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Stephen Boyd: THE MONDAY BRIEF | June 5, 2023

With Debt Crisis Averted, Congress Now Looks Ahead… Next Two Months Come into Focus… Appropriations Takes Center Stage… SPACECOM Fight Moves to New Committee…

Expect high morale on Capitol Hill this week as the 118th Congress just cleared its first major legislative hurdle, passing a carefully negotiated package to avoid an unprecedented default while also cutting future spending. In the end, the debt deal was a true compromise—by definition, few love it. Even so, most are happy the issue is now off the table. 

Will the good vibe last? Probably not. Enjoy it while you can. 

The Schedule…

The House of Representatives returns today, with the Committee on Rules preparing four anti-regulation bills important to conservatives. These include H.R. 277, the ‘‘REINS Act of 2023,” which would require congressional approval of “major rules” promulgated by the Executive Branch that have a $100 million or more annual impact on the economy. 

For court watchers, the House also appears poised to take up H.R. 288, the Separation of Powers Restoration Act of 2023 (SOPRA).  If enacted, SOPRA would override the Chevron deference doctrine, wherein federal courts defer to a government agency’s own interpretation of ambiguous statutes impacting its authority. SOPRA would require courts to review the laws “de novo” to exercise judicial judgment as to the true meaning of the statute.

The Senate also returns this week. As the adage goes, the Senate moves slowly until it doesn’t. Last Thursday, the Senate operated at warp speed to clear the debt deal. Now, it settles back into its normal glacial pace, convening tomorrow to take up the nomination of David Crane to be Under Secretary of Energy. 

In Debt Deal’s Wake, the Next Two Months Come into Focus…  

The vast majority of members had little direct input in the debt limit deal brokered last week. Even so, the final deal passed with significant bipartisan support. Let’s focus on the key parts of the compromise, a breakdown of the voting, and what it means for Capitol Hill between now and the August recess. 

Key Parts

Among other provisions, the debt deal signed into law:

  • Suspends the statutory limit on U.S. debt until 2025, which will equate to about $4 trillion in new borrowing. The debt issue won’t be back in play before the next presidential election.  
  • Sets caps on discretionary spending for fiscal years 2024 and 2025, treating non-defense and defense spending separately. In 2024, non-defense spending will be cut $40 billion below the current year, down to $703.7 billion. Defense spending will increase slightly by $28 billion to $886.3 billion. These caps would increase only 1% in 2025. 
  • Establishes an additional across-the-board cut to discretionary spending that automatically triggers in April of 2025 if Congress fails to pass the 12 annual spending bills by the end of this calendar year. Of note, this “sequester” would include the Department of Defense, resulting in a four percent, or $36 billion, reduction from what the Pentagon would otherwise be funded in 2024. 
  • Claws back $28 billion in unspent COVID funds and $1.4 billion allocated to hire additional staff at the Internal Revenue Service. 
  • Imposes new work requirements for most food stamp recipients who are able-bodied, under 55-years old, and without dependents. 
  • Makes permanent reforms to the National Environmental Policy Act that would expedite federal permitting of major infrastructure projects.

The Votes

The Republican-led House passed the legislation 314-117, with 149 Republicans and 165 Democrats voting “yes.” Alabama Representatives Robert Aderholt, Jerry Carl, Mike Rogers and Terri Sewell supported the legislation. Reps. Barry Moore, Gary Palmer and Dale Strong were opposed. In rallying 149 Republican votes, Speaker Kevin McCarthy satisfied the Hastert Rule, an informal Republican policy that no legislation should be brought to the House floor unless it has the support of a majority of the Majority.

In the Democratic-led Senate, the package passed 63-36, with 44 Democrats and 17 Republicans voting in favor. Alabama Senators Tommy Tuberville and Katie Britt each voted no. 

