The document summarizes various domestic and foreign policy matters from the previous week. On the domestic front, Congress passed a short-term spending bill to fund the government through March 2013 and debated various appropriations bills. Internationally, the US imposed new sanctions on Iran and supported opposition forces in Syria, while Secretary of State Clinton traveled to several African countries.

1. August 3, 2012
DOMESTIC POLICY MATTERS
Fiscal Year (FY) 2013 Appropriations/Sequestration. On Tuesday, Senate Majority Leader Harry Reid (D-
Nevada) and Speaker of the House John Boehner (R-Ohio) announced a deal on a six-month Continuing
Resolution, which will keep the government funded at current spending levels through March 2013. Both
chambers of Congress are expected to vote on the resolution after they return from recess on September
10th. Meanwhile, the Senate continued to mark-up FY 2013 appropriations bills this week, reporting the
Defense and Legislative Branch appropriations bills out of committee on Thursday. On Monday, the
Department of Labor issued guidance stating that in light of the uncertainty about whether sequestration will
go forward as scheduled, government contractors do not have to issue layoff notices under the WARN Act,
which would have required that notices be sent out just days before the November elections. The Office of
Management and Budget (OMB) followed with a letter Tuesday announcing that all military personnel
accounts will be exempt from sequestration for FY 2013. Acting OMB Director Jeffrey Zients testified at a
House Armed Services Committee hearing Wednesday, where Democrats and Republicans blamed each
other for failing to come up with a viable plan to avert sequestration.
On Tuesday, House Republicans pulled their one-year farm bill extension in favor of a narrower $383 million
disaster aid package to assist farmers and ranchers impacted by drought across the country. The House
passed the bill Thursday (223-197), but Senate Agriculture Committee Chair Debbie Stabenow (D-Michigan)
said she is not prepared to move ahead with the disaster aid measure as a substitute for a five-year farm bill.
A procedural motion failed in the Senate Thursday to advance cybersecurity legislation backed by most
Democrats and the White House, after the U.S. Chamber of Commerce and most Republicans had opposed
the bill’s voluntary guidelines for private industry. Senate Commerce Committee Chair Jay Rockefeller (D-
West Virginia) called the result “disappointing” and called cybersecurity “our top national security priority.”
Tax Policy. On Wednesday, after defeating a Democratic alternative to extend tax cuts for all household
incomes below $250,000, the House voted (256-171) to extend the Bush-era tax cuts for all taxpayers
through 2013. Senate Finance Committee Chair Max Baucus (D-Montana) and Ranking Member Orrin Hatch
(R-Utah) announced a bipartisan agreement on a tax extenders package Wednesday. At a mark-up the next
day, the Committee approved (19-5) the measure, which includes more than $205 billion in tax cut
extensions. On Friday, President Obama again called on Congress to extend tax cuts for the middle class,
expressing strong support for the Senate-passed bill targeting families earning up to $250,000. Meanwhile,
the Senate is highly unlikely to pass the House bill extending all Bush-era tax cuts.
Jobs & the Economy. The Federal Reserve (Fed) said Wednesday that it will not take further steps to
stimulate the economy at this time; however, the Fed committed to closely monitor economic developments
and “provide additional accommodation as needed to promote a stronger economic recovery.” On Friday, the
Labor Department announced that while the U.S. economy added a larger-than-expected 163,000 jobs in
July, the unemployment rate rose from 8.2 percent to 8.3 percent for the month.
Political News. Congressman Geoff Davis (R-Kentucky), who already had announced his retirement for later
this year, resigned Tuesday night, citing family health reasons. A special election for the solidly Republican
seat will take place in November. Ohio Congressman Steve LaTourette (R) stated Tuesday that he does not
plan to seek re-election to his Republican-leaning seat due to an increasingly polarized environment in
Washington. After the House Ethics Committee released its report on the investigation of Congresswoman
Laura Richardson (D-California), the House voted Thursday to reprimand and fine the Congresswoman for
campaign misconduct in 2010. Tea Party favorite Ted Cruz won the Republican primary runoff in Texas
Tuesday night to fill the seat of retiring Senator Kay Bailey Hutchison (R). Cruz, a former state solicitor
general, defeated Lieutenant Governor David Dewhurst and is now favored to win the general election.
FOREIGN POLICY MATTERS
Iran. On Tuesday, President Obama announced new sanctions, via an Executive Order, intended to place
further pressure on the National Iranian Oil Company. That same day, the Treasury Department announced it
will impose sanctions against two alleged violators of existing sanctions – the Bank of Kunlun in China and
Elaf Islamic Bank in Iraq. Administration officials reported the two financial institutions have processed
significant financial transactions for blacklisted Iranian banks, allegedly facilitating the movement of millions of
dollars that may have been used for proliferation activities. Meanwhile, the Senate and House passed new

2. sanctions Wednesday – consensus legislation introduced Monday (H.R. 1905) that has been negotiated over
the past month by Senate Banking Committee Chair Tim Johnson (D-South Dakota), House Foreign Affairs
Committee Chair Ileana Ros-Lehtinen (R-Florida), and others. H.R. 1905 tightens loopholes in existing
energy sector sanctions and deems as sanctionable any commercial activity – financial services, insurance,
technology, transportation or infrastructure – with Iran’s oil and natural gas sectors.
