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Democratic Party to confront challenging agenda
NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.
It was a trifecta victory for the Democratic Party, with wins for president, and gains in the Senate and House. The following is a tentative list of the winners and losers -- and some of the key issues ahead.
Electoral vote: Obama officially has garnered 349 electoral votes to 161 for McCain, with 28 electoral votes not yet called – 270 are needed to win. States not yet called include Indiana, North Carolina and Missouri.
Popular vote: 52 percent for Obama (first since Jimmy Carter in 1976 to get more than 50.1 percent); 46 percent for McCain.
Key swing states voting for Obama included: Virginia, Ohio, Florida, Colorado, Nevada, New Mexico, and New Hampshire.
Key Obama voter breakdowns:
* 96 percent of black voters (13 percent of electorate).
* Two-thirds of Hispanic voters.
* More than two-thirds of voters aged 18 to 29.
* 53 percent of Roman Catholic vote.
Trifecta: First time since 1994 that the President's party will control both chambers of Congress.
Leadership: Not many changes for House committee leaders, but for House Democratic leadership, if Rep. Rahm Emanuel (D-Ill.), the fourth-ranking Democrat in the House, becomes White House chief of staff, an opening develops in the House Democratic leadership. For Republicans, Rep. Adam Putnam (Fla.) resigned his post as chairman of the Republican conference. Minority Leader John Boehner (R-Ohio) tried to bolster his current position before the elections, but the results could bring some soul searching for new leadership and new ideas ahead. In the Senate, see an earlier column I wrote for possible Committee chairmanship changes.
Strengthened Democratic majority: The Democratic Party will be shy of the 60 votes needed to halt filibusters, but garnered at least five new seats.
Democratic wins (net gains in bold): North Carolina (Kay Hagan over Sen. Elizabeth Dole); Virginia (Mark Warner over James Gilmore); New Hampshire (Jeanne Shaheen over Sen. John Sununu); New Mexico (Tom Udall over Rep. Steve Pearce, filling the seat of retiring Sen. Pete Domenici, a Republican); and Colorado (Mark Udall over former Rep. Bob Schaffer, filling the seat of retiring Republican Sen. Wayne Allard); Iowa (Sen. Tom Harkin over Christopher Reed); Montana (Sen. Max Baucus over Bob Kelleher); Illinois (Sen. Dick Durbin over Steve Sauerberg); South Dakota (Sen. Tim Johnson over Republican state Rep. Joel Dykstra); Massachusetts (Sen. John Kerry over Jeff Beatty); Louisiana (Sen. Mary Landrieu over state Treasurer John Kennedy); New Jersey (Sen. Frank Lautenberg over Dick Zimmer); Michigan (Sen. Carl Levin over Jack Hoogendyk); Arkansas (Sen. Mark Pryor over Green Party nominee Rebekah Kennedy); Rhode Island (Sen. Jack Reed over Robert Tingle); West Virginia (Sen. John D. Rockefeller IV over Jay Wolfe). Delaware: Sen. Joseph Biden won his Senate re-election race over Republican Christine O'Donnell, but will serve as Obama's Vice President.
Republican wins: Kentucky (Sen. Mitch McConnell over Bruce Lunsford); Georgia (Sen. Saxby Chambliss over Jim Martin and Libertarian Allen Buckley – it appears Chambliss' garnered over 50 percent of the vote which, if confirmed, would avoid a Dec. 2 runoff); Mississippi (Sen. Roger Wicker over former Governor Ronnie Musgrove); Mississippi (Sen. Thad Cochran over Erik Fleming); Nebraska (former USDA Secretary Mike Johanns over Scott Kleeb); Kansas (Sen. Pat Roberts over Jim Slattery); Idaho (Jim Risch over Larry LaRocco to take over the Senate seat held for the last 18 years by Republican Larry Craig); Maine (Sen. Susan Collins over Rep. Tom Allen); Texas (Sen. John Cornyn over Rick Noriega) ; Wyoming (Sen. Michael Enzi over Chris Rothfuss); South Carolina (Sen. Lindsey Graham over Bob Conley); Oklahoma (Sen. James Inhofe over Andrew Rice); and Alabama (Sen. Jeff Sessions over Democratic state Sen. Vivian Davis Figures).
