Checks & Balances: The Oil Sector

Looking at recent behavior among the US House of Representatives, Senate, and President Bush, I believe we are about to see a classic example of the 'checks and balances' in action as foreseen by the Framers of our Constitution.

First, you have 'Frisco Nan's House, rabidly catching up on vengeful legislation from more than a decade out of power. Passing a whirlwind of legislation without debate. Basically, being the hot-headed, small-minded chamber that the Founders envisioned. Ever notice, by the way, that far more Representatives seem to be caught up in bribery scandals than Senators? I would guess, even adjusting for the different sizes of the chambers, fewer Senators, as a percentage of the chamber, get hacked up the way Representatives do.

Then, consider the Senate. It is more deliberative, by design, than the House. Representing whole states for six years necessitates a larger, longer-term view. This Senate was 'recaptured' in name only. The Democrats have no working majority, under the rules of the chamber. Filibusters can occur, and neither party has the necessary votes to end one, under current procedures. So the Senate Democratic plurality has less of an ability, or even taste, to act as vengefully as the House. Make a mistake as a Senator, and you become the next Tom Daschle. Remember him? The brief-serving Senate Democrat Majority Leader when Vermont's Jim "turncoat" Jeffords switched parties, and gave the Dems a short ride in the 'majority.' Daschle's excessive negativism and obstruction of President Bush's agenda landed him a new job as an ex-Senator from South Dakota. Harry Reid won't be forgetting that, or will, at his peril. As much as you want to choke those windbags in the Senate, sometimes, their slow pace is a blessing.

So, for the next two years, we have a classic study in the American system of politics/government.

We have a lame-duck President behaving as very much his own man, with his own agenda. He doesn't command the loyalty or votes of all of his own party's Reps or Senators, but he also has some aisle-crossers from the other party on some issues, including Iraq. Thus, no one branch can dictate policy.

'Frisco Nan's crowd is going to be busy venting their spleens on legislation that, in all probability, won't even make it out of the reconciliation process with the Senate intact, let alone avoid a Bush veto. And neither chamber has even close to a veto-proof majority, by party. The Senate is on such a razor-thin margin, that, depending on Tim Johnson's health, it could well be Republican-run by Easter.

For example, take the current animus towards the oil industry. Rumors of hearings abound. Something must be done! Ooops! Oil's down below $51/barrel now. Nevermind that, the Democrats want revenge. The House is making noises about drastic legislation. But, in a CNBC on-air interview between two Senators the other day, even the Democrat, Jeff Bingaman, from New Mexico, sounded thoughtful. One pundit pointed out that 36 US states engage in oil production in some fashion. Therefore, 72 Senators have a reason not to be so brash about screwing up an industry sector that may well affect their re-election.

Funny, how that works, isn't it?

It will truly be government by compromise and deliberate triangulation for the next two years. And, don't forget, there's a Presidential election at the end of that time, plus the entire House, plus one-third of the upper-chamber windbags.

As I noted in two posts on my business blog on and just after election day, here, everyone has reason to behave, because the voters have now placed both Houses in a position to change party control with each election cycle.

All in all, probably not a bad thing.