This Week In Washington

Latest news from Washington, D.C. produced by Total Spectrum/SGA exclusively for members of the Arizona Chamber of Commerce & Industry

More Info: Michael DiMaria | Partner and SW Regional Director | 602-717-3891 | mdimaria@totalspectrumsga.com

Thanks for your interest in Washington, D.C., and thanks for reading This Week in Washington.

We lead with Patrick Robertson’s Washington Whispers. Patrick notes that President Trump has the right to explore all of his legal options, but in the meantime it is important to watch and think about the ideas and agenda of the Biden Team as they address transition of the administration, filling cabinet positions, continuing COVID response, prioritizing infrastructure, and if – or how – to reform the Senate.  I cover the upcoming lame duck and how both the Senate and the House look after last week’s elections, as well as an overview of Georgia’s January 5 runoff elections, in Heard on the Hill.

Erik Paulsen has written a fascinating – albeit frightening – article about future ‘super-bugs’. Ramona Lessen monitored two Senate hearings – one before the Banking, Housing, and Urban Affairs committee focusing on the oversight of financial regulators, and another of the Commerce Science and Technology committee on Section 230 of the Communications Decency Act.

We will return on December 3 with the next issue of This Week in Washington and the next Total Spectrum Spotlight. All best good wishes for an enjoyable Thanksgiving. Stay well.

Steve Gordon, Managing Partner


Washington Whispers

By Patrick Robertson, Total Spectrum Strategic Consultant

While Washington and the rest of the country begin to digest the results of the 2020 general election, it very well may be that there are more questions than answers that have come out of the results across the country. We learned that the country is more divided than many of us hoped, even with near record voter turnout. We learned that America seems to favor divided government, at least for now. As opposed to the coattails that Barack Obama’s and Donald Trump’s elections to the presidency had, this election had voters splitting tickets in some key states. We also learned that key demographics are motivated to vote in large numbers, but campaigns wonder if they can keep these voters engaged. Two special elections in Georgia in January should give us a sense of whether they can.

Before going too far, it is crucial to note that President Trump has brought legal challenges to the election process and those are making their way through the courts, as they should. In the meantime, most observers have begun referring to former Vice President Biden as the winner of the election.

It’s appropriate to ask — how does governing move forward?

President-elect Biden has promised to govern all Americans, regardless of their preferred candidate. However, with a narrower Democratic majority in the House of Representatives and narrowly divided Senate that is expected to be in Republican control after two Senate runoffs in Georgia, will a Biden Administration be able to get anything done?  And will the new Administration be able to move close enough to the middle to make deals with Republicans while the far left of the party is trying to push the debate away from the center?

Since the election, moderate Democrats and the liberal wing of the party have been arguing over whether this election was a negative for Democrats because the party was too liberal or too conservative. We saw the same debate in 2010 and so many other election years. This biennial rite of passage takes on more significance as a Biden Administration and Hill Democrats look for a strategy for the next two years.

There are – at least for now — more questions than answers. But here are a few areas to consider when thinking about the beginning for 2021, the 117th Congress, and the opening days of the Biden Administration.

The Transition

The Biden Campaign released Tuesday their Agency Review Teams roster. The Presidential Transition requires a thorough reporting of the people on the Review Teams, their most recent employer, and sources of funding for each.

The Cabinet

While liberal Democrats had a long wish list for cabinet secretaries, it is looking increasingly likely that more moderate leaders will be required for most federal agencies. The Biden campaign promised the most diverse team in history, and this is still a near certainty. But the suggestions of Senator Elizabeth Warren as Treasury Secretary and Senator Bernie Sanders as Labor Secretary seem far-fetched in a narrowly divided Republican-controlled Senate.

The Republican Senate is going to allow a Biden Administration to have a cabinet, just not one they think is too liberal, just like Democrats will discourage choices that are out of step with their ideals. As a result, we are looking at a more mainstream moderate cabinet than many expected when the prediction was for the unified Democratic control of Washington.

That does not mean that a Biden Administration will not accomplish things at the administrative level. The campaign has already promised significant executive action to reverse or undo some Trump Administration actions. As a note, the Trump Administration will be racing to complete a number of formal actions before January 20, 2021.

You can expect a very active Environmental Protection Agency (EPA), some sort of gun control regulations, changes to the immigration system, Treasury regulations on the Tax Cuts and Jobs Act, and countless more. Democrats who have been working on issues on Capitol Hill for years will push the Administration to act through executive power to accomplish these goals.

COVID Response

The Biden transition has made government response to the COVID-19 pandemic its highest priority, naming a task force dedicated to the issue this week. The President-elect has promised to provide economic aid soon and Congress could choose to act even sooner in the lame duck session.  Democrats have been demanding action for some time, while Senate Republicans have counseled patience to allow earlier aid to do its’ work.

