By Matt Vallone, Director of Research & Analysis
Main Story: Topline Budget Numbers from the White House Start the FY 2018 Funding Fight
On Thursday, March 16th, the Trump administration will introduce its FY 2018 budget. While full documentation will likely not be released until sometime in May, the general direction appears clear: defense spending will increase by $54 billion while non-defense discretionary spending will be cut by an equal amount. However, the scope of the required cuts in non-defense discretionary is so great that it is unlikely Congress would ever agree to such a budget. Instead, we are likely to see a rehashing of the budget arguments of the past several years, with Democrats and deficit hawks opposing increased defense spending and defense hawks pushing for increased spending.
In other news, the Congressional Budget Office (CBO) released its formal scoring of the American Health Care Act (AHCA), the proposed legislation to replace the Affordable Care Act. The full report is here, but the bottom line is that the legislation will reduce the federal deficit by approximately $337 billion over ten years but at the cost of leaving an additional 24 million people without insurance. While not directly defense-related, the overall budget process is likely to remain on hold until Republicans come to some conclusion on health care reform. This score will likely make moderate Republicans even more skittish about the proposal, while House and Senate conservatives are pushing for amendments that would almost certainly increase both numbers. All told, the CBO report should be viewed as an indication that the road ahead is anything but clear.
House Activity – The focus of the House will be the AHCA continuing to work through committees. In last week’s Energy & Commerce mark-up, no amendments were adopted during a marathon session that saw the bill passed out of the committee at 430am. This week, the House Budget Committee will meet to mark up the bill as a reconciliation instruction. It remains unclear what its fate will be on the floor or in the Senate. Other than health care, this week will focus on legislation aimed at personnel issues in the VA. One bill will make it easier to fire employees, while the other will provide for additional incentives for hiring skilled employees.
Senate Activity – The Senate will continue with nominations, having voted to confirm Seema Verma as the head of the Centers for Medicare and Medicaid Services on Monday. After that, they will likely move on to consideration of other nominees, beginning with former Senator Dan Coats (R-IN) to be Director of National Intelligence and to confirm Lt. Gen. McMaster as posted to his position as National Security Advisor.
- 3/14 ‘OPEN/Closed: Information Surrounding the Marines United Website’, Full Committee Hearing, G50 Dirksen, 10am
- 3/15 ‘All Arms Warfare in the 21st Century’, Subcommittee on Airland, 232 Russell, 330pm
- 3/15 ‘Crafting an Information Warfare and Counter-Propaganda Strategy for the Emerging Security Environment’, Subcommittee on Emerging Threats & Capabilities, 2118 Rayburn, 415pm
- 3/16 ‘The Current State of the U.S. Navy’, Subcommittee on Readiness, 2118 Rayburn, 8am
- 3/16 ‘Oversight Review of the Infrastructure Needs and Projects Ready for Immediate Implementation in the Nuclear Security Enterprise’, Subcommittee on Oversight & Investigations, 2212 Rayburn, 2pm
- 3/16 ‘The Effect of Sequestration and Continuing Resolutions on Army Modernization and Readiness’, Subcommittee on Tactical Air and Land Forces, 2118 Rayburn, 330pm
- HAC-D – No hearing scheduled
- SAC-D – 3/15 ‘Closed briefing to receive a ballistic missile defense program update’, SVC-217, 1030am
Government Activity Round-Up
Not much of interest from CBO this week. I assume this is mostly due to an attempt to analyze the AHCA. That being said, on March 7th, CBO released a piece looking at the debt limit. On the 16th, Treasury will reach the statutory debt limit and begin to use ‘extraordinary measures’ to avoid default. The report delves into what it will do and what might happen should the debt ceiling fail to be lifted.
GAO has put out a piece looking at government-wide contracting trends. It provides insight into the types of contracts and other broad trends in Federal spending.
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