06/12/2023

Dispatch from Washington: November 2023

There is a new Speaker of the US House of Representatives, Congressman Mike Johnson of Louisiana. The United States Congress narrowly averted a government shutdown – delaying the funding fight until early next year. President Joe Biden hosted leaders from the Asia-Pacific Economic Cooperation (APEC) for a forum in San Francisco and met with Chinese President Xi Jinping and Mexican President Andrés Manuel López Obrador on the margins. The White House released a long-awaited Executive Order on Artificial Intelligence. The Federal Reserve paused rate hikes yet again as inflation continues to cool. It has been two years since the Infrastructure Investment and Jobs Act (IIJA), more commonly known as the Bipartisan Infrastructure Law (BIL), a core pillar of “Bidenomics,” was signed into law and tens of thousands of projects across America have been started or awarded. We are one year out from the 2024 elections and recent polls show President Biden losing in key swing-states to President Trump. Candidates for the Republican Presidential nomination, with the exception of Trump, took to the debate stage, and the race is getting increasingly contentious. The timing for Trump’s various criminal and civil trials is coming into focus. President Biden hosted a trans-Atlantic summit in Washington with European Council President Charles Michel and European Commission President Ursula von der Leyen.

Meet Speaker Johnson

After a three-week long interregnum, the US House of Representatives has a new leader, Congressman Mike Johnson of Louisiana. The new Speaker was first elected to the House in 2016. Prior to his election to Congress, he was an attorney and served in the Louisiana State Legislature from 2015 to 2017. Before being elected as Speaker, a post that is two heartbeats removed from the Oval Office, Johnson served in House leadership as the deputy whip, a very junior role in the Republican Leadership.

The new Speaker has a daunting “in box.” House Republicans have pledged to slash federal spending, but the majority has failed to pass all the legislation needed to put all those cuts into law and have been forced to pull some bills from the House floor.  There is pressure to end a number of Democratic policy priorities, with incremental progress made thus far and there are the investigations and impeachment inquiries into President Joe Biden. Internationally, the world is on fire. President Biden has requested over $100 billion in supplemental spending for Ukraine, Israel, and Taiwan but the issue has divided the Republican conference. This presents a test for American global leadership as well as a political challenge for Johnson as he must appease conservatives without alienating moderates and pass a measure that will be approved by the Democratic-controlled Senate. Politically, Johnson’s position is tenuous, and any single member of the House can call a “motion to vacate,” presenting an ever-present existential challenge to the new Speaker.

Government Shutdown Averted…For Now

With days to spare before government funding ran out, Congress passed funding measures to ensure the government remains open until after the holiday season, and potentially giving lawmakers more time to sort out their considerable differences over government spending levels for the current budget year. The legislation extends funding until January 19 for the military construction, Veterans Affairs, transportation, housing, and Energy Department accounts and for the rest of government until February 2. Notably, the spending plan does not include additional aid for Israel or Ukraine and the measure does not include the deep spending cuts hard-right House Repulbicans have pushed for but instead extends funding at current levels. While this avoids an immediate crisis and government shutdown, the path to a longer-term agreement on government spending is unclear.

Biden-Xi Meet

 President Joe Biden and Chinese President Xi Jinping met on the margins of the Asia-Pacific Economic Cooperation (APEC) forum in San Francisco this month. Much has happened in the bilateral relationship since their last meeting a year ago in Bali–in February, a suspected Chinese surveillance balloon transited the United States and was shot down by a US fighter, China’s economy is struggling, and there have been a series of provokative episodes in the South China Sea. China has also been increasingly aggressive toward Taiwan, where democratic elections are scheduled to take place in January. Nevertheless, there were a number of positive developments and deliverables out of the Biden-Xi summit. The leaders agreed to convene experts to discuss the risks of artificial intelligence. An agreement was reached wherby China would stem the export of items related to the production of the opioid fentanyl, a leading cause of drug overdoses in the United States. In a significant breakthrough, China and the United States announced that they will resume military contacts—military-to-military communication was severed in August 2022 after then-House of Representatives Speaker Nancy Pelosi visited Taiwan. In a press conference following the four-hour long summit, Biden said the US and China had to ensure that competition between them “does not veer into conflict” and manage their relationship “responsibly.”

