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Home » Avascent Analytics Blog » Political Report: 7/10/2017
Political Report: 7/10/2017

Political Report: 7/10/2017

July 10, 2017
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By Shane Mason, Senior Market Analyst

NDAA Hits the House, Crucial Week in the Senate for ACA

US Senate SealCongress returns from the July 4th recess this week. The Senate will redouble efforts to repeal the Affordable Care Act (ACA) and replace it with a version of the Better Care Reconciliation Act (BCRA). Passing the BCRA before the August recess is crucial for Congressional Republicans to advance other priorities heading into the 2018 mid-terms.

The 2018 National Defense Authorization Act (NDAA) heads to the House floor starting Tuesday. With a topline of $696.5 billion, the bill exceeds existing spending caps and what was requested by the Trump administration. Democrats have largely opposed the spending figure, setting up tense negotiations on how to proceed.

While it represents an important signal of priorities, the House version of the NDAA will not come close to resolving the thorny issues that surround defense spending in fiscal year 2018. The DoD topline budget will be shaped by several other processes currently ongoing on Capitol Hill. These include the House and Senate appropriators, and the related efforts by the House and Senate Budget Committees to resolve a Budget Resolution. GOP leaders need a Budget Resolution to carry reconciliation instructions, which can be used to pass tax reform in a manner that cannot be filibustered by Senate Democrats. But getting to agreement on a Budget Resolution will be very challenging for a Republican caucus that is sharply divided on matters of deficit spending, entitlement reform, and cuts to domestic discretionary spending.

House Activity – Floor action will focus on the 2018 NDAA. Fed Chair Janet Yellen will testify Wednesday before the Financial Services Committee on the Semiannual Monetary Policy Report, which was released last week.

Senate Activity – Attention will remain fixed on Senate efforts to repeal the ACA. Fed Chair Janet Yellen will testify Thursday before the Banking, Housing, and Urban Affairs Committee on monetary policy. The Judiciary Committee will begin confirmation hearings for Christopher Wray, the administration’s nominee for FBI Director. Floor action will consist of several nominations, including Francis Hagerty to be Ambassador to Japan.

Congressional Defense Activity
  • SASC
    • 7/13 ‘Attempted Coup in Montenegro and Malign Russian Influence in Europe,’ SD-G50 Dirksen, 9:30am
    • 7/12 ‘David Trachtenberg, Principal Deputy Under Secretary of Defense for Policy,’ ‘Owen West, Assistant Secretary of Defense for Special Operations and Low-Intensity Conflict,’ ‘Ryan McCarthy, Under Secretary of the Army,’ ‘Charles Stimson, General Counsel of the Department of the Navy,’ Nominations, SD-G50 Dirksen, 9:30am
    • 7/11 ‘Richard Spencer, Secretary of the Navy,’ Nomination, SD-G50 Dirksen, 9:30am
  • HFAC
    • 7/13 ‘America’s Interests in the Middle East and North Africa: FY 2018 Budget Request,’ Middle East and North Africa Subcommittee, 2172 Rayburn, 1:00pm
    • 7/12 ‘Advancing U.S. Interests in the Western Hemisphere: FY 2018 Budget Request,’ Western Hemisphere Subcommittee, 2172 Rayburn, 2:00pm

Government Activity Round-Up

A report released by GAO on June 30 on the defense-wide working capital fund (DWWCF) is worth the read. GAO found that monthly cash balances were outside the upper and lower cash requirements as defined by the Department of Defense’s (DoD) Financial Management Regulation (FMR) for 87 of 120 months, and more than 12 consecutive months on three separate occasions during fiscal years 2007 through 2016. The reasons why the balances were outside the requirements were mainly due to unexpectedly higher fuel costs. GAO recommended that DoD update the FMR to include guidance on the timing of when DoD managers should use available tools to help ensure that monthly cash balances are within preset limits.

GAO argued in a report released July 10 that the VA needs to better understand, process, and communicate decisions on claims for Gulf War Illness (GWI). It added that inadequate training hampers the VA’s ability to process GWI claims, and recommended that the Department develop a plan to develop a single case definition of Gulf War Illness.

A July 7 GAO report details DoD efforts to improve its chemical and biological defense program (CBDP). The report focuses on the CBDP Infrastructure Manager, who is expected to coordinate and oversee CBDP infrastructure.

No new defense-related publications from CBO this week.


For more information about this Political Report, contact mvallone@avascent.com.

July 10, 2017 jphan

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