3 moves Biden could make as a lame-duck president
11/06/2024 00:06
Biden might want to crimp Iranian and Russian oil revenue once he doesn't have to worry so much about gasoline prices at home.
Political life will get easier for President Biden once the election is over and he doesn’t have to worry about controversial moves that could damage Vice President Kamala Harris’s chances of winning the White House. And there’s a lot Biden might do after the election that he wouldn’t do before it.
The so-called lame-duck session — the period from Election Day until the new president takes office the following January — occasionally produces some interesting surprises. There’s also a congressional lame-duck session, which goes from Election Day until new members take their seats in early January.
If there’s a change in political power in the White House or Congress, the lame-duck session can be an opportunity for the outgoing party to wrap up unfinished business, especially involving moves that might be politically unpopular.
Seventeen days before leaving the White House, in 1960, President Dwight Eisenhower severed relations with Cuba, clinching its place in the Soviet orbit. President Jimmy Carter signed the Superfund environmental cleanup law during his lame-duck session in 1980. President George W. Bush approved the federal bailouts of General Motors (GM) and Chrysler (STLA) during the lame-duck period in 2008.
Biden hasn’t overtly signaled any major moves he plans to make during the next 10 weeks, but there are a number of unsettled issues on which he might feel he has a freer hand to act.
One is sanctions on Iran, which has fully asserted itself as the most nettlesome nation in the Middle East. Iran backs the Hamas and Hezbollah terrorist groups at war with Israel, and the conflict has escalated to direct exchanges of fire between Israel and Iran: once in April and again in October. The bloody scorecard now shows Israel with the latest jab and Iran vowing yet another retaliation.
Biden has taken heat for tacitly easing enforcement of long-standing sanctions against Iran that are meant to hamper its ability to earn desperately needed revenue from oil exports. Biden suffered clear political damage when US gasoline prices hit $5 per gallon in 2022, and he’s been determined to get gas prices down ever since. That includes letting Iran export more oil into global markets than it might under tougher enforcement, with the marginal supply boost putting downward pressure on prices.
Biden won’t have to worry quite as much about gasoline prices during the next couple of months, which means he might be able to tighten up on Iran. Eurasia Group estimates that Biden could take a range of actions that would reduce Iranian oil exports by 150,000 barrels per day to 700,000 barrels per day. The effect on oil prices, and, eventually, gas prices, could be negligible at the lower end, with a pop of 10% or more at the higher end.
Tit-for-tat bombing between Israel and Iran is obviously a complicating factor. It’s possible Biden could use tighter sanctions against Iran to try to dissuade Israel from any further military action, if it's planning any. Biden may also want to end his presidency by demonstrating to critics that he’s tough on Iran. If Harris wins, Biden might also be doing her a favor by playing bad cop toward Iran and giving her some leverage to play good cop once she takes office.
Biden has also drawn flak for a plan to limit Russia’s oil revenue — its main source of funding for its ongoing invasion of Ukraine — that isn’t especially effective. One part of the Biden plan is a $60 per barrel cap on the price purchasing nations pay for Russian oil. Other efforts are meant to limit Russia’s ability to access tankers and other infrastructure it needs to export oil. Russia has found many workarounds allowing it to evade sanctions and keep the oil flowing.
The difficulty for Biden has been crimping Russia’s oil revenue without, once again, causing a supply shortfall that could drive up prices for American consumers. Some allies of Ukraine have called for lowering the Russian oil price cap to as low as $30, while even some Biden administration officials want to impose new sanctions that would make it harder for Russia to ship oil. Both moves are more likely with the election out of the way.
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A final touchy issue is more US aid for Ukraine, which is stuck in a deadly war of attrition with Russian invaders exploiting advantages in both manpower and war materiel. The last big aid package for Ukraine was a $61 billion program Congress passed in April, which took months of debate while Ukrainian troops ran desperately short of ammunition. Another similar package will be no easy lift, and it may be impossible if Trump wins the White House or Republicans retain control of the House of Representatives.
But Ukraine’s allies on Capitol Hill are lobbying for more aid anyway, and there are other things Biden could do without congressional action. One of the most consequential would be lifting restrictions on the ways Ukraine can use advanced American weapons, such as allowing strikes on military sites inside Russia. There’s no silver-bullet solution that would promptly tilt the war in Ukraine’s favor, but many analysts think 2025 could be the year that Russia begins to hemorrhage resources, making ongoing US and Western support for Ukraine decisive — if it lasts.
Biden has generally governed as a careful pragmatist on some of the thorniest issues his administration has faced. If he’s contemplating bolder action, the lame-duck session is the time to move. Historians will be watching.
Rick Newman is a senior columnist for Yahoo Finance. Follow him on X at @rickjnewman.
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