Happy Monday and welcome to Overnight Defense. I’m Ellen Mitchell, and here’s your nightly guide to the latest developments at the Pentagon, on Capitol Hill and beyond. CLICK HERE to subscribe to the newsletter.

THE TOPLINE: Defense Secretary Mark Esper is out.

President Trump on Monday announced he had fired his fourth Pentagon chief, a stunning move that comes days after Joe Biden was projected to have won the presidential race.

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“I am pleased to announce that Christopher C. Miller, the highly respected Director of the National Counterterrorism Center (unanimously confirmed by the Senate), will be Acting Secretary of Defense, effective immediately,” Trump said in a series of tweets. “Chris will do a GREAT job! Mark EsperMark EsperOvernight Defense: Trump fires Defense chief Mark Esper | Worries grow about rudderless post-election Pentagon | Esper firing hints at broader post-election shake-up | Pelosi says Esper firing shows Trump intent on sowing ‘chaos’ Esper firing hints at broader post-election shake-up Democratic lawmakers lambast Trump over Esper firing as GOP remains mum MORE has been terminated. I would like to thank him for his service.”

The timing: Esper had long been seen as out the door, regardless of who won the election. But firing him now gives Trump a chance to flex his executive powers at a time he is trying to project strength amid his electoral defeat.

It also raises questions about the military chain of command during a fraught time in the United States.

The Pentagon declined a request for comment, referring questions to the White House. The White House did not offer comment.

White House chief of staff Mark Meadows informed Esper of his firing shortly before the tweet was sent, a defense official said.

A long time coming: Trump and Esper have had a rocky relationship since the summer’s nationwide racial justice protests. During the height of the protests, Trump threatened to deploy active-duty troops to quell the demonstrations. Esper responded by holding a press conference at the Pentagon announcing his opposition to deploying troops.

Esper’s public split reportedly angered Trump so much that he had to be talked out of firing the Defense secretary then.

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In August, Trump publicly signaled his displeasure with Esper, saying that he “considers firing everybody” when asked whether he would fire his Defense chief.

Trump also derided Esper as “Yesper,” a nickname that other Pentagon officials had reportedly given the Defense secretary for being too deferential to the president.

Talk that Trump could fire Esper picked up again in the days after Tuesday’s presidential election as it seemed increasingly likely that Biden had won.

Esper’s response: In an interview with Military Times published Monday after he was fired but conducted last week, Esper said he never intended to resign but was expecting his tenure to end soon.

Esper defended his legacy implementing the National Defense Strategy that calls for a greater focus on China and Russia and expressed agitation at his “Yesper” nickname.

“My frustration is I sit here and say, ‘Hm, 18 Cabinet members. Who’s pushed back more than anybody?’ Name another Cabinet secretary that’s pushed back,” Esper told Military Times. “Have you seen me on a stage saying, ‘Under the exceptional leadership of blah-blah-blah, we have blah-blah-blah-blah?’ “

“At the end of the day, it’s as I said — you’ve got to pick your fights,” he added. “I could have a fight over anything, and I could make it a big fight, and I could live with that —why? Who’s going to come in behind me? It’s going to be a real ‘yes man.’ And then God help us.”

Worries grow: National security experts and some lawmakers have warned about the dangers of having a rudderless Pentagon during the presidential transition period if U.S. adversaries such as Russia and China try to cause trouble.

In addition to speculation about Esper, questions have also swirled about the fate of other national security leaders, including FBI Director Christopher Wray and CIA Director Gina Haspel.

“The disarray of the lame duck Trump White House, especially in the national security space, could be staggering. And our adversaries may try to take advantage,” Sen. Chris Murphy (D-Conn.) tweeted Sunday.

“Like I said yesterday. Trump is creating a dangerously unstable national security environment during this transition period. Adversaries are watching,” Murphy added in a tweet Monday after Trump fired Esper.

House Armed Services Committee Chairman Adam Smith (D-Wash.) called the ouster during the transition period “destabilizing.”

Miller steps in: Miller, who Trump said will serve as acting Defense secretary, has been director of the National Counterterrorism Center since August. The Senate confirmed him in a voice vote that month, though his nomination was not without hiccups. Sen. Chuck Grassley (R-Iowa) placed a hold on him and another nominee for months as the senator pushed for more information on Trump’s firing of intelligence community Inspector General Michael Atkinson and State Department Inspector General Steven Linick.

Miller previously served as the deputy assistant secretary of Defense for special operations and combating terrorism, and before that, worked on counterterrorism in the Trump’s National Security Council.

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Photos and video showed Miller, wearing a mask, arriving at the Pentagon about an hour after Trump’s tweet on Monday.

