Senate sends $717B defense policy bill to Trump’s desk

The Senate on Wednesday easily passed a $717 billion annual defense policy bill despite some angst about its lack of a provision to block President Trump’s deal with Chinese telecommunications giant ZTE.

The Senate approved the compromise fiscal 2019 National Defense Authorization Act (NDAA) in a 87-10 vote, sending it to Trump’s desk for his expected signature and keeping it on track to become law before the start of the fiscal year for the first time since the fiscal 1997 bill.

This year’s bill — named after Senate Armed Services Committee Chairman John McCain (R-Ariz.), who is at home undergoing treatment for brain cancer — would authorize about $639 billion for the Pentagon’s base budget and the Energy Department’s defense programs. It would also allow for another $69 billion for a war fund known as the Overseas Contingency Operations account.

What would have been the most controversial provision of the bill, which dealt with ZTE, was jettisoned during House–Senate negotiations to reconcile each chamber’s version.

The initial Senate-passed version of the NDAA included a provision that would have blocked Trump’s plan to save the Chinese firm, which had been slapped with penalties that prevented it from buying U.S. technology after admitting violating sanctions on Iran and North Korea.

U.S. intelligence officials have also testified that ZTE and other Chinese state-directed telecommunications represent a national security threat by providing the capacity for spying and intellectual property theft.

Instead of the Senate’s approach, the final bill aligns with the initial House-passed version. It would ban the government from contracting with ZTE and Huawei, another Chinese telecommunications company, or companies that do business with those two.

Leaders of the House and Senate Armed Services committees have said the Senate provision was stripped because it would have cost $1 billion that would have had to be made up by cutting mandatory spending such as troop’s health-care or retirement benefits. That’s because ZTE has already paid the government a $1 billion fine as part of the Trump deal.

“I am not going to try to defend President Trump’s decision to overrule his administration’s penalties on ZTE for violating our sanctions, but the president’s actions created facts on the ground,” Sen. Jack Reed (D-R.I.), ranking member of the Armed Services Committee, said on the Senate floor. “We have done, I think, what we could do to ensure that our national security is not compromised in the future by ZTE or Huawei equipment.”

But senators who sponsored the original ZTE provision fumed Wednesday, saying that taking it out of the bill allows a national security threat to persist.

“The threat posed by China and its telecommunications companies are so severe and so significant that it regrettably brings me to the point that I cannot support a bill I have always supported in my time here,” Sen. Marco Rubio (R-Fla.) said on the Senate floor. “We need to wake up to the threat that China poses to this country, because we are running out of time to do so.”

The bill follows the administration’s request for a 2.6 percent pay raise for troops, an increase of about 15,600 service members across the Army, Navy, Air Force and Marine Corps, and 77 F-35 fighter jets. It goes above the administration’s request for ships, with a total 13 new vessels.

Also dropped from the final bill was a House-passed provision that would have blocked endangered species protections for the greater sage grouse and the lesser prairie chicken for 10 years.

One closely watched provision that did make it into the final bill was Defense Secretary James Mattis’s request for an ability to waive sanctions on partner countries that have bought Russian arms in the past but want to now buy U.S. weapons.

Mattis argued the provision was necessary to more closely align India, Vietnam and Indonesia with the United States, but some Democrats expressed concern the provision would loosen sanctions on Russia.

Mattis, however, did not win a separate fight with Congress over provisions in the bill on Turkey. The final bill would block F-35 transfers to Ankara until the Pentagon completes an assessment of U.S.-Turkish relations.

Lawmakers are concerned about Turkey’s plan to buy the S-400 air-defense system from Russia, its detention of American pastor Andrew Brunson and its moves in Syria against U.S.-backed Kurdish forces.