Taking the Initiative

With just over a week left until mid-term elections, races for the many governorships and Congressional seats at stake are kicking into high gear. In races that are particularly close, the campaigning is getting savage and expensive, with huge media buys being carried out by both parties. Really, this is nothing new for election-time, but the intensity with which it’s all happening make this mid-term, essentially, a vote of no confidence on healthcare reform and perhaps to a lesser extent on financial services reform. It is certainly a no confidence vote on record, trajectory and future plans of the Obama administration and the Democrat-held Congress, and frankly, that’s a good thing. Any time that much power gets concentrated within a single party, you have the chance for huge things to get done. But huge accomplishments by our federal government aren’t always a good thing, and at the very least, it merits vigorous debate, criticism and detraction. After all, if a legislative majority as lopsided as our current federal scene cannot withstand the energy of its harshest critics, then it never deserved its power in the first place.

With years of implementation left to go for both healthcare and financial services reform, we really don’t know how these sweeping initiatives will affect our day to day, especially on the business side of things. Already, however, we can see that big changes are afoot; the advent of the Federal Insurance Office, the Financial Stability Oversight Council, the requirements for medical loss ratios, and the fiduciary standard are all evidence of that.

That only fuels the deep sense of uncertainty that is keeping our economy in the doldrums and the increasing dissent among voters that the boys and girls in Washington should have had more to show for their efforts than what they currently have. To be fair, they have been busy on the Beltway, but there are more than a few people (read: tens of millions) who strongly feel that Congress hasn’t just been wasting it’s time, it’s been doing worse: making a full court press to create bad law.

With that in mind, is it really so surprising that the Tea Party is figuring so prominently in these upcoming elections? Hated by liberals and even by a good number of moderates and old school Republicans, the fiery Tea Partiers exemplify the kind of reaction I think we’d find whenever our government is seriously dominated by a single party and manages to enact huge legislation as a result of it. Frankly, we saw much the same during the Bush years, though it was even more grass roots, in the form of Internet dissent, political satire (ala The Daily Show and the Colbert Report) and the polarization of media brands (MSNBC, perhaps?) that, having been branded as liberal sympathizers for so long by Capitol Hill conservatives and FOX News, that they decided to chuck any pretense for objectivity and become officially partisan. With the Tea Party, the big difference was that the Republican party was genuinely stunned by its reversal of fortune in 2008, and there was a party-wide, collective bit of navel-gazing that went on. How the hell did Obama get into the White House? How did we lose control of all of Washington? Mix in with that a lot of popular indignation over Obama’s election, and the Tea Party was born. I think the reason why there was never a Democrat version of the Tea Party is only because the Democrats are so used to shooting themselves in the foot, even when on the verge of victory, that when they lose big, they just shrug and accept it like the losers that they so often are.

And so we come back to next week’s mid-terms, which will be historic, no matter how they turn out. If there is a big Republican stampede, then efforts to repeal healthcare reform will certainly pick up steam, though I suspect the repeal and replace movement won’t actually accomplish mush aside from a lot of screaming in Congress. (Although one hopes that Congress won’t descend into the anarchy we sometimes see in the Russian or South Korean parliaments.) Aside from repeal-and-replace, a wave of freshly minted Republican governors, Representatives and Senators could do much to slow down the implementation of reforms by way of initiatives and referendums, or by defunding reform so that it cannot accomplish what it set out to do.

But what if the Republicans don’t win? Honestly, while races are narrowing, I still think that this midterm will be a large-scale GOP victory. But strange things do happen, and if the GOP cannot capitalize on the huge opportunity it has before it, then what will that mean to the party’s long-term power? Will the outrage over at least another two years of unfettered Democrat lawmaking cause the GOP base to splinter even further into other groups like the Tea Party? Who knows. It’s certainly too early to tell, but for those in the life & health insurance industry, which is an industry all about playing the long game, I am interested by what long-term strategies could be employed to make sure that Washington doesn’t gallop off in a direction that makes it impossible for the industry to prosper.