Jobs and the economy appear to be the only safe political ground following Sen.-elect Scott Brown's victory in Massachusetts that put a Democrat-held seat in Republican hands for the first time in nearly 60 years and shifted the balance of power, ending Democrats short tenure in the "super" majority.
In the ensuing week, congressional leaders and the Obama administration scrambled to find solid footing on an election year agenda under the new power structure. Democrats hoped the president's State of the Union Address would help bring clarity on a number of issues and present a path forward to winning back many of the independent-minded voters that appear to have swung the Massachusetts Senate race. In addition to abruptly halting further consideration of the highly controversial health care reform package, the political change will usher in procedural and political challenges to a host of Democrat and White House priorities in the 111th Congress. President Obama already has acknowledged publicly the need to go back to the drawing board and rewrite health care reform so it reflects a far narrower, more focused and less expensive approach. And several moderate Democrats have called on Senate Majority Leader Harry Reid, D-Nev., to withhold all further action on health care reform until Brown is sworn in, and warned him not to use procedural tactics to push through the legislation.
Brown's election, coupled with palpable voter dissatisfaction, appears likely to shift the congressional agenda to one more focused on jobs and the economy. Also likely to be considered by the Senate during the first quarter of the year is comprehensive food and feed safety legislation (S. 510), which enjoys broad bipartisan support. But certain legislation deemed untenable without a super majority likely will fade, such as labor unions' attempts to enact so-called "card-check" legislation that would have made organizing of non-union workplaces far easier by allowing a simple majority of workers to sign "preference cards" to unionize.
President Obama's State of the Union Address confirmed the likely congressional focus on jobs and the economy, but also called for continued work on several of the "big-ticket" items that have brought about considerable division in Congress -- specifically health care reform and climate-change legislation. Obama called on Congress to complete work on both measures, citing their importance to long-term economic viability. Republicans countered that pressing those measures in the way outlined by bills passed in the House would have a negative impact on an already stressed economy. While both sides agree on a few basic elements of both health-care and climate-change legislation, the more comprehensive both bills become, the more the parties diverge and differences are magnified -- polarizing the process. This reality remains, and is amplified in an election year putting comprehensive changes in doubt.
A few topics in the president's address did generate initial bipartisan support: 1) tax credits for small businesses that hire additional workers and increase wages; 2) elimination of the capital gains tax on small business investments; and 3) provisions aimed at growing the economy and creating jobs through tax incentives to businesses for expansion, new building and equipment. But his proposal to use $30 billion repaid by banks from the Targeted Asset Relief Program (TARP) fund for community banks to bolster local lending for small businesses drew a more tepid reaction.
During his address, Obama asserted that one key to securing the long-term foundation for the economy will be to pass a comprehensive financial reform package intended to clamp down on certain risky activities of financial institutions and create a consumer protection agency. While in broad strokes financial reform has enjoyed some bipartisan support, the bill passed by the House in December did so without any Republican votes. The legislation, also intended to increase transparency and deter attempts at manipulation in the derivatives market, has not been considered yet by the Senate. Consideration there is expected to be difficult, given party-line differences and the new political composition of the Senate chamber.
The president included international trade as another key driver to shoring up the U.S. economy in the long term, and stated his goal to "double our exports over the next five years." He noted the launch of a national export initiative "that will help farmers and small businesses increase their exports." Although at odds with congressional leaders in his party, the President warned that the United States cannot "sit on the sidelines" as other countries sign trade deals. He offered vague commitments to "shape the World Trade Organization's Doha Round multilateral negotiations to open global markets and "strengthen our trade relations" with countries that currently are awaiting U.S. congressional approval of trade agreements: South Korea, Panama and Colombia.
One area that engendered a decidedly mixed reaction was Obama's outline of important elements of a comprehensive energy and climate-change bill. As a "bone" to congressional Republicans, the president included support for building a new generation of nuclear power plants and possibly developing new offshore gas and oil drilling. However, those would be provisions included in a climate-change bill that would cap greenhouse gas emissions and introduce an artificial market to trade emissions credits. As outlined in current legislation, this type of policy also would result in widespread conversion of cropland to forest and hamper America's ability to compete in global markets. Obama expressed an "eagerness" to help the Senate follow the House's lead and pass climate-change legislation -- but the current composition of the Senate would require adjusting many elements of the bill to garner the necessary support to move forward.