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The race that could impact Alabama the most didn’t even take place in the state

Sen. Thad Cochran, R-Miss. (Photo: YouTube Screenshot)
Sen. Thad Cochran, R-Miss. (Photo: YouTube Screenshot)

Alabama voters sent a clear message on Tuesday that they are not interested in returning Montgomery to the Alabama Education Association’s control. After spending $7 million on a wide variety of races around the state, the AEA was only able to pick up a small handful of low-profile state house seats.

But as important as that development was for the future of the state, a race in next-door Mississippi may actually end up having a greater impact on Alabama than any individual race that took place yesterday in the Yellowhammer State.

Mississippi State Senator Chris McDaniel is challenging U.S. Senator Thad Cochran, who is seeking a seventh(!) term. POLITICO described the contentious race as “savagely personal.” And various outside groups have dumped in roughly $8 million to swing it in their preferred direction.

Last night, McDaniel held on tight to less than a 1-percentage-point lead over Cochran, but neither candidate quite reached 50 percent. The race will now go to a runoff, set to take place in three weeks.

The national media has been paying close attention to this race. Many of them are framing it as an indication of whether the so-called establishment is finally positioned to declare ultimate victory over the tea party.

But Alabamians have a much different reason to pay close attention to what happens over the next 21 days in Mississippi.

Thad Cochran is the second-longest serving Republican in the Senate. If he wins and Republicans retake the Senate in November, he will become the chairman of the powerful Senate Appropriations Committee, the panel that plays a leading role in deciding where the government spends its money. Alabama’s senior U.S. Senator Richard Shelby would be the second-ranking member of the Appropriations Committee, and would become the chairman of the Banking Committee, another powerful panel that deals with a wide range of issues directly impacting the economy, from financial institutions and the Federal Reserve to housing finance.

However, if Cochran loses his runoff in Mississippi, Shelby would be well positioned at that point to move over to chair Appropriations.

That is a huge deal for a couple of reasons.

Sen. Richard Shelby
Sen. Richard Shelby

First of all, Shelby is already a legendary deal maker on the Appropriations Committee. There is a reason why universities around the state have research facilities named after him. He even managed to get a line item in President Obama’s budget — as a Republican — that starts the process of expanding the Port of Mobile.

Secondly, with Republicans in control of the Senate, Alabama’s junior U.S. Senator Jeff Sessions would become the chairman of the Budget Committee, which sets the federal government’s spending levels. So there is a very realistic scenario in which one Alabama senator (Sessions) would set the spending amount, and the other Alabama senator (Shelby) would lead the debate on where that amount of money is spent.

Sen. Shelby isn’t by any means pushing for Cochran to lose. He even recently hosted a fundraiser for him in Huntsville.

There’s also a pretty strong reason many conservatives will be rooting for Shelby to chair the Banking Committee, rather than Appropriations.

If McDaniel defeats Cochran and sets in motion everything we just laid out above, big banks would then get their preferred Senate Banking Committee chairman, Mike Crapo (R-Id.), instead of Shelby, who has taken much stricter positions against asking taxpayers to prop up the country’s major financial institutions.

POLITICO explains:

In the aftermath of the 2008 financial crisis, big banks have not exactly viewed Shelby as a friend.

In 2010, for example, the Alabama Republican voted for the so-called Brown-Kaufman amendment to the 2010 Dodd-Frank law that would have broken up the country’s biggest banks. He was also just one of a few Senate Republicans to vote against 2008 bank bailout law that set up the Troubled Asset Relief Program (TARP), refusing to support a government bailout of banking giants like Citigroup and Bank of America.

Shelby has also advocated for making banks meet tougher capital rules, an issue on which some liberal and conservative senators have found common ground…

[Shelby’s] push to repeal certain Dodd-Frank rules is welcomed by the financial sector, but [he] also opposes government backstops enjoyed by sectors such as housing and insurance that their more moderate GOP colleagues, like Crapo, tend to support.

“There’s far more of a willingness to ruffle some feathers on Shelby’s part, and Crapo puts more emphasis on consensus-building,” said Mark Calabria, director of financial regulation studies at the Cato Institute and a former Shelby aide.

No state gains more than Alabama if Republicans take over U.S. Senate in November, regardless of how things play out in Mississippi. But you can be assured that there are a lot of economic developers around the state salivating at the possibility of a Shelby-led Appropriations Committee.

Follow Cliff on Twitter @Cliff_Sims

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