to reduce tensions.

Trump’s mention of payments to North Korea appeared to be a reference to previous U.S. aid to the country.

A U.S. Congressional Research Service report said between 1995 and 2008, the United States provided North Korea with over $1.3 billion in assistance. Slightly more than 50 percent was for food and about 40 percent for energy assistance. The assistance was part of a nuclear deal that North Korea later violated.

Since early 2009, the United States has provided virtually no aid to North Korea, though periodically there have been discussions about resuming large-scale food aid.

The latest tweet by the Republican U.S. president drew criticism from some quarters in Washington. Democratic Senator Chris Murphy wrote on Twitter: “Bar is high, but this is perhaps the most dangerous, irresponsible tweet of his entire Presidency. Millions of lives at stake – not a game.”

North Korea’s leader, Kim Jong Un, ordered the launch to be conducted for the first time from its capital, Pyongyang, and said more exercises with the Pacific as the target were needed, the North’s KCNA news agency said on Wednesday.

“The current ballistic rocket launching drill like a real war is the first step of the military operation of the KPA in the Pacific and a meaningful prelude to containing Guam,” KCNA quoted Kim as saying. KPA stands for the Korean People’s Army.

Trump’s secretaries of defense and state have emphasized finding a diplomatic solution to North Korea’s nuclear ambitions. Earlier this month, Mattis told reporters the U.S. effort “is diplomatically led. It has diplomatic traction. It is gaining diplomatic results.”

Trump has offered divergent comments on North Korea in recent weeks. On Aug. 22, he tweeted that “I respect the fact that he is starting to respect us,” referring to Kim, and that maybe “something positive can come about.” On Aug. 8, Trump had threatened to unleash “fire and fury” against North Korea if it threatened the United States, and two days later delivered some more menacing words.

North Korea threatened to fire four missiles into the sea near Guam, home to a major U.S. military presence, after Trump’s “fire and fury” remark.

‘KEY MILESTONE’

The U.S. Defense Department’s Missile Defense Agency and the crew of the USS John Paul Jones conducted a “complex missile defense flight test” off Hawaii early on Wednesday, resulting in the intercept of a medium-range ballistic missile target, the agency said.

The agency’s director, Lieutenant General Sam Greaves, called the test “a key milestone” in giving U.S. Navy Aegis Ballistic Missile Defense ships an enhanced capability, but did not mention North Korea.

The United States and South Korea are technically still at war with North Korea because their 1950-53 conflict ended in a truce, not a peace treaty. North Korea routinely says it will never give up its weapons programs, saying they are necessary to counter perceived American hostility.

In Geneva, American disarmament ambassador Robert Wood, addressing the U.N.-sponsored Conference on Disarmament, called for “concerted action” by the international community to pressure North Korea into abandoning its banned nuclear and missile program by fully enforcing economic sanctions.

Washington has repeatedly urged China, North Korea’s main ally and trading partner, to do more to rein in Pyongyang.

Speaking during a visit to the Japanese city of Osaka, British Prime Minister Theresa May called on China to put more pressure on North Korea.

Asked about her comments, Chinese Foreign Ministry spokeswoman Hua Chunying said some “relevant sides” were only selectively carrying out the U.N. resolutions by pushing hard on sanctions yet neglecting to push for a return to talks.

She said this was not the attitude “responsible countries” should have when the “smell of gunpowder” remained strong over the Korean peninsula.

“When it comes to sanctions, they storm to the front but when it comes to pushing for peace they hide at the very back,” Hua told a daily news briefing.

North Korea has conducted dozens of ballistic missile tests under Kim in defiance of U.N. sanctions, but firing a projectile over mainland Japan was a rare and provocative move. Tuesday’s test was of the same Hwasong-12 missile Kim had threatened to use on Guam, but the test flight took it in another direction, over northern Japan’s Hokkaido island and into the sea.

