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Thanks for your interest in Washington, D.C., and thanks for reading This Week in Washington.
The legislative year is days away from wrapping up. Erik Paulsen and I summarize the three things that must get completed – the omnibus spending bill, COVID relief, and the National Defense Authorization Act – and take a look forward to the U.S. Senate in 2021 in “Heard on the Hill.” Patrick Robertson takes a last look back at the November elections, and Steve Ruhlen takes a first look forward at the 2022 midterm elections. Al Jackson gives us a defense update, and Ramona Lessen shares a hearing report, covering a recent Senate Commerce, Science, and Transportation subcommittee hearing on COVID’s impact on the live event entertainment industry.
Our Total Spectrum Spotlight features Erik Paulsen and Patrick Robertson discussing the anticipated focus of the Biden Administration in the first 90 to 100 days.
This is our last This Week for 2020, and it was a year like no other. The driving themes were a 100-year pandemic, economic dislocation and distress, and racial unrest. Each theme impacted November’s elections, which will conclude in Georgia on January 5th. We began the year with the first signs of a novel coronavirus. We are closing the year with the arrival of vaccines that will slowly get us back to a new normal.
Next year will bring a new President, a new Congress, and a new Administration. We will be here to watch, listen, and keep you informed.
On behalf of my colleagues – Erik Paulsen, Michael DiMaria, Patrick Robertson, Steve Ruhlen, Al Jackson Dana Marston, and Ramona Lessen– Merry Christmas, Happy Holidays, and all good wishes for a healthy and successful new year.
Stay well.
Steve Gordon, Managing Partner
Heard on the Hill
By Steve Gordon, Total Spectrum Managing Partner and Former Congressman Erik Paulsen (2009-2019), Total Spectrum Strategic Consultant
The Last Limp of the Lame Duck
Three major legislative items remain. The first two are relatively easy, and the third one will get done – the only questions are when, and what will be in it.
Funding for the federal government for the balance of this fiscal year.
The House and the Senate passed a continuing resolution that extended funding at current rates through today, Friday, December 18th. Compromises have been made and a $1.4 trillion omnibus spending bill is ready to be released. The spending bill is over 400 pages and covers spending for all federal agencies for the balance of the fiscal year. The COVID legislation will ride on the omnibus bill as an amendment, so both Houses of Congress will have to pass another continuing resolution that will keep the federal government open through Wednesday, December 23rd while they work out the last hurdles to completing the COVID relief legislation.
National Defense Authorization Act (NDAA)
This must-pass legislation was indeed passed in both the Senate and the House of Representatives by more than a two-thirds margin. President Trump has threatened to veto it, and he has until December 23rd to either sign or veto the bill. A veto – if it comes – will be overridden by Congress.
COVID legislation
Public pressure has been clearly building for Congress to provide additional financial relief.
Last week we sent out a special This Week that included the framework for the proposed legislative compromise, which had at a top-line cost of $908 billion. The bipartisan group of Senators working on this issue released this past Monday a section-by-section summary of a proposed bill that would spend $748 billion. The bipartisan group of Senators also proposed that a second bill be considered that would include both aid for state and local government and some liability relief and would cost $160 billion.
The gang of Senators and the House Problem Solvers Caucus deserve great credit for focusing on the need and offering solutions. But Tuesday the possible solution became a probable deal when the leaders got involved.
Groups of Senators and Congressmen create momentum, but Congressional leaders create legislation. Speaker Pelosi, Minority Leader McCarthy, Leader McConnell, and Minority Leader Schumer started meeting Tuesday, and there has been great progress.
The general outline of the deal is pretty much in place. We expect that the final deal will be around $900 billion and will include most of the items detailed in the Emergency Relief Act section-by-section summary. The agreement is expected to include a weekly unemployment boost of $300 per week through March, and approximately $300 billion for small businesses. We have been told that it will also include individual payments to eligible taxpayers of $600, an idea that has been strongly endorsed by Senator Josh Hawley (R-MO), Senator Bernie Sanders (I-VT), and President Trump.
The deal is being held up by details – questions of eligibility and how old and new money will be spent. The absolute deadline for Congressional work to be done is December 23rd, which has given Senators on both sides of the aisle plenty of time to try to ‘improve’ the COVID agreement.
The two most contentious items, state and local funding and liability reform, will be carried over into 2021, when President-elect Biden will propose his own pandemic relief legislation.
Leader McConnell said on Wednesday that the Senate will stay in Washington until the COVID legislation is done. Speaker Pelosi has said roughly the same thing. Leaders do indeed make legislation.
