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July 3, 2023
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THE TOP
Happy Monday morning.
Congress is out of session for another week. And we’ll only have AM editions until then.
President Joe Biden will travel to London to meet with Prime Minister Rishi Sunak and King Charles III, Lithuania for the NATO summit and Finland for a U.S.-Nordic Leaders summit. Biden will leave July 9 and return July 13.
Now let’s talk about the FY2024 defense authorization bill, which is projected to hit the House floor next week.
The House Armed Services Committee passed the legislation by a huge 58-1 margin on June 22, with only Rep. Ro Khanna (D-Calif.) voting no. The NDAA is one of the few things that Congress actually does on a bipartisan basis anymore, and it’s been that way for six decades.
The $886 billion package includes a 5.2% pay hike for service members, increased housing allowances, hundreds of millions of dollars for “quality of life” improvements, $300 million in new funding for Ukraine and more money to confront China’s growing power in the Pacific.
That was the easy part.
Republicans were also able to push through provisions limiting Biden administration initiatives on diversity, equity and inclusion. They cut funding for climate change programs – a big issue for U.S. bases and military planners – and banned the Pentagon from spending any money on critical race theory or drag shows. Defense Secretary Lloyd Austin had already banned drag shows on his own following an outcry from conservatives.
But the concern for the leadership on both sides of the aisle is what happens when the 1,200-plus page bill hits the floor. Especially on the Defense Department’s abortion policy, which has become a flashpoint in the Senate as Sen. Tommy Tuberville (R-Ala.) has blocked hundreds of senior level military promotions over the issue.
Nearly 1,400 amendments have been filed on the package in the House, including a number from House Freedom Caucus members (Don’t worry, we read all of them for you).
More than 45 House Republicans have signed onto an amendment by Rep. Ronny Jackson (R-Texas) that would bar the Pentagon from using any funds to pay for abortions except if the life of the mother is in danger or if the pregnancy is the result of rape or incest. The amendment also states that “the Secretary of Defense has no legal authority to implement any policies in which funds are used for such purpose,” and the current DOD abortion policy is “therefore unlawful and must be rescinded.”
This is similar to Jackson’s bill on the issue. That proposal has more than 70 cosponsors, including a bunch of Freedom Caucus members.
Other amendments would prohibit the Biden administration from making decisions on where to put military bases due to a state’s abortion policy. This is related to the fight between Colorado and Alabama over Space Command and how Tuberville’s efforts have played into that.
House Republican leadership’s strategy is to push to get 218 GOP votes for the defense authorization package, figuring they can’t count on much Democratic support. And the abortion language will be part of that effort.
Republican leaders, of course, know they’re not going to get 218 GOP votes. But “maximizing” Republican backing is critical for Speaker Kevin McCarthy in the wake of the debt-limit deal with President Joe Biden. That bill passed with more Democratic votes than Republicans, which caused a furious backlash from conservatives. They brought the House to a standstill and demanded fresh concessions from McCarthy.
“We know that we have to have something on the abortion policy, to stop the payment for travel and procedures, etc., for service members to go out of state to get abortions,” said a senior House Republican, speaking on the condition of anonymity to talk about party strategy. “The big risk for McCarthy for any of these bills [NDAA and FY2024 appropriations] is we have more Democrats than Republicans. That’s the kiss of death.”
There are other “anti woke” amendments on diversity and climate change, barring the use of federal funds to pay for gender reassignment procedures or hormone therapies and preventing anyone from using certain DOD facilities that don’t correspond with their gender at birth. A couple of amendments would restrict what flags can be flown at federal sites, including the White House.
Rep. Marjorie Taylor Greene (R-Ga.) wants to cut the additional Ukraine funding and require a “diplomatic solution” to the war with Russia. Rep. Chip Roy (R-Texas) has called for the creation of a Special Inspector General for Ukraine Assistance, similar to what was done in Afghanistan. Rep. Warren Davidson (R-Ohio) wants Biden “to develop and submit a report to Congress that contains a strategy for U.S. involvement in Ukraine.”
On Afghanistan, there’s a number of proposals slamming how Biden handled the 2021 withdrawal and the subsequent Taliban takeover.
There are dozens of amendments on China, Taiwan, Russia and Israel as well, plus a bunch that are just straight parochial point scoring.
All of these will have to be sifted through by GOP leaders and senior aides as they try to find enough votes to muscle the package through the chamber. Democratic aides are already warning that “all the culture war stuff is driving Democrats away,” so Republicans have to figure that in too.
It’s worth remembering that the Senate is working on their own NDAA bill, and it’s going to be a lot more in line with what Democrats and the White House want. Which means that at some point, McCarthy and House Republicans will have to decide whether they want a defense authorization bill to become law or not.
— John Bresnahan
Cannabis banking (probably) waits on the other side of recess
We see weed in the Senate Banking Committee’s future.