Three seats unsettled: Minnesota (GOP Sen. Norm Coleman versus Democratic candidate Al Franken and Independence Party candidate Dean Barkley); Oregon (GOP Sen. Gordon Smith, who is ahead by around 10,000 votes at this writing, versus Speaker of the Oregon House Jeff Merkley); and Alaska (GOP Sen. Ted Stevens versus Democratic Mayor Mark Begich of Anchorage) – Stevens is slightly ahead and even if the Senate would censure him out of the Senate, a Republican Alaska governor (Pallin) would pick the successor.
Most if not all of the Senate Ag Committee will return in the new Congress, although one of its members -- Sen. Norm Coleman (R-Minn.) is locked in a tight race that will very likely see a recount. Saxby Chambliss (R-Ga.), ranking member of the panel, while some observers say he appears to have won his race by enough to avoid a runoff that would have taken place Dec. 2. Others, however, think there will still need to be a run-off election and if that is needed, expectations are the Democratic leadership will pour a lot of resources into the state to help defeat him and get them closer to 60 votes in the Senate that is so far eluding them.
Strengthened Democratic majority: A final tally is not yet available as there are several lingering contests, but the Democrats have officially won a net gain of 18 seats, with 11 races undecided. Of note, Rep. Chris Shays (R-Conn.) lost to Democrat Jim Himes, while Rep. Robin Hayes (R-N.C.) was defeated by Larry Kissell. Embattled Democrat Rep. John Murtha (D-Pa.) won his reelection bid.
Three Democrats and four Republicans on the House Ag Committee lost re-election bids, including Democrats Nancy Boyda (Kan.), Nick Lampson (Texas) and Tim Mahoney (Florida), and Republicans Robin Hayes (N.C.), John Kuhl (N.Y.), Marilyn Musgrave (Colo.) and Tim Walberg (Mich.). There will be new faces on the House Ag panel in 2009, due to the increased margin of control by Democrats -- that will increase the number of Democratic members and staff for the panel, and fewer Republican seats.
Inauguration: Jan. 20.
Key personnel: Some Cabinet announcement could come as soon as next week. Obama's Treasury team is an important consideration, but initially he will continue to rely on his economic advisory team. Rep. Rahm Emanuel (D-Ill.) rumored to be Obama's White House chief of staff. Look for at least one if not two Republicans on Obama's forthcoming team -- perhaps including current Sen. Dick Lugar (R-Ind.), and former maverick Republican Sen. Chuck Hagel (R-Neb.). Transition director is former White house chief of staff John Podesta.
Budget proposal: Early February: a budget that details spending and tax priorities for next five years or longer, including any ideas on dealing longer term with a bulging budget deficit.
Health care: New government-organized health care system.
Taxes: Reduced taxes for families earning less than $200,000; higher taxes for those over $250,000. Estate taxes: no repeal but a multimillion-dollar exemption.
Education: Billions for education, teacher training and recruitment. But the weakened U.S. economy may delay some of Obama's tax policy plans, except those billed as job creation. The No Child Left Behind legislation needs to be reauthorized.
Energy: Reduce reliance on Middle Eastern oil over 10-year period; $150 billion for alternative and renewable energy research and development.
Global warming: Cap greenhouse gas emissions and force those who pollute to pay for emission permits to confront global warming. Congressional sources see this topic as a post-2010 election issue and thus this likely won't be completed during the next two years. Initially, a Democratic-led White House will go the regulatory route to temper greenhouse gas emissions -- that wouldn't cost any money and would lead to fines and thus revenue. Long-term, Obama and now-defeated Sen. McCain both backed a cap and trade system, but the timing is murky due to complex differences in establishing such a system, meaning it won't take place until after the 2010 elections.
Short-term aid for U.S. economy: Billions of dollars for Infrastructure, unemployment insurance and Medicaid. See related item under Congress' agenda.
Initial legislative initiatives: Funding embryonic stem-cell research, and an expansion of State Children's Health Insurance Program financed via a rise in the tobacco tax.
