Window on Washington – March 14, 2022, Vol. 6, Issue 10

Outlook for This Week in the Nation’s Capital 

Congress. The House and Senate are both in session this week. The House plans to consider numerous bills from the Judiciary and Natural Resources Committees and potentially legislation related to trade with Russia. Meanwhile, the Senate plans to confirm Shalanda Young as director of the Office of Management and Budget (OMB) this week. The House will also introduce an updated, standalone COVID-19 relief bill this week, but it remains to be seen whether it would have enough GOP support in the Senate. Additionally, now that Congress has wrapped up its work on the FY22 appropriations bills, House and Senate Democrats are going to resume their focus on USICA, BBB, and election reform. Hearings for the week include examining nominations, advancing public transportation through the bipartisan infrastructure package, the role of forest management in reducing catastrophic wildfires, the role of USDA programs in addressing climate change, proposals for WRDA 2022, and federal support for HBCUs.

Appropriations. The House passed the $1.5 trillion appropriations package last Wednesday, and the Senate passed the bill late Thursday. Given that it takes some time for legislation to head from Capitol Hill to the White House, President Joe Biden signed a short-term continuing resolution into law on Friday to avoid a government shutdown. He plans to sign the omnibus package, which includes the FY22 appropriations bills and aid to Ukraine, this week. The House and Senate will now turn their attention to the FY23 appropriations process, though it still remains to be seen when the President’s FY23 Budget Request will be released.

Supreme Court. Judge Ketanji Brown Jackson’s confirmation hearings will begin a week from today. Until then, she will continue to meet with senators on Capitol Hill throughout this week.

Biden Administration. Jake Sullivan, the White House’s National Security Advisor, will meet with China’s top diplomat, Yang Jiechi, in Rome, Italy today to discuss Russia’s ongoing invasion of Ukraine. Sullivan will separately also meet with Luigi Mattiolo, the diplomatic advisor to Italian Prime Minister Mario Draghi, to continue discussing a coordinated international response to Russia’s invasion of Ukraine.

Last Week in the Nation’s Capital

CONGRESS

Budget & Appropriations 

Senate Gives Final OK to $1.5T Government Funding Bill: The Senate passed a $1.5 trillion package last Thursday night that funds the federal government through September and delivers $14 billion to help Ukraine, clearing the bill for President Joe Biden’s signature. (Politico)

Young to Receive Confirmation Vote: The Senate today plans to vote on Shalanda Young’s nomination to serve as Director of the Office of Management and Budget (OMB). (Clark Hill Insight)

Health 

Government Scientists Prep to Slash Covid Research in Funding Gap: Scientists at the National Institutes of Health are scrambling to decide whether all its coronavirus research and development can continue after Congress dropped new funding from its sweeping budget bill. There are immediate implications for government trials on Covid-19 therapies, tests and vaccines that run out of funds as soon as this month, according to an internal email obtained by POLITICO. (Politico) 

Banking & Housing  

Fed Up – Inside the Senate’s Banking Brawl: Pat Toomey (R-PA) will help advance all but one of President Joe Biden’s Federal Reserve nominees. At least one Democrat wants his party to take the deal. “If they’re willing to move four out of five? Take it and run with it. It’s a win,” Sen. Joe Manchin (D-WV) said in an interview about the group of nominees paralyzed by Republicans’ Toomey-led boycott. “I’ll take a win any time I get it.” (Politico)

Banking Republicans Call on Biden Administration to Pause Financial Regulatory Efforts That Threaten America’s Energy Security: As Russia’s invasion of Ukraine highlights the problem with the United States and our allies buying Russian energy, U.S. Senate Banking Committee Republicans are calling on President Biden and his administration to pause all financial regulatory efforts targeting America’s energy security. The senators’ request comes as reports indicate the Securities and Exchange Commission (SEC) plans to propose its climate risk rule as early as next week. (Clark Hill Insight)

Crypto/Blockchain

Warren Crafts Bill Targeting Cryptocurrency in Russia Sanctions: As the U.S. searches for new ways to punish Russia for invading Ukraine, Sen. Elizabeth Warren (D-MA), is crafting legislation she hopes will make it harder to use cryptocurrency to evade sanctions. The proposal, still in draft form, has taken on new urgency as bipartisan concerns grow that members of Moscow’s elite might be able to sidestep sanctions by using digital currencies. It aims to force companies to choose between doing business in the U.S. or with sanctioned people and entities by threatening secondary sanctions on foreign crypto exchanges. (NBC News)