The need for additional pandemic relief is real. The COVID unemployment insurance program runs out right after Christmas, and many small businesses need additional help to get them through the winter. Congress must respond, and it will.
The omnibus bill is ready. The COVID bill, which will pass as an amendment to the Omnibus bill, will be ready today, tomorrow, or Sunday. This will give Senators and Congressmen time to pass the omnibus with the COVID legislation, send it to the President for his signature, and then leave for home.
The old saw is true. “Work does indeed fill the available time.”
Looking Ahead to 2021 – and a New Congress
Control of the Senate and committee assignments are up in the air pending the outcome of the Georgia Senate runoff elections. But here are some of the realignments:
- Senator Susan Collins will become either the Chair or Ranking Member of the Appropriations Committee.
- Senator Pat Toomey will become either the Chair or Ranking Member of the Banking, Housing, and Urban Affairs Committee.
- Senator Lindsey Graham will move from Judiciary Committee to become the Chair or Ranking Member of the Budget Committee.
- Senator John Barrasso will move from Environment and Public Works to become the Chairman or Ranking Member of the Energy and Natural Resources Committee.
- Senator Mike Crapo will move from the Banking Committee to become either the Chairman or Ranking Member of the Finance Committee.
- Senator Richard Burr will become either the Chair or Ranking Member of the Health, Education, Labor, and Pensions Committee.
- Senator Chuck Grassley will move from Chairman of the Finance Committee to become either the Chair or Ranking Member of the Judiciary Committee.
And a Final Thought—
The swearing in of the 117th Congress will be on Sunday, January 3rd.
Total Spectrum Spotlight: Looking Forward
The latest episode of Total Spectrum Spotlight explores 2021 with Total Spectrum Strategic Consultants Erik Paulsen and Patrick Robertson providing a view of the upcoming year from different sides of the aisle.
A Look Back at November’s Election
By Patrick Robertson, Total Spectrum Strategic Consultant
As the Electoral College confirmed President-elect Biden’s victory this week, we thought it was worth taking one more look back at the results before the 117th Congress is sworn in at the beginning of January and President-elect Biden is inaugurated on January 20, 2021. Democrats will have a much narrower majority in the House and control of the Senate will be decided in the two Georgia Senate runoffs in early January.
How large was the President-elect Biden victory in the popular vote? Actually, larger than it initially appeared to be. Biden received 81.2 million popular votes, to President Trump’s 74.2 million, a six million popular vote victory, resulting in a 4.5 percentage point margin of victory. This was good for a 306-232 win in the Electoral College.
How does President-elect Biden’s margin compare to other recent presidential elections? In 2012 former President Barack Obama beat now-Senator Mitt Romney by a margin of 3.9 percentage points, while former PresidentGeorge W. Bush beat then-Senator John Kerry in 2004 by 2.4 percentage points. More substantial victories occurred in 1996 when former President Bill Clinton beat Senator Bob Dole by 8.5 percentage points and in 1988 when former President George H.W. Bush beat Governor Michael Dukakis by 7.8 percentage points. Of course, none of these victories was even close to former President Ronald Reagan’s 1984 landslide over former Vice President Walter Mondale of 18 percentage points.
Was turnout really that high? Yes. Nearly 159 million Americans voted in October and November. Turnout was highest in states that allowed early voting, automatic voter registration, election day registration, and mail-in voting. This represents nearly two-thirds of all registered voters, the highest percentage turnout since the turn of the 20th century when 73 percent of registered voters cast ballots. Elections before 1900 had turnout in the mid to high 70s.
Was there a lot of ticket splitting? Actually, no.In 2016 every Senate race went the same way as the state went in the presidential election. In 2016, not one Senate candidate won in a state carried by the presidential candidate of the other party. In 2020, this pattern came within one race of repeating itself – every winning Senate candidate was of the same party as the winner of the presidential race in their state. The exception, not surprisingly, was Maine, where Biden comfortably won the presidential race by 9 percentage points, yet Senator Susan Collins won her race by 9 points as well – a delta of 18 points! To say that Susan Collins was an unusually gifted Republican candidate in an unusual state is an understatement.
