The Political Report 2/26/20
Main Story: Budget Season Moves to the Hill
This week, the Department of Defense (DoD) begins to present and defend the FY2021 budget before Congress with hearings before both the House and Senate Armed Services Committees. As discussed in the last Political Report, this year’s budget contains a lot of material that is certain to spark Congressional pushback. The cuts in the shipbuilding budget (which declines by just under $4 billion) have already been met with Congressional outcry. Similarly, the Air Force’s attempt to retire a variety of attack and tanker aircraft early, as well as end production on several high-profile UAV programs, will likely face significant scrutiny. The cut to the F-35 procurement will also be a sore spot for many members of Congress.
However, the key question here not how Congress will respond, as they will almost certainly seek to block these changes, but where Congress will make cuts to restore these funds. Absent an increase in Overseas Contingency Operations spending, the DoD topline will be relatively fixed due to the 2019 Bipartisan Budget Act. Congress has traditionally gone after other types of investment (C4ISR, weapons & munitions) as well as operations and maintenance to pay for restoring pet projects and increasing platform orders. Given that the budget contains increases to Classified, C4ISR and Space (unclassified), programs in those markets may be vulnerable. Expect more on this as the authorization and appropriations process develops.
Avascent has now broken down the entire Future Years’ Defense Program from the budget into a forecast of US spending at the Program Element level. This data points to the challenges facing the DoD as it seeks to implement the FY2021 President’s Budget Request. The budget request assumes multiple major programs will quickly transition from development to production, something that the Department of Defense has traditionally struggled to do. This allows reductions to RDT&E spending and transfer savings to Procurement. As an example, the budget assumes that the peak year for development spending on the B-21 bomber will be FY2020 and that spending will drop from $2.9 billion to $1.6 billion by FY2025. It is extremely hard to see how the B-21 program will progress that rapidly given the development paths of the Air Force’s other modern aircraft. Even if Congress were to greenlight a budget with this structure, it is difficult to see DoD successfully executing it.
The House will take up legislation placing additional regulations on e-cigarettes.
The Senate is going to take up legislation restricting abortion as well as a handful of nominations.
Congressional Defense Activity
- 2/27 “Coronavirus Disease 2019: The US and International Response,” Subcommittee on Asia, the Pacific, and Nonproliferation, 2172 Rayburn, 2pm
- 2/28 “Evaluating the Trump Administration’s Policies on Iran, Iraq, and the Use of Force,” Full Committee Hearing, 2172 Rayburn, 830am
- 2/25 “North Korea Policy One Year After Hanoi,” Subcommittee on East Asia, the Pacific, and International Cybersecurity Policy Hearing, SD-419 Dirksen, 215pm
- 2/25 “United States European Command and United States Transportation Command,” Full Committee Hearing, SH-216 Hart, 930am
- 2/25 “CLOSED: United States European Command and United States Transportation Command,” Full Committee Hearing, SVC-217 Capitol Visitor Center, 230pm
- 2/26 “The Fiscal Year 2021 National Defense Authorization Budget Request from the Department of Defense,” Full Committee Hearing, 2118 Rayburn, 10am
- 2/27 “The Fiscal Year 2021 National Defense Budget Request for the Department of the Navy,” Full Committee Hearing, 2118 Rayburn, 10am
- 2/27 “Strategic Forces Posture Hearing,” Subcommittee on Strategic Forces, 2212 Rayburn, 230pm
- 2/27 “Air Force Projection Forces Aviation Programs and Capabilities Related to the 2021 President’s Budget Request,” Subcommittee on Seapower and Projection Forces, 2118 Rayburn, 330pm
- No hearings scheduled
- No hearings scheduled