What is the National Defense Authorization Act (NDAA)?
The National Defense Authorization Act (NDAA) is an act that Congress passes annually to make changes in the policies and organization of United States defense agencies and to provide guidance on how military funding can be spent.
Understanding the National Defense Authorization Act
The NDAA is an annual bill that allows Congress to set guidelines for defense policy. Although funding for the U.S. military must be approved by credits bills, Congress uses the NDAA to set defense priorities, make organizational changes to military agencies, and provide advice on how funding is to be used.
In addition to the Ministry of Defense, the legislation also covers military-related programs run by other agencies, like the nuclear weapons programs of the Department of Energy and the counterintelligence activities of the Federal Bureau of Investigation.
A relatively rare example of bipartisanship in Congress, the NDAA has been passed for 60 consecutive years. This consistency has also made the bill a popular vehicle for tackling legislation that has little to do with defense.
Key points to remember
- The NDAA allows Congress to set priorities for defense policy and funding.
- The annual bill covers a wide range of issues and agencies beyond the Department of Defense, including the Department of Energy and the Federal Bureau of Investigation.
- The NDAA for fiscal 2021 marked the 60th consecutive year the bill passed in Congress.
- Congress overturned President Trump’s veto, the first time a president has vetoed this bill, to pass the $ 741 billion legislation.
- Legislation unrelated to defense is often attached to the NDAA given its prospects for bipartisan support.
How defense spending is approved
Prior to 1961, the defense budget of the United States was the exclusive domain of the House and Senate Appropriations Committees. But that year, legislating defense spending became a two-step process – involving both authorization and ownership – to give the committees that oversee defense policy more control over the strings of defense. stock Exchange.
The NDAA only provides guidance on how defense funding should be spent; Congress approves actual funding with appropriation bills.
The process usually begins in February, when the White House sends the federal budget in Congress for the fiscal year, which runs from October to September. At this point, the House and Senate armed forces committees begin the process of creating the NDAA. Each committee usually establishes sub-committees that focus on specific areas, such as military personnel, force readiness or cybersecurity.
After the various committees have held hearings, the House and Senate armed services committees will each draft and pass their own version of the NDAA bill and send it to the prosecution for a full vote in their respective chambers. Sometimes, however, the Senate may choose to debate and vote on the House’s version of the bill. If the two bills are different, the House and Senate appoint a conference committee to fill in the gaps and agree on a conference report for both houses to approve. Once passed, the legislation goes to the president’s office for enactment.
The only waiver of the Trump administration’s veto
The $ 741 billion NDAA for fiscal 2021, covering the period October 1, 2020 to September 30, 2021, was the first time Congress has successfully rescinded a veto by President Donald Trump. The president listed a series of objections to the bill, including non-defense issues, such as a request to include a provision that remove section 230 protection from social media companies from prosecution of the Communications Decency Act. Trump also opposed measures in the bill that would set up a commission to rename military bases honoring Confederate leaders, limiting the president’s use of emergency declarations to embezzle money for non-profit purposes. military such as the border wall and delaying the withdrawal of US troops from Afghanistan, South Korea and Germany.
The House voted to overturn the veto in December by a margin of 322 to 87, securing the necessary two-thirds majority, and the Senate followed suit in January with a vote of 81 to 13. The bill contained a number of other key defense-related provisions, including:
- A 3% salary increase for the troops
- Paid family leave
- Protection against discrimination
- A new Pacific deterrent initiative aimed at countering growth chinese military power in the Indo-Pacific region
- An initiative to support a national security innovation base to help the U.S. high-tech industry compete globally in areas such as artificial intelligence, quantum computing and biotechnology
- Measures to strengthen protections against cyber attacks, including the creation of a national director of cybersecurity in the White House and improved coordination within the Cybersecurity and Infrastructure Security Agency within the Department of Homeland Security.
Stricter rules against money laundering and terrorist financing
The NDAA for fiscal year 2021 also aims to money laundering and terrorist financing, including the use of front companies to hide funding sources. The inclusion of the Business Transparency Act in the bill means that businesses and limited liability companies (SARL) will now have to disclose information about the owners of the business. Companies will be required to provide information to the US Treasury Department on “beneficial owners”, Which includes any person who has“ substantial control ”or holds at least 25% of the capital. Treasury Financial Crime Network (FinCEN) maintain the database, and only national security or law enforcement agencies will have access to it.
The new transparency rules could have a substantial impact on the use of LLCs to make real estate purchases for cash, long seen as a loophole for illicit financing given the lack of reporting requirements. A study of a more targeted FinCEN program requiring title insurers to provide information on the beneficial owners of limited liability companies that have purchased luxury real estate in New York, Miami and other cities found that the amount of cash purchases by corporations had fallen by 70%.
Another piece of legislation included in the NDAA, the Money Laundering Control Act, also attempts to strengthen FinCEN’s campaign against illicit financing by improving the agency’s analytical capacities and coordination with others. agencies and the financial sector.