For an interactive on North Korea’s missile capabilities, click: http://fingfx.thomsonreuters.com/gfx/rngs/NORTHKOREA-MISSILES/010041L63FE/index.html

For a graphic on North Korean missile trajectories, click: http://fingfx.thomsonreuters.com/gfx/rngs/NORTHKOREA-MISSILES/010050CG0RT/NORTHKOREA-MISSILES.png

For a graphic on Kim’s new act of defiance, click: http://fingfx.thomsonreuters.com/gfx/rngs/NORTHKOREA-MISSILES/010050KV1C3/index.html

(Additional reporting by Jack Kim in Seoul, and Philip Wen and Michael Martina in Beijing, Susan Heavey, Yeganeh Torbati and David Alexander in Washington, Kanishka Singh in Bengaluru and William James in Osaka, Japan; Writing by Will Dunham; Editing by Jeffrey Benkoe and Alistair Bell)

Trump to visit flooded Texas as Harvey deluges region

Trump to visit flooded Texas as Harvey deluges region

By Mica Rosenberg and Erwin Seba

HOUSTON (Reuters) – U.S. President Donald Trump planned to visit Texas on Tuesday to survey the response to devastating Tropical Storm Harvey, the first major natural disaster of his White House tenure, even as the lingering storm pushed floodwaters higher.

The slow-moving storm has brought catastrophic flooding to Texas, killed at least nine people, led to mass evacuations and paralyzed Houston, the fourth most-populous U.S. city. Some 30,000 people were expected to seek emergency shelter as the flooding entered its fourth day.

Harvey had also roiled energy markets and wrought damage estimated to be in the billions of dollars, with rebuilding likely to last beyond Trump’s current four-year term in office.

“My administration is coordinating closely with state and local authorities in Texas and Louisiana to save lives, and we thank our first responders and all of those involved in their efforts,” Trump told reporters at the White House on Monday.

Trump was scheduled to arrive on Tuesday morning in Corpus Christi, near where Harvey came ashore on Friday as the most powerful hurricane to strike Texas in more than 50 years. The president will later go to the Texas capital Austin to meet state officials, receive briefings and tour the emergency operation center, the White House said.

Much of the Houston area remained underwater on Tuesday, and dangerous rescues went on through the night as police, firefighters and National Guard troops in helicopters, boats and trucks pulled stranded residents from flooded homes.

Officials believed about 1,000 households remained to be rescued, Houston Fire Chief Samuel Pena told ABC’s “Good Morning America.”

“We keep getting wave after wave after wave of rain and so that’s not calming the situation,” Pena said.

Forecasters drew comparisons to Hurricane Katrina, which lay waste to New Orleans and killed 1,800 people in 2005.

The administration of then-President George W. Bush drew accusations that his response was slow and inadequate – criticism that dealt a serious blow to his presidency.

Some who fled the rising floodwaters found they had few options, as roads were washed out and emergency services overloaded.

Emely Gonzalez, 21, said she took her wheelchair-bound mother to a hospital but was turned away because doctors determined her condition was not an emergency. Having left the woman’s oxygen tank at home, her friend Chris Pastor had to head back to the flooded home by kayak to retrieve it and had to swim back.

“It was just a very delicate situation,” Pastor said. The group later made it to safety in a hotel.

Before Harvey, the last Category 4 hurricane to make landfall in Texas was Carla in 1961. Its high winds and torrential rains destroyed about 1,900 homes and nearly 1,000 businesses, the National Weather Service said.

Residents use boats to evacuate flood waters from Tropical Storm Harvey along Tidwell Road east Houston, Texas, U.S. August 28, 2017. REUTERS/Adrees Latif

Residents use boats to evacuate flood waters from Tropical Storm Harvey along Tidwell Road east Houston, Texas, U.S. August 28, 2017. REUTERS/Adrees Latif

RUNWAYS TURNED INTO LAKES

Among the most recent deaths from Harvey was a man who drowned on Monday night while trying to swim across flooded Houston-area roads, the Houston Chronicle quoted the Montgomery County Constable’s Office as saying.

The storm center was in the Gulf of Mexico about 115 miles (185 km) southeast of Houston on Monday morning. It was likely to remain just off the coast of Texas through Tuesday night before moving inland over the northwestern Gulf of Mexico on Wednesday, according to the U.S. National Hurricane Center.

Since coming ashore, Harvey has virtually stalled along the Texas coast, picking up warm water from the Gulf of Mexico and dumping torrential rain from San Antonio to Louisiana.

The Houston metro area has suffered some of the worst precipitation with certain areas expected to receive more than 50 inches (127 cm) of rain in a week, more than it typically receives for a year.

