US voters will have an opportunity to alter the makeup of Congress in a little more than six months. This being our first elections report of this cycle, our aim is to validate what most of us feel: so much of consequence occupies us every hour since the last midterm (or even general election). Pestilence, prices, and politicians animate most Americans and the smaller subset of registered voters. Partisanship now seems more a predictor than a result of debate or developments. Recent polling data and historical midterm outcomes support our nothing-but-consensus call that November 8 results in divided government next January.
A recent Gallup poll shows that more Americans believe their financial situation is getting worse (48%) compared to who think it is getting better (37%). Respondents to a Quinnipiac poll suggested that if the election were held today 44% of registered voters polled would like to see Republicans take control of the House of Representatives compared to 40% who prefer Democrats retain control. If these numbers hold and Biden’s ratings remain in the doldrums, GOP control of Congress would be assured. Plenty of states and races will signal 2023 balance of power outcomes. Two jump out at the start of the campaign season: Arizona and Ohio. Senator Mark Kelly losing his seat in Arizona bodes ill for Democrats, just as Congressman Tim Ryan winning Senator Rob Portman’s Ohio seat would imply Democrats remained competitive.
The following table ranks our midterm scenarios by the likelihood of outcomes and includes a policy implication for each scenario. We believe the most likely outcome is unified Republican Congress, handing the GOP a 40- to 50-seat majority in the House and the two- to three-seat advantage in the Senate. In the case of a Republican-controlled Congress, enactment of legislation would still require bipartisan compromise since President Biden holds the veto pen. None of our midterm scenarios at this juncture indicate broad legislative policy implications for the 118th Congress. Rather, we believe global macroeconomic adjustments and the war in Ukraine, will continue to exert more influence on Washington policy than near-term politics.
More than anything, this midterm will define the framework for the 2024 general election. Social, economic, and medical/healthcare policies exhibit understandable duration in the top tier of US voters’ concerns. Geostrategic and geopolitical policy uncertainty will continue to provide risk flare surprises, but barring ultimate worst-case scenarios, international affairs will rank after domestic matters.
Presidents matter in midterms as targets of energized or demoralized voters unable to directly express that emotion. Generally, over the past three-quarters of a century Senate midterm losses have been toughest on first-term Democrats (Truman and Obama) and second-term Republican presidents (Eisenhower). Similarly, the top three worst House results during this period occurred in Clinton and Obama’s first midterms and Eisenhower’s second.
Election turnouts in 1982 (Reagan) and 2018 (Trump) were the only ones where turnout broke 50% among the past 11 midterms. The 2022 midterm is likely headed to a strong turnout; the media swirl around the Supreme Court and Mississippi abortion law deliberations likely energizes turnout. In which states and for which parties/candidates abortion drives turnout of course would be helpful to know prospectively. If the Supreme Court becomes an election issue, which seems probable, what would a higher-than-otherwise turnout imply? Our sense is turnout related to abortion policy shows up in tighter races as independents might lean less right and left-leaning voters rally to reliable Democrats willing to openly question the Court’s perceived political bent.
Back to Biden. Only Trump’s rating at this point of a first term was lower. Results of a recent Quinnipiac survey showed only 38% of those registered voters polled approve of the way Biden is handling his job as president. It’s one of many reasons it’s hard to see Democrats’ hold in Congress prevailing this midterm election. Since last summer, the base that elected Biden is less impressed by him. Why young people and voters of color say he and other Democrats have fallen short of those expectations could reflect unrealistic expectations, unimpressive legislating, or a combination. Irrespective of explanations, Biden’s net disapproval trend won’t help Democrats on November 8 unless the numbers improve, and traditional Democrats return to the fold.
In the following chart, only presidents Nixon and Carter managed through inflation spikes of the slope of current readings. The inverse relationship between inflation measures and approval ratings is yet another harbinger of a difficult midterm season for Democrats. Carter’s congressional seat losses in his only midterm, however, were not nearly as damaging to the party – and presidential agendas – as the seat losses presidents Clinton and Obama survived.
Headlines provide a sense that abortion and tangentially the Supreme Court will boost Democrats’ interest this year beyond current perceptions of Biden and other issues. Six months is a long time, but for now the Court and abortion aren’t in the top half of issues registered voters claim important. Suburban women might alter Democrats’ chances in a few close races on the issue of choice. What voters feel about the economy (inflation and the results of natural or Fed-induced tightening financial conditions) and the war might create space for social domestic issues to push to the fore. Social issues have an opportunity to become persistently heavier weights in voter decisions come November if sentiments on the economy, war, and the pandemic improve.
According to the most recent Quinnipiac poll only 42% approve of Biden’s handling of Russia and 33% approve of his handling of the economy. That same poll ranks inflation higher than any of the other issues.
Even when broken out by party affiliation, the economy dominates voter sentiment over other issues. It is the top issue for registered voters in both parties, according to polling done by the Pew Research Center, especially Republicans. Ninety percent of Republicans and 68% of Democrats rank as a top issue.
Economic performance doesn’t always translate into voter appreciation. US real GDP growth was okay-to-strong in every midterm election since 1990. Those data and the underlying activity didn’t protect Obama after a harsh recession and slow recovery of household sentiment focused more on his agenda and him. Clinton’s successful budget-balancing act, trade liberalizations, and improving market didn’t stave off the 1994 Republican Revolution. Trump’s tax cuts didn’t overwhelm voters’ perceptions of Republicans’ healthcare plans or him. Democrats cannot take much solace from these three examples, which suggest that even if the pandemic remains tame, supply chains unkink, and inflation moderates without an accompanying recession, the outcome is likely to be divided government.
We highlight in the table below six important states in the last two general elections that are again vital in this midterm: Arizona, Georgia, Michigan, Pennsylvania, Wisconsin, and Nevada. Each of these states had close margins in the last two presidential years. This year each state has a competitive Senate and Governor race. Turnout will be strong in these states both because governors are more closely linked to turnout machines, and because generally close margins imply competitive races up and down the tickets. With the majority control in the 50/50 Senate in the balance, we expect national attention for these races from both party machines.
Of the six states in our table, Pennsylvania and Georgia hold primaries this month. The Keystone state is dear to the sitting president and Democrats hope a messy GOP primary race helps their odds there. Not all being smooth in the Peach State, the previous president hopes to influence the outcome in the GOP primary and help build better Republican turnout than happened in the last election. Democrats are counting on Stacy Abrams to not only wage a competitive gubernatorial campaign, but to also boost statewide turnout.
The 2022 midterm elections will tell us more about ourselves than the politicians we elect. It may have always been this way, but social media and parties pulling away from the middle guarantee an introspective outcome. Not that everyone will engage the self-searching, either politicians or voters. We’ll end this note where we started: history and the electorate’s dour mood point to a unified GOP Congress next year. Voting margins in both houses next year will be influenced by economic conditions, social issues including abortion and education, and surprises that occur in every election cycle. This consensus outlook has risks worth monitoring, even though the GOP has more momentum than the president’s party half a year from Election Day.
