Oversight and Investigations Informer – November 13, 2020
Notable Developments
What We Are Watching:
PRESIDENTIAL TRANSITION: President-Elect Joe Biden named longtime advisor Ron Klain to serve as his White House Chief of Staff, and his transition team is forging ahead with vetting prospective cabinet picks and administration hires. The Trump administration has refused to begin the formal transition process as it launches legal challenges to election results.
ALL EYES ON GEORGIA: Republican Senators Dan Sullivan of Alaska and Thom Tillis of North Carolina officially defeated their challengers, bringing the Senate’s composition to 50 Republicans and 48 Democrats. Their victories confirmed that two January runoffs in Georgia will decide control of the Senate, with Republican Senators Kelly Loeffler and David Perdue respectively facing Democratic challengers Raphael Warnock and Jon Ossoff.
CONGRESSIONAL LAME DUCK AGENDA: The Senate Appropriations Committee released its proposed 12 spending bills ahead of the December 11 fiscal deadline. The House has already approved 10 of its 12 spending bills. Meanwhile, Speaker Nancy Pelosi continues to advocate for a large scale COVID relief package, while Senate Majority Leader Mitch McConnell insists that the package should be more modest and targeted than the Democrats’ proposal.
Week Ahead:
- The House and Senate are both in session next week.
- Key hearings include:
- Senate Judiciary Committee: Hearing on censorship and suppression; Facebook CEO Mark Zuckerberg and Twitter CEO Jack Dorsey will testify at 10:00 A.M. on Tuesday.
- Senate Banking Committee: Hearing on oversight of the securities and exchange commission; SEC Chairman Jay Clayton will testify at 10:00 A.M. on Tuesday.
Key Insights:
Despite some post-election speculation about Democratic leadership shakeups, Chuck Schumer was re-elected Senate Democratic Leader and no challengers have emerged against Speaker Nancy Pelosi. She will have a razor thin margin during the House floor vote for Speaker, but potential Democratic alternatives like Rep. Hakeem Jeffries of New York have insisted that she has their support.
Neither Speaker Pelosi nor Majority Leader McConnell are budging from their positions on a COVID relief package, and so the prospects of a measure passing before the end of the year appear dim.
What We Are Watching:
BIDEN’S ENERGY CZAR: President Elect Joe Biden has recently announced his transition team, agency transition teams, chief of staff, and now word of potential cabinet posts and agency heads are beginning to trickle out. On the Energy side of things, current Stanford engineering professor Arun Majumdar, is seen as the front runner to lead the department. He was recently named the agency team lead for the Energy Department transition. Other names reportedly on the list are former Iowa Governor Chet Culver, former deputy Energy secretary Elizabeth Sherwood-Randall, and Washington Governor Jay Inslee.
JOCKEYING FOR POSITION: With votes still being counted in several House races, several Republicans have already begun to campaign to replace retiring Ranking Members Rob Bishop (R-UT-1) and Greg Walden (R-OR-2), from House Natural Resources and Energy and Commerce Committees, respectively. Reps. Bruce Westerman (R-AR-4) and Paul Gosar (R-AZ-4) are reportedly running for the Natural Resources post; while Reps. Cathy McMorris Rodgers (R-WA-5), Michael Burgess (R-TX-26), and Bob Latta (R-OH-5) are hoping to replace Ranking Member Walden on Energy and Commerce.
CLIMATE POSITIONS: President-Elect Joe Biden has pledged to sign executive orders on climate “with unprecedented reach that go well beyond the Obama-Biden administration platform and put us on the right track,” on day one of his presidency. Specifically, he’s promised to reach net-zero emissions by 2050 and create a carbon-free electricity sector by 2035. Other promises include walking back Trump’s deregulations, steep methane restrictions for new and existing oil and gas sources and increasing fuel economy standards. All this, however, could be stymied early on by regulatory bureaucracy, making it harder for Biden to achieve his ambitions as promptly as he would like.
Week Ahead:
- Key Hearings Include:
- Senate Committee on Energy and Natural Resources: Hearing on pending legislation.
Key Insights:
President-Elect Biden’s desire to recast America as a leader in addressing climate change, will not only assure re-entry into the Paris Agreement, but will also cast a significant shadow on promoting LNG development and trade globally. Although proponents believe natural gas is crucial in assisting developing countries with energy poverty and transitioning away from carbon intensive fuel sources, the progressive wing of the Democratic party will continue to push Biden on full elimination of fossil fuels not only domestically, but internationally as well.
What We Are Watching:
PPP REGULATORY RELIEF: Republican senators pressed regulators Tuesday to ensure that banks’ participation in federal coronavirus relief programs don’t create new regulatory burdens.
A FIRST: The U.S. Federal Reserve for the first time called out climate change among risks enumerated in its biannual financial stability report, and warned about the potential for abrupt changes in asset values in response to a warming planet.
ESG NEWS: JP Morgan has partnered with environmental, social, and corporate governance (ESG) data science specialist RepRisk to incorporate ESG risk metrics within its data platform.
Week Ahead:
- THE FUTURE OF FINANCE: The Commodity Futures Trading Commission is hosting its third and final Empower Innovation 2020 session, “The Future of Digital Finance”, focusing on the future of FinTech.
Key Insights:
While there is speculation over what Biden’s first 100 days will look like, banks and other financial institutions are preparing for climate change scrutiny. Some banks are already proactively working to get ahead of the issue.
