ELECTION 2002

8 Things to Look for in the New Congress

On issues ranging from Iraq to the deficit to drug benefits, Democrats could have a tough year.

(Continued, page 2)

4. All the President's men
The federal court system is about to be transformed. With conservative Senator Orrin Hatch (R-Utah) as the chairman of the Judiciary Committee, Bush's nominees for district and circuit courts will fly through the confirmation process. That's a marked change from the days when liberal Senator Patrick Leahy (D-Vermont) ran the panel. Leahy's committee approved only 65 of Bush's 98 district court nominees and 14 of his 32 appeals court choices. The committee also delayed hearings on a number of nominees and rejected two outright--Charles Pickering and Priscilla Owen. Expect Pickering and Owen to be renominated to the appeals court and then approved by the full Senate. The judicial backlog could be cleared in six months.

That won't be automatic. Democrats will have to pick their fights, but once in a while they will be able to foil a nomination by a filibuster. Bush should also expect trouble if he gets the chance to name a Supreme Court Justice. Indeed, the voluntary retirement of a Republican justice is likelier now that Republicans control the Senate and the presidency. In response, Democrats will battle fiercely to reject any nominee--even a Hispanic, as is the prevailing rumor about Bush's intention--if that person is at all wishy-washy on abortion rights.

Rumors abound that Bush will shuffle his top-level advisors, especially his economic team. Securities and Exchange Commission Chairman Harvey Pitt is already gone. Ironically, Treasury Secretary Paul O'Neill's position is less secure than if the Democrats had stayed in control. With a GOP Senate, Bush won't have to worry as much about getting any new nominees approved. He'll have a freer hand to make changes, even on hot-button issues like the economy.

5. The war on terror
The glow of the President's performance after Sept. 11, and the fact that the country appears to be ramping up for war against Iraq, made Bush seem more a national than a partisan leader in the election. Polls also show that Republicans are more trusted on national security issues than Democrats.

That means Bush will probably get his way on all matters military. On the Department of Homeland Security, for example, he has a leg up in his fight to get flexibility over hiring and firing; labor unions and most Democrats want to retain the usual rules for federal agencies. Increasing Pentagon spending will also be a breeze.

6. This drug war is won
Old people vote. That's why politicians in both parties promised to create a prescription-drug benefit as part of Medicare. And that's why, one way or another, Congress is going to deliver.

With the GOP in charge of Congress, the government isn't as likely to dictate the price of drugs directly--as the Democrats wanted and as the pharmaceutical companies feared. Instead, beneficiaries will probably get a federal subsidy to buy health care from private managed-care outfits. This coverage in turn would include a prescription-drug benefit. Cost containment would come from the companies themselves.

A new prescription-drug entitlement will be expensive--$340 billion over ten years for the leading Republican plan. It will also be complex, tantamount to creating a new insurance program either run or overseen by Uncle Sam. The new Senate is still so narrowly divided that it might not do any better than the old one in cutting a deal. If the issue remains unresolved by 2004, both parties may prefer to suspend the legislative battle and use the issue again as an election come-on.

7. Let the race begin
The greater the number of Democrats running for President, the harder life will be for Bush. That's because by pounding his policies, the wannabes make the case for their own. Unfortunately for Bush, at least seven Democrats are likely to join the contest.

Two of them, in particular, are in a position to make the President squirm. Congressman Gephardt and Senator Tom Daschle of South Dakota are both strong possibilities to run for the Democratic nomination. From their perches in the House and Senate, they are ideally placed to attack Bush's policies. Even though Gephardt will step down as minority leader to focus on his presidential ambitions and Daschle may retire in 2004, every major vote on Capitol Hill will be freighted with presidential politics.

But here's a surprise: In a few instances that may actually help Dubya. The Democratic candidates have to distinguish themselves from one another, as well as from Bush. One way to do that is to embrace the President's policies every once in a while, to show a bipartisan spirit and a feisty independence of mind. Senators Lieberman and John Edwards of North Carolina, both relatively pro-business Democrats, will do so more than the other likely contenders (who include Senator John Kerry of Massachusetts, Vermont Governor Howard Dean, and Al Gore). And that could give Bush the extra votes he needs--sometimes.

8. Where wild things are
With the pressure of elections off, Congress could make progress on all sorts of fronts. A terrorism insurance bill, which contains a compromise that limits damage awards against developers for terrorist acts, is likely to pass with strong Democratic backing. Extra funding for the SEC and immigration services will also probably win. Then again, a few controversies, like tort reform and drilling for oil in the Arctic National Wildlife Refuge, will remain bogged down. A broad energy bill is also probably doomed. Elections can solve only so much.

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