This issue will define the early part of a Biden presidency.

Infrastructure

The biggest buzzword in official Washington over the last few years has been infrastructure. The other buzzwords were partisan and ugly, but infrastructure has a bipartisan ring to it. The bills that fund highways, airports, waterways, and transit are due to expire in 2021. Both the House and the Senate have been talking for years about improving American infrastructure.  President-elect Biden took a leading role on the stimulus package in the Obama administration and it has been one of the signature issues of his career.

It is widely expected that the stars will align for a big, bipartisan infrastructure bill in the next Congress. It may not be as big or as green as observers expected before the election. The largest sticking point to a package will be how to pay for it. The government funds the Highway Trust Fund through the federal gas tax which has not provided enough money for a number of years. Options will include whether to raise the gas tax, go to another funding mechanism, or shrink the size of federal transportation spending. Once this is resolved, a deal will be easy.

Structural Reform in the Senate

A number of Democrats before the election discussed ideas like eliminating the legislative filibuster – as was done for nominations – and adding members to the Supreme Court. The two runoff elections in Georgia leave the question of who will control the Senate on the table technically, since Democrats could win both and Vice President-elect Harris could break ties. But it is clear — even in the dream scenario of effective control in the Senate — that Democrats will not have a mandate to make broad sweeping changes to the way the Senate is run.

Senator Joe Manchin (D-WV) announced this week he would vote against these reforms, even as Democratic control of the Senate is a longshot, at best. He is the most conservative member of the Senate Democratic Caucus, especially after Senator Doug Jones (D-AL) lost his reelection bid.

This will make it much more difficult to accomplish some of the big ticket items the Biden campaign promised, like expansion of the Affordable Care Act, significant tax increases on the wealthy and corporations, huge advances in green energy, and the like. That does not mean that these ideas are off the table, just that they will need to be part of a bipartisan negotiation, mandating trade-offs and some conservative policies.


Heard on The Hill

By Steve Gordon, Total Spectrum Managing Partner

The Senate is back in Washington

The Senate is back in session. Senate Democrats held their leadership meetings Tuesday, adding Senator Cory Booker and Senator Catherine Cortez Masto to their leadership team. Senate Republicans met and reelected their leadership team. They elected Senator Rick Scott to be Chairman of the National Republican Senatorial Committee. You can download a full list of the Republican and Democratic Senate leadership team here.

Appropriations for Fiscal Year 2021

The federal government will run out of money on December 11. The Senate Appropriations Committee released Tuesday their version of spending bills for the balance of Fiscal Year 2021.  Key subcommittee summaries: Commerce, Justice, and Science; Energy and Water; Financial Services; Homeland Security; Interior and Environment; Labor, HHS, and Education; and Transportation and Housing.

Negotiations will now begin with the House of Representatives, which passed two bills earlier this year that included all the agency funding.  There is really no desire nor potential gain for either side to shut down the government. Expect minor disagreements that will be papered over and resolved.

Additional Key Legislative Work in the Lame Duck

Both the Senate and the House have passed their version of the National Defense Authorization Act (NDAA), and the bill has gone to conference. Both the Senate and the House are expected to consider and pass this must-do legislation.

The House previously passed the Water Resources Development Act of 2020. The Senate Environment and Public Works Committee passed the America’s Water Infrastructure Act of 2020. Both water bills, which authorize the U.S. Army Corps of Engineers’ civil works activities, have gone to conference and could be brought up for a vote during the lame duck session.

It is certainly possible that additional COVID-19 stimulus legislation could be considered, but it is far more likely that this topic will be held over for a new Congress to resolve after January 1.

The Election

President Trump is reviewing his legal options, which he is entitled to do. One thing is for sure:  IF Vice President Biden did prevail, his coattails were exceptionally short.

The Senate

Senator Thom Tillis (R-NC) was declared the winner of an extremely expensive campaign when former State Senator Cal Cunningham conceded this week. Senator Dan Sullivan (R-AK) was declared the winner of his race today. Those wins put Republicans at 50 Senate seats for the next Congress, and all eyes will be on Georgia for the January 5 runoffs.

The first Georgia contest is between Republican Senator David Perdue and Democrat challenger Jon Ossoff.  Georgia law requires that one candidate receive 50.1% of the vote or the contest goes to a runoff. Senator Perdue received 49.7% of last week’s vote, and Democrat Jon Ossoff received 48%.

