Democrat Midterm Odds Improve with Policy & Economic Victories

Democrat midterm odds have improved in the 2022 Senate race. On August 4, odds on Democrat Senate and a Republican House rose above the odds of a Republican House and Senate. As of August 9, the PredictIt price of a Democrat Senate and a Republican House is 48 cents on PredictIt. The price of a Republican House and Senate is 43 cents.

Two major victories have contributed to Democratic gains in polls and prediction markets. First, Democrats are coming off a wave of major policy victories. Second, key economic indicators are moving in the Democrats’ favor. 

Policy Victories

Over the course of about six weeks, President Biden and congressional Democrats: 

• Announced the death of Al-Qaeda leader, Ayman al-Zawahri
• Passed the Inflation Reduction Act through the Senate
• Signed the first federal gun control bill into law since the 1990s  

These policies enjoy bipartisan support among voters, even as many congressional Republicans voted against these measures. A Gallup poll found that the percentage of Americans who favor stricter gun laws is 66%. The same poll found that the percentage of Americans who want gun laws to be kept the same or loosened has also dropped.

The Inflation Reduction Act includes investments in climate change initiatives, a flat tax on corporations making at least $1 billion per year, select prescription drug price regulations, and federal negotiating power on certain drugs. These issues poll as either important or popular among the American public. (The exception is the majority of Republicans who oppose higher corporate tax rates.)     

Gun control is a tricky issue for Americans, though. The New York Times reports that while many Americans support gun control in theory, that broad support diminishes in response to specific policies. The same article went on to list votes on state gun control measures with tight margins of passage or failure despite high support in polls. Even though the gun control bill passed, the conflict between what voters want in theory and what policies they’re willing to embrace will continue resurfacing in subsequent election cycles.

In addition to these bills’ popularity, these policy victories also poke holes in the common Republican narrative that Democrats are ineffective legislators. They’re also ammunition for Democratic Senate candidates in competitive races who can point to popular party accomplishments. Policy factors aren’t the sole electoral factors, but they’ll be important in determining 2022 Senate control.      

Economic Issues

Key economic measures have finally begun to swing in Democrats’ favor. The inflation rate has begun to drop. Gas prices are falling. One detail that has been missed amid rising prices is that the US unemployment rate hasn’t risen above 4% since November 2021. For the moment, Democrats have good news to lean on. 

But even controlling for short voter memory, economic conditions may not be the slam dunk that Democrats need to keep the Senate in November. Energy and food prices remain high compared to a year ago. Rent prices and affordable housing remain key issues for many Americans. 

The authors of Democracy for Realists found that the last two quarters before an election sway voter opinion. So, if the economy remains strong, Democrats have a better chance of keeping the Senate. However, even though the economy is an important factor for voters, it’s not the only one, nor is it a guarantee of victory in the midterms. 

How Democrat Midterm Odds Can Change 

Democrats are riding the high of major policy victories and recovering economic conditions. The laws that Congress has passed and Biden has signed into law tackle issues that many Americans have been clamoring for action on. 

However, Biden’s performance is still being skewered by Republicans. Republican disapproval of Biden is driving his high disapproval rating. These voters will be the most motivated to vote against Democrats in critical races. So, there’s still a counterforce to Democrats’ recent momentum.