Harvey was expected to produce another 7 to 13 inches (18-33 cm) of rain through Thursday over parts of the upper Texas coast into southwestern Louisiana, the National Weather Service said.

“These stationary bands of tropical rain are very hard to time, very hard to place and are very unpredictable,” said Alek Krautmann, a weather service meteorologist in Louisiana.

Schools and office buildings were closed throughout the Houston metropolitan area, where 6.8 million people live.

The Federal Emergency Management Agency director Brock Long estimated that 30,000 people would eventually be housed temporarily in shelters.

Houston and Dallas have set up shelters in convention centers and Austin was preparing to house as many as 7,000 evacuees. More than 9,000 people packed into an overcrowded shelter in Houston, a Red Cross spokesman told CNN.

Hundreds of Houston-area roads were blocked by high water. The city’s two main airports were shut as the floods turned runways into ponds and more than a quarter million customers were without power as of Tuesday morning.

The Gulf of Mexico is home to half of U.S. refining capacity. The reduction in supply led gasoline futures to hit their highest level in two years this week as Harvey knocked out about 13 percent of total U.S. refining capacity, based on company reports and Reuters estimates.

The floods could destroy as much as $20 billion in insured property, making the storm one of the costliest in history for U.S. insurers, according to Wall Street analysts.

The Brazos River, one of the longest in the country, was forecast to crest at record highs well above flood levels on Tuesday about 30 miles (49 km) southwest of Houston, prompting authorities in Fort Bend County to order the evacuation of about 50,000 people.

For a graphic on storms in the North Atlantic, click: http://fingfx.thomsonreuters.com/gfx/rngs/STORM-HARVEY/010050K2197/index.html

A family arrives to high ground after they fled their home due to floods caused by Tropical Storm Harvey along Tidwell Road in east Houston, Texas, U.S. August 28, 2017. REUTERS/Adrees Latif

A family arrives to high ground after they fled their home due to floods caused by Tropical Storm Harvey along Tidwell Road in east Houston, Texas, U.S. August 28, 2017. REUTERS/Adrees Latif

(Additional reporting by Peter Henderson, Mica Rosenberg, Erwin Seba, Nick Oxford and Ruthy Munoz in Houston, Andy Sullivan in Rockport, Texas, Jon Herskovitz in Austin, Steve Holland and Jeff Mason in Washington and Brendan O’Brien in Milwaukee; Writing by Scott Malone and Jon Herskovitz; Editing by Mark Heinrich and Chizu Nomiyama)

Trump says ‘all options on the table’ after North Korea fires missile over Japan

Trump says 'all options on the table' after North Korea fires missile over Japan

By William Mallard and Jack Kim

TOKYO/SEOUL (Reuters) – North Korea fired a ballistic missile over Japan’s northern Hokkaido island into the sea on Tuesday, prompting a warning from U.S. President Donald Trump that “all options are on the table” as the United States considers its response.

The test, one of the most provocative ever from the reclusive state, came as U.S. and South Korean forces conduct annual military exercises on the peninsula, angering North Korea which sees them as a preparation for invasion.

North Korea has conducted dozens of ballistic missile tests under young leader Kim Jong Un, the most recent on Saturday, in defiance of U.N. sanctions, but firing projectiles over mainland Japan is rare.

Trump said the world had received North Korea’s latest message “loud and clear”.

“This regime has signaled its contempt for its neighbors, for all members of the United Nations, and for minimum standards of acceptable international behavior,” Trump said in a statement released by the White House.

“Threatening and destabilizing actions only increase the North Korean regime’s isolation in the region and among all nations of the world.  All options are on the table.”

Trump spoke with Japanese Prime Minister Shinzo Abe and the two agreed that North Korea “poses a grave and growing direct threat to the United States, Japan, and the Republic of Korea, as well as to countries around the world”, the White House said.

The Republic of Korea is South Korea’s official name.

“President Trump and Prime Minister Abe committed to increasing pressure on North Korea, and doing their utmost to convince the international community to do the same,” the statement said.

The U.S. disarmament ambassador said Washington still needed to do “further analysis” of the launch, which would be the subject of a U.N. Security Council meeting later in the day.

