DC Focused on Guns and Abortion While Powell Commits To Inflation Fight

L . Thomas Block

While markets may be agnostic to the issues of abortion and guns, the question for many in the political world is whether or not these two issues will impact the 2022 midterm elections. With President Biden’s popularity near record low levels, Democrats appear headed to substantial losses when Americans go to the polls in November.

The historical trend line is bad even without inflation and other concerns that are on the minds of voters.  The party controlling the White House has lost seats in Congress in 37 of the 40 midterms since the Civil War.  Could 2022 be different? Some political strategists are wondering if the Supreme Court’s decision overturning Roe v Wade will change the political landscape heading into the Fall. The same may also be true for gun legislation after recent mass killings.  This past week Congress passed the first gun control legislation in decades.  In the Senate, led by Leader McConnell, 15 of the 50 Republican Senators supported the measure.  In the House it was more a party line vote, passing on a vote of 234 to 193.  All the House Republican Leaders opposed the bill and only 14 of the over 200 House Republicans voted in support.

However, on abortion there seems to be no compromise and anti-abortion Republicans will face voters in the new post-Roe repeal era.  Traditionally suburban women have polled as supporting abortion rights, but they vote for Republicans who are on the other side of the issue.  Will the Supreme Court decision change the political landscape, it will be of intense interest as the elections approach.

Powell testimony

This past week Fed Chair Powell testified before the Senate Banking Committee and the House Financial Services Committee and there were no surprises.

The Chair reiterated the Board’s commitment to fighting inflation, calling the battle “unconditional.”  Under questioning from the Senators and Representatives, he conceded that a recession was “certainly possible” due to the unknown of Covid 19 and the War in Ukraine, but a soft landing was possible.

With Congress and official Washington heading out of town for July 4, the next date on the DC economic calendar is July 6 when the minutes from the June FOMC meeting will be released.

Disclosures (show)