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Simpson-Bowles 2.0

On Tuesday, former U.S. Senator Alan Simpson (WY), a Republican, and former White House Chief of Staff Erskine Bowles, a Democrat, unveiled a new deficit reduction package.

Simpson-Bowles 2.0 would reduce the federal budget deficit by $2.4 trillion over 10 years, more than the $1.5 trillion package that White House officials have said is their goal.

The new Simpson-Bowles proposal would identify $600 billion in spending reductions through changes to health-care programs such as Medicare and Medicaid. This component is perhaps the most detailed of any part of the package, calling for "improving provider and beneficiary incentives throughout the health care system, reducing provider payments, reforming cost-sharing, increasing premiums for higher earners, adjusting benefits to account for population aging, reducing drug costs, and getting better value for our health care dollars."

Another $600 billion in deficit-reduction would come from curbing or ending a number of tax breaks. The final $1.2 trillion in the proposal would come from lower caps on discretionary spending—the type Congress approves annually—changing the way cost-of-living increases are calculated for Social Security checks and other government benefits, cuts to farm subsidies, and changes to military and civilian retirement programs, among other things.

Weekly jobless claims rise

On Thursday, the Department of Labor announced that first time filings for unemployment benefits rose last week by 20,000, to 362,000, and that the unemployment rate ticked up to 7.9 percent.


On Wednesday, McDonald Hopkins Government Strategies released a “Primer” on Sequestration. Sequestration, which is set to occur on March 1, is the across the board budget cuts that are the product of the Budget Control Act of 2011. Sequestration, which was insisted on by Jack Lew and the Obama administration as part of the Budget Control Act, was intended to be so draconian and so mindless that it would force the bipartisan, bicameral “super committee” to come to a deal on a deficit and debt reduction package. Unfortunately, the super committee was unable to reach a deal and now we are facing the looming reality and uncertainty of the sequester.

Read the full primer on sequestration here.

NIH head says directors will have discretion with sequestration cuts

The head of the National Institutes of Health said Wednesday that although each of the 27 institutes and centers at NIH would have to cut 5.1 percent under sequestration, the directors of those entities could decide how to apportion the reduction within each institute.

NIH faces a cut of some $1.5 billion from its $30 billion budget under sequester provisions scheduled to take effect March 1.

Sin taxes fail to tackle the ‘SIN’

The finding of a new study published by scholar Chris Snowdon, a fellow at the Adam Smith Institute in London, is that taxes designed to curb smoking, drinking or the consumption of fatty foods may do little to actually reduce such behaviors.

Read more about this study here.

VA Lt. Governor continues to mull independent bid for Governor

It was reported this week that current Virginia Lt. Governor Bill Bolling (R) is continuing to mull an independent bid for Governor of the Commonwealth in 2013. Current polling shows Bolling would draw between 12 and 15 percent in a three-way contest against Republican Ken Cuccinelli and Democrat Terry McAuliffe. Bolling has until March 14 to decide.

Johanns won't seek reelection

First-term Republican U.S. Senator Mike Johanns, a former Governor and Secretary of Agriculture, announced this week that he will not seek reelection to the Senate in 2014. Current Nebraska Congressman Lee Terry (R) and Jeff Fortenberry (R), as well as current Nebraska Governor Dave Heineman (R), are all rumored to be interested in a potential run to replace Johanns. On the Democratic side, former U.S. Senator Bob Kerrey, who lost a Senate run in 2012, said he had no plans to seek the seat.

Opinion: “RINOs need to take back the republican party”

Right-of-center opinion writer Kathleen Parker wrote a provocative piece for The Washington Post this week where she posited that, “RINO, of course, refers to Republicans In Name Only and is the pejorative term used against those who fail to march in lockstep with the so-called conservative base. I used “so-called” because, though the hard-right faction of the party tends to be viewed as The Base, this isn’t necessarily so. My guess is there are now more RINOs than those who, though evangelical in their zeal, are poison to their party’s ability to win national elections.”  Read the entire piece here.


On tap for next week:


Unless Congress acts, sequestration is set to occur on Friday of next week (March 1st).

The Senate is in session

Hagel confirmation: After failing to invoke cloture to end a Republican-led filibuster last week, it is likely that the Senate will vote next week on the confirmation of former U.S. Senator Chuck Hagel (R-NE) to serve as Secretary of Defense. Leading Republican opponents of the nomination, including Senator John McCain (R-AZ) and Senator Lindsey Graham (R-SC), have signaled that they intend to allow an up or down vote on his confirmation and that he likely has the votes to be confirmed.

Lew nomination: The Senate Finance Committee is likely to hold a vote next week to send the nomination of Jack Lew – President Obama’s pick for U.S. Treasury Secretary – to the floor of the Senate for final confirmation.

The House of Representatives is in session

House Appropriations Committee: The House Appropriations Committee will begin hearings on fiscal 2014 appropriations for Energy and Water Development, Homeland Security, Labor/HHS/Education, and the Legislative Branch next week.

House Armed Services Committee: The House Armed Services Committee will hold hearings on the Impact of Budget Constraints on Military Strength and on the Impact of CRS and Sequestration on Defense Readiness next week.

Did you know?

2013 is the first year since 1987 to contain four different numbers. 



Steven C. LaTourette, President  |  202.737.8933

McDonald Hopkins Government Strategies LLC
101 Constitution Avenue NW, Suite 600 East, Washington, D.C.  20001


Although McDonald Hopkins Government Strategies LLC is owned by the law firm McDonald Hopkins LLC, McDonald Hopkins Government Strategies is not a law firm and does not provide legal services. Accordingly, the retention of McDonald Hopkins Government Strategies does not create a client-lawyer relationship and the protections of the client-lawyer relationship, such as attorney-client privilege and the ethics rules pertaining to conduct by lawyers, do not apply.