“It’s another provocation by North Korea, they just seem to continue to happen,” U.S. envoy Robert Wood told reporters in Geneva.

“This is a big concern of course to my government and to a number of other governments,” Wood said before a session of the U.N.-sponsored Conference on Disarmament.

North Korean Ambassador Han Tae Song told the session the United States was driving the Korean peninsula “towards and extreme level of explosion” by deploying strategic assets and conducting nuclear war drills.

In China, North Korea’s lone major ally, foreign ministry spokeswoman Hua Chunying said the crisis was “approaching a critical juncture”, but it was also maybe a turning point to open the door to peace talks.

Russia insisted North Korea abide by U.N. Security Council resolutions.

“Regarding the launching of the missiles from North Korea, we stick to the resolutions of the United Nations and we insist on the fact that the North Koreans must respect those resolutions from the United Nations,” Foreign Minister Sergei Lavrov told a news conference on a visit to the United Arab Emirates, according to a translation of his remarks.South Korea’s military said the missile was launched from near the North Korean capital, Pyongyang, just before 6 a.m. (2100 GMT Monday) and flew 2,700 km (1,680 miles), reaching an altitude of about 550 km (340 miles).

Four South Korean fighter jets bombed a military firing range on Tuesday after President Moon Jae-in asked the military to demonstrate capabilities to counter North Korea.

South Korea and the United States had discussed deploying additional “strategic assets” on the Korean peninsula, the presidential Blue House said in a statement, without giving more details.

North Korea remained defiant.

“The U.S. should know that it can neither browbeat the DPRK with any economic sanctions and military threats and blackmail nor make the DPRK flinch from the road chosen by itself,” North Korea’s official Rodong Sinmun said, using the initials of the North’s official name, the Democratic People’s Republic of Korea.

LOUDSPEAKER WARNINGS

Global markets reacted to the escalation in tension, buying safe-haven assets such as gold, the Swiss franc and even the Japanese yen on expectation domestic investors would bring large amounts of currency home in times of uncertainty.

Stocks fell, with Japan’s Nikkei 225 index <.N225> closing down half a percent, and South Korea’s KOSPI index <.KS11> 0.25 percent lower.

Some experts said the test appeared to have been of a recently developed intermediate-range Hwasong-12 missile, but there was no clear consensus.

This month, North Korea threatened to fire four missiles into the sea near the U.S. Pacific territory of Guam after Trump said it would face “fire and fury” if it threatened the United States.

North Korea fired what it said was a rocket carrying a communications satellite into orbit over Japan in 2009 after warning of its plan. The United States, Japan and South Korea considered it a ballistic missile test.

Japanese Chief Cabinet Secretary Yoshihide Suga said the latest missile fell into the sea 1,180 km (735 miles) east of Cape Erimo on Hokkaido.

Television and radio broadcasters broke into their regular programming with a “J-Alert” warning citizens of the missile launch. Bullet train services were temporarily halted and warnings went out over loudspeakers in towns in Hokkaido.

“I was woken by the missile alert on my cellphone,” said Ayaka Nishijima, 41, an office worker on Honshu island.

“I didn’t feel prepared at all. Even if we get these alerts there’s nowhere to run. It’s not like we have a basement or bomb shelter,” she told Reuters by text message.

This month, the 15-member U.N. Security Council unanimously imposed new sanctions on North Korea in response to two long-range missile launches in July.

PATH TO DIALOGUE?

U.S. Secretary of State Rex Tillerson appeared to make a peace overture to North Korea last week, welcoming what he called its restraint by not conducting any tests since July.

The United States has said before all options, including military, are on the table, although its preference is for a diplomatic solution.

Some experts said Kim was trying to pressure Washington to the negotiating table with the latest tests.

“(North Korea) thinks that by exhibiting their capability, the path to dialogue will open,” Masao Okonogi, professor emeritus at Japan’s Keio University, said by phone from Seoul.

“That logic, however, is not understood by the rest of the world, so it’s not easy,” he said.

The Japanese military did not attempt to shoot down the missile which may have broken into three pieces, said Minister of Defence Itsunori Onodera.

Experts say defenses in Japan and South Korea that are designed to hit incoming missiles would struggle to bring down a missile flying high overhead.

