The gains enjoyed by the Republican Party in November's midterm elections were widely viewed by political pundits as a referendum on the Obama presidency. The GOP victories, most notably the party's securing of a majority in the Senate, might suggest that Republicans now have the mandate and the means to roll back the Democrats' legislative accomplishments, including the President's signature legislation: PPACA.
With Republicans controlling both the House and the Senate come January, there will be just one thing standing in the way of this scenario: the president's veto power. Absent a two-thirds voting majority in both the House and the Senate — which seems unlikely given the still-substantial Democratic caucus in the Senate — the Republicans will be hard-pressed to make good on their conservative agenda.
And this leads to the question du jour: Given the prospect of continuing legislative gridlock, will Republicans pursue a strategy of confrontation with the president to satisfy pent-up demands of their conservative base. Or will they reach across the aisle to support legislation on which both parties can agree?
The initial signals coming out of Washington appear promising. Incoming Senate Majority Leader Mitch McConnell expressed hope that Congressional leaders and the president can set aside differences over the most polarizing issues — PPACA, immigration reform, administration policy toward international hot spots — and coalesce around a modest legislative agenda.
What might be the areas of common interest? Three items on the Congressional docket could yield potentially huge economic dividends: trade, infrastructure investment and tax reform.
In respect to the first, President Obama requested Congressional authority to more easily negotiate international trade agreements. Of key interest to the Administration is the Trans-Pacific Partnership (TPP), a trade deal the U.S. is negotiating with 11 Asia-Pacific nations.
If realized, the trade pact will give U.S. companies greater access to fast-growing markets and impose strengthened environmental and labor standards. The TPP also promises to boost intellectually property rights, establish new rules on state-owned enterprises and allow for greater transparency and consistency of regulations governing international trade.