Tax Reform

Senate Finance Chair Proposes Stripping Russian Oligarchs’ ‘Tax Goodies’: A new proposal by Senate Finance Committee Chair Ron Wyden (D-OR) seeks to eliminate tax benefits for sanctioned Russians doing business in the U.S., as well as to nix U.S. tax credits and deductions for taxes paid to Russia. “Russian oligarchs and companies supporting [Russian President Vladimir] Putin shouldn’t be getting tax breaks in the United States,” Wyden said in a statement. “We should take away every special tax benefit for all sanctioned individuals, as well as give [Treasury Secretary Janet] Yellen the authority to identify other individuals, companies, or governments supporting the invasion that should lose their tax goodies.” (The Hill) 

Transportation 

Davis, Graves Ask Biden Administration to Rescind Guidance Intended to Deter Road Projects: Highways and Transit Subcommittee Ranking Member Rodney Davis (R-IL), joined by Transportation and Infrastructure Committee Ranking Member Sam Graves (R-MO) and other Transportation and Infrastructure Committee Republicans, asked the Biden administration to rescind guidance intended to delay or deter critical road and highway expansion projects in clear defiance of the Infrastructure Investment and Jobs Act (IIJA). (Clark Hill Insight) 

Space/NASA & NOAA

Congress Finally Delivers a Budget, and NASA Gets Most of What it Wants: The top-line number is that Congress will provide NASA with a budget of $24.04 billion, which is about $760 million less than the agency sought from congressional budget writers. However, this is still about $700 million more than NASA received in fiscal year 2021. While the poorly performing SLS program received another budget increase NASA had asked for $7.9 billion for its science programs, including especially big boosts for Earth Sciences, however Congress provided only $7.6 billion in the Omnibus. (Ars Technica)

Omnibus Bill Cuts Funding for Future Weather Satellites: Appropriators cut funding for a new generation of weather satellites while increasing funding for the Office of Space Commerce for fiscal year 2022. Most of that cut was absorbed by the Geostationary Extended Operations, or GeoXO, line of future weather satellites. NOAA requested $490 million for that program of geostationary weather satellites that will follow the current GOES-R series but received $150 million. Other NOAA weather satellite programs received all or nearly all of their request, which included $17 million for commercial data purchases, with up to $5 million to be used for acquiring commercial space weather data. (Space News)

Defense

Defense Spending Deal Bristles with Weapons Biden Didn’t Seek: The fiscal 2022 appropriations compromise that lawmakers unveiled early Wednesday would spend generously on the Pentagon and its contractors, marking a big win for GOP defense hawks over progressive Democrats. The $782.5 billion figure was some $42 billion above fiscal 2021 spending, or nearly 6 percent, topping the President’s request by about $30 billion. It invested heavily in procuring additional aircraft and ships and was some $4 billion more than senators had authorized for such programs, most of which was in the fiscal 2022 National Defense Authorization Act. (Roll Call)

Lawmakers Provide Large Increase for Defense Lab and Testing Infrastructure: As the DoD’s laboratories and testing organizations grapple with a multibillion-dollar infrastructure funding gap, lawmakers have boosted fiscal 2022 funding for the most critical projects by nearly $800 million. The funding — included in the fiscal 2022 compromise defense spending bill released this week — targets key technology development and testing infrastructure like space, hypersonic weapons, directed energy, electromagnetic spectrum and targeting, adding $422.7 million across multiple defense-wide and Navy research and development projects. (Defense News)

Homeland Security & Immigration 

Democrats, Republicans Struggle to Compromise on Border, Immigration Funds: The government funding bill sent to President Biden late Thursday night modestly raises funding for the Department of Homeland Security while seeking to exert limitations on the agencies managing U.S. immigration policy. (The Hill)

Pressure Builds to End Pandemic-Era Border Expulsions: Democratic lawmakers upped pressure on the White House to scrap Title 42, a public health directive used to expel migrants at the U.S.-Mexico border, noting a rollback of other pandemic restrictions along with a court decision last week limiting the policy. In a call with reporters Thursday, Senate Majority Leader Charles E. Schumer (D-NY) said he was “deeply disappointed” with the Biden administration’s continued use of Title 42, first begun under the Trump administration to prevent the spread of COVID-19. (Roll Call)