The United States is technically still at war with the North because their 1950-53 conflict ended in a truce, not a peace treaty. The North says it will never give up its weapons programs, saying they are necessary to counter hostility from the United States and its allies.

For an interactive on North Korea’s missile capabilities, click: http://fingfx.thomsonreuters.com/gfx/rngs/NORTHKOREA-MISSILES/010041L63FE/index.html

For a graphic on Kim’s new act of defiance, click: http://fingfx.thomsonreuters.com/gfx/rngs/NORTHKOREA-MISSILES/010050KV1C3/index.html

(Additional reporting by Soyoung Kim in SEOUL,; Malcolm Foster, Chris Gallagher, Chang-ran Kim, Linda Sieg in TOKYO, Idrees Ali, David Brunnstrom and Matt Spetalnick in WASHINGTON, Ben Blanchard in BEIJING, Stephanie Nebehay in GENEVA, Michelle Nichols at the UNITED NATIONS, Susan Heavey in WASHINGTON and Noah Browning and Celine Aswad in ABU DHABI; Writing by Lincoln Feast, Paul Tait and Nick Macfie)

Trump slaps sanctions on Venezuela; Maduro sees effort to force default

Venezuela's President Nicolas Maduro speaks during a meeting at Miraflores Palace in Caracas, Venezuela August 25, 2017. Miraflores Palace/Handout via REUTERS ATTENTION EDITORS - THIS PICTURE WAS PROVIDED BY A THIRD PARTY.

By Alexandra Ulmer and David Lawder

CARACAS/WASHINGTON/ (Reuters) – U.S. President Donald Trump signed an executive order that prohibits dealings in new debt from the Venezuelan government or its state oil company on Friday in an effort to halt financing that the White House said fuels President Nicolas Maduro’s “dictatorship.”

Maduro, who has frequently blamed the United States for waging an “economic war” on Venezuela, said the United States was seeking to force Venezuela to default — but he said it would not succeed.

The order is Washington’s biggest sanctions blow to date against Maduro and is intended to punish his leftist government for what Trump has called an erosion of democracy in the oil-rich country, which is already reeling from an economic crisis.

It suggests a weakening in already strained relations between the two countries. Just three days ago, Maduro said the relations between Caracas and Washington were at their lowest point ever.

“All they’re trying to do to attack Venezuela is crazy,” said Maduro on a TV broadcast on Friday. “With the efforts of our people, it will fail and Venezuela will be stronger, more free, and more independent.”

Venezuela faces a severe recession with millions suffering food and medicine shortages and soaring inflation. The South American nation relies on oil for some 95 percent of export revenue.

Citgo Petroleum [PDVSAC.UL], the U.S. refiner of Venezuela’s ailing state-run oil company PDVSA, is “practically” being forced to close by the order, warned Maduro, adding that a preliminary analysis showed the sanctions would impede Venezuelan crude exports to the United States.

He said he was calling “urgent” meetings with U.S. clients of Venezuelan oil.

The new sanctions ban trade in any new issues of U.S.-dollar-denominated debt of the Venezuelan government and PDVSA [PDVSA.UL] because the ban applies to use of the U.S. financial system.

As a result, it will be it tricky for PDVSA to refinance its heavy debt burden. Investors had expected that PDVSA would seek to ease upcoming payments through such an operation, as it did last year, which usually requires that new bonds be issued.

Additional financial pressure on PDVSA could push the cash-strapped company closer to a possible default, or bolster its reliance on key allies China and Russia, which have already lent Caracas billions of dollars.

“They want us to fall into default,” said Maduro, adding that just under two-thirds of Venezuelan bond holders are in the United States.

Maduro insisted that Venezuela would continue paying its debts.

The decision also blocks Citgo Petroleum from sending dividends back to the South American nation, a senior official said, in a further blow to PDVSA’s coffers.

However, the order stops short of a major ban on crude trading that could have disrupted Venezuela’s oil industry and worsened the country’s faltering economy.

It also protects holders of most existing Venezuelan government and PDVSA bonds, who were relieved the sanctions did not go further. Venezuelan and PDVSA bonds were trading broadly higher on Friday afternoon.

“Maduro may no longer take advantage of the American financial system to facilitate the wholesale looting of the Venezuelan economy at the expense of the Venezuelan people,” U.S. Treasury Secretary Steven Mnuchin said on Friday.

