What Happens After The Shellacking? - Policy
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What Happens After The Shellacking?

By Christian A. Klein and Jason Langford

Article Date: 12-01-2010
Copyright(C) 2010 Associated Equipment Distributors. All Rights Reserved.

Divided They Stand: Republicans Seize Control of House, Dems Hold Senate
An AED analysis of November's election outcomes, and the individual opportunity that lies before every AED member

It is hard to believe that just two years ago the Democrats, led by President Obama, soundly defeated Republicans to win the White House and substantial control of Congress. Emboldened by the huge victory, Democrats pursued policy priorities like health care and climate change legislation, rather than ambitious initiatives to get the economy back on track. On Nov. 2, voters spoke – giving the congressional leadership and the president, in Obama's words, a "shellacking."

Riding a wave of voter anger and frustration, Republicans washed out Democratic gains of the last four years, capturing at least 60 seats to gain control of the House (as of this writing the outcome was yet to be decided in nine races). Senate Democrats escaped the Republican tsunami, keeping control of the upper-chamber by a four-seat margin. The midterm election results will shake up Washington, and AED members should take pride knowing the equipment industry played a part in the process.

AED ImPACt Yields Returns
AED PAC is an important tool to encourage member political participation. From that standpoint, this has been the most successful election cycle ever for AED. In a surge of activism, AED members held a stunning 28 ImPACt 2010 meetings with congressional candidates to personally deliver AED PAC checks. The previous record for ImPACt events was 20 in 2006. Fifty-seven percent of our PAC support this year was given through the ImPACt program.

AED's strategy was to focus special attention on the races that would determine control on Capitol Hill. While maintaining support for longtime allies, we made considerable contributions to promising open-seat and challenger candidates. The returns highlight the wisdom and success of this plan. Eighty-seven percent of AEDbacked candidates won their contests. Of the 13 challengers in House contests supported by AED, all but two won. Additionally, all four Senate candidates in open races who received PAC funds bested their challengers!

AED's Majority Makers
  • Cory Gardner (R-CO-4)
  • Richard Hanna (R-NY-24) *
  • Steve Stivers (R-OH-15) *
  • Kristi Noem (R-SD-At Large)
  • Reid Ribble (R-WI-8) *
  • Sean Duffy (R-WI-7)
  • Steve Chabot (R-OH-1)
  • Charlie Bass (R-NH-2)
  • Pat Meehan (R-PA-7)
  • Mike Fitzpatrick (R-PA-8)*
* Start Us Up USA! Infrastructure Pledge signer

Because of support from AED PAC contributors, members had an important stake in the victories of these "majority makers." The association was active across the country, including districts that many other organizations avoided, such as South Dakota and New York's 24th congressional district.

StartUsUpUSAIn addition to AED PAC, distributors from across the country engaged candidates through the Start Us Up USA! infrastructure pledge initiative. The effort, launched by AED and the Association of Equipment Manufacturers was an unprecedented drive to get U.S. House and Senate candidates from across the country to commit to making surface transportation and water infrastructure investment a top priority in the next Congress.

Start Us Up USA! sent the pledge to every candidate for U.S. House and Senate and industry leaders engaged these individuals on our country's growing infrastructure needs. The pledge gave candidates the opportunity to publicly commit to supporting robust federal investment in surface transportation and water projects to create jobs, spur economic growth, ensure the country's global competitiveness, protect public safety and the environment, and create a better quality of life for every American.

In total, over 70 candidates signed the pledge. More importantly, 12 new Republican House members and 13 winning incumbents supported our effort, many of whom made infrastructure investment a centerpiece of their campaign. AED looks forward to working with these lawmakers.

The House
As the pundits predicted, Republican House candidates dominated, regaining control of the lower chamber. Several Capitol Hill veterans will not be a part of the next Congress. In the upset of the season, Rep. James Oberstar (D-MN), chairman of the House Transportation & Infrastructure (T&I) Committee lost his re-election bid to political newcomer, Republican Chip Cravaack. Oberstar has been in Congress since 1974, and the seat has been in Democratic hands since 1946. John Spratt (D-SC) and Ike Skelton (D-MO), respectively the chairmen of the House Budget and Armed Services Committees, also lost. Additionally, Blue Dog members, who anchored the conservative wing of the Democratic Party and had some of the highest marks on AED's 111th Congress Vote Scorecard, saw their pack thinned at the polls by more than half.

The GOP victory set up Rep. John Boehner (R-OH) as the next Speaker of the House. Eric Cantor (R-VA) will join Boehner on the leadership team as majority leader while Kevin McCarthy (R-CA) will serve as majority whip. Surprisingly, as of this writing, Nancy Pelosi (D-CA) will continue to lead House Democrats as the minority leader.

So, what kind of changes will we see in a Boehner-led House? For starters, Boehner has pledged to give committee chairs more power. Pelosi was known for concentrating power in the Speaker's office at the expense of committees. Boehner has committed to making the panels legislative laboratories, rather than rubber stamps for the leadership's agenda. There will also be a focus on transparency and openness in proceedings.

With the shift in party control, committee leadership will see changes. Rep. John Mica (R-FL) will head the T&I Committee, which is responsible for surface transportation and wastewater projects. The surprising defeat of Oberstar likely sets up Rep. Nick Rahall (D-WV), a major highway proponent, as the panel's next likely ranking member.

Rep. Dave Camp (R-MI) is in line to chair the powerful Ways & Means Committee. Camp will emphasize a tax policy that encourages economic growth, job creation, and an extension of the Bush tax cuts for all taxpayers. Camp and other leading Ways & Means Republicans have sided with AED against LIFO repeal. Additionally, committee Republicans will make repealing the health care law a priority.

