Public Affairs & Government Relations

Oversight & Investigations Informer – 3/5/21

NOTABLE DEVELOPMENTS

 

What We Are Watching:

BURNING THE MIDNIGHT OIL: The Senate is completing work on the $1.9 trillion stimulus measure, with a ‘vote-a-roma’ session that is expected to continue late into Friday night. The updated measure will then return to the House for approval. Congressional leaders hope to have the measure signed into law before March 14, when additional unemployment benefits are scheduled to expire.

PROGRESSIVE AGENDA MOVES FORWARD IN THE HOUSE: House Democrats passed their sweeping government and elections reform bill known as H.R. 1, as well as the George Floyd Justice in Policing Act, in mostly party line votes. It’s unlikely that the closely divided Senate will pass either of the measures this Congress.

MINIMUM WAGE HIKE SETBACK: Finance Committee Chairman Ron Wyden, and Budget Committee Chairman Bernie Sanders, have decided not to pursue a plan to raise the minimum wage through tax penalties after economists and tax experts said it could be easily avoided and difficult to implement, partly because large corporations would able to reclassify workers as contractors to avoid potential penalties.

Look Ahead:

 The House and Senate are both in session next week. Key hearings include:

Monaco/Gupta Nomination

Senate Judiciary full committee hearing on Lisa Monaco’s nomination to be Deputy Attorney General, and Vanita Gupta’s nomination to be Associate Attorney General.

March 9, 9 a.m., 216 Hart Bldg.

U.S. Indo-Pacific Command

Senate Armed Services full committee hearing on United States Indo-Pacific Command in review of the Defense Authorization Request for Fiscal Year 2022 full committee hearing on

March 9, 9:30 a.m., G-50 Dirksen Bldg.

Young Nomination

Senate Homeland Security and Governmental Affairs full committee hearing on Shalanda Young to be deputy Office of Management and Budget Director.

March 10, 9:45 a.m., 342 Dirksen Bldg.

Graves Nomination

Senate Commerce, Science and Transportation Committee full committee hearing on Don Graves Jr. to be Deputy Secretary of Commerce

March 10, 10 a.m., 253 Russell Bldg.

Military Toxic Exposures

Senate Veterans’ Affairs full committee hearing on “Military Toxic Exposures: The Human Consequences of War”

March 10, 3 p.m., G-50 Dirksen Bldg.

KEY INSIGHTS:   

Even as Congress continues to work through the stimulus bill, many in Washington are already eyeing what will likely be the next major item Congress will pass under budget reconciliation rules- a large-scale infrastructure bill that various committees and the White House are drafting.

ENERGY SECTOR

What We Are Watching:

IT WAS INEVITABLE: Rep. Ro Khanna (D-CA), chairman of House Oversight and Reform Subcommittee on Environment, sent a letter to ERCOT this week requesting information about its preparedness for freezing temperatures and winter storms, along with an explanation of why Texas failed to apply the recommendations made after similar events in 1989 and 2011. “The Subcommittee is concerned that the loss of electric reliability, and the resulting human suffering, deaths, and economic costs, will happen again unless ERCOT and the State of Texas confront the predicted increase in extreme weather events with adequate preparation and appropriate infrastructure,” Khanna wrote in his letter, which requests a full response by March 17. Meanwhile, ERCOT’s independent market monitor revealed this week that ERCOT “kept prices artificially high for 32 hours during the power crisis last month, leading to $16 billion of overcharges.”

SEC IS FULL STEAM AHEAD ON ESG: On the heels of last week’s announcement that it would begin reviewing its past climate risk disclosure guidance, the U.S. Securities and Exchange Commission announced Thursday that it would create a new Climate and ESG Task Force focused on ensuring companies, advisers, and funds are complying with those climate and ESG disclosure rules. Gary Gensler, President Joe Biden’s nominee to lead the SEC, said during his confirmation hearing this week that he thinks “the SEC has a role to play to help bring consistency and comparability” to ESG disclosures. Republicans aren’t convinced, as Sen. Cynthia Lummis (R-WY) expressed concern that stricter reporting requirements would make it more challenging for oil and gas companies to raise capital, and Sen. Pat Toomey (R-PA) warned against the agency “using its regulatory powers to advance a liberal, social and cultural agenda on issues ranging from climate change to racial inequality.”

Week Ahead:  

Resources of the Future will host a discussion with BP CEO Bernard Looney at 2:15 p.m. on Thursday, March 11, focusing on BP’s ambitions on climate and the energy transition.

Key Insights:

SOLYNDRA 2.0?: Energy Secretary Jennifer Granholm said this week that the Energy Department was reviving an Obama-era loan clean energy loan program, providing up to $40 billion in guarantees for wind, solar, advanced vehicles, and other green projects. Under the Obama administration, the program gave a boost to Tesla, but also came under fire for the high-profile failures, such as the $500 million wasted on Solyndra. But this time around, Granholm says she’ll require companies to “offer positions that allow people to have a middle-class life.” That’s a vague definition, which could come back to bite companies if some congressional committees decide loan recipients haven’t fulfilled their end of the bargain.

