Democratic control of the next Congress could mean that the life insurance industry agenda will fare better than it has under the last 6 years of the Bush administration, industry officials said last week.
In the meantime, Congress will reconvene on Nov. 13 for a lame-duck session to deal with issues left undecided before it left in late September to campaign.
The Association for Advanced Life Underwriting said in a note to its members after the election that this Congress is likely to accomplish “nothing substantial,” given that Congress will look vastly different next year.
“This is particularly true on politically polarizing issues such as the estate tax,” said Dermot Healey, president of the AALU, in the note.
But Healey left open the possibility that both Democrats and Republicans in Congress “may look to compromise to clear the decks of some important issues that may get bogged down with the new, tightened majorities in both Houses of Congress next year.”
If both sides “gave a little,” Healey said, “the estate tax could be an issue ripe for compromise in the Senate during the lame duck session.”
At the same time, he said, “the reality of a new Democratic House majority in the 110th will have an impact on this debate. How much, of course, remains to be seen.”
It was clear as Election Day ended that the Democrats would control the House, and it appeared that they would pick about 33 seats, giving them a working margin of 16 seats in the Congress.
Then, on the day after the election, news organizations declared Democrat James Webb the winner over incumbent Republican Sen. George Allen, in the cliff-hanging Virginia race, sealing Democratic control of the Senate.
The Democratic victory in the House installed Rep. Barney Frank, D-Mass., as presumptive chairman of the Financial Services Committee and Rep. Charles Rangel, D-N.Y., as presumptive chairman of the House Ways and Means Committee. Rep. Pete Stark, D-Calif., is presumptive chairman of the key Health Subcommittee of the Ways and Means panel.
The Democratic victory in the House gives Rep. Paul Kanjorski, D-Pa., the chairmanship of the key Capital Markets, Insurance and Government-Sponsored Enterprises Subcommittee of the FSC.
Democratic victory in the Senate means that Sen. Chris Dodd, D-Conn., who is proud of his support for the insurance industry, will become chairman of the Senate Banking Committee.
Dodd was primary author of the original Terrorism Risk Insurance Act, enacted in late 2002, and is also an author of legislation reining in class action litigation involving alleging securities fraud that was enacted in the Clinton administration.
His negotiations with the White House in November 2002 resulted in language being included in the TRIA bill that would allow the Treasury Department to extend TRIA to the group life insurance industry. Treasury, however, has consistently declined to do so, maintaining there is adequate capacity to handle all group life insurance demand.
In a statement issued before Webb was declared the winner in Virginia, Dodd confirmed he would keep the top Democratic post on the Senate Banking Committee, ending speculation he would seek the chairmanship of another committee.
He added that whether he served as ranking member or chairman, he intends “to consult with Senator [Richard] Shelby, R-Ala., [current committee chairman], and other members of the committee in an attempt to forge common ground.”
He added, “I intend to do all I can to work with all members of the committee to create a more secure and prosperous America.”
Dodd said he believed the committee should have 2 “primary priorities: First, to make America more secure by preventing the outsourcing of militarily sensitive jobs and technologies, by protecting our transit systems, by protecting our ports, and by ensuring that terrorists are thwarted in their efforts to use our financial system.”
The second priority, Dodd said, is “to make America more prosperous by creating the most transparent and vibrant capital markets in the world, by using our laws to better promote the export of American goods and services, by ensuring that working families can find affordable housing and better jobs, by protecting consumers so they can fully and fairly participate in our capitalist system, and by creating public transportation that serves the needs of working Americans in every corner of our country.”
And, in comments published by The Wall Street Journal on Nov. 4, Rep. Frank said he would be amenable to making it easier for public companies to live with the Sarbanes-Oxley Act, either through legislation or Securities & Exchange Commission rule-making.
A Democratic Senate will have Sen. Max Baucus, D-Mont., who is amenable to estate tax reform rather than repeal, as chairman. But, he would be working closely with Sen. Charles Grassley, R-Iowa, the current chairman.
The Democratic sweep brought losses of some familiar faces in the House. Rep. Nancy Johnson, R-Conn., who was serving her 11th term in Congress and was a strong supporter of the industry, was defeated handily. Rep. Jim Leach, R-Iowa, the first Republican chairman of the committee after the GOP takeover in 1995 but who stepped down because of term limits in 2001, was also defeated.