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Post 2014 Election Expectations

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IL  2014 Gov. voting map by county in 2014.

A majority of voters were not happy with the policies (higher taxes, Obamacare, etc.) of many politicians on the ballot and the results show many new faces in office.

Here are some of the my opinions about what this may mean:

  1.  Gridlock

    1. In Washington – All the republicans can do is pass bills and bring to the Oval office where I expect most will be vetoed.  Under Harry Reid, well over 200 bills that were passed by the House were never voted on, giving the democratic senators and/or the president cover from having their vote on the record.

    2. In Illinois – A democrat dominated congress will be stymied by the new republican Governor Rauner. This is a significant change as it was 100% democrat rule.  The tax and spend policies of the past have IL over $100,000 billion in the hole with no foreseeable way out.

I do not expect either leader (Obama or Rauner) to go along with the other party which is why I believe that “gridlock” will be here to stay. The interesting thing will be who is blamed when the local and national economy do not significantly improve after these election results. This will be a key determinant in the 2016 presidential election because if President Obama is held accountable for his actions and is “blamed” for the economy than we may see another anti-incumbent dominated voter movement.  If the blame is put on republicans’ democrats could take back the senate and win the presidency. The key is “who is to blame” for the declining wages and slow economic growth.

  1. The Great Divide in Illinois and the United States is Urban vs. Rural. We are polarized by where we live as you can see by the map showing that most of the country is rural and votes republican, but the densely populated areas tend to vote democrat. In my mind the difference is “the more government is better” in the urban areas and “the less government interference” the better in the rural areas.

 countymaprb512

  1. In Washington, the biggest impact the republican senate will have

    1. Passing a budget (haven’t had one President Obama took office) as Paul Ryan will be new Chairman of the house Ways and Means Committee and the president’s signature is not needed for this.

    2. Change in the chairman of all the governmental committees

    3. Stop liberal judge appointees, this would be a major issue if a Supreme Court Judge vacated

    4. Potentially stand in the way of President Obama’s expansion of Executive Powers if he tries to bypass Congress and make laws with executive orders beyond the Presidents scope of authority – Immigration

    5. Minority’s and women enter and expand republican party: Republicans elected a black man as senator (Tim Scott) in South Carolina. Jodi Ernst in Iowa and Shelly Capito (West Virginia) also won senate races so maybe this will help open eyes to black and some women voters that republicans are not a war against them. Susan Martinez (Latino woman) won her Governor’s re-election by a large margin in New Mexico.

  1. In Washington, the republicans expanded their advantage in the House of Representatives to the largest advantage since the 1940’s. This just means that it will likely stay in the republican’s hands for at least a couple more election cycles.

 Impact on Your Money

Financially, gridlock could be a pretty good thing for the stock market.  I don’t see the federal reserve changing their current monetary policy as was hinted at a meeting I attended the last week with a member of Chicago’s Federal Reserve Board last week. Fiscal policy which is dominated by tax policy is unlikely to change much unless President Obama does a one hundred eighty degree turn. Congress will pass bills on tax policy that the president will be inclined to veto. History is on the stock market’s side as this mix (republican congress, Dem Pres. Worked great in 1984).

 

The biggest issue we will hear about in the coming months may be health insurance complaints about increased premium rates and narrow doctor networks as the President strategically made sure this would not come to fruition until after this election was complete.

In summary, I do not expect a sea of change as like zebra’s, politicians don’t usually change their stripes.

 

What are your expectations?

Please share below….

 

Other related posts:

Affordable Care Act – Newest Plan to Create Gov’t Dependency Will do Just That

Chicago Finances in BIG TROUBLE- The Blue State Reckoning

4 Expectations from President Obama’s Second Term

 

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