Democrats Cancel Vote on Biden Pick to Lead ICE after Domestic Abuse Allegations: Senate Homeland Security Committee Chairman Gary Peters (D-MI) on Tuesday withdrew a motion to vote on Sheriff Ed Gonzelez, President Biden’s nominee to serve as director of Immigration and Customs Enforcement (ICE), after the nominee’s wife accused him of domestic abuse. (The Hill)

ICE Conducted Sweeping Surveillance Of Money Transfers Sent To And From The U.S., A Senator Says: Immigration and Customs Enforcement agents obtained millions of people’s financial records as part of a surveillance program that fed the information to a database accessed by local and federal law enforcement agencies, according to a letter sent last Tuesday by Sen. Ron Wyden (D-OR) to the Department of Homeland Security inspector general requesting an investigation into whether the practice violated the US Constitution. (Buzzfeed News) 

Judiciary/Justice 

Policing Overhaul Provisions Not Hitching a Ride on Omnibus Spending Bill: Congressional Democrats abandoned a push to use federal funding legislation this year to change policing practices at local and state law enforcement agencies, and instead left out controversial provisions from an omnibus spending bill that the House passed Wednesday. (Roll Call)

Senator Floats Reexamination of Baseball’s Antitrust Exemption: The Chicago Cubs fan who runs the Senate Judiciary Committee, irked by an ongoing lockout that has canceled games at the beginning of the upcoming season, suggested Thursday that the panel will examine Major League Baseball’s long-standing exemption to the nation’s antitrust laws. (Roll Call)

Coons-Cornyn Bipartisan Gun Safety Legislation Heads to President Biden’s Desk: The U.S. Senate voted to pass the NICS Denial Notification Act, bipartisan gun safety legislation led by U.S. Senator Chris Coons (D-DE) and John Cornyn (R-TX), both members of the Senate Judiciary Committee. The NICS Denial Notification Act will help states enforce existing laws against individuals who “lie and try” to illegally purchase firearms with a fraudulent background check. (Clark Hill Insight)

Senate Sends Anti-Lynching Bill to Biden’s Desk in Historic First: The Senate voted by unanimous consent on Monday to pass anti-lynching legislation that would designate lynching as a federal hate crime for the first time in U.S. history. (Axios)

Cyber

Spending Bill Includes Large Funding Increase to Boost Cybersecurity: The FY22 Omnibus spending bull includes large budget increases for the government agency that oversees the nation’s cybersecurity infrastructure as well as language that requires companies in critical sectors to alert the government of potential hacks. The bill has a total $2.6 billion budget for the Cybersecurity and Infrastructure Security Agency (CISA), a $568 million increase above last year’s funding level that surpasses the amount requested by the president. (The Hill) 

Agriculture

Inside Senate Republicans’ Battle Over the Future of Big Beef: After years of failed attempts, Washington lawmakers are closer than they’ve ever been to mandating more competition in the American beef industry — which is dominated by four big meatpackers that control how most cattle are bought and sold. (Politico)

Energy

Manchin Delays Vote on Interior Nominee, Citing Energy Crisis: Senate Energy and Commerce Committee Chairman Joe Manchin (D-WV) delayed the nomination of a key Biden Interior Department nominee after holding a rare second hearing for her, citing the ongoing energy crisis sparked by Russia’s invasion of Ukraine. (The Hill)

GOP Senator Outlines Proposal for ‘Energy Operation Warp Speed’: Sen. Bill Cassidy (R-LA) on Wednesday unveiled an energy policy proposal he equated to the Trump administration’s “Operation Warp Speed” vaccine development program to address soaring energy prices. The Louisiana Republican’s proposal included streamlining the permitting process for energy development at agencies such as the Environmental Protection Agency, similar to the regulatory streamlining put in place to rapidly develop the COVID-19 vaccine over 2020. (The Hill)

Manchin says Biden Could Invoke Defense Production Act to Complete Natural Gas Pipeline: Sen. Joe Manchin (D-WV) on Thursday called on President Biden to invoke the Defense Production Act (DPA) if necessary to complete a U.S. natural gas pipeline following the ban on oil imports from Russia. (The Hill) 

EXECUTIVE BRANCH 

Budget & Appropriations 

Biden Signs Stopgap Funding Bill to Avert Shutdown: President Biden last Friday signed legislation to fund federal government operations in the short term, averting a government shutdown before a midnight deadline. The continuing resolution Biden signed funds the government through March 15, buying time for a sweeping $1.5 trillion government funding bill to make it to Biden’s desk. (The Hill) 