Venezuela’s Oil Ministry and PDVSA did not immediately respond to a request for comment.

 

PDVSA UNDER PRESSURE

PDVSA, the financial engine of Maduro’s government, is already struggling due to low global oil prices, mismanagement, allegations of corruption and a brain drain.

Washington last month sanctioned PDVSA’s finance vice president, Simon Zerpa, complicating some of the company’s operations as Americans are now banned from doing business with him.

Trump has so far spared Venezuela from broader sanctions against its vital oil industry, but officials have said such actions are under consideration. The Republican president has also warned of a “military option” for Venezuela, although White House national security adviser H.R. McMaster said on Friday that no such actions are anticipated in the “near future.”

Venezuela has for months struggled to find financing because of PDVSA’s cash flow problems and corruption scandals have led institutions to tread cautiously, regardless of sanctions.

Russia and its state oil company Rosneft have emerged as an increasingly important source of financing for PDVSA, according to a Reuters report.

On at least two occasions, the Venezuelan government has used Russian cash to avoid imminent defaults on payments to bondholders, a high-level PDVSA official told Reuters.

“At this point our view is that the country can scrape by without defaulting this year, largely with the help of Chinese and Russian backing and by further squeezing imports. Next year is a tossup,” said Raul Gallegos, an analyst with the consultancy Control Risks.

However, China has grown reticent to extend further loans because of payment delays and corruption. Russia has been negotiating financing in exchange for oil assets in Venezuela, sources have told Reuters, but going forward it would be difficult for the OPEC member to provide enough assets to keep up loans destined for bond payments.

Venezuela’s government has around $2 billion in available cash to make $1.3 billion in bond payments by the end of the year and to cover the import of food and medicine, according to documents reviewed by Reuters.

 

(Reporting by David Lawder in Washington and Alexandra Ulmer in Caracas; Additional reporting by Deisy Buitrago, Girish Gupta, Eyanir Chinea, Corina Pons, Deisy Buitrago and Hugh Bronstein in Caracas, Marianna Parraga in Houston, Tim Ahmann and Ayesha Rascoe in Washington, Rodrigo Campos and Riham Alkousaa in New York; Writing by Alexandra Ulmer and Girish Gupta; Editing by Leslie Adler)

 

Trump to begin tax reform push next week, White House adviser tells FT

U.S. President Donald Trump speaks to the National Convention of the American Legion in Reno, Nevada, U.S., August 23, 2017. REUTERS/Joshua Roberts

WASHINGTON (Reuters) – U.S. President Donald Trump will begin a major push next week to convince the public of the need for tax reform, shifting his focus to fiscal policy in an effort to win a big legislative victory by the end of the year, The Financial Times reported on Friday.

Trump would begin the effort next Wednesday with a speech in Missouri, the first in a series of addresses to generate public support on the issue, Gary Cohn, director of the National Economic Council, told the newspaper.

“We are completely engaged in tax reform,” Cohn told the FT in an interview. “Starting next week the president’s agenda and calendar is going to revolve around tax reform. He will start being on the road making major addresses justifying the reasoning for tax reform.”

Although Cohn stressed that tax reform would be front and center of Trump’s agenda, the Republican-controlled Congress faces two other pressing issues when it returns from its August recess on Sept. 5.

Lawmakers need to approve an increase in the U.S. debt ceiling to allow the federal government to keep borrowing money and paying its bills, including its debt obliterations. Separately they need to pass at least stop-gap spending measures to keep the government operating. Deadlines on both issues will loom within weeks after lawmakers return from their break.

Asked by the FT whether the debate over the debt ceiling could derail the tax reform drive, Cohn said that “at the end of the day, Congress has to increase the debt ceiling – that is just the reality.” He added that this would be in September, before tax reform legislation.

“The key point is this: tax reform is the White House’s number one focus right now,” he added.

Cohn said White House officials had been working with Senate Majority Leader Mitch McConnell, House of Representatives Speaker Paul Ryan and other leading congressional Republicans on “an outline and skeleton” for the tax reform proposal, “and we have a good skeleton that we have agreed to.”

The details Cohn discussed were similar to those mentioned by Ryan at a meeting with Boeing employees on Thursday.

