Corporate interests hate uncertainty from Washington, as they’re fond of reminding policymakers at every opportunity. But they’re about to get a new heap of it as the shakeup in House Republican leadership unfolds.
It starts at the top. The business world had a known and mostly friendly quantity in House Speaker John Boehner, whose shock decision to resign at the end of October has set off a succession scramble. Boehner’s odds-on replacement, current House Majority Leader Kevin McCarthy (R-Calif.), remains more of a cipher.
Part of that owes to experience. Boehner has served in the House for a quarter-century; McCarthy, a mere 9 years. And McCarthy has mounted a historically rapid rise through the leadership ranks — one which, if he consummates it be seizing the Speaker’s gavel, would mark the fastest ascent to that position since 1891.
So what can business expect from a Speaker McCarthy?
If his admittedly thin record is any indication, McCarthy will try to be helpful where he can, depending on your sector: Since coming to Washington in 2006, McCarthy has compiled a 93% score from the U.S. Chamber of Commerce. Arguably most important of all, in the immediate term, McCarthy says he’ll work to avoid the manmade fiscal crises that Tea Party types have repeatedly pursued as a means of exerting political leverage. “The system is created that you can’t get 100% of what you want,” McCarthy said in Fox News interview Monday. “I think that’s probably good. And I think we could find a compromise,” adding there won’t be any government shutdowns on his watch.
Here, a look at how McCarthy is likely to approach a handful of major business priorities:
Tech
Though he hails from Bakersfield, 250 miles south of Silicon Valley, McCarthy has worked to cultivate the tech industry both as a source of GOP campaign cash and an imprimatur of innovative cred for the party’s economic program. That includes buddying up to Elon Musk and introducing, as his lone substantive legislative proposal this year, a measure called the SPACE Act, which is aimed at fostering the commercial aerospace industry. Yet he has not reliably pushed broader tech’s agenda on Capitol Hill. Patent reform legislation that tech giants have sought for years, for example, has languished in the House, with no assist from McCarthy. And he sided with the big telecoms earlier this year in the debate over net neutrality that pitted them against online companies.
Immigration
McCarthy’s district is 35% Latino. And it includes agribusinesses that rely on migrant labor — one reason the United Farm Workers union is headquartered there. He’s toed the GOP line on the need to secure the border first. But he’s also expressed a willingness to provide papers for working migrants. “There are so many ways we can change,” he told Fox. “I think there’s an ability to make an immigration system that works.”
The Export-Import Bank
Like most lawmakers, McCarthy had been a supporter of the once-sleepy federal agency that guarantees financing for American exporters. But free-market purists elevated the bank to a symbol of crony capitalism, mounting major resistance to its reauthorization. And in the aftermath of then-House Majority Leader Eric Cantor’s upset defeat in his 2014 primary — a fight in which his little-known opponent made Cantor’s support for the bank a leading issue — McCarthy flipped, declaring his opposition. The bank’s rightwing opponents in the House managed to force the expiration of the bank’s charter over the summer. And McCarthy remains committed to keeping it in liquidation. “That has failed now and it should stay failed,” he told Fox News on Monday. “I fought hard for that, and I’ll continue to fight.”
Energy and the environment
McCarthy has declared energy his top issue and fought to expand exploration opportunities for producers while fighting regulations on users. He recently reversed his opposition to lifting the ban on U.S. Oil exports, declaring, “If there was ever a time to lift the oil export ban, it’s now.” And he’s proved an aggressive advocate for business interests fighting new federal rules related to environmental concerns. That includes battling the Obama administration on efforts to impose tougher restrictions on water pollution under the Clean Water Act and address carbon emissions through new EPA rules. McCarthy also signed a pledge by the Koch-affiliated Americans for Prosperity against supporting any climate change measure that produces a net increase in federal revenue.
Tax reform and infrastructure spending
McCarthy earlier this year expressed support for funding a major commitment to highway projects with a tax tweak that would force home corporate profits stashed abroad, albeit at a steep discount. A bipartisan, bicameral push to accomplish just that has been quietly gaining steam on Capitol Hill.
But McCarthy’s views on any given subject are hardly dispositive of the approach House Republicans will take. That’s true not only because McCarthy himself is much more of a conciliator than an ideologue. Even where he might have strongly-held opinions, his ability to wrangle consensus from an epically fractious group will be challenge enough. His first order of business will be keeping the wheels on.
