Healthcare / Politics / U.S. Senate

Senate Shake-Up: Retirements and 2014 Election Projections

A wave of high-profile retirement announcements continues to sweep through Congress. Consequently, there will be significant shifts of power within both chambers, as well as electoral developments that have the potential to change which party controls the Senate in the 114th Congress.

New committee chairmanships and open-seat elections will have significant implications for both the public and private sectors. In the Senate, a total of five Democrats and four Republicans will not hold their seats in 2015:

  • Max Baucus (D-MT): 6 terms, appointed to become U.S. Ambassador to China
  • Carl Levin (D-MI): 6 terms, retiring
  • Tom Harkin (D-IA): 5 terms, retiring
  • Jay Rockefeller (D-WV): 5 terms, retiring
  • Tim Johnson (D-SD): 3 terms, retiring
  • Saxby Chambliss (R-GA): 2 terms, retiring
  • Mike Johanns (R-NE): 2 terms, retiring
  • Tom Coburn (R-OK): 2 terms, retiring before end of current term
  • David Vitter (R-LA): 2 terms, running for Governor

The seniority of the retiring Democrats will cause the biggest shifts in power within the chamber.  All five hold full committee chairmanships: the Senate Finance Committee and the Joint Committee on Taxation (Max Baucus); the Committee on Armed Services (Carl Levin); the Committee on Health, Education, Labor and Pensions (Tom Harkin); the Committee on Commerce, Science, and Transportation (Jay Rockefeller); and the Committee on Banking, Housing, and Urban Affairs (Tim Johnson).

Republican Saxby Chambliss is Vice Chairman of the Senate Select Committee on Intelligence, but the retiring Republicans do not hold anything close to the level of seniority and influence that the retiring Democrats do, especially with regard to business interests. These chairmanship changes will likely have profound effects on the prioritization of the legislative agenda.

Tax Reform

When Senate Finance Chairman Max Baucus announced his planned retirement in April 2013, many anticipated that he would lead the charge for a tax overhaul as his last major act in Congress. Six months later, Baucus was unexpectedly announced as the next U.S. Ambassador to China. While it is not yet clear when he will resign to take the post, Tuesday’s confirmation hearing at the Senate Foreign Relations Committee indicates that he will easily be confirmed by the Senate and retire before the end of his current term.

Baucus’ expected resignation evaporates the momentum for any major tax overhaul happening in 2014. However, on the same day that his ambassadorship was first reported, he officially released his proposal for energy tax reform. This proposal was preceded by November’s discussion drafts on international taxes, tax administration, and cost recovery and accounting.

Senator Ron Wyden (D-OR) is set to take over as Chairman of the Senate Finance Committee, and, like Baucus, is interested in rewriting the tax code. Wyden is known for seeking bipartisanship on a wide range of issues, but with the committee likely focusing on health care-related issues for the foreseeable future, it is unlikely that he and House Ways and Means Committee Chairman Dave Camp will be able to develop enough rapport to move forward on passing any part of tax reform, including Baucus’ proposals.

Health Care

Senate Finance Chairman Baucus was also extremely influential in crafting the Affordable Care Act. Even though the massive piece of legislation was signed into law nearly four years ago, the regulations associated with its implementation will take years to finalize. Last April, he notably announced his fear that the law’s implementation could become “a huge train wreck,” and considering the launch of healthcare.gov, his concerns were accurate.

Along with the ongoing issues surrounding the individual mandate, the employer mandate, which was delayed until 2015, will almost certainly have compliance problems that will dominate the committee’s work and hearing schedule. The departures of Jay Rockefeller, Chairman of Senate Finance’s Subcommittee on Health Care, and Tom Harkin, Chairman of the Senate HELP Committee, mean that when witnesses come to testify on the Affordable Care Act in the 114th Congress, some of the most important figures involved in passing the law will not be present to address the most pressing implementation issues facing business leaders.

Two weeks ago, soon-to-be Senate Finance Chairman Wyden released The Better Care, Lower Cost Act (S. 1932), which is intended to provide improved, less-expensive care for Medicare beneficiaries with multiple chronic conditions. Co-sponsored by fellow committee member Johnny Isakson (R-GA), and introduced alongside House members Erik Paulsen (R-MN) and Peter Welch (D-VT), the bill flexes Wyden’s bipartisan and bicameral influence. This potential sign of his leadership scope may inspire optimism with regard to overcoming legislative gridlock, but the timing of these retirements is far from ideal for any sort of intraparty leadership change.

Election Expectations

The Democratic retirements are notable from an election standpoint because most of these senators hail from states in which Republicans have a natural advantage. Montana (Baucus), West Virginia (Rockefeller), and Johnson (South Dakota) are red states that were carried by Republican presidential candidates in every election since 2000, and Republicans are looking to be competitive in the open-seat races in Iowa and Michigan. Further, the candidates looking to replace the retiring Republicans are expected to have much more competitive primaries than general elections, with little hope for Democrats in Georgia, Nebraska, Oklahoma and Louisiana.

Republicans need six seats to take control of the Senate, and the Democratic retirements only increase their chances of success as they target Arkansas’ Mark Pryor, North Carolina’s Kay Hagan, Louisiana’s Mary Landrieu, and Alaska’s Mark Begich. The House of Representatives is expected to remain in Republican hands, so a Republican-controlled Senate would leave President Obama with only veto power, the regulatory process, and executive orders to solidify his legacy.

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