Analysis by Energy Workforce SVP Government Affairs Tim Tarpley
As the dust begins to settle from the 2022 midterm elections, we are starting to get a much clearer picture of the political climate we will be facing as a sector come next year.
The most uncertainty is in the House, where at writing Republicans have secured 221 seats and Democrats have secured 213 with one race still undecided. This means that Republicans will either have a three- or four- seat margin going into next year. This is important to us for a number of reasons. First, while Rep. Kevin McCarthy (R-CA-23) is still the favorite to become Speaker of the House (and he won the internal Republican caucus vote with 188 votes), he still needs to receive 218 total votes on the floor of the House in January. At this time, at least four Republicans have said publicly that they will not support him under any circumstance. This leaves him at least one or two votes shy of the 218 he will need. This opens the possibility of a new candidate emerging. For now we can assume that McCarthy will prevail in the end and move into next year as Speaker of a fractured House majority with a very small margin to lose on any key vote.
Also of keen importance to our purposes in the House is there are 17 Republican House members from districts that voted for President Biden in the 2020 election. Many of these districts are from New York and California and are being filled by new members who will be keen to keep those marginal districts in 2024. These members may not be familiar with our issues, as there is very little energy production and/or manufacturing in many of those areas. It will be up to Energy Workforce and our allies to educate the new members as soon as possible as to the importance of our sector and its workforce to both their individual districts and to the economy of the greater United States and our collective energy security. This education is paramount as House support will be the only thing standing between some very problematic legislation passing and becoming law.
In the Senate, polling in the Georgia runoff continues to show Republican candidate Herschel Walker down five to seven points to incumbent Sen. Raphael Warnock (D-GA). Therefore, it appears likely that Democrats will end up with a 51-vote margin in the Senate after the runoff. This margin is still low enough to ensure that bipartisan support will be necessary to pass any major legislation absent a budget reconciliation maneuver, and while Sen. Joe Manchin (D-WV) will continue to play an important role as a swing vote, his support will not be absolutely necessary in every scenario, as the Democrats would have a one-vote cushion.
Congress Takes Action to Avert Rail Strike Which Could Have Significant Impacts To Energy Industry
The lame-duck Congress came back into session this week to finish a number of must-do actions before the end of the year. Negotiations between railroad companies and their unions have reached a standstill and the potential for a nationwide strike appears likely without action by Congress. Twelve unions representing railroad workers have spent nearly three years negotiating a new contract with rail carriers, with the members seeking sick leave, more flexibility in schedules and a raise. Union leaders agreed to a Biden Administration supported deal earlier this year, but the union members have rejected it. Without a deal a strike could begin December 9.
Each year between 300,000 and 700,000 barrels of oil move by rail, as well as countless products and materials used in manufacturing by Energy Workforce companies. A nationwide rail strike would certainly make an already challenging supply chain situation even worse.
Wednesday, the House voted on a package which will force both sides to accept a compromise agreement. This package passed the House and will move to the Senate. Sen. John Cornyn (R-TX) and other leaders in the Senate have said they believe there will be ample support on the Republican side to pass the measure in the Senate as well. President Biden is expected to sign before the December 9 deadline to avert the strike.
This lame-duck Congress will also have to act on the defense authorization bill, as well as an extension of the government funding to get us through the holidays and into the next Congress. While some have speculated that Sen. Manchin may try and make another pass on permitting reform, this scenario is looking to be very unlikely given the political climate and the long list of other things that need to be cleared before the Congress breaks for the holidays.
Tim Tarpley, SVP Government Affairs & Counsel, analyzes federal policy for the Energy Workforce & Technology Council. Click here to subscribe to the Energy Workforce newsletter, which highlights sector-specific issues, best practices, activities and more.