If there was very little ticket splitting, how did the Republicans pick up 10 seats in the House, narrowing the Democrats majority to a very slim 222-211 with two races still too close to call? Going into the election there were 30 House Democrats sitting in seats where Trump had carried their district. Thus, of those 30 vulnerable Dems, 10 of them lost. And many of these seats were seats won in the Democratic wave election of 2018. But unlike 2018 – when Trump was not on the ballot – his being on the ballot in 2020 dramatically drove up Republican turnout. In fact, President Trump garnered 11 million more votes in 2020 than he received in 2016, while President-elect Biden received 14 million more votes than former Secretary of State Hillary Clinton got in 2016.
Were the polls way off on their predictions for the 2020 election? Yes.The final pre-election aggregation of all major polls compiled by Real Clear Politics calculated that President-elect Biden would win by 7 percentage points, versus the 4 points he actually won by. That’s a difference of 3 full percentage points – a lot for a poll that is the aggregation of a series of polls.
What happened? No one – and I mean no one – foresaw President Trump getting 11 million more votes in 2020 than he received in 2016. The conventional wisdom was that in 2016 Trump had found virtually every Trump voter in the country and gotten them to the polls. Apparently not.
Finally, much has been said about the run-up in the popular vote for President-elect Biden in just two states – California and New York. President-elect Biden won California and New York by an aggregate total of six million votes, identical to his national popular vote margin of six million votes. But let’s “unpack” these numbers. In winning California and New York, Biden gained 84 Electoral Votes, roughly 30% of the 270 needed to win. Thus, if Trump and Biden – in aggregate – ran dead even in the other 48 states, I believe it’s a safe assumption for the sake of argument to say that potentially they could divide up the remaining 454 Electoral Votes evenly as well. Accordingly, if the 454 Electoral Votes of the other 48 states were equally divided between the two candidates – and President-elect Biden is given the 84 electoral votes of California and New York – he would have received 311 electoral votes and President Trump 227, virtually identical to the actual outcome of Biden 306 and Trump 232.
A Look Ahead to 2022’s Midterm Election
By Stephen Ruhlen, Total Spectrum Partner
The unexpected gain in House seats by Republicans in last month’s elections strengthens the GOP’s position in the House and offers them a very real chance of taking control of the lower body in the 2022 midterms. The analysis of their increased support is still ongoing, but it seems apparent that House Republican candidates benefited from voters’ concern over the far-left tilt of the Democratic platform. This was especially apparent in several Latino-majority areas. The Republican position in the House will be stronger, but it also challenges them to understand what led to their increase and how to keep the momentum going into the 2022 midterms.
Since the end of World War II, the party out of power in the White House on average gains 27 House seats in midterm elections. However, midterm results are a rather volatile affair. The range is wide. For example, in 2002 Republicans were in power and public support for President Bush in the wake of the 9/11 attacks helped the Republicans gain eight seats. In 2010, Democrats lost 63 seats on the heels of the passage of the Affordable Care Act (Obamacare). In 2018, Republicans were again in power at the White House, but ended up losing 40 seats. The voters’ confidence in the President and direction of the country drive the midterms.
Given the unpredictable variables, we cannot say what will happen in 2022. But Republicans, who at this writing hold 211 seats (which could rise to 213 depending on the outcome of Democrats’ legal challenges) in the new Congress, will be 5-7 seats away from the magic number of 218 needed to take control of the House – well within the statistical average of midterm pickups.
President-elect Biden seems aware of the divide among Democrats over the philosophical direction of his party. His staff selections for the most part reflect known Washington operatives, not the activist AOC/Sanders wing of the party. Biden and national Democrats will be challenged by their left. If the embrace of a leftward tilt pushed many to choose the Republican House candidate, Democrats, who will control the White House and at least one body of the Congress, will be walking the thinnest of tightropes in appeasing their left wing without driving away voters.
For Republicans to be successful in 2022, they will need to understand the root reasons for their gain, thread together the winning themes, and effectively apply the message in their congressional campaigns. Republicans more than doubled the number of women they have in the House. The incoming class includes two of Korean ancestry, four Latinos, and an African American. This increased diversity also evidences the wider concern of economic and personal security among the electorate.
Going into 2022, it seems that both parties will have to keep from getting mired in the rhetoric that often defined them in the 2020 campaign. Events will also dictate what happens in the midterms. If Democrats preside over a growing economy going into the fall of 2022 and, assuming no other major crisis such as war or another pandemic, Republicans will have to provide a clear and compelling distinction to the American people. Conversely, Democrats will have to figure out how to govern effectively in the middle while placating dueling factions within their party.
