Good morning. Here’s your Daily SITREP for Monday, 18 September 2023.
- READ TIME: 5 Minutes, 20 Seconds
- Inside the Beltway
- (1) Senate Republicans Beg Biden to Send ATACMS to Ukraine
- (2) GOP Factions Join Forces on Stopgap but Still Far Apart
- Domestic INTSUM
- (3) Bank Of America: Congress Will Avert a Government Shutdown
- (4) Unprecedented UAW Strike Takes On Big Three
- Global SITREP
- (5) China’s Missing Defense Minister Found, Arrested
- (6) ONI Leak: Chinese Shipbuilding Capacity Insurmountable
- (7) China’s New Pressure Tactic and Taiwan Fails to Publish 60% of Incursion Data
INSIDE THE BELTWAY
- (1) SENATE REPUBLICANS BEG BIDEN TO SEND ATACMS TO UKRAINE: In a letter to President Biden, Senators Tom Cotton (R-AR), Roger Wicker (R-MS), Susan Collins (R-ME), and Lindsay Graham (R-SC) urged the White House to send MGM-140 Army Tactical Missile Systems (ATACMS) to Ukraine.
- The Senators said ATACMS could be provided without “appreciable risk” to U.S. combat capability because Ukraine only needs a small amount after “significantly degrading” Russian combat power.
- Why It Matters: The Biden administration has maintained that sending ATACMS, a missile system that would give Ukraine the capability to strike targets in Russia, would be withheld from Ukraine because it would be a significant escalation. Multiple Launch Rocket System (MLRS) vehicles sent to Ukraine were even modified to be unable to launch the ATACMS. The White House is reportedly considering sending the ATACMS now, and Ukrainian President Volodymyr Zelensky will visit the capital this week, likely to lobby for them. The administration now seems open to providing a weapons system Ukraine can use to strike the Russian interior, likely because the Ukrainian situation is much worse than mainstream reporting lets on. – R.C.
- (2) GOP FACTIONS JOIN FORCES ON STOPGAP BUT STILL FAR APART: House GOP leadership released a proposed a 31-day stopgap funding bill this week based on a framework between GOP leadership and the House Freedom Caucus that includes border wall funding, immigration enforcement, and an 8% spending cut.
- House Speaker Kevin McCarthy (R-CA) said he has never seen “anyone win in a shutdown” and will push a floor vote on the House Pentagon funding bill after withdrawing it from a rules vote last week.
- Rep. Chip Roy (R-TX) said there will “almost inevitably” be a shutdown, and the Freedom Caucus members are working on a “centralized message.”
- Why It Matters: Freedom Caucus Republicans burned McCarthy on the impeachment announcement and defense spending bill, which he thought would placate his right flank while averting a shutdown. This 31-day stopgap bill will not get through the Democrat-controlled Senate, and the White House said President Biden would veto the House Defense spending bill if it made it to his desk. Senate Republican leadership is also opposed to anything other than a clean Continuing Resolution or bipartisan appropriations bills, leaving the ball in McCarthy’s court. Immigration is emerging as the main obstacle for a stopgap bill and is even causing internal strife between state Democrats and the national party. – R.C.
- (3) BANK OF AMERICA: CONGRESS WILL AVERT A GOVERNMENT SHUTDOWN: Bank of America economists predict that Congress will still pass a continuing resolution before 01 October to avert a government shutdown, although the likelihood of a brief shutdown is “inching closer to 50%.”
- If the government does shut down, the U.S. will lose 0.1% of GDP growth per week, but some of this GDP decline will be recovered as federal workers receive back pay, according to Bank of America’s analysts.
- Why It Matters: The chances and duration of a government shutdown vary among investment banks. Goldman Sachs analysts see over a 50% chance of a shutdown and project that it will last 2-3 weeks. But most banks agree that a shutdown won’t cause financial market chaos. – H.B.
- (4) UNPRECEDENTED UAW STRIKE TAKES ON BIG THREE: The United Auto Workers (UAW) Union launched an unprecedented strike Friday against General Motors, Ford, and Stellantis, known as the “Big Three” automakers, after automakers rebuffed UAW demands for a 40% wage increase over the next two years and a 32 hour work week.