US Hosts Asia Summit in California

The United States hosted the leaders from the 21-member Asia-Pacific Economic Cooperation (APEC) group for the annual APEC leaders summit for the first time since 2011 – the group accounts for nearly 40% of the global population and almost half the world’s trade. At the gathering in San Fanscisco leaders discussed how to better spur trade and economic growth across the Pacific region. At the summit, leaders agreed to adopt new trade and investment principles, known as the “San Francisco Principles on Integrating Inclusivity and Sustainability into Trade and Investment Policy.” This accord is a non-binding cooperative agreement aimed at shoring up environmental sustainability, communication and information gathering. In a joint ministerial statement, following a misterial meeting chaired by Secretary of State Antony Blinken and Ambassador Katherine Tai, United States Trade Representative, the APEC members reaffirmed a commitment to the World Trade Organization (WTO) and pledged to reform the body, saying “we support necessary reform to improve all of the WTO’s functions, so that members can better achieve the WTO’s foundational objectives and address existing and emerging global trade challenges.” 

On the margins of the summit, President Biden met with Mexican President Andrés Manuel López Obrador (AMLO). Biden and AMLO agreed to work together to combat fentanyl trafficking and migration. The meeting occurred as Republicans on Capitol Hill criticize the administration over its handling of immigration and border policy as well as the fentanyl epidemic.

Biden Administration Releases Sweeping AI Executive Order

 On October 30, 2023, the White House released a sweeping executive order on artificial intelligence (AI) focused on managing risks associated with the technology and encouraging its development. According to a White House fact sheet, the executive order “establishes new standards for AI safety and security, protects Americans’ privacy, advances equity and civil rights, stands up for consumers and workers, promotes innovation and competition, and advances American leadership around the world.” The measure incudes dozens of directives to numerous agencies that will be implemented in the next year. These directives will impact companies that are developing and deploying AI. As government departments and agencies implement the order, there will be new requirements for government contractors, as well as new AI standards, guidance, and best practices for the private sector. In an effort to promote innovation and competition, the order established the National AI Research Resource, which will expand grants for AI research in areas such as health care and climate change. Following the release of the executive order Vice President Kamala Harris traveled to the United Kingdom to participate in Prime Minister Rishi Sunak’s Global Summit on AI Safety. In a speech delivered at the US Embassy in London in advance of the Summit, Harris detailed the vision and the principles that guide America’s work on AI.

Fed Pauses Rate Hikes, Inflation Continues to Cool

Following their October Federal Open Markets Committee (FOMC) meeting, Federal Reserve policymakers announced that they would keep interest rates between 5.25 and 5.5 percent. This was the second FOMC meeting in a row where policymakers left the benchmark lending rate unchanged. While the pause in rate hikes was widely expected, the FOMC left the door open for further interest-rate hikes in the future, should central bank officials decide the economy needs it. At a press conference following the policy meeting, Federal Reserve Chairman Jerome Powell said that officials weren’t yet satisfied with the progress being made on inflation and that monetary policy might not be restrictive enough. While inflation continues to challenge the Fed, there are encouraging signs under the surface. The latest consumer price index (CPI), a key inflation data point, shows prices rising 3.2 percent in the year through October, half a percentage point lower than the 3.7 percent reading in September. Inflation has come down significantly over the past year after peaking in the summer of 2022.

Two Year Anniversary of the Infrastructure Law

 It has been two years since the Infrastructure Investment and Jobs Act (IIJA), more commonly known as the Bipartisan Infrastructure Law (BIL), was passed. This historic infrastructure bill is a core pillar of “Bidenomics.” The legislation authorized approximately $1.2 trillion in spending, with $550 billion being newly authorized spending on top of what Congress was planning to authorize regularly, over a period of eight years. To date, the Biden Administration has announced nearly $400 billion in Bipartisan Infrastructure Law funding, including over 40,000 specific projects and awards, across over 4,500 communities across the country. According to a White House fact sheet, under the BIL, the administration has: enabled high-speed internet for over 21 million low-income households, started improvements on 135,800 miles of roads and launched over 7,800 bridge repair projects, deployed over 2,900 low-and zero-emission American-made transit buses and funded approximately 2,400 clean school buses, directed investments in over 190 airport terminal projects, and delivered funding for 445 port and waterway projects to strengthen supply chains. The administration also claims that the infrastructure bill has helped drive over $614 billion dollars in private sector manufacturing and clean energy investments. 