Health/HHS/NIH 

COVID Aid Faces Uncertain Path on Capitol Hill as White House Warns of Severe Consequences: White House officials on Thursday warned that key pandemic programs could soon run out of money if Congress fails to quickly authorize $15.6 billion in new Covid-19 funding. “We will have to stop a number of components of our program that are essential,” press secretary Jen Psaki told reporters Thursday. “If we had that money to move around we would be moving it. Our assessment is that we need this additional funding in order to meet the needs of the American public.” (Politico)

Department of Education 

Biden Officials Signal They Might Extend Student Loan Payment Freeze: The Biden administration dropped a new hint this week that it may further extend the freeze on federal student loan payments for tens of millions of borrowers as the White House weighs a final decision. (Politico) 

Banking & Housing/HUD

Treasury Secretary Janet Yellen says Americans Will Likely See Another Year of ‘Very Uncomfortably High’ Inflation: Treasury Secretary Janet Yellen said Thursday that Americans will likely see another year of “very uncomfortably high” inflation as Russia’s invasion of Ukraine muddles her prior forecast that price acceleration would moderate in the months ahead. “I think there’s a lot of uncertainty that is related to what’s going on with Russia in Ukraine,” Yellen told CNBC’s “Closing Bell.” (CNBC)

Oil Shock Upends Fed Strategy: Russia’s invasion of Ukraine threatens to further disrupt global supply chains just as shipping delays were poised to improve, scrambling the economic outlook and the Federal Reserve’s strategy for fighting inflation along with it. (Politico)

Wall Street Regulator to Propose Climate Risk Rule: The U.S. Securities and Exchange Commission (SEC) plans to propose its landmark climate risk rule, said two people familiar with the agency’s planning. (Reuters)

Crypto/Blockchain

Biden Issues Long-Awaited U.S. Executive Order on Crypto: President Biden directed federal agencies to coordinate their efforts at drafting cryptocurrency regulations in a first-of-its-kind executive order last week. The “whole-of-government” effort to regulate the crypto industry focuses on consumer protection, financial stability, illicit uses, leadership in the global financial sector, financial inclusion and responsible innovation. The executive order, the first such to focus exclusively on the growing digital asset sector, directs federal agencies to better communicate their work in the digital asset sector, but it does not lay out specific positions the administration wants agencies to adopt. (CoinDesk)

Tax Reform/IRS

IRS Plans to Hire 10,000 Workers to Relieve Massive Backlog: The IRS said Thursday it plans to hire 10,000 new workers to help reduce a massive backlog that the government says will make this tax season the most challenging in history. (AP)

Transportation/DOT 

TSA Extending Mask Mandate for Another Month: The Biden administration will extend the federal mask mandate for all transportation networks through April 18, one month after it is set to expire. (The Hill)

NHTSA Eliminates Human Controls Requirement for Fully Automated Vehicles: U.S. regulators on Thursday issued final rules eliminating the need for automated vehicle manufacturers to equip fully autonomous vehicles with manual driving controls to meet crash standards. Automakers and tech companies have faced significant hurdles to deploying automated driving system vehicles without human controls because of safety standards written decades ago that assume people are in control. (Automotive News)

U.S. Agency Will Review FAA Efforts on ‘Flying Taxi’ Rules: The U.S. Transportation Department’s Office of Inspector General said on Monday it will review progress by regulators in establishing the basis for certifying lower-altitude aircraft known as “flying taxis.” (Reuters) 

Trade

U.S. Moves to End Normal Trade Relations with Russia: The U.S. is moving to revoke Russia’s “most favored nation” trade status in what President Biden called “another crushing blow” against the country over its invasion of Ukraine. The U.S. is set to lift the status in coordination with the European Union and the Group of Seven countries, meaning those nations can raise tariffs on Russian imports to further inflict economic damage in retaliation for the invasion. Congress must pass legislation to remove Russia’s permanent normal trade relations with the U.S., though lawmakers in the House and Senate have signaled they are ready to act. (Axios)

Space/NASA & NOAA

Soyuz Embargo Strands Satellites With Limited Launch Options: While Russia’s share of the international launch market has shrunk, the Soyuz rocket’s sudden exit from the global stage, due to Russia’s invasion of Ukraine, has left more than a dozen non-Russian satellite missions without clear paths to orbit, and is raising questions over how fast the launch market can absorb the loss of the workhorse rocket. Three otherwise suitable flagship rockets — Arianespace’s Ariane 5, Mitsubishi Heavy Industries’ H-2A, and United Launch Alliance’s Atlas 5 — are being phased out, with no room left on their manifests. (Space News)