Immediate Implications

The debt problem has been a black cloud over Capitol Hill all year, and—for better or worse—Congress is now liberated to move forward on other priorities. Here is what to expect in the next few weeks:

  • There will be rumblings in conservative corners about removing Speaker McCarthy, but I doubt much will come of it. The right wing of the House Republican conference was unlikely to be satisfied with any compromise with the White House, and there are certainly some who felt the final deal fell short of what was promised. There is talk of filing a Motion to Vacate the Chair, a procedural move to oust McCarthy made easier by McCarthy’s own concession to conservative-backed rules changes in January. The ploy won’t have wide support—in part because McCarthy satisfied the Hastert Rule. All and all, McCarthy (and, for that matter, Biden) came out of this “crisis” politically stronger than before. 
  • President Biden will tout the compromise in swing states as an example of leadership that actually gets things done. He’ll argue that this “win” adds to a growing list of legislative accomplishments in his term: the American Rescue Plan, the bipartisan infrastructure plan, gun safety legislation, the CHIPS Act to boost domestic semiconductors manufacturing, the Inflation Reduction Act, and military support for Ukraine. The White House will contrast this with the chaos and dysfunction that they say a second Trump term would bring.  
  • The armed services committees will now proceed with consideration of the National Defense Authorization Act. The committees’ work was postponed pending a resolution on the debt limit.  Reportedly, the House Armed Services subcommittees will mark up legislation next week, the full committee will proceed the following week, and the full House should vote on the defense legislation just after the July 4th holiday. Expect the Senate to move on a similar timeline. 
  • Defense hawks, unhappy with the cap on defense spending, will look to circumvent the debt deal’s limitations. Citing rising threats in Russia, Iran, North Korea and China, some will explore how to use the next Ukraine military aid bill to also carry spending for the Pentagon that circumvents the newly imposed limits. 
  • The deal also frees up Congress to focus on other legislation and oversight priorities. Reauthorization of the Farm Bill, the Federal Aviation Administration, and an important surveillance program known as “702” are all necessary by year’s end.  House-led scrutiny of the Federal Bureau of Investigation and congressional investigations of the Biden family will ramp up.
  • The appropriations process, now uniquely incentivized by provisions in the debt deal, will take center stage throughout the summer. With top line spending numbers set for FY24, appropriators can set 302(b) allocations for each of the 12 subcommittees. Passing all 12 bills individually hasn’t happened since 1996, but expect major floor time to be devoted to this effort. 

Hitting “Pause” on SPACECOM Funding…

Speaking of appropriations, the House Committee on Appropriations may be the next forum for the ongoing battle over the permanent location of the SPACECOM headquarters, which has become a mano a mano fist fight between Alabama (which ranked first in all of the Air Force’s objective evaluations) and Colorado (which ranked no better than fourth).

We noted two weeks ago that Rogers, the Chairman of the House Committee on Armed Services, is launching an inquiry into the Air Force’s handling of the matter. That congressional investigation comes, at least in part, at the request of Strong, the freshmen representative on the committee that represents Redstone Arsenal in north Alabama. 

Now, Aderholt, a senior member of the powerful appropriations committee, is poised to submit language for the committee’s defense and military construction spending bills that would halt funds from being spent on any new construction or leasing in Colorado for SPACECOM until the Secretary of the Air Force makes a final decision on the HQ’s permanent location. 

That’s a smart move. Despite years of evaluations and reviews, the Air Force is sitting on the final decision. Meanwhile, quietly improving facilities or moving personnel into adjacent buildings at Peterson Space Force Base in Colorado during the delay could gradually move the temporary Colorado site closer to full operational capability, changing the calculus in favor of Colorado. That’s a sneaky way of putting a thumb on the scales of what should be a factual determination in favor of the warfighter’s best long-term interest. Not deciding, in effect, becomes the decision.    

The appropriations process can be an effective way to get results, and a limitation on funding is squarely within the committee’s authority. One downside, however, is the threat of “steady-as-you-go” continuing resolutions that Congress too often relies on when it fails to approve appropriations bills before the end of the fiscal year. 

Unexpectedly, the just-passed debt deal, which incentivizes the passage of those same bills to avoid deeper cuts, may actually strengthen Aderholt’s hand here.  

In Washington, everything can impact everything.

Stephen E. Boyd is a Partner at Horizons Global Solutions. Previously, he served as a Senate-confirmed Assistant Attorney General at the U.S. Department of Justice, Chief of Staff for Alabama members in both the U.S. Senate and U.S. House of Representatives, and as a Communications Director of the Senate Committee on the Judiciary. He resides in the Washington, D.C. area. Opinions expressed herein are his own. This news report is not intended to influence or persuade. Email Stephen at [email protected].

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