The Senate
While the GOP significantly dented the Democrats' majority in the upper chamber, Republicans fell shy of seizing control. The leadership of the Senate will therefore remain as it was prior to the election. However, Majority Leader Harry Reid (D-NV) will find it more difficult to pass legislation.

One change that will occur when the Senate resumes for the lame-duck session this November is the immediate seating of three new senators. Unlike their colleagues who will be sworn in this January, Sens.-elect Joe Manchin (D-WV), Mark Kirk (R-IL) and Chris Coons (D-DE) all won special elections and will join the chamber before the next Congress starts in January.

Tighter margins in the Senate may mean more gridlock. With new senators supported by the Tea Party movement, such as Rand Paul (R-KY) and Pat Toomey (R-PA), joining returning Sens. Jim DeMint (R-SC) and Tom Coburn (R-OK), expect little movement on Democratic priorities. These newly emboldened conservative senators can use Senate rules, which permit a single member to hold up the progress on legislation for days (or even weeks at a time) to delay the Democrats' agenda.

The Democrats' narrow margin of control will also cost them seats on committees. Republican committee assignments are difficult to predict, as there are significantly more new Republicans than there are Democrats (13-3). Perhaps the biggest Republican squabble will occur at the powerful Appropriations Committee, where five of that panel's GOP members are not returning, creating several openings. The Environment & Public Works (EPW) Committee, which has jurisdiction over highway and water infrastructure legislation, will still be led by Chairman Barbara Boxer (D-CA) and Ranking Member James Inhofe (R-OK).

What to Watch
The shift in power on Capitol Hill will have a substantial affect on AED's legislative agenda. A GOP-controlled House will mean the death of pro-union measures, over-reaching environmental proposals, and tax legislation that hinders small business growth and job creation. However, those of us seeking long-term highway and water infrastructure reauthorization bills may encounter challenges from new Tea Party-supported Republicans, who have expressed hostility to new spending and support a much smaller federal government. The challenge for our industry will be helping new members understand that there is a difference between investment in long-term infrastructure and wasteful government spending, just as there is a difference between taxes and user fees like the federal gas tax (all of which goes to transportation programs).

All that being said, the shakeup may actually help a highway bill move forward. It is one area where Republicans and Democrats have successfully worked together in the past and where President Obama's desires align with those of Congress. Republican gains in the Senate have also strengthened the hand of EPW Ranking Member Inhofe. He was chair of the committee during the last reauthorization and is a strong infrastructure supporter.

EPW Chair Boxer is also supportive, but has been distracted for the past two years by climate change and her re-election. Now that she has won re-election and climate change legislation is dead in the new political environment, there is no excuse for not focusing on infrastructure. These factors could combine to produce a favorable bill with Inhofe serving as the conduit between House Republican and Senate Democratic leaders.

Voters will expect House GOP members to act on their campaign promises to create jobs. This will put the onus on Republican leadership to achieve results, not just snipe at the White House. Job producing measures that have traditionally enjoyed bipartisan support, such water investments and surface transportation, would be likely opportunities. T&I Chairman Mica could collaborate with infrastructure advocates in his party and Blue Dogs in drafting the type of long-term investment the industry needs to restore certainty to the marketplace.

While Boehner has never supported a highway bill, significant numbers of new GOP members are on record favoring significant and sustained infrastructure investments. If Boehner learned anything from Nancy Pelosi, it is that retaining majorities is dependent on listening to rank-and-file members. So, it's not out of the question that he would allow a vote to take place.

After two years with little congressional oversight, the White House can expect new scrutiny of regulatory policies. Rep. Darrel Issa (R-CA) will chair the House Oversight & Government Reform Committee and has promised to carefully scrutinize the administration's regulatory agenda. With Obama expected to use regulations to advance his goals in the face of congressional gridlock, Issa and Education & Labor Committee Chairman John Kline (R-MN), will serve as important checks on federal departments and agencies.

Remaining Questions

How much "no" will Americans accept?
For the last two years, the GOP's strategy has been to vote no. That works well in the minority, but it is not an agenda for governing. Americans are tired of partisan fights and want government to work.

How will the GOP make good on its campaign promises?
For all the rhetoric about fiscal responsibility, it remains to be seen whether Republicans will pursue difficult and unpopular short-term policies to put America back on sound footing.

Will the GOP pull together?
Whether the new tea party members of Congress fall in line or buck leadership will have a big impact on what gets accomplished.

What's Next?
AED is continuing to develop a strategy for advancing our agenda in the 112th Congress. However, we do know that we will be aggressively pursuing substantial and sustained investment in our nation's highway and water infrastructure; tax policies that encourage growth and job creation by creating certainty in the tax code; re-examination of President Obama's health care bill; and commonsense environmental initiatives that do not unnecessarily burden small businesses.

As the construction equipment industry continues to dig out of the worst economic climate in generations, distributors must remain engaged. Reach out to your newly elected members of Congress, governors, and state representatives. Invite them to visit your facility and urge them to support measures that will spur economic growth and job creation in the industry. Use AEDaction.org, AED's grassroots tool to send messages to lawmakers and join us May 11-12 for the 2011 AED Washington Fly-In.

The elections illustrate that your voice matters. Now, let it be heard! For further information about AED's legislative priorities, or how you can get involved, please contact our Washington office.

Christian A. Klein is AED Vice President of Government Affairs & Washington Counsel.

Jason Langford is AED Manager of Government Affairs.
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