State of the Union 2018 – What happens next?

Racepoint Global

Written by: Elizabeth Wells – Account Supervisor

Now that the pundits have weighed in on President Trump’s 2018 State of the Union Address, influencers and decision-makers inside the beltway are gaming out which of the many priorities he outlined might actually be implemented in the coming year. Immigration, infrastructure, civil service reform, and even paid family leave were all raised in the President’s speech, but in a legislative year already shortened by looming midterm elections, which of these items are likely to move?

Trump offered a specific, if contentious, framework on immigration reform—one that will face resistance from not only Democrats, but members of his own party who object to a path to citizenship for Dreamers, funding a border wall and ending family unification policies that allow immigrants to sponsor family members. Prospects for a bipartisan agreement in the Senate are real, as long-running negotiations continue, but even if an agreement is achieved there, it will face headwinds in the House.

Trump’s proposal for a $1.5 trillion infrastructure package has generated interest, as the topline number is 50 percent higher than what was previously proposed. What remains unclear is whether that investment would come from the federal government, or would be leveraged from states, localities, and private companies. Still, the prospect of a major investment in America’s bridges, roads, and communications infrastructure is enticing for companies that could compete for this business.

Complicating matters, congressional Democrats are deeply skeptical that the White House will make any good-faith attempts to engage in serious policy negotiations, despite the praise Trump’s rhetoric on bipartisanship and unity received in media coverage. The Washington Post touted the speech as “A call for bipartisanship,” in Wednesday’s edition, but the portions of the speech replaying in the minds of Democrats are Trump’s divisive comments on immigration—aimed at firing up his base, not reaching across the aisle.

A few other policy priorities discussed in the speech, including job training and paid family leave – and, in principle, infrastructure investments, do offer openings for bipartisan compromise. These are issues that Democrats would typically be eager to pursue, but the political climate—both in Washington and in their home states—isn’t pushing them to make deals with Trump, who remains deeply unpopular in blue states and many swing districts. A looming government funding deadline and the cloud of the Russia investigation present additional obstacles to legislative progress in the few remaining months before 2018 campaigns kick into high gear.

With so many obstructions on the path to bipartisan compromise on the President’s goals, many observers are skeptical that big legislation—infrastructure, in particular—is a realistic objective this year. House Republicans seem to be bracing for a Democratic wave election in November, with dozens of members retiring. We may very well be forecasting the prospects of an infrastructure compromise between the Trump White House and a Democratic Congress this time next year. Either way, any infrastructure bill will need support from both parties to move forward.

In contrast to the behind-closed-doors approach that led to the new tax law in 2017, Republicans will have to engage with Democrats on key committees to earn votes for an infrastructure plan that will almost surely lose the backing of deficit hawks on the right. This process is likely to move much more slowly than tax reform did.

To capitalize on this opening, companies should be planning now to develop the messaging and the tactics they need to affect policy debates around infrastructure on the Hill, in the executive branch, and in the states.

Thought leadership activities will help to shape the conversation around solutions for upgrading transportation, communications, and other infrastructure needs.  Activations targeted to governors and state officials, who will be key partners on projects resulting from federal legislation in terms of both funding and execution, will help build a surround-sound approach to ensure legislators hear these key messages.

With negotiations happening out in the open this time, there is ample opportunity for stakeholders to weigh in and activate constituencies to press Congress for desirable outcomes, and the time is now to build your strategy for this debate.