2011 Congressional Outlook

19 November 2010

As expected, the mid-term election turned out to be a sweeping and historic victory for Congressional Republicans, as they snatched 6 Senate seats and at least 60 House seats (plus control) from Democratic hands. House Republicans, in eager anticipation of Nancy Pelosi officially passing the gavel to John Boehner, have wasted little time in drafting an aggressive agenda for the 112th Congress.

Naturally, most of the political discourse since November 2 has been enveloped by issues such as healthcare repeal and the national debt. On that note, we thought it appropriate to put on our public affairs hats and address question that tech insiders from D.C. to Silicon Valley are asking: In this heated political environment, does the tech industry have any chance at all to gain traction on its core issues before the divided Congress?

Handicapping the Republicans’ play appears to be easy at first glance. Following Republican criticism that President Obama neglected the economy in lieu of an insular focus on healthcare reform, future Speaker John Boehner’s agenda is likely stock full at this time.  Indeed, nowhere in Republicans’ much publicized Pledge to America does the word “technology” even appear. Seeing many of its top allies getting relegated to ranking status (or in Virginia Congressman Rick Boucher’s case, relegated out of office) could not have been a pleasant sight for Silicon Valley.

Much of the agenda will ride on who takes over as Chair of the important House Energy and Commerce Committee, which regulates many technology issues. As the current ranking member, Joe Barton would appear to have the leg up. However, the broad nature of a committee that regulates both technology and the environment, coupled with Barton’s defense of BP CEO Tony Hayword, might prove a dealbreaker for Republican leadership. The Texas Republican is facing a spirited challenge from Michigan’s Fred Upton. Both Rep. Barton and Rep. Upton have declared net neutrality dead on arrival under their chairmanships. Still, there is a lot of money on both sides of the issue, so it is likely to at least get raised in 2011.

Alternatively, the issue of patent reform is handled by the Judiciary Committees. Here, the conflict is not between Democrats and Republicans as much as it is between the House and Senate. Senate Judiciary Members reached a deal earlier this year that was criticized by many in the technology sector. House Judiciary Members agreed and refused to participate in negotiations until the Senate came back with a bill that was more tech-friendly. The issue has been stalled ever since.

Since patent reform lacks a partisan divide, is there hope for it in 2011? Possibly. However, anyone who thinks any technology issue – whether it patent reform, net neutrality, privacy or any others – has a realistic chance of making the 2011 Congressional agenda is probably being overly optimistic.

But is it fair to exclude this sector from discussions on the economy and jobs? A strong argument could be made for relying more than ever on technology companies during these trying times. According to a report from the Tech America Foundation, the tech industry has begun its climb out of the recession, having added 32,200 jobs from January-June 2010.

“The technology industry now appears to be slowly turning the corner with the rest of the economy,” said Phil Bond, the Foundation’s president and chief executive officer. “We have weathered the storm better than most. From its position embedded in every other industry, technology remains the best hope for driving robust recovery across the economy.”

Both Republicans and Democrats have had a focus on creating jobs – and understandably so. Perhaps Congressional leadership would do well to realize that in these trying times, it might be worth it to address the concerns of one of the few industries that has actually made job creation a reality rather than a theory.

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