Political Report: 2/13/2019

 In Political Report

Main Story: Congress Agrees to Spending Deal while Administration’s FY20 Request Roils Waters

Early Tuesday, February 12th, Congressional leaders announced that they had reached an agreement on a spending deal that would avoid a shutdown when the current continuing resolution expires on Friday, February 15th. However, the President has not yet taken a formal position on the bill, so it is not clear whether it will be signed into law. Even if the President does sign it, he has indicated that he may seek to go around Congress through an emergency declaration that would almost certainly generate significant Congressional opposition.

At the same time, sources indicate that the FY2020 defense budget will see a massive increase in Overseas Contingency Operations (OCO) funding in order to set base defense spending at the level of the Budget Control Act (BCA). Non-defense spending would also be set at the BCA cap level in FY20, and the administration would claim credit for potential savings from these reductions as spending would grow from a lower baseline. This proposal is almost certainly dead in Congress, where appropriators will have no interest in funding so much activity out of OCO accounts, and Democrats will certainly demand spending increases in non-defense spending. The need for a budget deal that balances increases in both sets of discretionary accounts will drive the eventual outcome, making this budget request even more irrelevant than usual.

While the White House’s approach is almost certainly just a budget gimmick, there remains the possibility that this hints at a far less aggressive defense budget in the FY20 Future Years Defense Program (FYDP). Unnecessarily low FYDP toplines will put pressure on defense programs and create a forecast even more divorced from reality than normal. Industry would then be forced to consider the utility of the document that presently serves as the benchmark for strategic planning for the second time in four years (the first being the FY18 request, which the administration openly portrayed as not being analytically useful). Budget watchers will be holding their breath to see the impact of this new budget proposal on the utility of the five-year forecast.

House Activity

The House will pass legislation aimed at making permanent the Department of Veterans’ Affairs Child Care Pilot program as well as legislation to fund the government.

Senate Activity

The Senate will confirm William Barr to be the new Attorney General of the United States and likely take action on the funding deal.

Congressional Defense Activity

    • No hearings this week
  • SSCI
    • 2/14 ‘Closed Briefing: Intelligence Matters’, Full Committee Briefing, Hart 219, 2pm
  • HFAC
    • 2/13 ‘Venezuela at a Crossroads’, Full Committee Hearing, 2172 Rayburn, 11am
  • SFRC
    • No hearings this week
  •  SASC
    • 2/12 “United States Indo-Pacific Command and United States Forces Korea’, Full Committee Hearing, SD-G50 Dirksen, 930am
    • 2/13 ‘Current Condition of the Military Housing Privatization Initiative’, Joint Subcommittee on Personnel & Readiness and Management Support, SD-G50 Dirksen, 2pm
  • HASC
    • 2/12 POSTPONED: “Outside Perspectives on Nuclear Deterrence Policy and Posture”
    • 2/13 ‘Rescheduled: Military Service Academies’ Action Plans to Address the Results of Sexual Assault and Violence Report at the Military Service Academies’, Subcommittee on Military Personnel, 2212 Rayburn, 2pm
  • SAC-D
    • No hearings this week
  • HAC-D
    • 2/13 ‘Rescheduled: U.S. Military Service Academies Overview’, H-140 The Capitol, 11am
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