FINANCIAL SERVICES SECTOR

What We Are Watching:

CLIMATE AND THE SEC: The SEC announced it would set up a climate and ESG task force within its enforcement division. Acting Deputy Director of Enforcement Kelly Gibson will lead the effort, along with 22 people across the department.

SENATE BANKING NOMINEE HEARING: The Senate Banking Committee held a confirmation hearing this week for Gary Gensler to be SEC Chairman and Rohit Chopra to be CFPB Chairman. Chopra highlighted credit buraus, student loan industry and mortgage servicers as those needing greater scrutiny. Gensler said the SEC would consider companies more on climate risk, workforce diversity and political spending activities. Gensler also called for greater scrutiny of trading firms post GameStop, including looking at payment for order flow.

SHAREHOLDER PROPOSALS DECISION: The SEC said companies, including Citigroup, Exxon and Pfizer, have no legal basis to exclude shareholder proposals related to racial equity and climate risk. Going forward, these companies will have to let shareholders vote on resolutions tied to race and climate change.

Week Ahead

The Senate Banking Committee is holding a virtual nominating hearing on March 9th on trading platforms and investing after the market volatility of Game Stop called, “Who Wins on Wall Street? GameStop, Robinhood, and the State of Retail Investing”.

The House Financial Services Committee is holding two virtual hearings next week. The first one on the 10th will discuss racial equity called, “Justice for All: Achieving Racial Equity Through Fair Access to Housing and Financial Services”, and the one on the 11th will discuss consumer protections during the pandemic called, “Slipping Through the Cracks: Policy Options to Help America’s Consumer During the Pandemic”.

Key Insights:

The Biden Administration continues to make large strides in their climate agenda with the SEC playing a large role this week. While the acting head of the SEC has begun to take steps to increase climate requirements for financial companies, the nominated head during a hearing this week indicated he would continue her efforts if nominated. 

HEALTHCARE SECTOR

What We Are Watching:

OVERSIGHT TO INVESTIGATE ONE MEDICAL FOR VACCINE ADMINISTRATION TO INELLIGIBLE GROUPS: On Tuesday, the House of Representative’s Select Subcommittee on the Coronavirus Crisis Chairman James E. Clyburn (D-SC-06) announced that the Select Subcommittee will launch an investigation into One Medical, after reports indicate it breached COVID-19 vaccine guidelines by giving vaccine priority to company executives’ friends and family and wealthy concierge clients. Rep. Clyburn sent a letter to Amir Dan Rubin, Chair, Chief Executive Officer, and President of One Medical, seeking documents related to reports that One Medical has intentionally distributed coronavirus vaccines to ineligible individuals in multiple locations and urging compliance with state and local prioritization rules going forward. In the letter, Rep. Clyburn wrote “I am deeply concerned that medical providers’ refusal to adhere to vaccination prioritization guidelines and intentional diversion of doses to individuals in lower priority groups may cost more American lives and delay or even derail containment of the virus across the country.”

TRUMP ADMINISTRATION SPENT BILLIONS IN PROVIDER FUNDS ON OPERATION WARP SPEED: On Tuesday, STAT News reported that four former Trump officials informed the news outlet that the Trump Administration used around $10 billion from the Provider Relief Fund to fund Operation Warp Speed contracts. According to the STAT exclusive report, the Department of Health and Human Services (HHS) top lawyer permitted the agency to use a “financial maneuver” that allowed officials to spend the Provider Relief Fund money on Operation Warp Speed without receiving congressional approval. The money, which was originally set aside by Congress to assist providers during the pandemic was used to facilitate the Trump Administration’s vaccine rollout program. Former White House Budget Office Director Russ Vought defended the redirection of the funds saying, “We had to draw from the Provider Relief Fund and had the authority to do so. It was the right thing to do in order to move as quickly as possible because lives were on the line. Thankfully we did. We would do it again.” The news is significant as providers have continued to advocate for additional funding in light of the continuing pandemic.

Week Ahead:

The Senate Committee on Health, Education, Labor and Pensions (HELP) will hold a hearing on Tuesday, March 9, 2021, at 10 a.m. entitled, “Examining Our COVID-19 Response: An Update from the Frontlines.” Witnesses will include: Jerry P. Abraham, MD, MPH, CMQ, Director of Kedren Health Vaccines; Umair A. Shah, MD, MPH, Secretary of Health for the State of Washington; Ashish K. Jha, MD, MPH, Dean of Brown University School of Public Health; Mary Ann Fuchs, DNP, RN, NEA-BC, FAAN, Vice President of Patient Care & System Chief Nurse Executive, Duke University Health System.

 Key Insights:

On Tuesday, President Joe Biden announced that Johnson & Johnson’s deal with fellow pharmaceutical manufacturer Merck to produce more of its COVID-19 vaccine, will accelerate the timeline of access to COVID-19 vaccines for all Americans. The partnership is a notable sign of good-will from the pharmaceutical industry, who had been closely scrutinized by Congress prior to the pandemic for drug pricing practices. But this positive spotlight may just be temporary reprieve, as reports and statements from drug makers like Pfizer have indicated they may raise vaccine prices after the pandemic ends, drawing Congresses attention once again.