Installing Miller as acting Defense chief leapfrogs over Deputy Defense Secretary David Norquist, who is in line to fill the role under the Vacancies Reform Act, which Trump has routinely flouted.

More from The Hill on Esper’s firing:

— Esper firing hints at broader post-election shakeup
 
— Esper: If my replacement is ‘a real yes man’ then ‘God help us’
 
— Pelosi says Esper firing shows Trump intent on sowing ‘chaos’
 

LAWMAKER LAMBAST TRUMP OVER ‘DESTABILIZING’ ESPER FIRING: Democratic lawmakers on Monday condemned President Trump’s abrupt firing of Defense Secretary Mark Esper, calling the move “destabilizing” and an attempt to “sow chaos” ahead of a presidential transition. 

Trump earlier on Monday announced via Twitter that he fired Esper, only minutes after the Pentagon chief was himself notified of the decision. The move comes days after Joe Biden was projected to have won the presidential race, which Trump has refused to concede. 

“Dismissing politically appointed national security leaders during a transition is a destabilizing move that will only embolden our adversaries and put our country at greater risk,” House Armed Services Committee Chairman Adam SmithDavid (Adam) Adam SmithOvernight Defense: Trump fires Defense chief Mark Esper | Worries grow about rudderless post-election Pentagon | Esper firing hints at broader post-election shake-up | Pelosi says Esper firing shows Trump intent on sowing ‘chaos’ Democratic lawmakers lambast Trump over Esper firing as GOP remains mum Trump fires Defense chief Mark Esper MORE (D-Wash.), said in response. 

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“President TrumpDonald John TrumpPence to attend Senate GOP lunch on Tuesday Biden transition team to mull legal action over agency’s transition delays: reports Trump campaign lawyers worry about pushing lawsuits that could undermine election: report MORE’s decision to fire Secretary Esper out of spite is not just childish, it’s also reckless. It has long been clear that President Trump cares about loyalty above all else, often at the expense of competence, and during a period of presidential transition competence in government is of the utmost importance.”

Why now?: The firing of Esper – who had been seen as a dead man walking regardless of who won the election – now gives Trump a chance to use his executive powers in a last ditch effort to project strength amid his electoral defeat. 

National security experts and some lawmakers have warned about the dangers of having a rudderless Pentagon during the presidential transition period if U.S. adversaries such as Russia, China and Iran try to cause trouble.

Lawmakers are now also alarmed at what actions Trump may try to push through in the eleven weeks he has left in office.

The timing of Esper’s firing “raises serious questions about Trump’s planned actions for the final days of his Administration,” House Speaker Nancy Pelosi (D-Calif.) said in a statement. 

And former defense official and CIA analyst Rep. Elissa Slotkin (D-Mich.), tweeted that Trump may have fired Esper because he “wants to take actions that he believes his Secretary of Defense would refuse to take, which would be alarming.” 

Out of spite: Lawmakers, many of whom worried that the dismissal was out of spite, also say the move can only hurt the country.

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“Firing the Secretary of Defense in the waning weeks of the Administration undermines national security at a critical moment,” said Senate Armed Services Committee ranking member Jack Reed (D-R.I.). 

Pelosi said she feared that Esper’s dismissal “is disturbing evidence that President Trump is intent on using his final days in office to sow chaos in our American Democracy and around the world.”

“It is disturbing and dangerous that, at this precarious moment, our military will now be led by an official who has not been confirmed for this position by the Senate,” she added. 

House Majority Leader Steny Hoyer (D-Md.), said Trump’s decision “is nothing less than a temper tantrum by someone upset at being rejected by the majority of voters in this country.

Fears over no resistance: Other lawmakers took the moment to urge their colleagues as well as military leaders to uphold the Constitution, as there are fears Trump could use the tumultuous period before he is ousted to act without pushback.

Trump was reportedly angered and wanted to fire Esper this summer when the Pentagon chief resisted the president’s threat to deploy active-duty troops to quell nationwide racial justice protests. Esper responded by holding a press conference at the Pentagon announcing his opposition to deploying troops.

But with Miller now at the helm, it remains to be seen what the new acting Defense secretary will offer as far as resistance to controversial moves. 

“Donald Trump fired someone who wouldn’t order U.S. troops to attack peaceful protesters and is replacing him with someone he may think will carry out those orders,” Sen. Ron Wyden (D-Ore.) said in a statement. “I opposed Chris Miller’s nomination earlier this year, because he refused to promise that intelligence agencies wouldn’t target Americans based on their political views. He should remember that anyone who carries out an illegal order from Donald Trump will be held fully accountable under the law.” 