Trade policy: Obama campaigned on the need to reform the way new agreements are written. On China, Obama has two decisions ahead: On Jan. 1, U.S. textile quotas on China expire, with some Democrats already pressing for a quota renewal and perhaps strengthening them. During the campaign, Obama said China's currency, the yuan, was undervalued. Around May 1, the new president must decide whether China manipulates its currency to keep it below market value (China currently holds nearly $2 trillion in foreign-exchange reserves, the majority in dollars). Cuba: A new effort will be made to further modify if not eliminate the current trade embargo, but this issue could wait if Obama wants to pursue a bipartisan approach initially. Regarding the ongoing Doha Round of multilateral trade talks, the focus initially will be on Obama's selection for the U.S. Trade Representative.
Labor Unions: A key Obama constituency who will get what they want, including the proposal to end secret ballots in union elections.
Mergers: An Obama-led Justice Dept. would very likely look askance at big mergers in the years ahead.
Another economic stimulus package: At least a $150 billion plan. Timing depends on whether outgoing President George Bush goes along with the proposal; if not, Democratic leaders will wait until they have a new, strengthened majority next year, and a Democratic president in the White House. Sen. Chuck Schumer (D-N.Y.), chairman of the Joint Economic Committee, previously said an Obama win would mean Congress will take up a small stimulus package in a post-election, lame-duck session this year, and a bigger one in January after the inauguration. The stimulus package will focus on infrastructure projects, extension of unemployment insurance benefits, increases in food-stamp payments, and aid for state governments.
Financial regulation: Senate Banking Chairman Chris Dodd (D-Conn.) said he would bring the White House team into talks regarding financial system regulatory reform.
Health-care reform: Democrats in Congress will focus on payments to private insurers for Medicare plans in an overhaul package. Democrats in the past have pushed to give the government power to negotiate the prices for drugs sold to Medicare recipients.
Defense spending: While many observers see a reduction in defense spending ahead, others say Obama will be careful not to repeat the too-aggressive cuts of some prior Democratic presidents.
Food safety reform: This will be pushed in the Senate by powerful Sen. Dick Durbin (D-Ill.) and by Rep. Rosa DeLauro (D-Conn.) in the House.
Farm Policy: Reports of "big changes" ahead for U.S. farm policy are an errant assessment. The 2008 Farm Bill passed by an overwhelming margin in Congress, and it was supported by many Democrats and Republicans. That does not mean there will be no farm policy changes, but they will largely focus on finding budget cuts in the years ahead to help reduce the bulging budget deficit. Expected revenue-generators could include cuts in direct payments and tightening payment limits.
It will be interesting to see if President-elect Obama follows through with his support for a ban of packer ownership of livestock.
House Ag Committee Chairman Collin Peterson (D-Minn.) has already indicated he wants to focus on reorganizing USDA, beginning with the Risk Management Agency (RMA).
Proposition 2 Passed in California:
Early returns show that more than 60 percent of Californians voted for Prop 2 in California -- the measure to prohibit pigs, cows raised for veal and egg-laying hens from being housed in cages. That is a big win for the sponsors, the Humane Society of the United States.
Bottom line: The key for future market-sensitive policy out of Washington is how President-elect Obama actually governs – will it be the more populist approach he showed during the primary season, or will it be the more pragmatic tone he showed during the presidential campaign against his Republican opponent John McCain (R-Ariz.)? We may get some initial indications of the direction when Obama begins announcing his top Cabinet choices, perhaps beginning as soon as next week with some economic advisors.
Another initial assessment: Not getting the 60 votes needed in the Senate to stop filibusters means Democratic leadership and future President Obama will have to form some alliances with moderate Republicans to get important legislation cleared in the Senate. That may be to Obama's advantage if he proves to be not as liberal as many of the Committee leaders in the Senate and House. Republicans are already hoping the Democratic Party will overreach in the belief that would help set them up for election gains in 2010 and 2012. But Obama has already privately told Democratic leaders he wants to avoid this from happening.
Many Americans/voters do not believe Washington will temper its spending ways. That may be true in the short run as Congress and the White House work on at least one if not two economic stimulus packages, but those who have responsibility to govern will eventually have to confront the bulging budget deficit and many billions of dollars needed for unfunded entitlements as baby boomers retire. That is when we will see some hard decisions have to be made by lawmakers and the Executive Branch.
NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.