Good morning. Here’s your Daily SITREP for Monday, 21 August 2023.
- READ TIME: 5 Minutes, 30 Seconds
- Inside the Beltway
- (1) Ukraine Hawks, Administration Question Ukraine’s Future
- (2) Goldman Sachs: Government Shutdown More Likely Than Not
- (3) Trump to Skip First Republican Primary Debate, Poll Lead Grows
- Domestic INTSUM
- (4) JPMorgan: Americans’ Excess Savings Gone
- Global SITREP
- (5) Ukraine Out of Options on Counteroffensive
- (6) United Nations Deploys Kenyan Recon Force to Haiti
- (7) Belgium Throws in the Towel in Niger
- (8) China Launches Retaliatory Military Drills Around Taiwan
- (9) Gálvez Sells “Mexican Dream” in Texas
INSIDE THE BELTWAY
- (1) UKRAINE HAWKS, ADMINISTRATION QUESTION UKRAINE’S FUTURE: A Biden administration official said “the realities” of the Ukrainian counter-offensive are sinking in around Washington, and another official said the administration is questioning the future of support for Ukraine.
- Rep. Andy Harris (R-MD), the most outspoken Ukraine supporter in the House Freedom Caucus, said the Ukraine counter-offensive failed, he’s not sure the war is winnable, and he will not support further funding that is non-military and doesn’t have an Inspector General.
- Why It Matters: This is a bad sign for future Ukraine funding now that Ukraine hawks are openly, and the administration is secretly acknowledging that the counter-offensive has stalled and there is no real path to a quick victory over Russia. If the Biden administration is going to rip the band-aid off before Ukraine becomes another foreign policy failure, the time to do so is now when there is time for it to make the media cycle before the 2024 election year. – R.C.
- (2) GOLDMAN SACHS: GOVERNMENT SHUTDOWN MORE LIKELY THAN NOT: Goldman Sachs’ Economics Research arm said a government shutdown after 01 October is “more likely than not,” and the less severe economic consequences increase the likelihood Congress will fail to pass spending bills or a Continuing Resolution (CR) in time.
- Goldman analysts said the thin House majority, disagreements over spending levels, Ukraine aid, and border security could hold up any progress towards final spending bills or a CR.
- Why It Matters: Goldman analysts identify opposition to a CR due to arguments over border security as a warning sign that a government shutdown is likely. Rep. Chip Roy’s (R-TX) statement that he will oppose a CR and funding for DHS over the border crisis should be a flashing red alert. Roy is a member of the Rules Committee and could try to use parliamentary procedure to block or delay a CR from hitting the floor before the 01 October deadline. – R.C.
- (3) TRUMP TO SKIP FIRST REPUBLICAN PRIMARY DEBATE, POLL LEAD GROWS: Former President Donald Trump said he will skip the first Republican Primary debate in Milwaukee, WI, on Wednesday and instead sit for an interview with former Fox host Tucker Carlson.
- A CBS/YouGov poll said that 62% of likely Republican voters support Trump after his latest indictment in Atlanta, and 16% supported runner-up Florida Governor Ron DeSantis.
- Why It Matters: Trump has an effectively insurmountable lead and nothing to gain by participating in primary debates. His absence takes the wind out of the sails of candidates like Chris Christie, who are running on being anti-Trump. It also takes away a focus point for lower polling candidates turning the debate into an audition for VP. While Trump is the most-likely Republican nominee at this point, barring a brokered convention in July 2024, his likely only path forward in the general election is if Biden drops out of the race before November next year. – R.C.
- (4) JPMORGAN: AMERICANS’ EXCESS SAVINGS GONE: In a recent research report, JPMorgan analysts wrote that Americans’ excess savings, which totaled $2.1 trillion in 2021, are now completely gone.
- Without any savings left, Americans have turned to credit cards – now with a total balance of $1 trillion.
- Why It Matters: Higher inflation will return this fall and hurt Americans, especially the 60% who are living paycheck to paycheck. Discretionary spending will drop, which will put pressure on retailers and could lead to overall stock market weakness. – H.B.
- (5) UKRAINE OUT OF OPTIONS ON COUNTEROFFENSIVE: Ukraine is running out of options to retake Russian-occupied territory as Kiev’s manpower and material are depleted.
- Ukraine’s inability to demonstrate decisive success on the battlefield is creating fear that international support could falter.
- Ukraine is using drone strikes to detract from its inability to succeed on the ground against dug-in Russian forces.