- U.S. Chamber of Commerce President and CEO Suzanne Clark said the UAW strike and the “Summer of Strikes” were the fault of President Biden’s “unionization at all costs” approach.
- Ford announced a layoff of 600 workers at their Michigan Assembly Plant in Wayne, MI, adding that it was a direct consequence of the UAW walkout.
- Why It Matters: UAW and automakers are back at the negotiating table, but it looks like they are still far apart on a contract deal after UAW President Shawn Fain said the latest offer from Stellantis was “definitely a no-go.” President Biden has touted himself as the most pro-union president in U.S. history, but he seems to be out of step with Fain and other Democratic lawmakers who support the strike. Appeals from the White House to end the strike are likely to fall on deaf ears. – R.C.
- (5) CHINA’S MISSING DEFENSE MINISTER FOUND, ARRESTED: China’s Defense Minister, who has been missing for over two weeks, has reportedly been detained for corruption by the military’s powerful disciplinary inspection commission.
- Li Shang Fu reportedly disappeared after giving a keynote speech at a security forum with African nations.
- Unconfirmed reports indicate that up to 200 People’s Liberation Army (PLA) Strategic Rocket Forces officers have also been detained.
- Why It Matters: Li Shang Fu’s disappearance and subsequent detention follows former Chinese Foreign Minister Qin Gang’s July disappearance, which was ultimately blamed on “health problems.” China’s strategic rocket forces have also undergone a significant purge following revelations that the U.S. had obtained classified information on its bases and operations. The Chinese Communist Party could be reacting to compromises of its key military and defense establishment – or possibly taking the bait on a Western information operation of epic proportions. Either way, the shakeup will have a major impact on the PLA command and control echelon when Beijing is moving towards reunification of Taiwan. – M.M.
- (6) ONI LEAK: CHINESE SHIPBUILDING CAPACITY INSURMOUNTABLE: A leaked slide from a presentation by the Office of Naval Intelligence highlighted concerns that China’s rapidly expanding shipbuilding industry is 200 times more capable than the U.S. shipbuilding industry.
- A senior research fellow for the Center for National Defense said there was no near-term fix for the capability gap between China and the U.S.
- The slide outlined China’s shipyard capacity at 23.2 million tons compared to 100,000 tons for the U.S.
- Why It Matters: While U.S. warships are thought to be more technologically advanced than the Chinese, an advantage of 200 times the U.S. capability to build or regenerate combat losses puts the U.S. at an almost insurmountable disadvantage in any future conflict with China. A side-by-side comparison of current naval capabilities between China and the U.S. showed China with an advantage of 355 naval vessels to 296 on the U.S. side. Additionally, the U.S. is almost totally reliant on Chinese shipbuilding for commercial vessels. A potential vulnerability China could use to harm U.S. supply chains should the two nations go to war over Taiwan. – M.M.
- (7) CHINA’S NEW PRESSURE TACTIC AND TAIWAN FAILS TO PUBLISH 60% OF INCURSION DATA: Last night, the Taiwan Ministry of National Defense (MOD) reported 103 People’s Liberation Army (PLA) aircraft entering their airspace on Sunday.
- This is the highest number of air incursions in a single day. The PLA Navy broke the record for most naval incursions last week.
- Taiwan’s MOD reported tracks for 40 of the 103 incursions.
- Why It Matters: Breaking records on separate days seems like a new way for the PLA to keep high pressure on Taiwan for much longer than it has in the past. This is the first time record-breaking air incursions have not come on the same day as record-breaking ship incursions. Also, none of the flight paths published by the MOD come from a ship. They only accounted for 40% of the total flights yesterday, but it could indicate that Taiwan has trouble identifying shipborne aircraft or that they are withholding information to avoid sources and methods disclosure. – J.V.
— END REPORT
M.S. indicates analyst commentary from Mike Shelby
M.M. indicates analyst commentary from Max Morton
J.V. indicates analyst commentary from Jared Vaughn
R.C. indicates analyst commentary from Robert Cook
H.B. indicates analyst commentary from Harrison Burge
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