Syria. President Obama and Turkish Prime Minister Recep Tayyip Erdoğan spoke Monday to attempt to
accelerate a political transition in Syria. On Tuesday, the Syrian Chargé d’Affaires to Great Britain defected.
Fighting increased this week between the Syrian opposition and President Assad’s forces for control over
Aleppo, with the Free Syrian Army (FSA) claiming Friday it now controls 50 percent of Syria’s largest city.
Reports also emerged this week of alleged torture and killing of regime loyalists in Aleppo, leading the FSA to
issue a statement noting "these reprehensible acts do not conform with the ethics of the FSA or the Syrian
revolution." On Wednesday, the Senate Foreign Relations Committee held a hearing on Syria, discussing
what more the United States could be doing. On Thursday, Kofi Annan announced his resignation as the
U.N.-Arab League Special Envoy to Syria. Secretary Clinton issued a statement saying the United States
remains committed to an effective political transition as envisioned under the Annan framework. The State
Department further noted the United States will continue its strategy to accelerate sanctions to hurt the Syrian
regime financially, to assist the opposition with organization, and to provide communication equipment,
nonlethal and increased humanitarian assistance. In addition, U.S. media reported this week that President
Obama had signed a covert order authorizing clandestine support for the Syrian rebels from the CIA and
other U.S. intelligence agencies. Meanwhile, the U.N. General Assembly voted 133-12 Friday in favor of a
resolution, drafted by Saudi Arabia, to pressure the U.N. Security Council to take further action against the
Assad government. U.S. Ambassador to the U.N. Susan Rice praised the vote, stating, “The General
Assembly demanded once more that the first step in the cessation of violence be made by the Assad regime.”
Trade. On Thursday, the House passed a trade bill, previously passed by the Senate, which reauthorizes
the Administration’s ability to ease or re-impose sanctions on Burma and to extend through 2015 the
Third-Country Fabric Program for Sub-Saharan Africa. The bill has been submitted to President Obama
for signature. Before recessing, neither the House nor the Senate brought to a floor vote the legislation
granting Permanent Normal Trade Relations (PNTR) status to Russia and Moldova – and containing a
version of the Sergei Magnitsky Accountability Act. The legislation may come up in September.
Secretary Clinton is on a ten-day trip to Africa, with stops in Senegal, South Sudan, Uganda, Kenya, Malawi,
South Africa, and Ghana. The Secretary met with Senegalese President Macky Sall and gave a speech
Wednesday on building sustainable partnerships in Africa. On Friday, the Secretary met with President of
South Sudan Salva Kiir and Foreign Minister Nhial Deng, encouraging progress in negotiations with Sudan on
security, oil and citizenship issues. In Uganda Friday, Secretary Clinton highlighted the additional $25 million
the U.S. government recently committed to help Uganda eliminate mother-to-child transmission of HIV.
Late last Friday, the State Department issued a statement on the inability of U.N. Member negotiations to
reach consensus on the U.N. Arms Trade Treaty, noting negotiators’ “considerable” progress. The State
Department said the United States prefers another round of negotiations to address U.S. concerns related to
the Second Amendment of the U.S. Constitution – the right to bear arms.
On Tuesday, presumptive Republican Presidential nominee Mitt Romney concluded his overseas trip with
a visit to Poland. Governor Romney praised the U.S. ally’s post-Communist economic and political
liberalization while noting that Russia’s “once-promising advances toward a free and open society have
faltered.” On Sunday, Governor Romney had visited Jerusalem, meeting separately with Israeli Prime
Minister Benjamin Netanyahu and Palestinian Prime Minister Salam Fayyad and subsequently stating, “We
should employ any and all measures to dissuade the Iranian regime from its nuclear course….We recognize
Israel’s right to defend itself, and that it is right for America to stand with you.”
President Obama spoke with French President François Hollande and Italian Prime Minister Mario Monti
Wednesday, welcoming the recent declarations by the European Central Bank and European leaders on the
need to do what is necessary to preserve the eurozone. President Obama also discussed the situation in
Syria with both leaders. This week, President Obama announced his intention to nominate the following
individuals: Kevin Washburn to be Assistant Secretary for Indian Affairs (Interior) and Christopher Meade to
be General Counsel (Treasury). Late Thursday, the Senate confirmed James Cunningham as U.S.
Ambassador to Afghanistan. This week, the State Department released its 2011 International Religious
Freedom Report (Monday), and its 2011 Country Reports on Terrorism (Tuesday).
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