The second contest is between Republican Senator Kelly Loeffler, who was appointed by Governor Kemp to fill the seat of retiring Senator Johnny Isakson until the November election, and Democratic candidate Reverend Raphael Warnock. Reverend Warnock came in first in Tuesday’s jungle primary with 32.9% of the vote, and Senator Loeffler came in second with 25.9%.  A significant number of other candidates were also in last week’s jungle primary, including Republican Congressman Doug Collins.

Turnout for the January 5 runoff for both races will tell the tale. Some experts say that it will be a base election and expect that Republicans will be more motivated to vote than Democrats. Some experts say that the suburbs and independents will be the key to the elections and point out that the Atlanta suburbs supported Vice President Biden.

Georgia’s Republican party is now split over Republican Secretary of State Brad Raffensperger, who has been accused of failing to deliver a transparent election. He responded at a press conference by saying that he will continue to look at claims of voter fraud but said that local officials performed their jobs well.  “My office will continue to investigate every instance of illegal voting, double voting, felon voting, or people voting out-of-state. But we have all worked hard to bring fair and accurate counts to ensure that the will of the voters is reflected in the final count and that every voter will have the confidence in the outcome whether their candidate won or not.”

Secretary Raffensperger did say that he would implement a hand audit of the presidential ballots in Georgia, followed by an automatic recount.

A Republican strategist surveyed Georgia and said the January 5 runoffs will either be the last race of the 2020 election or the first race of the 2022 election. If they relitigate 2020, both races are a coin toss. But if these runoff elections are the first battles of the off-year 2022 elections – and if Vice President Biden won the election as it appears – it will be much easier for both Republican Senators to be reelected.

History may get the final word. Republicans have not lost a Georgia runoff since the 1990’s.

The House

The surprise of the election was the ongoing battle for control of the House of Representatives.

If Vice President Biden won the presidential election, he received a limited mandate and certainly had next to no coattails.

Currently, Democrats have 232 seats and Republicans hold 197 seats. Republicans were hoping before the election that losses in the House would number fewer than 10 seats.  But Republicans have already flipped nine seats and another in California is about to be called for the Republicans – which would mean Republicans picked up 10 seats. It is possible to see Republicans flip a few more close races and finish with as many as 212 seats.

Everything changes everything. Two-hundred eighteen seats makes a majority. The immediate impact of this successful Republican election is that Speaker Pelosi will be forced to limit her legislative reach, and Republicans will be able to have a more significant impact – even as the minority party.

The long-term impact is even more significant. The average turnover of seats in the first off-year election is 22, so if Vice President Biden won the election it would mean that Republicans have a very significant statistical probability of holding the gavel in the House of Representatives in January 2023.


Guest Opinion: Superbugs will kill millions — unless Congress acts

By Kenneth E. Thorpe and Erik Paulsen

We’re in the midst of the worst health crisis of the 21st century — and it’s not COVID.

The coronavirus is a terrible disease, of course. In just ten months, it has killed more than one million people around the globe. But there’s a far more dangerous plague circulating through the population.

Antibiotic-resistant bacteria infect one American every 11 seconds and kill one every 15 minutes. By 2050, these “superbugs” could kill 10 million people worldwide each year unless we invent stronger antibiotics, according to the United Nations.

We were ill-prepared for COVID — but we don’t have to let superbugs catch us sleeping. As a health policy expert and a former congressman, we both believe this coming crisis is manageable — as long as lawmakers act now.

Superbugs are microbes, like bacteria and fungi, that have developed immunity to most antibiotics.

Doctors were once able to eradicate these infections. But each time a patient takes an antibiotic, some bacteria survive with the potential to adapt, evolve, and form defenses against all but the strongest medicines. Already, more than 35,000 Americans die each year from these resistant microbes. Globally, they’re responsible for 700,000 deaths annually.

The worst is likely yet to come. Antibiotics discovery has slowed dramatically in recent years. Scientists have only developed two new types of antibiotics in the last two decades.

Many firms have abandoned antibiotics research in recent years, because it’s a money-losing endeavor. Forty years ago, there were 18 large-scale drug companies pursuing antibiotics. Today there are just three.

It’s tough to blame firms for throwing in the towel. Antibiotics have a relatively low return on investment. Doctors only prescribe advanced antibiotics in emergencies — so total sales are meager. Most antibiotics developers struggle to even recoup their research costs.

Drug innovators could justify new antibiotics projects if the government changed the incentive structure.

Unless the government incentivizes new research and development efforts, superbugs may grow immune to our last remaining antibiotics. If that happens, even simple wounds could prove fatal. Procedures that risk infection — ranging from elective surgeries like joint replacements to lifesaving treatments like chemotherapy — could become too dangerous for doctors to perform.

Rather than wait for superbugs to overwhelm our health system, we can take steps now to build an effective arsenal against them.  

For instance, lawmakers could offer tax breaks — like credits, allowances or deferrals —for antibiotics research and development spending, which would give companies a fighting chance to break even on their investments.

