Monday Morning Memo - October 10 - O'Donnell & Associates

Good Morning from Central New York…

In New York, and throughout the country, the biggest news of the week was Micron announcing a $100 billion investment to build one of the world’s largest semiconductor factories in Clay, New York just outside of Syracuse. It is a major win for New York (and New Yorkers) as the federal government works to bolster domestic supply chains of these critical technologies. Under the leadership of Senator Chuck Schumer and the Biden Administration, Congress passed the CHIPs Act and, according to Micron’s chief executive, the legislation was the difference maker. “There is no doubt that without the CHIPS Act, we would not be here today.”

While the investment may not be quite as transformative, as some have suggested, as the Erie Canal, it is still a very big deal. The factory is expected to bring roughly 50,000 jobs to the area. New York State has committed to invest in community workforce development and training programs. New York, which already boasts another large-scale computer chip and semiconductor facility as well as a State Polytechnic Institute in Albany, seems to be positioning itself as America’s hub for this critical manufacturing. Governor Hochul, who grew up in Buffalo during a period of manufacturing decline, indicated she was determined not to let this opportunity pass by, saying, “This is personal for me.”

Also this week, President Biden paid a visit to the IBM facility in Poughkeepsie to announce a $20 billion dollar investment by IBM over the next 10 years to expand its operations. These large-scale, job-creating investments are a continuation of Biden making good on his campaign promise to bring back domestic manufacturing. The President offered, “And, folks, by the way, just since we’ve been elected, we’ve created 678,000 new manufacturing jobs….and we’re just getting started. Where is it written that we can’t lead manufacturing in the world?”

It is no coincidence that the President came to the Hudson Valley where, less than a month out from the midterm elections, there are 3 competitive House races that could be instrumental in determining which party will control the lower chamber:

In NY-17, Member of Congress Sean Patrick Maloney is narrowly ahead of Republican challenger and current state Assemblyman Michael Lawler. Maloney, the head of the House Democrats fundraising arm, has had to acquaint himself with many new constituents after the redistricting saga but nonetheless, still holds a lead over Lawler.

In NY-18, Pat Ryan won an upset victory here (formally NY-19) in an August special election to fill out the remainder of Antonio Delgado’s term following his ascension to Lt. Governor. Now, Ryan will have to hold off Republican Assemblyman Colin Schmitt to earn himself a full term in office.

In NY-19, Republican Marc Molinaro lost to Ryan in the Special Election but has another kick at the can against Democrat Josh Riley. Most of the available polling, including Politico, has this race as a real toss-up.

Recent polling across the country is giving Democrats increased hope that they can retain both the House and the Senate, something thought to be impossible just a few months ago. Democrats hold a slight lead over Republicans on the generic congressional ballot, President Biden has seen his approval ratings steadily climb, and House Democrats have both raised and spent more money than Republicans . But is that too good to be true? History would say yes.

Some experts think Democrats are making the same mistake they did in 2016, relying on imperfect or biased polls when evaluating individual races. Trump voters are less likely to respond to polls and if they do, may result to “social desirability bias,” or providing an answer they deem more socially acceptable than their actual opinion. In Ohio, one pollster found strong evidence of this. A recent Marist poll, which shows Congressman Tim Ryan and J.D. Vance in a toss-up, reported that 45% of respondents had a college degree. The problem is that only 29% of Ohio’s population has a college degree, meaning the poll most likely is skewed in favor of Ryan. This phenomenon is not unique to Ohio: campaigns in Pennsylvania, North Carolina, and other swing states are also likely underrepresenting a section of Republican voters.

On the other hand, some Republican candidates have serious flaws that Democrats are working to exploit. Two recent bombshells: in Georgia, Herschel Walker’s campaign is scrambling following revelations that he paid for one of his girlfriends to have an abortion in 2009. The story, first reported by the Daily Beast, includes a get-well-soon card with Walker’s familiar autograph as well as bank records confirming a $700 check from Walker to the woman. The hypocrisy and public denials proved to be enough for one of Walker’s sons, Christian, who is a popular, conservative social media influencer in his own right. The younger Walker took to Twitter to say, “You’re not a ‘family man’ when you left us to bang a bunch of women, threatened to kill us, and had us move over 6 times in 6 months running from your violence.”

In Pennsylvania, Dr. Mehmet Oz is struggling to push back against a Columbia University internal investigation that found horrible instances of animal abuse in a lab run by Oz . During his time as “principal investigator” at the Columbia University Institute of Comparative Medicine labs, over 300 dogs and a variety of other animals were killed as a result of the experiments and the treatment was so inhumane, it led to whistleblower complaint. Columbia eventually paid a small fine for violating the Animal Welfare Act.

While these developments may appear, at first blush, as game-changers, it is unclear if these revelations will have an effect on the voters. For the most part, these stories reinforce the negative traits that have already accompanied both men; traits that some voters have come to accept. Walker has a long history of troubling behavior toward women and his children, yet he won a competitive Republican primary. It is also no secret that Oz has made millions of dollars selling fictitious “cures” and miracle pills. Will another instance of poor medical ethics and bad judgement move the needle? It remains to be seen.

Another factor helping Oz and Walker is that increased polarization has diminished the impact of an “October surprise.” By now, most voters have their mind made up and there is very little that could come out about a candidate that would give them pause. The most pertinent comparison would be the 2020 North Carolina Senate race where it was revealed in October that Democratic nominee Cal Cunningham, running on family values, had an affair. Cunningham, who was up in the polls at the time, ultimately lost but given that Joe Biden also lost North Carolina, it is up for debate whether the revelations made a real difference or if the polling was wrong in the first place.