Asked whether the focus on tax reform had been complicated by Twitter attacks by the Republican president on McConnell and Ryan, Cohn said the White House officials worked well with the two “and we have made a massive amount of progress” on taxes.

Cohn said the House Ways and Means Committee would put more “flesh and bone” on the tax reform plan when lawmakers return from the recess. He said he believed a bill could pass tax committees in both chambers and be passed by both the House and Senate by the end of 2017.

TAX DETAILS

In the case of individual taxpayers, Cohn said the president’s reform plan would protect the three big deductions that people can claim on taxes: for home mortgages, charitable giving and retirement savings.

Beyond that, it would increase the caps for the standard deduction while eliminating most other personal deductions, Cohn said. The plan also aims to get rid of taxes on estates left when people die.

Cohn said for businesses, the administration is proposing to lower corporate tax rates, while eliminating many of the deductions that businesses use to reduce the amount of tax they must pay.

Asked whether the corporate tax rate could be cut to 15 percent as previously suggested by Trump, Cohn said, “I would like to get the tax rate as low as possible so that businesses want to create jobs here.”

He said the administration would propose going to a system where American companies would not have to pay additional tax when they bring profits earned overseas back to the United States.

“Today, they often have to pay extra taxes for bringing profits back to the U.S.,” Cohn said. “Our current system basically creates a penalty for headquartering in the U.S.”

He said the administration did envision a one-time low tax rate on all overseas profits.

(Reporting by David Alexander and Makini Brice; Editing by Jeffrey Benkoe and Frances Kerry)

“Don’t Stop Believing!” Watch Journey’s Jonathan Cain and Paula White-Cain on demand!

Journey's Jonathan Cain on the Jim Bakker show

by Kami Klein

Spirit-led Preacher of the Word as well as spiritual adviser to President Trump for many years, Paula White-Cain, and her husband Rock and Roll Hall of Famer, songwriter and keyboardist for the legendary rock band “Journey”, Jonathan Cain, recently graced the stage of the Jim Bakker Show!  The insight into the White House was eye-opening and the music that Jonathan Cain brought to the audience celebrated God in a whole new way.

Paula White-Cain and Jonathan Cain on the Jim Bakker Show

Paula White-Cain and Jonathan Cain on the Jim Bakker Show

We have had many people who wanted to be sure they didn’t miss a note or inspirational word and now you can watch all three of our shows on demand on the Jim Bakker Show website, the PTL Television Network website, and on Roku or Apple TV.

Paula White Cain’s study on Esther begins our three part series entitled “The Esther Connection”, followed by “The True Story of Donald Trump” with the conclusion entitled “The Esther in You.”.  Follow the links and don’t miss one moment of these amazing teachings of Paula White-Cain and celebration of God through music with the legendary Jonathan Cain.

 

 

Interior Department won’t eliminate national monuments; to recommend changing some: AP

U.S. Interior Secretary Ryan Zinke listens to a presentation about the merits of a monument offshore of Massachusetts, part of his National Monuments review process, in Boston, Massachusetts, U.S., June 16, 2017. REUTERS/Brian Snyder

WASHINGTON (Reuters) – U.S. Interior Secretary Ryan Zinke will not recommend eliminating any national monuments, but will recommend changes to a “handful” of sites, the Associated Press reported on Thursday.

After a months-long review, Zinke is due to present a report to President Donald Trump later on Thursday with his recommendations on whether 27 national monuments across the country created by presidents since 1996 should be reduced in size.

In April, Trump ordered Zinke to carry out a review of the sites, arguing that previous administrations “abused” their right by creating massive monuments under the Antiquities Act of 1906 and put millions of acres of land, mainly in western states, off limits to drilling, mining, logging, ranching and other activities without adequate input from locals.

Conservation groups and the growing outdoor retail industry have launched public campaigns over the last few weeks to urge Zinke to leave the monuments intact, and have vowed to challenge him in court.

(Reporting By Valerie Volcovici; Editing by Dan Grebler)

Trump says U.S. debt ceiling ‘mess’ could have been avoided

U.S. President Donald Trump waves as he steps out from Air Force One in Reno, Nevada, U.S., August 23, 2017. REUTERS/Joshua Roberts

WASHINGTON (Reuters) – President Donald Trump said on Thursday congressional leaders could have avoided a legislative “mess” if they had heeded his advice on raising the U.S. debt ceiling, renewing criticism of fellow Republicans whose support he needs to advance his policy agenda.