On Wednesday, the Senate Finance Committee held a vote to advance the confirmation of President Biden’s Department of Health and Human Services (HHS) Secretary nominee, Xavier Becerra, splitting evenly along party lines. It will now be left up to Majority Leader Chuck Schumer to bring the nomination up for a full Senate vote. Despite the unfavorable 14-14 Committee vote to advance his nomination, Becerra is still likely to be confirmed as early as next week. Following the vote on Wednesday, White House Press Secretary Jen Psaki said in a press briefing that the Biden Administration, “remains confidently behind” Becerra.

INDUSTRIALS SECTOR

What We Are Watching:

 

APPROPRIATORS SLAP FOOD INDUSTRY FOR WORKER SAFETY: This week the House Appropriations Subcommittee on Labor-HHS-Ed held an oversight hearing of workforce safety protections administered by the Occupational Safety and Health Administration (OSHA). The hearing featured testimonies from witnesses representing the meatpacking, food processing, and agricultural industries. House Appropriations Committee Chairwoman Rosa DeLauro (D-CT-03) and other members of the Committee argued members of the industries represented at the hearing failed to take adequate measures to protect workers from the pandemic.

 

EARMARKS COMING FOR INFRASTRUCTURE: House Transportation and Infrastructure Committee Chairman Peter DeFazio (D-OR-04) published guidelines that will govern the process through which Members of the House can request infrastructure projects within their district are included in the surface transportation infrastructure package. Members will be required to include whether the project is also covered in a state or local transportation improvement program, potential sources of funding to finance the full cost of the project, letters of support from local officials, and an update on any ongoing environmental reviews related to the project.

 

 

Week Ahead:

SENATE EPW INFRASTRUCTURE HEARING: The Senate Committee on Environment and Public Works (EPW) will hold its second infrastructure hearing of the 117th Congress on Wednesday, March 10. The hearing is expected to focus on climate change and electrification, suggesting electronic vehicles and the auto sector broadly will be prominent topics during the meeting.

Key Insights:

WORKER SAFETY RESTRICTIONS ARE COMING: Several weeks ago, President Biden issued an Executive Order directing the Department of Labor (DOL) to determine whether the Occupational Safety and Health Administration (OSHA) should administer mandatory worker safety rules for the remainder of the public health emergency. The Office of the Inspector General for the DOL issued a report earlier this week that indicated legally binding OSHA guidelines were necessary to ensure worker safety during the pandemic. OSHA is expected to issue recommendations on the additional worker safety rules in the coming weeks.

TECH, MEDIA & TELECOM SECTOR

What We Are Watching: 

FB’s MISINFORMATION PREMIUM: In a study conducted between August 10, 2020 and January 11, 2021 by the Cybersecurity for Democracy project at New York University, researchers found that on average, far-right pages that regularly trade in misinformation raked in 65% more engagement per follower than other far-right pages that aren’t known for spreading misinformation. 

MORE DATA LIFTED BY LAW ENFORCEMENT: In a review of hundreds of internal police emails from nearly 20 police departments around the country, it was found that law enforcement has been utilizing Flock, a service which uses cameras to automatically read license plates, and a specific network of cameras called TALON, which enabled police to gain access to a nationwide network of cameras that have been installed by law enforcement agencies around the country. 

COVID SCANNERS LIGHT ON RESULTS: Experts have questioned the effectiveness of Covid-19 symptom screening technology, deployed at over 100 colleges and universities nationwide, as a cost-effective alternative to mass testing. At the University of Idaho, where administrators spent $90,000 on scanning tech, fewer than 10 cases were identified out of a student body of over 9,000. Companies like CampusClear, which provides the tech, have not yet done a comprehensive study of its effectiveness.  

Week Ahead:  

The Klobuchar-led Judiciary Antitrust Subcommittee will hold its first hearing on competition and monopoly power on March 11, 2021. Klobuchar has expressed interest in big tech, particularly on competition issues related to Apple and Google’s app stores.  

Key Insights: 

COVID RECKONING – Expect a bevy of claims against tech companies from critics for not adequately protecting their workforces. Like every industry, many tech companies – particularly those in the “gig economy” – are vulnerable to scrutiny. As America begins to “get back to normal,” critics won’t take a break. 

Related Articles

January 14, 2022

FTI Consulting News Bytes – 14th January 2022

Welcome to FTI Consulting News Bytes – a roundup of top tech stories of the week from FTI Consulting’s TMT (Telecom,...

January 13, 2022

FTI Consulting Public Affairs Snapshot: To CBDC or not to CBDC?

The Mesopotamian shekel is often cited as the first form of money, initially representing a specific weight of barley, a...

January 13, 2022

ESG+ Newsletter – 13th January 2022

Your weekly updates on ESG and more Greetings from 2022! Our first ESG+ Newsletter of the year starts off with a review ...