- Why It Matters: Analysts caution that while the drone attacks can shift attention away from Ukraine’s slow-moving ground counteroffensive, they are unlikely to tip the balance of the war in Kiev’s favor. Calls for advanced Western weapons systems and training miss the mark in that Ukraine has failed to properly employ its Western-trained and equipped forces against the Russian defensive lines. If Ukraine fails to make a breakthrough, expect Russian forces to advance along the Kupyansk direction at the onset of winter. – M.M.
- (6) UNITED NATIONS DEPLOYS KENYAN RECON FORCE TO HAITI: Kenyan police officials arrived in Haiti over the weekend to conduct a reconnaissance ahead of their planned peacekeeping mission.
- Kenya has offered to help what is left of the Haitian government to combat gang violence and organized crime that has taken control of the country.
- The U.S. promised to push forward a U.N. resolution to authorize Kenya to lead a multinational peacekeeping force in Haiti, although no timetable for the action has been identified.
- Why It Matters: Haiti is a lawless country without a functioning government. Although the U.N. has called for a more robust peacekeeping force of Western special forces and police personnel, only Kenya has agreed to participate. It is highly unlikely that the Kenyan force will be able to quell the violence in Haiti and restore a democratic government. Expect further trouble in Haiti amid coincidental Chinese and Russian advances in Latin America and the Caribbean. – M.M.
- (7) BELGIUM THROWS IN THE TOWEL IN NIGER: Belgium is evacuating citizens from Niger in an effort to reduce its presence in the Sahel country ahead of possible armed conflict between Niger and its allies and the African political bloc ECOWAS.
- Belgian military A-400M cargo planes are making regular flights from Niamey to Gabon and then onto an airbase near Brussels to ferry passengers out of Niger.
- Last week, the West African bloc decided to activate its standby force for a possible military intervention to restore constitutional order in Niger.
- Why It Matters: The U.S. and European Union are between a rock and a hard place regarding Niger. Tied down with the war in Ukraine, Western governments are unable to dedicate forces to topple Niger’s military junta and restore a pro-West democratic government. In its absence, ECOWAS has pledged to activate a military intervention force, although it is doubtful that the ECOWAS force could prevail against a united faction of Niger, Malian, and Burkina-Faso allied forces pledged to defend the Niger junta. – M.M.
- (8) CHINA LAUNCHES RETALIATORY MILITARY DRILLS AROUND TAIWAN: China’s People’s Liberation Army (PLA) launched air and sea patrols and military exercises around the island nation of Taiwan after its Vice President concluded a trip to the U.S. and South America.
- Beijing considers Taiwan’s Vice President Lai Chng-te a “separatist” who advocates for Taiwan’s independence.
- China’s military exercise appears to be a rehearsal for a naval and air blockade of Taiwan.
- Why It Matters: A China PLA Eastern Theater Command spokesman admitted that the exercises were a test for “the theater’s joint operation capacity in actual combat.” Beijing is becoming increasingly assertive in its demands on Taipei’s political activities, which strongly indicates a looming military operation against Taiwan. – M.M.
- (9) GÁLVEZ SELLS “MEXICAN DREAM” IN TEXAS: Mexican senator and presidential candidate Xóchitl Gálvez was in Houston, Texas, over the weekend to meet with migrants, where she pledged to build the “Mexican Dream.”
- Gálvez said that Mexico has a bright decade ahead with increased foreign direct investment and nearshoring the U.S. supply chain. This investment will bring jobs so Mexicans don’t have to migrate to the United States, she said.
- Why It Matters: Houston has large get-out-the-vote efforts in Mexico’s elections, where Mexicans living in the United States can cast absentee votes. She’s unlikely to be the only presidential candidate to campaign in the United States. – M.S.
Low Intensity Conflict SITREP (Next 48 hours)
- Anchorage, AK – The Party for Socialism and Liberation is coordinating a protest for Bishar Hassan, who was killed in an officer-involved shooting with Anchorage Police. The protest is scheduled for 1800 PDT on Tuesday, 22 August, at 3600 Denali St., Anchorage, AK.
- Los Angeles, CA – Resistance Coalition LA, in coordination with Queer Nation, LA Forward, and Ground Game LA, is planning a Rally for LGBTQ+ Youth at 0830 PDT on Tuesday, 22 August. The rally’s location is Grand Park, across from city hall, Los Angeles, CA.
— 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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