Defense Update
By Al Jackson, Strategic Consultant to Total Spectrum
Despite veto threats by President Donald Trump, the Congress passed the Fiscal Year 2021 National Defense Authorization Act (NDAA). For 59 consecutive years, the defense budget policy legislation has become law. The bill passed by numbers large enough to secure a possible override of a veto, should it come to that.
President Trump in recent months has indicated he would veto the bill over its inclusion of language to rename military bases named for Confederate War figures. Recently, the President insisted on including in the legislation language that would repeal Section 230 of the 1996 Communications Decency Act. Section 230 contains the following language: “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” In summary, online intermediaries that host or republish speech are protected against a range of laws that might otherwise be used to hold them legally responsible for what others say and do.
The protected intermediaries include not only regular internet service providers (ISPs), but also a range of “interactive computer service providers,” including basically any online service that publishes third-party content. Though there are important exceptions for certain criminal and intellectual property-based claims, Section 230 creates a broad protection that has allowed innovation and free speech online to flourish. The intent of the language was to protect content providers such as Facebook, Twitter, YouTube, etc. During the election cycle, those aforementioned companies have been accused of censoring conservative views by President Trump and other citizens, hence the desire to remove the protection afforded by Section 230.
Senator Jim Inhofe (R-OK), Chairman of the Senate Committee on Armed Services, indicated on the Senate floor that he supports repeal of Section 230 but not as part of the NDAA legislation. Another point of contention in the legislation is language contrary to the President’s recent announcement of the removal or drawdown of American troops currently stationed in both Afghanistan and Germany.
The final version of NDAA yielded significant cuts to several high-priority programs associated with the Army’s ambitious modernization program while adding to one program the Army had sought to end. A 20% cut was authorized for Army’s new “do-it-all” night vision and augmented reality goggles. The Congress did, however, add millions to a program that the Army had tried to cut, the CH-47 Chinook heavy-lift helicopter. The conferenced NDAA bill nearly doubled the Army’s CH-47F request by adding $136 million for five helicopters above the President’s FY2021 request. It also added another $29 million to the Army’s $18.4 million request for advanced procurement of the helicopter in future years. The conference also supports, to the tune of a $42.5 million add, the new Army-led multi-service effort to counter small drones through the Joint-Counter-UAS office.
The NDAA legislation added 14 Lockheed Martin F-35 Joint Strike Fighters over the DoD’s FY2021 budget request. This adds 12 F-35As and 2 F-35Bs. In addition, the Air Force is authorized to add six F-35s meant for Turkey to its own fleet. In total the authorizing committees dedicated $9.1 billion to the program.
The Air Force did well in the conference agreement, as an additional $2.5 billion was authorized for procurement for a total of $51.1 billion. Consistent with the appropriations bill, $753 million was cut from its request for research, development, test and evaluation leaving $36.6 billion for the development of future weapons systems.
In an effort to block the Air Force from retiring any of its A-10 Warthog attack planes, which have significant presence in Arizona, Congress allowed in legislative language for the Air Force to retire some bombers, tankers, and cargo planes, but protected the A-10 and Global Hawk from any reductions. KC-135 refueling tankers are also exempted from being retired. The Air Force had sought to retire the entire fleet of the A-10 attack aircraft over the past decade despite Congressional pressure to do otherwise. In the FY21 budget request by the administration, the Air Force offered a more modest adjustment, requesting the retirement of 44 A-10s or about three squadrons worth of aircraft, thereby leaving 237 Warthog aircraft to fly close air support missions in the next decade. Congress supplanted that desire with language in the NDAA that directs that no funding be used to divest or retire any of the 281 A-10s currently operating in the Air Force’s inventory.
Congress directs the Pentagon in this policy legislation to build an interim homeland intercontinental ballistic missile defense interceptor, as a weapon that is not in the Missile Defense Agency’s current plan to counter threats from North Korea and Iran. The legislation directs the Pentagon, through the Missile Defense Agency, 30 days from enactment to “commence carrying out a program to develop an interim ground-based interceptor capability.” Specifically, the Pentagon’s solution “should address the majority of current and near-to-mid-term projected ballistic missile threats to the United States homeland from rogue nations,” and “at a minimum, meet the proposed capabilities of the Redesigned Kill Vehicle program.
Concerned about China’s rise as a global military and economic power, Congress in the NDAA legislation targets China on multiple fronts including $6.9 billion dedicated toward a new Pacific Deterrence Initiative over two years. This language counters President Trump’s claims that the legislation does not adequately address the threat from China.
