CONGRESS FINALIZES DEFENSE BILL: The Pentagon’s annual funding appears to be on a glide path after Congress finalized a $674.4 billion appropriations bill on Thursday. The legislation is now teed up for final votes in the House and Senate before the end of the fiscal year on Oct. 1. The chance of the military getting stuck with another stopgap continuing resolution is vanishing. “If we continue to set aside the things that divide us and focus on what we can do together, I think we’re going to continue to get across the finish line,” said Sen. Richard Shelby, the chairman of the Senate Appropriations Committee.

FROM ‘MAD’ TO ‘MODERATE’ DOG: For months the burning question among insiders at the Pentagon has been how much longer Defense Secretary Jim Mattis would be willing to serve a president whose views about the value of allies and the use of military force were so out of line with his own. The answer seemed to be as long as Mattis felt he could fulfill his constitutional role and protect the troops. In other words, as long as President Trump wanted him as defense secretary.

Now the question that’s increasingly being asked is: How much longer Trump will tolerate the Marine commander who was once his favorite Cabinet pick? In a story posted yesterday, Politico became the latest to cite sources inside the White House saying Trump has soured on Mattis, who has quietly served as a brake on some of Trump’s more impulsive instincts, such as withdrawing U.S. troops from Afghanistan and Syria, and evacuating American dependents from South Korea.

“Trump has for months been mulling the prospect of replacing Defense Secretary Jim Mattis, who is now expected to be dismissed or to resign after the midterm elections,” Politico reports. “Once enamored of the retired Marine general and his nickname, ‘Mad Dog,’ the president bragged to donors, ‘The guy never loses a battle, never loses.’ But Trump has slowly come to realize that Mattis’ political views are more moderate than his sobriquet suggests, and the president has taken to referring to him behind closed doors as ‘Moderate Dog.’ ”

The story follows a similar report last week by the Washington Post’s Josh Rogin, who says discussions about replacing Mattis have been going on for weeks, and that quotes attributed to him in Bob Woodward’s book Fear: Trump in the White House have only intensified the internal speculation. In the book, Mattis is said to have told associates that Trump “acted like — and had the understanding of — ‘a fifth- or sixth-grader.’ ” Mattis has forcefully denied uttering those words, but none of the other actions attributed to him.

“The speculation about who replaces Mattis is now more real than ever,” Rogin quotes a senior White House official as saying. “The president has always respected him. But now he has every reason to wonder what Mattis is saying behind his back. The relationship has nowhere to go but down, fast.”

TRUMP KEEN ON KEANE: Rogin says former Army Vice Chief Gen. Jack Keane is at the top of the short list of possible Mattis replacements. Keane, who is 75, was Trump’s first pick to be his defense secretary, according to Woodward’s book. Keane acted as an informal adviser to President George W. Bush, and is generally credited with convincing Bush to order the “surge” of U.S. troops in Iraq in 2007.

Woodward wrote that in a Trump Tower meeting after the election the president-elect offered the job to Keane. “You’re my number-one guy,” Trump reportedly said. But Keane, who has turned down a number of requests to return to public life over the years, is said to have declined, citing financial debts from taking care of his late wife. Instead, he suggested Mattis.

Like Mattis, Keane enjoys enormous respect on Capitol Hill, and unlike Mattis would not require a congressional waiver to lead the Pentagon, having retired from the military in 2003.

COTTON OR GRAHAM? Others on the shortlist are Sens. Tom Cotton and Lindsey Graham, as well as former senator Jim Talent and former Treasury Department official David McCormick, Rogin reported. No decision would be made until after the midterm elections when the makeup of the Senate and House has been determined.

MATTIS MUM: In a question and answer session at the Pentagon Tuesday, a reporter asked Mattis if he intends to serve out the rest of Trump’s first term? Mattis declined to comment citing the anniversary of the 9/11 attacks. “This is not a day I’m going to go further into politics,” he said.

Asked “How would you describe your relationship with President Trump?” he said simply, “No problem. It’s been the same all along.”

Mattis is scheduled to speak at tonight’s Congressional Medal of Honor Society’s 2018 Patriot Award reception and gala at the Naval Academy. Don’t expect him to say anything about it.

HAPPENING TODAY, FLORENCE ATTACKS: As we push “send” on this morning’s newsletter, Hurricane Florence is about to make landfall in North Carolina. Though it’s now only a Category 1 storm, it still poses a catastrophic threat to life and property because of the heavy rains and storm surges that are accompanying its hurricane-strength winds.

Already tens of thousands of people are without power, and hundreds await rescue from rising flood waters. It’s worth remembering that during Hurricane Harvey last summer, most of the people who perished in Houston died by drowning

Yesterday at the Pentagon, the commander of U.S. Northern Command Air Force Gen. Terrence O’Shaughnessy said the military has proactively positioned “the full spectrum of DOD capabilities at every level — by air, by sea and by land” to assist local authorities.

“Search and rescue is probably the first and foremost response that we’d be looking at, but it’s not the only response we’re looking at. It’s just that temporally will be incredibly important to have those assets available, not on a generation in 24 hours, but immediately available,” O’Shaughnessy said.