Defense/DOD

U.S. General says Starlink in Ukraine Showing What Megaconstellations Can Do: U.S. Space Command has been impressed by SpaceX’s ability to provide internet access in war-torn parts of Ukraine, the head of the command told lawmakers March 8. “What we’re seeing with Elon Musk and the Starlink capabilities is really showing us what a megaconstellation or a proliferated architecture can provide in terms of redundancy and capability,” Gen. James Dickinson, commander of U.S. Space Command, said during a hearing the Senate Armed Services Committee. (Space News)

DHS & Immigration

DHS Releases Report on Internal Review of Domestic Violent Extremism: On Friday, the Department of Homeland Security (DHS) released a report on how it can best prevent, detect, and respond to potential threats related to domestic violent extremism within the Department. This report is the product of a comprehensive high-level internal review that Secretary of Homeland Security Alejandro N. Mayorkas directed, and it highlights the steps that DHS should take to improve our ability to adequately identify and address related threats. (Clark Hill Insight)

The Biden Administration Has Been Planning to Tell Mexico That a Trump-Era Policy Could Soon End and Attract More Immigrants to the Border: Top officials at the Department of Homeland Security have been planning to tell Mexico that a controversial Trump-era border policy enacted during the pandemic may come to an end as soon as April, which could lead to an increase of immigrants coming to the border and a strain on resources. (Buzzfeed News)

Judiciary/DOJ

DOJ Names Chief Prosecutor for Pandemic Fraud Task Force: The Justice Department announced on Thursday that it was tapping Associate Deputy Attorney General Kevin Chambers to lead the department’s pandemic fraud efforts. In a news release, the department said Chambers would focus on “large-scale criminal enterprises” and “foreign actors” who tried to profit off Americans during the Covid-19 pandemic. Chambers will establish “Strike Teams,” as the Justice Department redoubles its work to combat pandemic fraud. The department has already uncovered alleged fraud involving more than $8 billion in federal aid, hitting nearly every key component of the roughly $6 trillion in emergency coronavirus spending Congress passed to aid families, workers and businesses. (Politico)

Cyber

SEC Weighs Cyber Reporting Requirements for Publicly Traded Companies: The Securities and Exchange Commission Wednesday proposed new cybersecurity risk management and disclosure rules for publicly traded companies, at the center of which is a requirement that companies report cybersecurity incidents to the agency within four days of determining one occurred. The proposed rules would also require that publicly traded companies periodically disclose their policies for managing and identifying cybersecurity risk, management’s role in managing cybersecurity and the board of directors’ oversight role and cybersecurity expertise. (Cyber Scoop)

Outgoing Official Pushes for CISA Shift from Risk Advisor to Risk Reducer: Leaving his post for a job in the private sector, Bob Kolasky, director of the Cybersecurity and Infrastructure Security Agency’s National Risk Management Center, wants CISA to embrace a more proactive role in helping to methodically reduce the considerable cybersecurity risk facing U.S. critical infrastructure. He suggests that after almost a decade and a series of massive intrusion campaigns, government and industry may finally be ready to have the crucial talk about cybersecurity metrics they’ve been avoiding. (Next Gov) 

EPA & DOI

EPA Unveils Rule to Combat Cross-State Smog Pollution: The Biden administration unveiled a rule Friday to slash smog pollution that comes from power plants and other industrial sources and drifts across state lines, endangering people in downwind states. (Roll Call)

EPA Restores California Waiver on Vehicle Greenhouse Gas Emissions: EPA last Wednesday formally restored California’s authority to enforce more stringent vehicle greenhouse gas standards, undoing a Trump-era action that had stripped the state of its climate tailpipe authority. The move restores authority to the Golden State and other blue states that support more aggressive climate action. However, California will need a new waiver from EPA in the coming years to regulate post-2025 vehicles. (Politico)

Department of Energy

‘We are on War Footing’ says Granholm as She Calls on Oil Companies to Ramp Up Production: Energy Secretary Jennifer Granholm on Wednesday exhorted the oil industry to produce more fuel to help offset the global energy supply shock as the U.S. is now in a “war footing” triggered by Russia’s invasion of Ukraine. (Politico)

White House is Pressed on Potential Oil Deals with Saudi Arabia, Venezuela and Iran: The White House last week pushed back on concerns about the Biden administration’s willingness to cut deals with countries like Saudi Arabia, Iran and Venezuela as it looks for ways to blunt skyrocketing fuel prices in the United States. (Politico)