The Republicans doubled down on their support for both Walker and Oz, knowing that cutting them loose at this point is not an option. If Republicans did decide to cut Walker and Oz loose to focus their resources and efforts elsewhere, their path to gaining the Senate becomes much narrower and runs through Democratic leaning states.

Still, Republicans have seen the polling gap close in other close races, driven primarily by an increase in television and digital ads depicting Democrats as soft on crime. Senator Ron Johnson in Wisconsin has increased his attack ads and in that time, has seen an increase in his favorability. Dr. Oz has also benefited from a correlation between “soft on crime” attack ads and poll numbers. The most recent Franklin & Marshall poll has Lt. Governor John Fetterman 3 points ahead of Oz but in August, his lead was 13. A recent Ohio poll shows that Congressman Tim Ryan has pulled ahead of JD Vance, closing Vance’s 4-point August lead.

Once the midterm madness is settled, there are still a number of agenda items that could see some movement during the lame duck session. Some votes have been delayed until after the midterms in the hope that lawmakers may be more willing to make conciliatory or politically contentious votes after the election.

Here is what to keep an eye on:

Funding the Government: The CR recently passed by Congress will expire on December 16th and lawmakers will be tasked with passing a large omnibus spending bill or risk a government shutdown. A number of proposals that were dropped from the CR could ultimately hold up the larger spending bill.

National Defense Authorization Act: Senate Majority Leader Chuck Schumer decided to wait on action on the NDAA, instead deciding to take the measure up after the election. A group of Senator is expected to meet this Tuesday to begin debate but amendments and any vote will not occur until November.

Hurricane Aid: While the Biden Administration did approve Florida’s request for a major disaster declaration, the long-term cleanup effort is going to require an appropriation from Congress. This will likely pass, it is just a question of whether it is included in the omnibus package or through a separate, stand-alone vote, as Senator Rick Scott has requested.

Electoral Count Act: A measure to shore up the procedure for the counting of electoral votes and prevent a redux of 2020 has bipartisan support, though differences remain about which version to proceed with. The GOP insists on the Senate version of the bill, as Democrats would prefer the House version.

Marriage Equality: The vote in the Senate was ultimately delayed in the hope that more Republicans will vote in support after midterms. The house has already passed their version and Senate Democrats, including sponsor Tammy Baldwin, remain optimistic the bill will pass.

Taxes: Both parties have an agenda when it comes to taxes and this is an issue that could be ripe for compromise. Democrats will surely be looking to revive the Child Tax Credit enhancement which is set to lapse at the end of the year. Republicans are pushing for a tax credit that allows business to write off research expenses upfront.

COVID Relief: Despite President Biden declaring that the pandemic was over, Congressional Democrats could make another push for federal COVID aid, as well as fund to deal with monkeypox.

The controversial debate surrounding raising the debt limit will have to occur at some point, though just when that deadline is remains unclear. A lot of it will have to do with how much gets passed and how much is spent in the lame duck session.

Despite being dropped from the CR, Senator Manchin is hopeful there is still a deal to be had to pass his energy permitting proposal. While he may have deal with Senator Minority Leader Mitch McConnell, it is the members of his own party, primarily the progressives, that Manchin will have to convince.

Senator Manchin campaigned for Senate hopeful and current Democratic Congressman Tim Ryan in Ohio this past week. Tim Ryan is much closer on the political spectrum to a Joe Manchin than he is say, Bernie Sanders. Manchin offered, “his demographics and my demographics are the same. So, we understand those people. He would be great for Ohio.” Manchin, keenly self-aware, also noted that he told Ryan early on in the campaign, “I’ll be for you or against you, whatever helps you.”

Back in New York State…

The Hochul Administration will also have their hands full after Election Day. The Governor has until the end of the year to sign or veto roughly 440 bills that have passed both houses of the Legislature. They include such major issues as a cryptocurrency moratorium, requiring public hearings for utility rate increases, contractor registration, mandating insurance covers drugs preventing HIV infection, eliminating interest collection on student debt to state agencies, and a slew of other issues.

A Federal Judge has stalled New York’s efforts to reinforce their gun laws following the Supreme Court’s decision this summer to expand gun rights. In his order, Judge Glenn T. Suddaby of the Northern District of New York put a pause on the law requiring one to submit years of social media history and prove “good moral character” before obtaining a firearm. Judge Suddaby also took issue with the provision of the law that declared places such as Times Square or the subway, “gun-free zones.” The order is in effect until October 20th at which point Judge Suddaby will hold a hearing to contemplate the long-term future of the law. Suddaby allowed his order to extend three additional days which allows the Second Circuit Court of Appeals to step in, which New York Attorney General Tish James intends to ask them to do. “Today’s decision comes in the wake of mass shootings and rampant gun violence hurting communities here in New York and across the country. While the decision preserves portions of the law, we believe the entire law must be preserved as enacted. We will appeal this decision.”

Finally, Los Angeles Rams linebacker Bobby Wagner is shrugging off the legal action being taken by the protestor he flattened on the field at last week’s Monday Night Football game between the Rams and host San Francisco 49ers. The man charged on the field carrying a pink smoke flare, escaping security staff, but not Wagner, who tackled him into the turf. “I think that we all know where Bobby’s intentions were, and I support Bobby Wagner,” Rams coach Sean McVay said.

-Jack O’Donnell

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