Washington Is Whispering About the “L” Word

THERE’S BEEN SLIGHT MOMENTUM SWING in the Nov. 8 elections, and suddenly there’s talk in Washington about a landslide. That may be an exaggeration, but there’s a swing in the polls toward Republicans.

DEMOCRATS ARE DISMAYED by several developments: a clear move by Hispanics toward the GOP, a surge of polls that show crime is a huge issue, the failure of abortion to become the dominant issue, and President Biden’s dismal job approval ratings. The key, of course, is voter anxiety over inflation and the overall economy.

OUR TAKE IS THAT A HALF-LANDSLIDE IS LIKELY: The House is looking like a blowout — perhaps a Republican pickup of 25 seats, far more than the 5 seats the GOP needs to regain control.

THIS WILL BE A SEA-CHANGE, ousting Nancy Pelosi as speaker (she’s likely to retire from Congress by year-end), replacing her as speaker with conservative Rep. Kevin McCarthy or, possibly, by uber-conservative Rep. Steve Scalise. McCarthy, hardly a policy wonk, is a clever insider who is likely to become speaker after making promises to the party’s right wing base.

COULD THERE BE A FULL LANDSLIDE, with the Senate also falling? Chances of that happening look better now than two weeks ago but that might require some surprises — Democratic Senate losses in Colorado or Washington or New Hampshire.

BUT A ONE-SEAT GOP MAJORITY is now within reach — watch Wisconsin, where incumbent Republican Sen. Ron Johnson has gone from underdog to slight favorite in the past month. And watch Nevada, where the incumbent Democrat is in trouble.

WHY HAS THERE BEEN A MOMENTUM SHIFT? Some Democrats blame the messaging and the timing of ads, which were dominant in the summer but not as potent now. This isn’t about messaging — it’s the failure of Democrats to offer a compelling case for reducing inflation.

WE HAPPEN TO THINK that inflation is peaking but it’s far too late to make that
argument to voters. The election is less than four weeks away and as always, pocketbook issues will dominate. We predict a half-landslide, not necessarily a total landslide — but it’s increasingly likely that Democrats are going to have a bad night on Nov. 8.

ALL THE REPUBLICANS NEED to change the narrative in Washington is to win just one of the two houses, and that’s virtually certain. This will be an election the markets can happily live with.

Related: The Biggest Surprise of This Fall’s Campaign

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