Let's take a live look at Capitol Hill.
While the 2026 midterm elections are about seven months away and here on Wall Street, the major U.S. stock averages tend to fall in midterm election years.
Political friction in D.C. is colliding with a macroeconomic shock around the globe and the ongoing Iran war as well as the shuttering of the Strait of Hormuz have sent shockwaves through the global energy market.
At the same time, the national debt Right now, the U.S. government is on track to borrow a staggering $2 trillion just this year.
And thanks to the ongoing war, rising interest rates, as well as the recent Supreme Court ruling on tariffs, our budget deficits are ballooning out of control.
Well, joining me this morning to weigh in is Mark Bloomfield, Chair, Board of Directors, American Council for Capital Formation.
Mark, good morning.
Thank you so much for joining us.
Well, It is a midterm election year, and the GOP has control of all three branches, but still faces struggles on its legislative agenda here.
So what will Congress look like after the midterms?
Well, first of all, congratulations on Fentech.
I was there at the beginning, and my God, what a success.
What will Congress look like after the November elections?
First, the facts.
The facts are the Republicans in the House don't have much leeway.
217 Republicans, 214 Democrats, one Independent, and three vacancies.
So they're at risk.
The Senate also isn't good for Republicans.
35 seats up, 22 of them held by Republicans.
So there's not that much margin.
Those are the facts.
The history.
The President's party has lost House seats in roughly 90% of the midterms in the last 80 years.
Remy, you weren't there, but I was when the president's party lost 116 seats. in the House.
You weren't there, I was, because I'm a little bit older, and it was Grover Cleveland in 1894.
But more recently, Trump lost 41 seats in his first midterm.
The key factors are the president's approval.
And you alluded to the war, you alluded to the economy, more importantly, the uncertainty.
And let's look at the latest poll.
March 30th, the Economist Poll, 35% approval, 58% disapproval.
The key elements, of course, are the economy, foreign policy, domestic issues.
So what will Congress look like after the election?
Well, Mark Twain said predictions are very hard, especially about the future, but it does not look good for the Republicans.
Well, Mark, in 2026, DC politics appear as polarized as ever, and we're seeing fireworks as well as headlines every single day.
And it's hard not to be reactive here.
But when you talk to people behind closed doors in our nation's capital, how much of the standoff that we're seeing do you think is electioneer theater?
Help us make sense of the reality on the ground.
Well, let me partake.
Once a month, I bring together two Democrats, two Republicans, four journalists, and business leaders.
And at the last meeting, it's on a house on Capitol Hill, I looked out the window and I said, did you know in May, a congressman walked behind, across our building, into the senator and caned a U.S. senator?
And the answer is that no caning is allowed in our discussions.
Well, the caning took place actually when a Democrat from the South caned Massachusetts Senator Summers in 1852.
We don't have any caning.
So it's not that bad behind the scenes.
But what is the problem then?
The problem is, some of it's real simple.
In old prior days, congressmen and senators used to live in Washington, D.C.
Their families intermingled.
That doesn't happen anymore.
They just come and go.
Secondly, coming and going.
They used to travel together.
Take, for example, the Republican leader, Bob Michael.
He used to travel to Chicago by car with the Democratic leader of the tax committee.
And then this is the most important, I think, populism.
And in deep America, the blue-collar worker really doesn't have any understanding or sympathy for the real financier in Wall Street. or the tech leader in Palo Alto.
So J.D.
Banz's book, Hillbilly Elegy, really hits it.
And that is to say populism is the thing that creates that sort of anger.
And Trump actually won because he was able to dip into that.
So what's the solution?
Well, the solution, I think the easiest solution is a new amendment to the Constitution.
And what would that new amendment be?
It would be, you have to have been in jail 27 years like Nelson Mandela.
So when you became president, you could bring people together.
Well, Mark, we have less than 60 seconds here since we are counting down to the opening bell here on Wall Street.
So one thing that is affecting all Americans is higher gas prices.
We are looking at WTI rallying by 12% and we're already seeing the ripple effects of this geopolitical conflict in the real economy.
So at what point do you hire for longer energy prices as well as borrowing costs shift from being strictly an inflation story to a tipping point that actually sends the economy into a downturn?
Uncertainty.
Uncertainty is the key factor.
I think most analysts think that we'll be able to cope with energy in the long term, but it's the uncertainty that deals with affordability which deals with our first question, the future of government in the United States.