Former Marine Rep. Seth Moulton (D-Mass.) said he has “no doubt” that Esper was fired for being critical of Trump’s policies. He said he hopes the commander in chief does nothing between now and Biden’s inauguration that puts the Joint Chiefs of Staff “in a position where they will need to make a partisan decision on a civilian, political matter.” 

Slotkin, who said she worked with Miller during her at the Pentagon, and more recently during his time at the National Counterterrorism Center, said on twitter that “it is critical that he, and all senior Pentagon leaders, remember that they swore an oath to the Constitution, not any one man.”

GOP skirts the subject: In contrast, Congressional Republicans seemed reluctant to chastise Trump for Esper’s firing. Several offered statements that praised the former Pentagon chief but did not mention the president.   

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“Mark Esper has served the nation well under very challenging circumstances,” said House Armed Services Committee ranking member Rep. Mac Thornberry (R-Texas), who is retiring when his term ends in January.

Fellow committee member Rep. Michael Turner (R-Ohio) only said that Esper “was an outstanding Secretary of Defense” and that “his leadership had the support of our military and the American people.”

Senate Armed Services Committee Chairman James Inhofe (R-Okla.) offered a similar response to the leadership change, thanking Esper for his service. 

Inhofe also said he had recently spoken with Miller, and looks “forward to working with him to ensure that these priorities remain paramount and to working with President Trump to maintain stability at the Pentagon, particularly as we work to enact the 60th annual National Defense Authorization Act.” 

ON TAP FOR TOMORROW:

Secretary of State Mike PompeoMichael (Mike) Richard PompeoOvernight Defense: Trump fires Defense chief Mark Esper | Worries grow about rudderless post-election Pentagon | Esper firing hints at broader post-election shake-up | Pelosi says Esper firing shows Trump intent on sowing ‘chaos’ Top US official for Syria and ISIS to retire this month Trump administration readies new sanctions against Iran: report MORE will speak at the Ronald Reagan Presidential Foundation and Institute virtual launch of the Center for Freedom and Democracy, at 10 a.m. 

ICYMI

— The Hill: Top US official for Syria and ISIS to retire this month
 
— The Hill: Russian helicopter shot down over Armenia: Moscow
 
— The Hill: US imposes new sanctions on Syria
 
— The Hill: NATO secretary general ‘warmly’ welcomes Biden as president-elect
 
— The Hill: Pentagon officials keep low profiles as political battle rages
  
— The Hill: Opinion: What a Biden administration can do on Europe policy
 
— Military Times: Esper, on his way out, says he was no yes man
 
— The Associated Press: Polish leader signs deal enhancing US military presence
 
— The Washington Post: Trump raises vague questions about military ballots in Georgia

A sharp spike in COVID-19 cases across the U.S. is threatening the economic recovery and increasing the odds of a double-dip recession.

Daily coronavirus infections surpassed 100,000 for the first time earlier this month; since then, they have surged past the 150,000 mark. At the same time, congressional leaders appear increasingly unlikely to strike a deal on another COVID-19 relief package, even as another round of key unemployment benefits are set to expire in the coming weeks.

Economists across the political spectrum have consistently warned that sustained growth is dependent on getting the coronavirus under control, with many now viewing the rise in infections with heightened concern.

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“It’s alarming, to put it mildly,” said Beth Ann Bovino, chief U.S. economist at S&P Global. “If this spreads and governments are forced to go back to lockdown measures, this very fragile recovery is sure to fail.”

Earlier in the year, S&P Global forecasted several scenarios for the economic recovery. The baseline scenario, which would lead to a 4 percent decline in gross domestic product, assumed Congress would pass a limited, $500 billion relief bill, and that the winter spike in COVID-19 would be under control.

Instead, there is no coronavirus relief package and cases are surging.

“Everything that is happening now, the risk of a resurgence in COVID-19 as well as policymakers walking away from stimulus negotiations — those two factors are what my team had feared would happen,” said Bovino.

Without improvements on either front, a bigger economic contraction is likely, to the tune of 5.1 percent.

“It wouldn’t be as large as what we experienced in the first half of the year, but it would be a double dip,” Bovino said.

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The jump in coronavirus cases can affect two crucial aspects of the economy: business operations and consumer confidence.

In Europe, several countries have re-imposed severe restrictions or resorted to a second round of lockdowns in an attempt to ease the strain on hospitals.

President TrumpDonald John TrumpViolence erupts between counter-protestors, Trump supporters following DC rally Biden considering King for director of national intelligence: report Here are the 17 GOP women newly elected to the House this year MORE has been vehement that he opposes lockdowns at any level of government, and President-elect Joe BidenJoe BidenViolence erupts between counter-protestors, Trump supporters following DC rally Biden considering King for director of national intelligence: report Here are the 17 GOP women newly elected to the House this year MORE’s transition team has indicated they would favor targeting hotspots instead of the nation as a whole.

