DOMESTIC POLICY MATTERS
Budget. The House Budget Committee is expected to release its proposed Fiscal Year (FY) 2013 budget next week when the House returns from recess, although House Republicans are still in discussions about the appropriate level of discretionary spending and where to find savings to avoid sequestration. House Armed Services Committee Chair Buck McKeon (R-California) gave a speech Wednesday where he advocated for the rollback of sequestration in order to spare the Department of Defense an additional $450 billion in automatic spending cuts. Meanwhile, the Congressional Budget Office (CBO) announced Tuesday that it has updated its baseline budget projections to incorporate the effects of the recently-enacted legislation renewing the payroll tax cut and extending unemployment benefits. The CBO’s new estimate of the budget deficit for FY 2012 — $1.2 trillion — is $93 billion higher than previously projected. Conversely, CBO’s baseline projection of the cumulative deficit over the next 10 years is $186 billion less than the amount it projected two months ago.
Transportation Reauthorization. The Senate on Wednesday passed (74-22) a two-year, $109 billion transportation reauthorization bill, and Senate leaders in both parties urged the House to take up its version. The path forward in that chamber is uncertain but may include a short-term extension of the current authorization, set to expire March 31st. However, Speaker John Boehner (R-Ohio) has indicated his preference to work on a longer-term measure, based on the framework of the earlier House bill that failed to advance, when Members return from recess next week.
The Federal Reserve announced Tuesday that 15 of the 19 largest U.S. banks passed a stress test designed to determine whether the banks could remain healthy in a hypothetical recession scenario where unemployment would rise to 13 percent, stock prices would drop by 50 percent and housing prices would decline by 21 percent. Meanwhile, President Obama delivered a speech in Washington’s Maryland suburbs on Thursday focused on defending his Administration’s energy policies in the midst of criticism for rising gas prices.
Senate Majority Leader Harry Reid (D-Nevada) and Minority Leader Mitch McConnell (R-Kentucky) on Wednesday reached an agreement to consider a group of President Obama’s judicial nominees, as well as the Republican-sponsored JOBS Act passed by the House last week. As such, Majority Leader Reid filed cloture on the JOBS Act, setting up a vote early next week, and the Senate will vote on 14 of the 17 judicial nominees by May 7th at a pace of two per week. The agreement side-stepped a longstanding battle between Democratic and Republican leadership over the Senate’s consideration of judicial branch nominees by the Obama, Bush, and Clinton Administrations.
2012 Political News. Former Pennsylvania Senator Rick Santorum won the Republican Presidential primaries in Alabama and Mississippi and the caucuses in Kansas. Former Massachusetts Governor Mitt Romney won the caucuses in Hawaii, the Northern Mariana Islands, and American Samoa and the nominating convention in Guam. Senator Santorum’s wins in Alabama and Mississippi renewed media attention on the future of former Speaker of the House Newt Gingrich’s (R-Georgia) campaign, which has emphasized winning southern states, but Speaker Gingrich has vowed to stay in the race. Representative Jay Inslee (D-Washington) announced last Saturday that he is resigning his House seat in order to focus on his 2012 Washington gubernatorial campaign. Despite an ongoing ethics investigation, incumbent Representative Spencer Bachus won the Republican primary for Alabama’s Sixth District on Tuesday. On Thursday, 15-term New York Representative Gary Ackerman (D) announced he will not seek reelection in 2012. A new Washington Post-ABC News poll released this week shows that President Obama’s overall approval rating has decreased slightly to 46 percent, although most new polls show the President with a lead over his prospective Republican challengers.
FOREIGN POLICY MATTERS
Afghanistan. Eleven years into the Afghanistan conflict, new polling suggest that public support for a continued U.S. military presence is waning. Last Sunday, a U.S. soldier allegedly shot and killed 16 Afghan villagers in the Kandahar province, which the Department of Defense is investigating. President Obama immediately issued a statement of condolence for the tragedy. Meanwhile, following a trip to promote defense cooperation in Kyrgyzstan on Tuesday, Secretary of Defense Leon Panetta travelled to Afghanistan Wednesday, acknowledging the recent tragic events and voicing support for the 2014 transition timeline agreed to at the November 2010 NATO summit in Lisbon, Portugal. The Defense Department also noted a possible attack at Bastion Airfield in Afghanistan’s Helmand province, which occurred moments after the Secretary’s plane touched down. On Thursday, the Taliban announced it was suspending its peace talks with the United States. Shortly thereafter, Afghan President Hamid Karzai called for the withdrawal of international troops from Afghan towns and villages. On Friday, President Obama called President Karzai to discuss the withdrawal demand, with further discussions planned. Also Friday, a NATO helicopter crashed, reportedly killing 12 Turkish soldiers and four Afghan civilians.