One Year Until the 2024 Presidential Election

We are less than a year out from the 2024 Presidential election. While a year is a considerable amount of time, there are some early indicators and poll numbers worth of note. It is important to recognize that American voters cast 158 million ballots in the 2020 presidential election, yet the winner was ultimately decided by about 43,000 voters across Arizona, Georgia and Wisconsin, allowing us to focus out attention on key geographies and specific demographics. A widely cited poll from CNN/SSRS shows former President Donald Trump leading Biden 49% to 45%, in critical swing states revealing Biden’s challenges and Trump’s potential path to victory. A new poll from NBC News and Public Opinion Strategies, released on November 20, paints an additional dire picture for Biden. The data shows the President’s overall job approval fixed at 40%, this is compounded for a further erosion of support among young voters—a critical demographic that he, and other Democratic candidates, will need to mobilize.

Current and prospective third-party candidates are an additional variable. Support for Robert F. Kennedy Jr. and Cornel West, both of whom have announced runs as independents, is hovering around 11 percent and 4 percent, respectively, presenting third party complications. Jill Stein, the 2012 and 2016 “Green Party” candidate, whom may feel played a spoiler role in Hilary Clinton’s Presidential aspirations also announced her candidacy this past month. The announcement from Senator Joe Manchin (D-WV) that he will not seek reelection has sparked further conversations about his potenial run on a third party ticket facilitated by the group, No Labels.  This is something he has not completely dismissed and, infact, leaned into when stating he would remain involved in politics, including by “traveling the country and speaking out to see if there is an interest in creating a movement to mobilize the middle.” 

GOP Debates Grow Heated, Primary Field Narrows

 On November 7, five candidates for the Republican Presidential nomination—Florida Governor Ron DeSantis, former South Carolina governor and United Nations Ambassador Nikki Haley, former New Jersey Governor Chris Christie, entrepreneur Vivek Ramaswamy, and South Carolina Senator Tim Scott—took to the debate stage in Miami, Florida for the third GOP debate. This was the first debate since the outbreak of the Israel-Hamas war, and foreign policy featured heavily. The candidates were unified in offering robust support for Israel, but they said virtually nothing about protecting Palestinian civilians in Gaza. Splits were also evident in views on Ukraine and China. All of the candidates are trying to overtake Trump, who continues to dominate the contest as the overwhelming front-runner and has thus far not appeared on the debate stage citing his polling advantage. The candidates face an increasingly urgent task to emerge as a clear alternative to former President Donald Trump, with a rivalry between DeSantis and Haley ramping up in recent weeks, with Haley rising in a prominent Iowa poll and gaining ground in New Hampshire. There is also increasing tension between Ramaswamy and Haley – in a noteworthy exchange, Ramaswamy clearly got under her skin by invoking Haley’s daughter, to which she forcefully responded, “leave my daughter out of your voice…You’re just scum.” Meanwhile, in recent weeks, several contestants for the Republican Presidential nomination ended their campaigns. Former Vice President Mike Pence and Tim Scott announced that they were dropping out of the 2024 race. 

