Nov 06, 2014
Picking through the debris left by this week's mid-term election “tsunami,” our office has several observations on the Republican takeover of the Senate by winning eight (and possibly nine) Senate seats held by Democrats and the increase in Republican control of the House, and what these changes mean for ASA priorities in the 114th Congress.
In terms of “what did it mean,” the results suggest a repudiation of President Obama and some of the policies enacted or proposed by Democrats, most notably Obamacare. Exit polling also showed voters expressing disapproval of gridlock and partisan fighting in Washington and a desire for Congress and the Administration to work together to get things done. A President’s party usually fares poorly in mid-term elections, particularly in a President’s second term, and the political map, with Democrats defending 21 of 33 Senate seats, favored Republicans. However, the margin of victory in states that were considered “close” in pre-election polling was much higher in many races, and Virginia, which was not supposed to be in play, turned into a real cliffhanger.
The question now is whether those who won this year and the incumbents who face reelection in 2016 read the results in a way that motivates them to press their leaders to work together and reach compromises on issues which have been stalled by one or both parties for years. The Republicans will have 23 seats to defend compared to 9 for the Democrats. The fact that 2016 is also a Presidential election year will compress these decisions into a short timeframe, between January and August or maybe early in the fall of 2015. The Republicans have a stronger hand to play now, and may be willing to work across the aisle rather than forcing their priorities into confrontational budget reconciliation packages, which require only 51 votes to pass.
For the Obama Administration, we’ll see whether they will use the President’s executive authority to make regulatory policy changes that aren’t subject to Congressional approval, or if the President decides that engaging the Republican leadership is important in making his last two years relevant in the political process as the 2016 sweepstakes begin early next year.
Let’s look at the political terrain between now and year’s end, and going into 2015.
The “lame duck” session that will begin when Congress returns to Washington next week will likely be shorter than if control of the Senate had been in doubt. Republicans will want to defer most issues on their agenda to January, when they take control of the chamber. So Congress will need to pass omnibus legislation or, more likely, a Continuing Resolution to keep the government running beyond expiration of the current CR on December 15. They may also take up a tax extenders package that may include an extension of the biodiesel tax credit, at least retroactive to the beginning of 2014. It is considered doubtful that they will take up Trade Promotion Authority or more significant tax reform legislation before adjourning for the year.
For 2015, the critical question will be whether the President and Congress begin to negotiate on key issues in good faith and actually move and enact legislation. If not, Republicans will consider whether to force their priorities through the Senate in budget reconciliation packages which only require 51 votes. A second question is whether they will craft these packages in a way that forces a Presidential veto, or if they include “must-pass” measures in them, including an increase in the federal debt limit, which will be reached in March and when borrowing authority will become critical in July. This tactic has been used before with mixed results – the Republicans were blamed after President Clinton vetoed a reconciliation bill in 1995, contributing to their losses in the 1996 elections. It is possible that the Farm Bill, particularly SNAP, could be subject to the reconciliation process if the Agriculture Committees are directed to identify and provide savings to include in a budget reconciliation bill. ASA and other farm groups have traditionally opposed efforts to re-open the Farm Bill.
With regard to ASA’s priorities, efforts will continue into 2015 to conclude the Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (TTIP) agreements, and to obtain Congressional approval of Trade Promotion Authority (TPA). While Administration officials have stated that extension of TPA could follow conclusion of the two trade deals, it would be much harder to make the hard decisions required at the end of negotiations if TPA is not already in place.
Prospects for legislation normalizing trade with Cuba are likely to get caught up in 2016 politics as candidates for both parties vie for support in Florida. ASA is participating in a broad coalition of organizations to push for lifting the long-standing embargo on trade with Cuba.
Legislation establishing national voluntary standards for labeling foods that do not contain biotech ingredients as opposed to confusing and costly state labeling laws (HR 4432) was introduced in the House in 2014, but only attracted 37 co-sponsors. While it may receive a hearing on December 10 if Congress remains in session that long, ASA and other farm organizations are looking at ways to redraft the bill in order to broaden support beyond agriculture-related groups.
The Renewable Fuel Standard (RFS) and support for biofuels is probably not strengthened with the Republican majorities, but it should not be in grave danger either. It will continue to be a regional issue within the Republican caucus, and not likely to be repealed or significantly reduced. EPA is expected to finalize the 2014 RFS volumes in the coming days. Higher livestock prices and lower corn prices will reduce the pressure from anti-RFS factions and energy policy will be focused on the Keystone Pipeline, expanded domestic oil and gas production, and potentially allowing exports of U.S. oil. The biodiesel tax credit remains tenuous. A tax extenders package could be enacted in the lame duck session, but tax reform may be on the agenda in 2015 making those temporary tax breaks more vulnerable.
The outlook for transportation policy is not expected to be dramatically different in 2015 following the election results. Reauthorization of the Highway bill will be on the agenda and could get tied to energy issues and/or budget and reconciliation packages as Congress seeks revenue sources to cover the costs of the bill, which is popular on both sides of the aisle.
Regulatory issues, including the proposed rule defining Waters of the United States, should be low-hanging fruit for a Republican Congress. The comment period for WOTUS will close on November 14. Congress can choose to either include an appropriations rider in the FY2015 omnibus appropriations bill to prohibit funding to advance the rule, or they could pass legislation through the authorizing committees. Other regulatory issues that have been important to agriculture, such as the NPDES permitting rule for pesticide applications over water, could finally be overturned through the Agriculture committees.
Legislation that could be considered next year by the Agriculture committees includes the overdue reauthorization of the CFTC and reauthorization of child nutrition programs. Incoming Senate Ag Committee Chairman Pat Roberts has indicated an interest in reform of the Supplemental Nutrition Assistance Program (SNAP, or food stamps), which is a shared interest of the House Agriculture Committee. That effort, however, would severely complicate any efforts at bipartisanship. Any serious efforts to make changes to SNAP would likely come through the reconciliation process discussed above.