Republicans Take Control of the House, While Democrats Maintain Control of the Senate

Republicans will control the House next year after winning enough seats in the 2022 midterm elections to secure a narrow majority.  The victory was announced eight days after the elections due to Democrats faring better than expected in many races, delaying the call for several seats and control of the chamber.  At this time, 218 seats have been called for Republicans and 210 seats for Democrats, with seven races remaining uncalled. If current results hold, the GOP is looking at a 221-214 margin.

Democrats will maintain control of the Senate after several competitive races were not called until Nov. 12, giving Democrats a 50-49 majority. A Dec. 6 runoff election in Georgia will determine whether Democrats can extend that lead to a 51-49 seat margin.   The increased margins give Democrats subpoena power, something they are missing in the current split Senate. Schumer and the caucus will have more room to legislate with larger majority committees, a wider margin on simple majority votes (50 votes instead of the 60 needed for most legislation), and a buffer for the influence of “swing” votes such as Senators Joe Manchin (WV) and Kyrsten Sinema (AZ), who put a check on the administration’s legislative priorities for the past two years.  It will also give President Joe Biden the opportunity to continue pushing out federal judges to fill the remaining 10 percent of vacancies, including any Supreme Court vacancies that might open up in the next two years.

 

Lame Duck Begins

Congress returned this week to complete its post-election lame duck session. Lawmakers aim to wrap up remaining agenda items before the new congressional session starts on Jan. 3. Because they will miss next week for Thanksgiving break, they will have only five weeks to pass a few “must pass” items, namely the FY23 Appropriations and the reauthorization of the National Defense Authorization Act (NDAA). There is a list of “will do” items that are likely to include nominations and health care that has expiring programs. Other Democratic priorities might be added as riders to the spending bill.  Democratic leaders and the White House have said they would like to address raising the debt ceiling during the lame duck if they can get bipartisan support.   There is also potential for bipartisan agreement on a narrow package of tax extenders. This could include an extension of favorable tax treatment for business R&D expenses and a delay in TCJA limitations on business interest deductibility.

House Leadership Races Shape the Majority and Pelosi Announcement Shakes Up Dem Caucus

House Republicans voted on Nov. 15 to nominate current Minority Leader Kevin McCarthy (CA) for House Speaker. McCarthy prevailed in a secret ballot vote 188 to 31, fending off a challenge from Rep. Andy Biggs of Arizona, formerly chairman of the conservative House Freedom Caucus.  Several conservative members of the House and Senate had called for the leadership elections to be delayed until after the December 6 runoff in Georgia and all election results are fully decided.  The House’s slim margins will also make it challenging for McCarthy, to fend off factions such as the House Freedom Caucus, who seek to flex their influence and leverage on leadership’s agenda and gain more power.

The No. 2 Republican in the House, Rep. Steve Scalise (LA), won his election as future House majority leader unopposed. Rep. Tom Emmer (MN), chairman of the National Republican Congressional Committee (NRCC), was elected for No. 3 position, which will be Majority Whip. And Elise Stefanik (NY) was also reelected as Republican Conference Chair.

Republicans have started working on a new rules package.  McCarthy has suggested prior to the elections that if he became Speaker, he would alter tradition and propose that its term limit rules also apply to House Democrats. In January, McCarthy said he would remove some high-profile Dems from their committee roles in retaliation for Democrats (along with 11 Republicans) stripping Rep. Marjorie Taylor Green (R-GA) from her committee assignments. Other rules changes McCarthy has mentioned include: opening the Capitol to visitors, ending virtual hearings, ending proxy voting, fewer large en block amendment packages, and ending the ongoing blockade against certain privileged items, including Resolutions of Inquiry, War Powers Resolutions, and Motions to Instruct Conferees.  The House Freedom Caucus has also released a list of rules changes for the GOP conference, but many have been dismissed.

House Democrats plan to hold their leadership elections on Nov. 30 with significant changes to come for the caucus.  On Nov. 17, Speaker Nancy Pelosi’s (NY) announced on November 11, that after two decades, she plans to step down as the House Democratic leader to “pass the torch” to the next generation of leadership. Pelosi will remain in Congress and help guide the future leadership. Minutes later, No. 2 Steny Hoyer (MD) sent a letter to colleagues announcing that he would not be seeking an elected leadership position and will return to the Appropriations Committee.  Majority Whip Jim Clyburn (SC) will not run for the No.3 spot, but as Assistant Democratic Leader. This clears the way for Rep. Hakeem Jeffries (D-NY), Reps. Katherine Clark (D-MA) and Pete Aguilar (D-CA), who have been positioning themselves as the new generation to lead the caucus for several years.  Jeffries is said to announce his run to head the caucus this afternoon.

McConnell Remains Senate Minority Leader

On Nov. 16, Senate Minority Leader Mitch McConnell (KY) also won his election as the top Republican in the caucus by a vote of 37-10. McConnell was challenged for the first time in his 16-year tenure by Senator Rick Scott (FL), chairman of the National Republican Senate Committee (NRSC), which is responsible for GOP campaign and fundraising. Minority Whip John Thune and Republican Conference Chairman John Barrasso—the No. 2 and No. 3 in the conference–were also re-elected.  Also notable, Sen. Shelley Moore Capito (WV), ranking member of the Senate Environment and Public Works Committee, was elected as the Vice Chair of the Republican Conference.

Rail Labor Union Approves Tentative Contract

The International Association of Machinists on Nov. 5 voted to approve a proposed contract with freight railroads after rejecting an earlier version in mid-September. The vote eases some of the industry’s tensions and concerns about a potentially economically devastating rail strike and possible congressional intervention. The union said it was “confident that this is the best deal for our members” but acknowledged it was not overwhelmingly approved. “Our team will continue conversing with our members at our rail yards across the nation. This agreement is the first step in addressing some of the issues in our industry,” the Union said in a statement.

Meanwhile, the Brotherhood of Maintenance of Way Employees Division further eased tensions by announcing that it would extend its so-called strike cooling-off period until December 9, the same date currently set by the two largest unions. They plan to adjust the date if the unions vote to ratify earlier than that. So far, seven of 12 unions have voted to ratify their tentative agreements.

Stuart Awarded Lifetime Achievement Award by American Chemistry Council

John Stuart, principle of Statehouse Strategy LLC, was awarded the American Chemistry Council’s first ever Lifetime Achievement Award at the ACC annual State Affairs Committee meeting in Florida on November 9th.

 

VI Signs Letter Urging Congress to Urge the SEC to Adopt a more Workable Climate Rule
The Vinyl Institute joined the National Association of Manufacturers (NAM) and other manufacturing organizations in a Nov. 11 letter to House and Senate Finance and Banking Committees leaders urging Congress to exercise its oversight authority and call on the SEC to promulgate a more workable climate rule. Specifically, the signatories ask Congress to protect manufacturers and insist that the SEC revise its proposed climate disclosures rule to make it more tailored, workable, and cost-effective for manufacturers.

Earlier this year, the SEC proposed a climate reporting regime that could have far-reaching implications for the manufacturing industry. The SEC’s proposed rule would impose significant costs and compliance burdens on public companies by instituting a “one-size-fits-all” mandate that is inconsistent with manufacturers’ existing reporting practices. It would also impact privately held companies by requiring them to provide data to support public companies’ Scope 3 emissions disclosures. The letter argues that manufacturers believe in the importance of disclosing material information to investors and cannot afford such “impractical and overboard” regulation.