Tracking Trump’s Trials

Trump is facing a number of legal challenges—four felony criminal charges and one civil case—and the timing of his trials is coming into focus. New York state Attorney General Letitia James has brought a civil fraud case in a New York state court in Manhattan. Thus far, Trump and a number of his children have testified. The judge overseeing the case, Justice Arthur Engoron of the Manhattan Supreme Court, has already ruled that the defendants are liable for fraud, finding “conclusive evidence” that Trump inflated his net worth by as much as $2.2 billion–this leaves only damages and other claims for the trial. In June, a federal grand jury in Florida charged the former President with 37 criminal counts, including unauthorized retention of national security secrets and obstruction of efforts. The case, brought by Special Counsel Jack Smith, is now pending trial with the trial expected to commence in May, by which point the Republican nominating contest may be locked up. Special counsel Jack Smith also oversaw a probe into Trump’s efforts to overturn 2020 election, including events surrounding the January 6 insurrection at the United States Capitol Building. In August, a sweeping indictment was issued, charging Trump, as well as six alleged unnamed co-conspirators, with four felony counts: conspiracy to defraud the United States, conspiracy to obstruct an official proceeding, obstruction of and attempt to obstruct an official proceeding, and conspiracy against rights. The presiding judge ordered the start of Trump’s trial on March 4, 2024, one day before “Super Tuesday.” The judge has also issued a gag order on the former president, prohibiting him from making or “reposting” statements “publicly targeting” the special counsel and his staff, as well as the staff of the presiding judge and other D.C. district court personnel. In Georgia, the case brought forth by Fulton County District Attorney Fani Willis is likely to start on August 5, 2024. A total of 41 charges were brought against the 19 defendants, with Trump facing 13 counts—several of Trump’s co-defendants have already pled guilty. Finally, in New York, Trump is facing 34 counts of falsifying business documents in New York through a series of hush money payments, most notably to adult film star Stormy Daniels. Trump’s New York criminal trial is scheduled to begin March 25 before New York Supreme Court Acting Justice Juan Merchan, but that is subject to change.

Trans-Atlantic Summit Held in Washington

A trans-Atlantic summit was hosted in Washington on October 20. The high-level meeting between US President Joe Biden, European Council President Charles Michel and European Commission President Ursula von der Leyen sought to address a long-running steel and aluminum dispute amid rising pressure and geopolitical friction on multiple fronts. The gathering comes as negotiators are under increasing pressure to avert the reimposition of Trump-era tariffs on billions of dollars worth of transatlantic commerce. The last official EU-US summit took place in June 2021, although Biden did attend a meeting of EU leaders in March of last year. In a joint summit statement, the leaders committed to strengthen and deepen EU-US security cooperation, advance joint work in the run up to the upcoming US-EU Trade and Technology Council (TTC) ministerial meeting later in 2023, deepen collaboration to address climate change and biodiversity loss, expand technology cooperation, as well as strengthen economic resilience and economic security. The Leader’s statement also strongly condemned the October 7 Hamas attack on Israel, expressed unwavering support for Ukraine, and committed to enhancing coordination and cooperation in support of a free and open Indo-Pacific.

“Who’s Who” – Personnel Updates from the Biden Administration

Department of CommerceBen Haas is now the Chief of Staff to the Undersecretary for Industry and Security.

Department of DefenseAndrew L. Winternitz is now the Deputy Assistant Secretary for East Asia in the Office of the Assistant Secretary of Defense for Indo-Pacific Security Affairs.

Department of Health and Human Services Dr. Monica M. Bertagnolli, MD, FASCO was confirmed as the Director of the National Institutes of Health. Dr. Ruth T. Jones Nichols, PhD is now a Senior Advisor for Public Engagement.

Department of Homeland SecurityJared Lang is a Special Advisor in the Office of the Undersecretary for Strategy, Policy, and Plans. 

Department of State Jack Lew was confirmed as the US Ambassador to Israel. Julie E. Turner was named Special Envoy on North Korean Human Rights Issues. Sarah E. Morgenthau in the Special Representative for Commercial and Business Affairs.

Department of TransportationStephanie Pollack is the Director of Bipartisan Infrastructure Law Implementation in the Office of the Secretary. Mike Whitaker was confirmed as Administrator of the Federal Aviation Administration.

The White HouseJosh Geltzer is now Deputy Assistant to the President and Legal Advisor to the National Security Council (NSC). Samer J. Mosis is Director for Energy Markets and LeAnne Noelani Howard is the Special Advisor for NATO and Coordinator at Europe and Russia on the NSC staff. Josh May is the Deputy Chief of Staff at the Office of Management and Budget (OMB). Dan Koh is Deputy Director at Office of Intergovernmental Affairs. Sheila B. Grant is now the Deputy Cabinet Secretary in the Office of Cabinet Affairs. Marian Dimaano is the Director of Partnerships in the Office of Digital Strategy. Krista B. Schwarz is now a Senior Economist at Council of Economic Advisers. In the Office of Public Engagement, Jenny Kaplan in now a Senior Advisor and Jamie Citron is Principal Deputy Director.

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P. IVA 12561140968

Via Pattari, 6, 20122 Milano MI

Proud member of

© 2022 Created by ABCPRODUCTION.digital