US infrastructure and farm bill spending can progress

Subject

Economic implications of the midterms.

Significance

The US elections this month enjoyed the highest voter turnout for midterms in more than a century and left the Republicans retaining control of the Senate and Democrats regaining the House of Representatives. Healthcare and immigration eclipsed the economy as the top factors affecting voters for the first time in a decade. Democrats did well in suburban districts, making about 75% of their gains in such areas. Republicans strengthened in rural communities despite the impact of the US-China trade dispute on agriculture.

Impacts

• Trump can pursue trade policy changes despite a divided Congress -- making it more likely the tariffs will persist into 2019 or escalate.
• The House and Senate could join forces to approve a bill reducing prescription drug prices.
• The leaders of the House and Senate have met to discuss infrastructure but will struggle to attract large-scale private financing.