A pair of Democratic wins in the Georgia Senate race is “going to make a lot of policy decisions easier. There is now a sense of momentum beyond the November elections — a signal that Biden can have his economic team in place,” James Hodges, a former governor of South Carolina, now president and CEO of McGuireWoods Consulting, told ThinkAdvisor in a phone interview Tuesday.
As of Wednesday afternoon, Raphael Warnock, a Democrat, was projected to unseat Sen. Kelly Loeffler, R-Ga. The race between Sen. David Purdue and Jon Ossoff, his Democratic challenger, was still too close to call, with Ossoff widely expected to win. The two Democrats would shift the party balance in the Senate to 50-50, with Vice President-elect Kamala Harris as the tiebreaking vote.
President-elect Joe Biden “already was planning to move aggressively” on the regulatory front with “tougher environmental regs, especially on carbon emissions, and reversing Trump on labor standards, antitrust policy, etc.” Greg Valliere, chief U.S. advisor for AGF Investments, said in his Wednesday morning email briefing.
Senate Majority Leader Mitch McConnell, R-Ky., who will be replaced by Sen. Chuck Schumer, D-N.Y., and the Republicans “won’t be able to stop this,” Valliere said.
With a Senate Democratic sweep, Biden “is likely to get all of his Cabinet nominations approved, with the possible exception of Neera Tanden” to head the Office of Management and Budget, Valliere said. “She has Democratic detractors.”
As to executive actions under a Biden administration, added Andy Friedman, principal and founder of The Washington Update, “it is fair to expect Treasury to shine a harsher light on the financial services industry. Banks could face tighter regulation and more stringent supervision, including an expansion of the Volcker Rule, tougher stress tests, and greater scrutiny of their actions.”
The Labor Department “could take anti-business actions as well,” Friedman said. “We could see expanded eligibility for overtime pay and an enhanced ability of employees to unionize and enforce labor rights.”
As to the Labor Department fiduciary prohibited transaction exemption to align with the Securities and Exchange Commission’s Regulation Best Interest, “we don’t know how the new Labor secretary will view the DOL fiduciary rule,” Friedman said. “The new regime there might simply leave the rule as is. Or it could decide to reconsider whether the rule is sufficiently strict, particularly given criticism by investor rights organizations that view the rule is too lax.”
See the galley above for Biden’s anticipated picks for his economic team.
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