Syrian Conflict and Other Middle East Issues. In New York Monday, Secretary of State Hillary Clinton addressed the U.N. Security Council (UNSC) about: (1) continued international support for Libya’s democratic progress, (2) support for Yemen’s evolving democratic transition, and (3) again rebuking the recent failed UNSC effort to condemn the violence in Syria. Secretary Clinton met Thursday in Washington with Organization of Islamic Cooperation (OIC) Secretary General Ekmeleddin İhsanoğlu to discuss developments in Syria and the Palestinian Authority. The Secretary General reported he shared with Secretary Clinton the OIC’s lack of unified support for military intervention in Syria (despite some OIC members supporting intervention in some form). Meanwhile, U.N.-Arab League Special Envoy Kofi Annan is expected to release his report on Syria to the UNSC Friday.
Iran. On the margins of the UNSC meeting Monday, Secretary Clinton met with Russian Foreign Minister Sergey Lavrov, discussing the P5+1 talks and the need to ensure any future talks are structured to bring substantive results. President Obama said Wednesday the window for a diplomatic solution with Iran is shrinking. On Thursday, Azerbaijan’s counterintelligence services reportedly arrested a network of 22 Iranian agents, allegedly planning terrorist attacks against U.S. and Israeli targets and international oil companies.
President Obama hosted a State Dinner for British Prime Minister David Cameron Wednesday, reaffirming the U.S.-U.K. special relationship. The President was joined by Secretary Clinton in his bilateral meeting with Prime Minister Cameron earlier that morning. On Tuesday, President Obama and the Prime Minister travelled to Ohio to catch the first game of the NCAA men’s basketball tournament.
On Thursday, the Senate Finance Committee held a hearing on the implications of Russia’s accession to the World Trade Organization (WTO). Resurrecting his Russian opposition role from the New START treaty negotiations, Senate Minority Whip Jon Kyl (R-Arizona) said he will lead Congressional opposition to granting Russia Permanent Normal Trade Relations (PNTR). Several lawmakers have expressed reservation of repealing the 1974 Jackson-Vanik law without supplanting those trade sanctions with Senator Benjamin Cardin’s (D-MD) more targeted Sergei Magnitsky Rule of Law Accountability Act of 2011. Leading Russian dissident leader Boris Nemtsov and other Russian opposition leaders sent a letter to Congress this week supporting both Jackson-Vanik repeal and Senator Cardin’s legislation. With many U.S. business leaders supporting Russia’s WTO entry, Committee Chair Max Baucus (D-Montana) is leading the Senate drive to repeal the law preventing PNTR conferral.
Thursday, the U.S.-Korea Free Trade Agreement went into effect, with President Obama calling Korean President Lee Myung-bak of Korea to welcome the entry into force. The President also said he looks forward to attending the upcoming Nuclear Security Summit (25th) in Korea. On Friday, Secretary Clinton characterized North Korea’s announcement that it plans to conduct a missile launch as “highly provocative” and called on North Korea to adhere to its international obligations.
House Democratic Leader Nancy Pelosi (D-California) met with Egyptian officials in Cairo Thursday, characterizing the recent NGO crisis as a “bump in the road” and saying the two countries’ longstanding ties will not be derailed. Meanwhile, the State Department has yet to make a decision as to whether Egypt should continue to receive its $1.5 billion annual aid package, with a leading international human rights organization submitting a letter to Secretary Clinton Wednesday urging the Secretary to deny the certification.
On Monday, Assistant Secretary of State for East Asian and Pacific Affairs Kurt Campbell hosted Chinese Foreign Minister Cui Tiankai for the third U.S.-China Asia-Pacific Consultations. Tuesday, Secretary Clinton addressed the Global Chiefs of Mission Conference, where she reaffirmed U.S. foreign policy priorities and placed emphasis on a new policy directive to promote gender equality. On Thursday, Secretary Clinton chaired the annual meeting of the President’s Interagency Task Force (PITF) to Monitor and Combat Trafficking in Persons. President Obama said he was directing his Cabinet to expand on partnerships with civil society and the private sector to combat modern slavery. Secretary Clinton also held a bilateral meeting Thursday with Moroccan Foreign Minister Saad-Eddine Al-Othmani. Late last Friday (9th), President Obama announced his intent to nominate Dorothea-Maria Rosen to be U.S. Ambassador to Micronesia. On Thursday, the President announced Grant Colfax as New Director of the Office of National AIDS Policy.