More than 160 Army, Air Force and National Guard helicopters have been moved to the region ready to pluck people to safety, along with 240 High-Water Vehicles for ground search and rescue, commodities distribution, citizen transportation, and patient movement.

In addition, amphibious ships USS Kearsarge and USS Arlington, along with 800 embarked Marines, have been positioned to chase the storm and be available after it passes. The ships carry MV-22 Ospreys, CH-53 Super Stallion and UH-1Y Super Huey helicopters, as well as landing craft, ground vehicles, generators and other equipment.

Active duty and Guard troops from 10 states have been mobilized under an emergency management assistance compact. “It’s a rapidly-changing number, but at this moment we have approximately 7,000 personnel. Of that, just over 4,000 is National Guard, and about 3,000 active duty,” O’Shaughnessy said.

SYRIA HEARING CANCELED: The House Armed Services Committee has postponed a hearing this morning on the U.S. strategy in Syria.

SMITH IS A BIG ‘NO’ ON SPACE FORCE: Trump’s plan for a new Space Force military service might be heading for trouble on Capitol Hill, especially if Democrats win a majority in the House in November. Rep. Adam Smith, the top Democrat on the House Armed Services Committee, said he is a hard “no” on the proposal. “What I oppose is a separate branch. I don’t think a separate branch makes sense,” Smith told the Washington Examiner after it was first reported by Politico. “What is the most cost-effective way to give space the emphasis it deserves? I know it is not a Space Force.”

The Washington state Democrat said he remains open to an earlier idea floated by the House to create a Space Corps, which would be located inside the Department of the Air Force. Still, if Democrats win big in the midterm elections, Smith could be sitting in the Armed Services chairman’s seat next January when the Pentagon presents its Space Force proposal. His skepticism could rally a Democratic majority on the committee against a signature Trump plan that is estimated to cost billions of dollars.

POSEIDON VENTURE: Boeing won a $194 million contract to update software and equipment used by crews training to work on the Navy’s P-8A Poseidon, a maritime patrol jet based on the planemaker’s widely used 737 model.

Under the four-year deal, the Chicago-based company said it will upgrade equipment at three sites for the Navy and the Royal Australian Air Force to reflect the Poseidon’s latest configuration. The training system, which includes simulators, allows military personnel to prepare for missions while reducing expenses for wear and tear and fuel that would be incurred by using the planes.

SOUTH KOREA P-8s: Meanwhile, South Korea has gotten the OK from the State Department to buy six P-8A Poseidon aircraft worth $2 billion. The sale is expected to increase the naval capabilities of South Korea, which is one of the closest U.S. allies in the Pacific region. It has been buying U.S.-made P-3 Orion surveillance aircraft for more than 25 years and hopes to modernize its fleet.

SHORT DELAY: The F-35’s Joint Program Office has responded to criticism from the independent watchdog group Project On Government Oversight, which published an internal memo this week showing a crucial combat testing phase would be delayed.

“The formal start of F-35 Initial Operational Test and Evaluation (IOT&E) is a readiness-driven event,” said a statement emailed by Joe DellaVedova, a JPO spokesman. The statement indicates that the delay in testing, originally set for this month, will be brief as the F-35s are loaded with the latest software upgrade. “The operational test readiness certification is anticipated to be received in October with the start of formal IOT&E in November and completion is estimated by summer 2019,” it said.

The final combat evaluation of the F-35 includes cold weather and weapons testing, along with two-ship missions in lower threat environments, the JPO said.

RUSSIAN MEDDLING: Russian officials on Thursday pressured an independent panel of United Nations experts to remove embarrassing material from a report on North Korean sanctions violations, U.N. Ambassador Nikki Haley said.

“Russia can’t be allowed to edit and obstruct independent U.N. reports on North Korea sanctions just because they don’t like what they say,” Haley said Thursday evening. “We’ve seen the original report and we know the truth — the panel should do the right thing and release it.”

HE WANTS TO CALL IT WHAT? Trump said Thursday that wants to rebrand the North American Free Trade Agreement as the United States-Mexico-Canada agreement. That spells out USMC, although he may limit it to just the USM pact if he cannot reach an agreement with Canada regarding the deal he negotiated with Mexico.

Hope we get to hear from Mattis, Joint Chiefs Chairman Gen. Joe Dunford or chief of staff John Kelly on that one.

THE RUNDOWN

Washington Examiner: Top Republican: Trump letting Russia help Iran weapons trafficker

Washington Examiner: GOP warns Trump team: Going soft on China hurts North Korea effort

Threat Matrix: Taliban overruns military base in Zabul

Defense News: McRaven, former SOCOM head, resigns from Pentagon board following Trump criticism

Washington Post: N. Korea says U.S. ‘smear campaign’ over hacking undercuts Trump-Kim accord

Navy Times: Overshadowed By Florence, Navy And Marines Race To Save Typhoon-Ravaged Rota

Breaking Defense: Futures Command Won’t Hurt Oversight, Army Tells Congress

Defense One: Rep. Adam Kinzinger: We Need a Strategy in Syria

Bloomberg: Army Secretary Sees ‘Steady Progress’ on Visit to a BAE Factory

Daily Beast: Michael Flynn To Appear At Far-Right Conference With Pizzagaters, Racist YouTube Stars