By Matt Vallone, Director of Research & Analysis
Main Story: Senate Appropriations Proposal Points Towards Defense Spending Endgame
Last week saw the Senate Appropriations Committee release its proposal for defense funding for FY2018 and, for defense hawks, the numbers were not encouraging. Topline defense spending was $595.2 billion, with a significant amount of money coming from OCO ($82.1 billion) rather than base ($513.1). This is significantly below the values released from other committees and even what was in the White House’s FY2018 FYDP, but may reflect a more realistic reflection of what bipartisan funding legislation will ultimately look like. So, while the House will spend the week debating and passing a security minibus of appropriations legislation, it’s worth noting that these bills will almost certainly pass with minimal Democratic support and, if combined with non-security appropriations, will have trouble gaining passage even among House Republicans (as evidenced by their inability to adopt a budget). Brass tacks: it remains difficult to see a path for significantly higher defense spending absent some type of significant bipartisan deal.
On a slightly related note, we’d like to send our thoughts and prayers to Sen. John McCain and his family as he fights against a brain tumor. Regardless of where one stands on the political spectrum, Sen. McCain has given much of his life in service to his country, first in the U.S. Navy and afterwards as a Congressman and Senator.
House Activity – The House will debate and pass the ‘Make America Secure Appropriations Act’, which rolls up four different House appropriations bills into one. This minibus (so called because it contains multiple appropriations bills but not all appropriations bills like the omnibus bill passed this spring) would fund DoD at the levels found in the HAC-D proposal. This legislation will Include the legislation are DoD appropriations, Military Construction-Veterans Affairs appropriations, Energy & Water appropriations (which contain a significant amount of our nuclear activity), and Legislative Affairs appropriations (increased legislative security following this spring’s Capitol Hill shooting).
Senate Activity – The Senate will vote on a motion to proceed to the House-passed health care legislation on Tuesday, though it is unclear if Senate Republicans will have the 50 votes needed to begin debate. As of this writing, should the motion to proceed be adopted, it is unclear what the end legislation will look like. Last week saw the apparent collapse of the Senate replacement legislation (the Better Care Reconciliation Act or BCRA) but a proposal to pass a more direct repeal of the Affordable Care Act was also rejected. This story will likely dominate the week absent additional news out of the White House. If the measure fails, expect to see action on a variety of nominees while Senate leadership decides what to do. The Senate has announced an intention to stay in session for two more weeks, but that could change. As always, jet fumes, especially August recess jet fumes, are a great motivator.
- SASC – 7/25 ‘Options and Considerations for Achieving a 355-ship Navy from Former Reagan Administration Officials’, Subcommittee on Seapower, SR-222 Russell, 230pm
- 7/25 ‘Evaluating DoD Equipment and Uniform Procurement in Iraq and Afghanistan’, Subcommittee on Oversight and investigations, 2212 Rayburn, 2pm
- 7/27 ‘Continued Oversight of the Transfer of Excess Military Equipment to Civilian Law Enforcement Agencies’, Subcommittee on Readiness, Rayburn 2118, 10am
- HAC-D – No scheduled hearings
- SAC-D – No scheduled hearings
Washington Activity Round-Up
Beyond official reports, Defense News released their Top 100 list for 2017. Not exactly a surprising list, but still always worth reviewing. Also worth reviewing is a report put together by Avascent’s Meaghan Doherty Myers on ‘Drones on Demand: Additive Manufacturing and the Future Battlefield’. Really fascinating stuff looking at how 3-D printing can “revolutionize the ways in which militaries equip, supply, and support their troops”. More at the link.
Nothing directly defense-related from CBO this week, so we will just relink to the two articles from last week. The first is a release of the CBO’s analysis of the President’s 2018 budget request. This has all sorts of interesting stats and conclusions, but one of the more salient is that military spending would be “sharply lower” in the out years than under current law. More here. The second interesting document is CBO’s regular update of its budgetary and economic outlook. This piece looks at the impact of recent economic data on CBO’s ten-year forecasts for outlays, revenue, the deficit, and other key indicators. In order to understand how the CBO views the next ten years, this is an important document to read.
GAO has a variety of reports out relevant to defense and aerospace. First, they look at DoD’s transportation of hazardous material as a follow-up to a previous 2015 report and review what progress has been made. Second, GAO issued a Congressionally requested study of “DOD efforts to attract non-traditional companies” that offered products that could be converted to military use. This report reflects the results of GAO surveying 12 such companies and outlining challenges they face to sell to DoD. It’s interesting reading. Lastly, outside of defense, but of interest to firms involved with communications and the broadband network, GAO looked at progress on FIRSTNET creation.
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