The Midterm Elections: Industry Mulls Impact Of Possible Power Shift

There's a lot at stake for the fashion industry in the upcoming Congressional midterm elections and the outcome could dictate how companies operate.

WASHINGTON — There's a lot at stake for the fashion industry in the upcoming Congressional midterm elections and the outcome could dictate how companies operate.

The entire House and a third of the Senate are up for grabs on Nov. 7. Democrats are out to regain control of Congress while Republicans try to hold on. Observers believe at a minimum the Republican majority will shrink, which has industry executives and associations reassessing their lobbying strategies and legislative wish lists. If the one-party status quo remains — the GOP controlling the White House and both chambers of Congress — there will still be challenges after the elections.

The top national issues this election year — the war in Iraq, the war on terrorism, the economy and ethics scandals — will weigh heavily on voters' minds and shape the election results.

If Democrats regain the majority or make inroads in the House or Senate, priorities will change for both parties. That will have an impact on the industry's key legislative issues, which broadly include trade, tax and health care policies, port security, customs and border patrol issues, immigration and the minimum wage. Should the GOP lose control of either chamber, the Bush administration would find it tough to move its domestic and foreign policy agendas and lose control of key committees. (See related story, this page.)

House Democratic Leader Nancy Pelosi (Calif.), a likely Speaker if Democrats take control of the House next year, laid out the Democrats' priorities in a speech at Georgetown University on Oct. 5.

Pelosi pledged to raise the minimum wage and "repeal current tax incentives that serve to export American jobs overseas." She also promised to cut taxes to spur economic growth, help businesses become more competitive and keep tax rates low for the middle class.

"This is our recipe for jobs and growth, making our country more competitive, our economy fairer, college more affordable, health care more accessible, our tax code more equitable, all achieved with fiscal discipline," said Pelosi.

Academics and political experts predict Democrats won't have the muscle to effect major policy changes even if they wrest control because they won't have the votes to override a presidential veto. But they will control the agenda, which will create more legislative logjams on Capitol Hill for the next two years.
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