Commentary | The Democratic party has retained control of Senate, with Democrats keeping their 51 seat majority, Republicans losing a net of 2 seats so far, and Independents grabbing the leftovers according to Fox News. There are still two seats being contested for control of Senate, but, even combined with the complete support of Independents, that is not enough to give either party a supermajority which is necessary to push a vote past a filibuster.
In addition, the Republican party has retained control of the House according to Fox News, with Republicans winning 231 seats so far, the Democrats losing a few to bring them down to 190, and Independents apparently have not won a single House seat.
But there are 14 House seats still up for grabs with votes so close that those districts are probably doing a recount before announcing for certain. In 2010, Republicans won 242 House seats, so it is possible the Republicans may lose a couple House seats overall or perhaps gain a small increased advantage.
So is Congressional gridlock inevitable? With the control of the Senate and the House, as well as the Presidency, remaining the same, essentially nothing has changed since before the 2012 Election. The Legislative branch’s primary responsibility is to pass laws that affect our nation. But that job has not been getting done.
Now that elections are over, the number one priority facing Congress is to deal with the looming Financial Cliff. This term describes the $607 billion plus negative effect on the economy due to tax increases and government spending cuts, which will be triggered by the automatic sequester slated to start taking place on January 1, 2013. The only reason we have an automatic sequester is because both parties in Congress and the President could not reach an agreement despite years of attempts. This cannot be blamed on a filibuster by the Republicans since Congressional rules explicitly do not allow budgets to be filibustered. This is why the control of Senate is so important.
The House Republicans have been passing many budgets to avoid the Financial Cliff only to get shot down each time by Senate Democrats. The Senate has not been able to pass a budget in years. Even Obama’s attempts at creating a budget were voted down unanimously by fellow Democrats. Republicans were hoping to gain control of Senate in order to pass a budget.
This Financial Cliff triggered by the automatic sequester has businesses and investors very worried about the possibility of a double-dip recession that could potentially plummet the country into a full-blown economical depression.
“It doesn’t matter who’s (in charge), both sides (of the political aisle) will have to deal with the cliff,” says Linda Duessel, according to USAToday.com.
Wall Street wants this fiscal cliff and the overwhelming Federal debt to be tackled immediately. Why is this so important? If Congress does nothing, according to the Chicago Tribune, “investors will think twice about lending the U.S. government money at low interest rates, which would strain the economy, widen the deficit and hurt the dollar. It also raises the possibility that major credit-rating agencies will cut the U.S. debt rating.” Again.
“Tackling the fiscal cliff will be the first order of business,” says Craig Johnson, a market strategist at Piper Jaffray. “If we can get any sort of sign that the cliff will be avoided or minimized, it would lift another piece of uncertainty from the investment landscape.”
I personally predicted the Obama win, and I’ve even told friends that I do not think the Republicans should want to have won the Presidency. Why? There is the perception that whichever party controls the Presidency is in the driver’s seat. Whoever drives over the financial cliff gets the blame. Call me pessimistic, but I believe that a financial cliff of some type, and thus further recession, is inevitable in the next two years. This now means that Obama and the Democrats will be blamed for the economical destruction if this scenario plays out like I think it will.
What do you think: Will the control of Senate remaining the same mean this Congressional gridlock will continue straight over the Financial Cliff?