Special Report: The GOP Landslide and Policy Implications

Largest Majority Since WWII – And Are Likely To Pad Their Numbers… 
November 6, 2014

The landslide capture of the Senate by Republicans has several important policy implications.  At the very least, issues important to Republicans now will be on the front burner, despite President Obama’s veto power;  Republican ideas that had been bottled up in the Senate now will get an airing, as we detail in this special PRG report.  And at the most, some policies could change.

In the short run, even before the lame duck session convenes in about a month, Republicans will need to decide on a path.  Will they adopt the scorched-earth policies of Ted Cruz, or will they side with pragmatists – led by John Boehner and Mitch McConnell – who want to show the country they can govern?  We think the pragmatists will prevail; they know a gridlocked Republican Congress, unable to accomplish much, would be a foil for Hillary Clinton.

The full report describes the key issues in the new Congress in the following sectors: Macro, Defense, Telecom-Media, Health, Energy, and Special Situations. Read the full special report Here. 

Election Impacts on Energy Policy

Former Secretary Spencer Abraham, Senior Energy Analyst
November 3, 2014

With a number of races tightening over the past week, Republicans are still favored to take control of Congress and Washington seems poised for a major inflection. There are few policy areas that hang in the balance more than energy. Senior Energy Analyst and Former Secretary of Energy, Spence Abraham, looks at the potential opportunities and risks for investors in the lame-duck session and beyond.   Read the Full Research Report Here

The Policy Response to Slow Growth; Democrats Begin to Point Fingers; Kobani — the Next Tragedy

Greg Valliere, Chief Political Strategist
October 8, 2014

SLOW GROWTH AND THE POLICY RESPONSE:  Europe is on the brink of a recession, but the policymakers seem paralyzed; Mario Draghi may want to do more, but the irrational German fear of inflation has thwarted him.  It strikes us that the only decisive response will come from angry voters, who are insisting on the end of austerity.

THIS IS THE BIGGEST POLICY TREND OF THE YEAR, and even in the U.S. — where the economy appears to be growing by 3% or better — politicians are loosening the purse strings.  The great irony is that Republicans will lead the way, pushing for tax stimulus that ignores “pay go” rules while rejecting static scoring. Dynamic scoring may be “voodoo economics,” as Paul Krugman wrote this week, but there’s a change in the air on fiscal policy — it’s becoming more stimulative everywhere you look, from defense spending to tax cuts. Read Greg’s Full Morning Bullets Here.

 

Oil & Gas Severance Taxes on Tap in Ohio & Pennsylvania in 2015

Joe McMonigle, Senior Energy Analyst
October 7, 2014

The energy industry has fought off oil & gas severance taxes in Pennsylvania and Ohio in the past few years but their luck is coming to an end. In Ohio, Governor John Kasich, who holds a 30-point lead in his reelection bid, has told editorial boards he will push for a ballot initiative for a minimum 4 percent severance tax if the legislature does not take action. The Ohio Oil & Gas Association opposes the move and helped to pass in May a 2.5% tax in the Ohio House of Representatives, which Kasich opposed as “puny.” We hear that some energy companies would be fine with Kasich’s approach but the industry association is gearing for a political battle. In Pennsylvania, the severance tax has become a big issue in the Governor’s race with Governor Tom Corbett opposed to one while his Democratic opponent Tom Wolf, who has a big lead in the polls, proposes a 5 percent severance tax. Wolf, a former Secretary of Revenue under former Governor Ed Rendell, wants to use the proceeds for education spending. Regardless of the election outcome, most political observers in Pennsylvania believe a severance tax is inevitable. Former Republican Governor Tom Ridge who chaired the Marcellus Shale Coalition at its inception, told a conference that he expects a severance tax after the election. The state senate’s top Republican leader also was quoted in the press as saying it’s coming sooner or later.

With the Senate at Stake, Democrats Can’t Shake One Very Big Albatross

Greg Valliere, Chief Political Strategist
September 2, 2014

INTO THE HOME STRETCH:  Democrats are doing surprisingly well in generic polls, and they’re hanging on in several crucial states — Alaska, Arkansas, North Carolina — that are crucial to retaining the Senate.  But Republicans are now favored to take the upper chamber, so Democrats are trying to play what they think is a trump card: the economy, which clearly is healing.  The recession officially ended in 2009, yet nearly 50% of all Americans think the country is still in one — why? Read the Full Research Report Here.