This morning America awoke to the political version of the 1993 Bill Murray film Groundhog Day. After billions of dollars spent during a brutal campaign, we essentially had a status quo election. The re-election of President Obama, a Republican House and Democratic Senate presents the venture industry – and the country – with an identical political landscape for the next four years. However, if you recall the film, once the main character, Phil Connors, understood what was happening, he began to greatly improve his actions and interactions with the people in his world and, of course, a happy ending ensued. We are optimistic that the same holds true for our country this time around.
While overall, the political power makeup is very much the same, there are subtle differences that will impact the way we interact with Congress and the Administration. The Senate became more divided as moderates were turned out in favor of candidates on the right and left. The Republicans did remarkably well in the House, thereby creating an effective lever against President Obama suring the lame duck session. Hopefully, both parties will recognize that the country needs comprehensive solutions to problems that have been with us for several years: a budget that needs balancing, a tax code which needs fundamental change, an immigration policy which honors the entrepreneurial spirit, and a government that recognizes the importance of research and development to the future of the country.
These challenges will all be addressed by one of the most inexperienced Congresses in history. The education process on Capitol Hill never ceases. NVCA will continue to educate new members and their staffs about the importance of maintaining and supporting a vibrant entrepreneurial sector of which venture capital is an integral part. Because of this inexperience, particularly in House, party discipline could be problematic and finding solutions to pressing problems could take longer than many are currently anticipating.
Aside from the obvious challenge President Obama will face with a country divided, he will also have to address the makeup of his Administration. The President has done a remarkable job in keeping the lion's share of his appointees in their positions for four years. Come January you will see many who will leave the Administration, potentially opening up major slots at Treasury, DOE, SEC, and many other departments and agencies with whom our community interacts. This turnover will take time. We are going to have to be patient as this process unfolds.
Venture capitalists are by their nature optimists and thus we view these elections as a time to inform the newly elected and re-engage with those returning about the venture process and its important contribution to moving our economy forward. Like Phil Connors, we know this drill even better than we did four years ago and intend to use this familiarity to advocate even more effectively for our industry.
NVCA has posted a comprehensive election report on our website. We encourage you to review it today.
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