They could also reform Medicare’s existing reimbursement structure, so that hospitals receive increased funding when they responsibly prescribe newer antibiotics. That would bolster demand for these advanced drugs and, in turn, make antibiotics research more attractive.

Direct investment from government agencies like BARDA — the Biomedical Advanced Research and Development Authority — would similarly incentivize antibiotics innovation. Providing biopharmaceutical firms with grants and financing contracts would help them bring promising experimental antibiotics to market.

The government already helps fund some of this research, of course. BARDA’s CARB-X program establishes public-private partnerships that provide innovators with non-dilutive funding sources to propel antibiotic development.

But current levels of investment aren’t sufficient. A world without effective antibiotics would make everyone worse off. It’d lead to widespread suffering and misery — and lop trillions off global GDP. Only by greatly boosting funding for research and development can we avert such a dystopian future.

COVID caught us off guard. But Congress has the power to ensure we’re prepared for the next health crisis — one we know is coming.

Kenneth E. Thorpe is a professor of health policy at Emory University and chairman of the Partnership to Fight Chronic Disease. Erik Paulsen represented Minnesota in the U.S. House of Representatives from 2009 to 2019.

This article originally appeared in the Naples Daily News on November 1, 2020.  The views expressed in this article are the writers’ own.


House and Senate seats that flipped

Click image below for full report


What you need to know about The Freshman of Congress

Click image below for full report


President-elect Biden announces Covid-19 task force

Click image below for full report


Hearing Reports

by Ramona Lessen, Executive Director, Total Spectrum

Senate Banking, Housing, and Urban Affairs Committee hearing

“Oversight of Financial Regulators”

Tuesday, November 10, 2020; 11:00 a.m.

To view a livestream of the hearing, please click here.

Senator Mike Crapo (R-ID), Chairman

Majority Statement

Senator Sherrod Brown (D-OH), Ranking Member

Minority Statement

Witness Panel

The Honorable Randal K. Quarles

Vice Chairman for Supervision

Board of Governors of the Federal Reserve System

Testimony

Mr. Brian Brooks

Acting Comptroller

Office of the Comptroller of the Currency

Testimony

The Honorable Jelena McWilliams

Chairman

Federal Deposit Insurance Corporation

Testimony

The Honorable Rodney E. Hood

Chairman

National Credit Union Administration

Testimony


Senate Commerce, Science and Transportation Committee hearing

“Does Section 230’s Sweeping Immunity Enable Big Tech Bad Behavior?”

Wednesday, October 28, 2020; 10:00 a.m.

The hearing examined whether Section 230 of the Communications Decency Act has outlived its usefulness in today’s digital age. It also examined legislative proposals to modernize the decades-old law, increase transparency and accountability among big technology companies for their content moderation practices, and explore the impact of large ad-tech platforms on local journalism and consumer privacy. The hearing provided an opportunity to discuss the unintended consequences of Section 230’s liability shield and how best to preserve the internet as a forum for open discourse. 

To view a livestream of the hearing, please click here.

Senator Roger Wicker (R-MS), Chairman

Majority Statement

Senator Maria Cantwell (D-WA), Ranking Member

Minority Statement

Witness Panel

Mr. Jack Dorsey

Chief Executive Officer

Twitter

Testimony

Mr. Sundar Pichai

Chief Executive Officer

Alphabet Inc., Google

Testimony

Mr. Mark Zuckerberg

Chief Executive Officer

Facebook

Testimony


Calendar

Legislative Highlights: Hearings and Markups

Week of November 9, 2020 – all time EST

Tuesday, November 10:

  • 11:00 a.m.  Senate Judiciary Committee hearing on Crossfire Hurricane Investigation Oversight (Part IV).
  • 2:00 p.m.  Senate Banking, Housing and Urban Affairs Committee hearing on Oversight of Financial Regulators.
  • 2:30 p.m.  Senate Commerce, Science and Transportation Committee hearing on pending nominations to NASA, the Department of Commerce, and the FCC.

Thursday, November 12:

  • 12 noon  House Financial Services Committee hearing on Oversight of Prudential Regulators.

This e-newsletter is produced by Total Spectrum/Steve Gordon and Associates and the Arizona Chamber of Commerce and Industry. The views expressed herein may include subjective commentary and analysis that are the views of the editors and authors alone. Information in this e-newsletter is obtained from sources believed to be reliable, but that cannot be guaranteed as independently investigated or verified. Information in this e-newsletter is not an endorsement, advertisement, recommendation, or any type of advice; political, legal, financial or otherwise. For questions about the content of this e-newsletter, please contact the Arizona Chamber of Commerce and Industry.

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