Sources around the committee widely expect the panel to return from recess and reconsider the SAFE Banking Act this summer — a long-suffering bipartisan bill that would make it easier for regulated financial institutions to work with state-legal cannabis companies.
The timing here remains unclear, partly due to the Senate Banking Committee’s more immediate priority of getting other legislation onto the floor. The panel cleared two bills during a June markup — one targeting illegal fentanyl production with new sanctions and anti-money laundering requirements and another bolstering accountability among bank executives.
We asked Senate Banking Committee Chair Sherrod Brown (D-Ohio) if the panel would turn to cannabis banking reform next.
“My first job is getting FEND Off Fentanyl and the accountability act, RECOUP, to the floor — make sure we don’t lose people,” Brown replied.
But when asked later if he’d have a markup on the SAFE Banking Act in July, Brown sounded somewhat optimistic. “I would like to, but it depends,” Brown said.
Sen. Jeff Merkley (D-Ore.) echoed that, telling us: “We’re going to do a deep plunge now and try to set the stage, hopefully, for a markup when we return from break.”
The SAFE Banking Act has had broad bipartisan support going back years, including a key ally in Senate Majority Leader Chuck Schumer. But the reform has consistently been tripped up in the Senate. Having interest from the Senate Banking Committee this time around is crucial, though a Republican House will complicate things.
Even in the Senate, it could be another bumpy ride. Sen. Steven Daines (R-Mont.) has been the Republican lead in cannabis banking negotiations, and he told us that lawmakers were “not quite there yet, but continuing discussions.”
Daines also warned Democrats not to expand the bill’s scope. “We’ve got to keep it focused on SAFE Banking, to keep it in a bipartisan way,” he said. “I thought we were there when I reintroduced the bill. The goalposts maybe moved a little bit.”
“We’re working in good faith to get it locked down so we can have a markup. That’s my task,” Daines added.
Many progressive Democrats want cannabis banking reform to cover a wider gamut of reforms, including funding for state level expungements of non-violent cannabis offenders.
Sen. Jack Reed (D-R.I.) flagged some newer concerns back in May about Section 10 of the latest version of SAFE Banking Act, which would limit the ability of regulators to “restrict or discourage” banks from working with “a specific customer or group of customers.” We’re told this remains a sticking point in committee discussions.
This policy is a priority for Republicans, who want to limit regulators’ power to discourage the banking of controversial sectors, like gun manufacturers or payday lending.
Don’t expect the House to play much of a role here until the Senate gets itself together. House Financial Services Committee Chair Patrick McHenry (R-N.C.) isn’t supportive of the reform but has also said in the past he wouldn’t stand in its way. Rep. Dave Joyce (R-Ohio), the chamber’s lead GOP co-sponsor of SAFE Banking, told us before recess he’s been largely focused on appropriations work around Homeland Security lately.
“Been a little tied up with my own stuff,” Joyce said. “But we’re still monitoring progress.”
— Brendan Pedersen
Bipartisan boost for McCarthy in latest survey
The majority of senior Hill staffers think they may have underestimated Speaker Kevin McCarthy’s influence at the start of this Congress.
This month’s results from The Canvass Capitol Hill show that 85% of Republican and Democratic senior staffers think McCarthy is more effective as speaker than they initially thought. Of course, the overwhelming majority of GOP respondents (97%) were in agreement. But even 73% of Democrats said as much.
This is a huge shift compared to our February survey, when most senior staffers doubted McCarthy after the concessions he made to conservative hardliners to win the speakership to start the 118th Congress.
Of course, McCarthy went on to negotiate a debt-limit deal with President Joe Biden that cut government spending and implemented two years of spending caps. The speaker was able to get two-thirds of the House Republican Conference to back the package and ultimately staved off an economic catastrophe.
But shortly after the debt-limit deal was reached, far-right Republicans struck down a rule vote, and the House floor was paralyzed for days.
In this month’s survey, 78% of senior aides were correct in predicting that McCarthy’s debt-limit deal would weaken his stance with hardline conservatives.
The Canvass Capitol Hill was conducted from June 5-26 in partnership with Locust Street Group.
Interested in being a part of our survey? The Canvass provides anonymous insights each month from top Capitol Hill staffers and K Street leaders on key issues facing Washington. Sign up here if you work on K Street. And click here to sign up if you’re a senior congressional staffer.
– Donna Baeck
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THE CAMPAIGN
Here’s a brand new ad from Trust in the Mission PAC, which supports Sen. Tim Scott’s (R-S.C.) presidential bid. The ad is running in Boston and Iowa media markets.
– Jake Sherman
DOWNTOWN DOWNLOAD
Meta, the parent company of Facebook and Instagram, has hired Venable to lobby on “[i]ssues related to social networking.” James Barnette, the former general counsel for the House Energy and Commerce Committee, is the lobbyist on the account.
– Jake Sherman
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