Democrats picked up three new seats in the Senate and lost one; the GOP lost three and picked up two. Depending on the final tally (i.e. Washington States) the Senate will be divided either 50/50 or 51/49. Democrats also netted two House seats; the make up of the new House will likely be 221 (R), 212 (D) and 2 (I). Thus, Bush or Gore will have to appeal to centrists of both parties in both Houses of Congress. Neither will succeed in pushing new grandiose tax or social programs. The U.S. Senate seat in Washington and a House seat (FL-22) remain in doubt at this writing. One should bear in mind, however, that over 391 incumbents who sought re-election were returned to Congress. With a few exceptions, most of the important turnover occurred as a result of retirements - the chairmen of the House Commerce, Education and Workforce and Ways & Means will retire at the end of 2000. These three committees are of great importance to the Principal Financial Group''s legislative goals.

 

The most significant development from Principal's perspective was the not unexpected defeat of Senate Finance Committee chairman Bill Roth (R-DE) and the ascension of Sen. Charles Grassley (R-IA) as chairman. Other than a minor disagreement on one narrow aspect of his bankruptcy reform bill, Principal and Grassley have had a very productive working relationship for his entire Senate career. Grassley is expected to continue to chair the Senate Special Aging Committee, which he has effectively used as a platform for pension, retirement savings, and health policy issues in recent years. Grassley is also expected to continue Sen. Roth's ability to work with Democrats in fashioning bipartisan legislation.

 

The new Ranking Democrat on the Senate tax panel will be Sen. Max Baucus (D-MT), a good friend and supporter and effective advocate of private pensions and foreign trade issues. 2 Other than the Finance Committee change of chairman and ranking Democrat, the leadership of the other Senate committees should remain the same as in the 106th Congress. Decisions on House committee chairmanships will not be made until early January. Assuming House Republican Leaders stick to their self-imposed rules, current committee chairs will have to relinquish their positions. This means that Rep. Jim Leach (R-IA) will no longer chair the House Banking and Financial Services Committee, paving the way for an expected three-way fight among Reps. Marge Roukema (R-NJ), Doug Bereuter (R-NE), and Richard Baker (R-LA). At this point there is no clear frontrunner.

 

A two or three-way battle will also occur in the race to chair the House Ways & Means Committee. At this time the frontrunner appears to be Rep. Bill Thomas (R-CA), chairman of the health subcommittee. Rep. Clay Shaw (R-FL), chairman of the social security subcommittee, could be a contender if he survives the ballot recount in his closely contested reelection.

 

Reps. Billy Tauzin (R-LA) and Mike Oxley (R-OH) will contend for chairmanship of the House Commerce Committee while Rep. Tom Petri (R-WI) is expected to be chosen to lead the House Education and Workforce Committee. There is a remote possibility that Rep. Jim Nussle (R-IA) could be tapped to chair the House Budget Committee.