Trump said he had advised Senate Majority Leader Mitch McConnell and House of Representatives Speaker Paul Ryan to link passage of legislation raising the debt ceiling to a measure on veterans affairs that he signed on Aug. 12.

“I requested that Mitch M & Paul R tie the Debt Ceiling legislation into the popular V.A. Bill (which just passed) for easy approval,” Trump said a in Twitter post.

“They … didn’t do it so now we have a big deal with Dems holding them up (as usual) on Debt Ceiling approval. Could have been so easy-now a mess!” he added, referring to Democrats.

The Treasury Department, already using “extraordinary measures” to remain current on its obligations, has said the limit on the amount the federal government may borrow must be raised by Sept. 29.

The issue is one of the must-pass measures Congress will take up when it returns on Sept. 5 from its August recess. Another is a spending bill: Congress will have about 12 working days from when it returns from the break to approve spending measures to keep the government open.

Trump threatened on Tuesday to shut down the government if Congress failed to secure funding for his long-promised wall along the U.S. border with Mexico. His threat, which added a new complication to Republicans’ months-long struggle to reach a budget deal, rattled markets and drew rebukes from some Republicans.

Democrats have slammed Trump over his comments.

On the debt ceiling issue, House Democratic leader Nancy Pelosi said on Thursday that with Republicans controlling the White House and both chambers in Congress, “the American people expect and deserve a plan from Republicans to avert a catastrophic default and ensure the full faith and credit of the United States.”

On Thursday, investors were more broadly waiting for speeches on Friday by central bank governors at a conference in Jackson Hole, Wyoming, for any new indications on monetary policy. U.S. stocks opened higher but then turned negative, and U.S. Treasury yields edged higher.

Yields on Treasury bills due in early October rose on concerns that payments on the debt could be delayed if lawmakers fail to raise the debt ceiling before the government runs out of funds.

“There’s disjointedness because of the debt ceiling,” said Lou Brien, a market strategist at DRW Trading in Chicago.

RELATIONS WITH MCCONNELL

Trump’s renewed criticism of the Republican leaders came just a day after the White House and McConnell issued separate statements saying they were continuing to work together on shared priorities, seeking to counter news reports that their relationship is disintegrating.

Trump and McConnell “remain united on many shared priorities, including middle class tax relief, strengthening the military, constructing a southern border wall, and other important issues,” the White House said in its statement.

Trump also reiterated his criticism of McConnell on Thursday over the Senate’s failure in July to pass a bill to replace Democratic former President Barack Obama’s healthcare law, legislation opposed by Republicans since it was enacted in 2010.

“The only problem I have with Mitch McConnell is that, after hearing Repeal & Replace for 7 years, he failed!That should NEVER have happened!,” Trump said in a tweet.

McConnell offered muted criticism of Trump on Thursday, saying he was “a little concerned about some of the trade rhetoric” by the president and others.

Trump has repeatedly condemned trade deals he believes are bad for American workers and for the U.S. economy. On Tuesday he cast doubt on any deal emerging to improve the North America Free Trade Agreement with Mexico and Canada. “We’ll end up probably terminating NAFTA at some point,” he said.

“Trade is a winner for America,” McConnell told a gathering of Kentucky farmers and lawmakers. “You may or may not know this, but of all the current free trade agreements that we have with the various countries all around the world, if you add them all up, we actually have a trade surplus.”

“The assumption that every free trade agreement is a loser for America is largely untrue,” McConnell said.

The New York Times reported on Tuesday that McConnell and Trump were locked in a political “cold war,” especially after an Aug. 9 phone call it said devolved into a shouting match. On that day and the next, Trump assailed McConnell via Twitter, angered by a speech McConnell had given saying Trump had “excessive expectations” of Congress.

(Story refiles to delete duplicated phrase ‘which added’ in seventh paragraph.)

(Reporting by David Alexander, Makini Brice and Ayesha Rascoe in Washington; Karen Brettell and Megan Davies in New York; Writing by David Alexander; Editing by Frances Kerry)