Pertaining to the COVID-19 pandemic, a bipartisan group of lawmakers have unveiled a $748 billion coronavirus relief proposal that includes an extension of the reimbursement program for federal contractors. Defense officials have indicated they may have to use modernization and readiness funds if Congress does not appropriate at least $10 billion for defense contractors’ coronavirus-related expenses as authorized by Section 3610 of the Coronavirus Aid, Relief, and Economic Security Act passed earlier this year. The new proposal doesn’t appropriate funding for the Section 3610 reimbursements. Negotiations on a final relief deal are ongoing but the package does include a Section 3610 extension through April 30, 2021. The provision applies to all federal agencies. Added funding could come in the $1.4 trillion omnibus spending package for Fiscal Year 2021, which is expected this week or in the next Congress through passage of another continuing resolution or stopgap funding bill. The deadline to reach an agreement falls on December 18, 2020.
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Hearing Report
By Ramona Lessen, Executive Director, Total Spectrum
Senate Commerce, Science and Transportation Subcommittee on Manufacturing, Trade and Consumer Protection Hearing on the COVID-19 Impact on the Live Event Entertainment Industry.
Tuesday, December 15, 2020; 10:00 a.m.
To view a livestream of the hearing please click here.
Opening Statements:
Senator Jerry Moran (R-KS), Chairman
Welcome to all of our participants today. COVID-19 continues to impact many industries and the economy including the live event entertainment sector. Because of the ban on large gatherings of people, companies in this sector have been forced to cease sponsoring events. They have had to furlough staff. Without concerts and other live events, the surrounding economies are severely affected. In March, Congress passed the CARES Act and the Small Business Administration provided the Paycheck Protection Program (PPP) which was to cover some business expenses for various industries. However, many of those programs did not help the live event entertainment sector. We have introduced the Save our Stages Act which would provide a lifeline to this industry until they can return doing what they love. There is a ripple effect on the economy when the live event entertainment industry is out of work. Restaurants, bars, transportation, and many other businesses that thrive on live events bringing people into communities from the surrounding area are hurting. This means that when the lights are dark at the local live event venue, the economy of that community as a whole is suffering. I thank all of our witnesses today.
Senator Richard Blumenthal (D-CT), Ranking Member
Our cultural industry is very important to all of us and to our democracy. Over the past several months, I have heard from theaters and other venues across the country who are doing everything they can to try to keep the lights on. We need to, for the sake of the employees, multiple economies affected, as well as our cultural heritage to help the live entertainment industry to stay alive. I am proud of the Save our Stages Act as well as the Restart Act. We are approaching a critical point to save our stages and our small businesses which are all hanging by a thread. For the sake of our cultural heritage and great treasures of enjoyment for our families who attend events together and regard them as social centers as well, we must pass this measure. I am very grateful to all of our witnesses today whose testimony will help encourage our colleagues to include this measure which is in the current package before the Congress. Thank you for participating today.
Witnesses:
Mr. David Fay, President and Chief Executive Officer
The Bushnell Center for the Performing Arts
Mr. Adam Hartke, Owner
Cotillion and WAVE
Mr. Ron Laffitte, President
Patriot Management
Mr. Pete Pantuso, President and Chief Executive Officer
American Bus Association
Mr. Michael Strickland, Owner
Bandit Lites
Congressional Calendar
Tuesday, December 15
- 10:00 a.m. Senate Commerce, Science and Transportation Subcommittee on Manufacturing Trade and Consumer Protection hearing – COVID-19 Impact on Live Event Entertainment industry.
- 2:30 p.m. Senate Commerce, Science and Transportation Committee hearing – Expanding American Entrepreneurship.
- 2:30 p.m. Senate Judiciary Subcommittee on Intellectual Property hearing – Curbing Online Piracy.
Wednesday, December 16
- 9:30 a.m. Senate Banking, Housing and Urban Affairs Subcommittee on Economic Policy hearing – US-China Economic Competition (Part II).
- 10:00 a.m. Senate Homeland Security and Governmental Affairs Committee hearing – Irregularities in the 2020 Election.
- 10:00 a.m. Senate Judiciary Committee hearing – pending nominations.
- 2:00 p.m. Senate Judiciary Subcommittee on Border Security and Immigration hearing – Hong Kong’s Pro-Democracy Movement and US Refugee Policy.
- 2:30 p.m. Senate Finance Subcommittee on Health Care hearing – The Alzheimer’s Crisis.
Thursday, December 17
- 9:00 a.m. House Oversight and Reform Committee hearing – Purdue Pharma’s role in the Opioid Epidemic.
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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