What We Are Watching:
SENATE HELP CALLS FOR SMOOTH TRANSITION: Chairwoman Patty Murray (D-WA) sent a letter to Secretary of Education Betsy DeVos, Secretary of Labor Eugene Scalia, and HHS Secretary Alex Azar requesting they preserve all records to allow for the transition from President Donald Trump’s Administration to that of President-Elect Joe Biden. Murray said violating the law could disqualify them from future federal office.
CONGRESS CHIMES IN ON OPIOID SETTLEMENT: More than two dozen members of Congress wrote a letter to Attorney General William Barr requesting that the Justice Department change its opioid settlement with Purdue Pharma. The $8.3 billion settlement, which was announced last month to settle lawsuits that accuse the company of fueling the opioid epidemic, would require Purdue to convert its company into a “public benefit company,” which would allow the public trust to count toward the settlement. The members of Congress in the letter called the proposal “a mirage designed to help the Sacklers keep billions in ill-gotten gains” and requested that the Department of Justice instead require that Purdue be sold to a private owner.
AGENCY ON THIN ICE: On Thursday, Chairs from the Committee on Oversight and Reform and Committee on Homeland Security sent a letter to Immigration and Customs Enforcement (ICE) saying the agency must stop deporting people who are witness or are the victims of medical malpractice alleged at the Irwin County Detention Center, which the Committees are currently investigating. The Chairs requested confirmation that ICE will halt the deportations no later than November 13.
Key Insights:
President-elect Joe Biden announced his COVID-19 Transition Advisory Board and HHS transition team, which include former Obama administration officials, healthcare coverage experts, and infectious disease specialists who participated in combatting HIV/AIDS, tuberculosis, and Ebola. Biden’s selections indicate that controlling the COVID-19 pandemic will be central to the first few months of his presidency.
Chairwoman Murray’s call for a smooth transition comes as GSA administrator Emily Murphy, a Trump appointee, has yet to confirm Biden as the winner of the presidential race. As a result, Biden’s HHS transition team is currently unable to access certain classified information and communicate with current health officials.
What We Are Watching:
BIDEN’S DOD TEAM: Earlier this week President-Elect Joe Biden introduced his agency review team for the U.S. Department of Defense (DOD). The team includes multiple allies of Michelle Flournoy, the Obama Administration alum considered a frontrunner for the role of Secretary of Defense. House Democrats and progressive think tanks are scrutinizing the agency review team for its ties to private industry and lack of progressives. After the review team was announced, Reps. Mark Pocan (D-WI-02) and Barbara Lee (D-CA-13) sent a letter to President-Elect Biden urging him to nominate a Secretary of Defense without ties to the defense industry.
Week Ahead:
- The Federal Aviation Administration (FAA) may approve the proposed changes to Boeing’s 737 MAX aircraft in the coming days and the regulator may lift its grounding order as early as November 18. Airlines must complete necessary software updates and pilot trainings to account for the changes to the 737 MAX systems, a process that will take at least 30 days after the grounding order is lifted. Southwest Airlines, the largest operator of the 737 MAX, said it would take several months to comply with the FAA’s new requirements. However, the greenlight from the U.S. regulator would be a critical milestone for the return of Boeing’s bestselling aircraft.
Key Insights:
President-Elect Biden is expected to increase regulatory scrutiny of performance chemicals in the early days of his presidency. Biden pledged to designate PFAS as a hazardous substance under the Comprehensive Environmental Response, Compensation, and Liability Act and set enforceable limits for PFAS in drinking water. In addition, he may attempt to secure bipartisan support for new legislation providing his administration with additional regulatory and enforcement capabilities related to performance chemicals.
What We Are Watching:
INFIGHTING AT THE FCC: Democratic Commissioners called on Chairman Ajit Pai to halt new rulemaking on “partisan issues” as power in the White House transfers hands. In focus are new regulations on Section 230 favored by President Trump that remain unfinalized and require an extended rulemaking period. Congressional Democrats also urged Pai to follow tradition and focus only on consensus items.
CITIES SPAR WITH ISP’S ON BROADBAND: Pressure continues to mount on internet service providers to provide data on how many customers they have signed up for the affordable packages, forcing advocates to ramp up pressure on state and federal government agencies to step in, as reported by NBC.
ZOOM SETTLES PRIVACY SUIT: On Monday, the FTC announced a settlement with Zoom on charges the video-conferencing service had misrepresented its user data encryption capabilities. As part of the settlement Zoom must implement “a robust information security program,” namely with the end-to-end encryption it told consumers it already possessed. The FTC voted 3-2 in favor of the compliant and settlement, with Democratic commissioners arguing the penalties did not go far enough to compensate users.
Week Ahead:
- The Senate Judiciary Committee will hold a hearing with Twitter and Facebook CEO’s Jack Dorsey and Mark Zuckerberg on Tuesday. The hearing will focus on the platform’s handling of content from the New York Post, as well as their broader content moderation policies during the 2020 election.
Key Insights:
The Senate Commerce Committee held a confirmation hearing this past Tuesday for Trump FCC Commission nominee Nathan Simington. It’s pretty clear Simington wasn’t the first choice for Senate Republicans who, under tradition, would get to pick a Republican nominee for the seat during a Biden Administration. But not confirming Simington before Trump leaves office would likely hand control of the FCC to Democrats in January, potentially affording them a multi-month head start on likely priorities like the reinstatement of Title II net neutrality regulations.
Contact Us
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