“I think of this as a dimmer switch, not an on-and-off light switch,” Celine Gounder, who is advising Biden on his COVID-19 response, said in a CNBC interview Friday.

“I think we need to close only those things that really are contributing to the spread.”

Already, states such as Michigan, New York, Oregon and Virginia have announced they will impose more restrictive measures to curb the spread of the virus, limiting the number of people who can gather in one place, restricting hours or capacity at bars, gyms and restaurants.

Ben Ayers, senior economist at Nationwide Insurance, said those kinds of steps would help avoid a double dip recession, as well as avoid the kind of full-scale lockdowns that much of the country saw in April when the pandemic took hold.

“My estimation is that there’s not much of an appetite for anything that severe, so we see the downside as slower growth, but not a double dip,” he said.

“The odds say that once an expansion starts, it’s really hard to slow the economy so quickly,” he added.

New Mexico, however, ordered a two-week shutdown on Friday, a sign that more severe restrictions could soon be in place elsewhere.

Even without government restrictions, the increase in cases can spook consumers, prompting them to stay at home instead of going out and spending money.

Consumer confidence dropped nearly 5 percentage points this month, almost entirely based on consumer expectations of what the economy will look like in the future, according to preliminary figures from the University of Michigan.

While consumers in the early part of the recession were bolstered by stimulus checks and enhancements to state unemployment benefits, those revenue streams from Congress have since disappeared.

Federal Reserve Chairman Jerome Powell has insisted that fiscal stimulus remains among the most important factors affecting the economy’s near-term trajectory.

But Speaker Nancy PelosiNancy PelosiHere are the 17 GOP women newly elected to the House this year Biden could lose Georgia Senate races all by himself House adjusts format for dinner with new members after criticism MORE (D-Calif.) and Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellRepublicans seek to batter Warnock ahead of Georgia runoff Haspel not in attendance at latest Trump intelligence briefing: reports Overnight Defense: Another Defense official resigns | Pentagon chief says military ‘remains strong’ despite purge | Top contender for Biden DOD secretary would be historic pick MORE (R-Ky.) remain miles apart on striking a deal for more coronavirus relief.

Pelosi favors a $2.2 trillion measure the House passed in October, while McConnell wants legislation closer to $500 billion.

The prospects for a deal are dwindling, creating anxiety for millions of people who remain unemployed and thousands of struggling small business owners.

A key small business loan program, the Paycheck Protection Program, has expired, and federal support for state unemployment benefits has largely ended as well.

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The remaining federal unemployment programs, for self-employed and gig economy workers, will expire on Dec. 31 without congressional action. Those two programs alone are covering 13.5 million Americans.

One bright spot, for those who have investments, is the performance of U.S. financial markets.

Markets this past week shrugged off moves by states to increase restrictions, with the Dow Jones Industrial Average rising 400 points, or 1.4 percent, on Friday alone, and the S&P 500 closed at a record high.

“We have an effective vaccine around the corner. The market is going to look through what we’re experiencing with that knowledge in mind,’ said Nick Juhle, director of investment research at Greenleaf Trust.

Even if the economy slips, he said, markets are keeping their eyes on the long-term prize.

“When you think about the markets, we’re talking about publicly traded companies that we’re pricing based on future earnings.”

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– Prior to capturing the SmackDown Tag-Team Championships from Daniel Bryan and Rowan last night, WWE released the following episode of WWE Playback on their official YouTube channel, which shows Big E., Xavier Woods and Kofi Kingston re-watching their first-ever tag-team title victory.

– WWE looks at the most “Bizarre Tag Team Partners” in the latest installment of their digital series, WWE Top 10. Check out the video below.

– WWE posted the following complete archive of their Kickoff Show pre-show for Sunday night’s WWE Extreme Rules 2019 pay-per-view at the Wells Fargo Center in Philadelphia, Pennsylvania. For those who missed the show, check out our detailed WWE Extreme Rules 2019 Results (7/14): Philadelphia, PA.

– As noted, WWE premiered their WWE Chronicle: Ricochet special on the WWE Network after the WWE Extreme Rules 2019 PPV. Featured below is a clip from the special that shows Kacy Catanzaro’s surprise gift for Ricochet. WWE Chronicle: Ricochet is now available for On Demand viewing on the WWE digital subscription service.

• UPDATE: WWE’s SummerSlam Plans For Undertaker: Drew McIntyre Or Bray Wyatt?!

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