Democrats Promised to Fix the Economy. Can They?

Hey, What's News listeners. It's Sunday, November 8th. I'm Luke Vargas for The Wall Street Journal, and this is What's News Sunday, the show where we tackle the big questions about the biggest stories in the news. And this week, Democrats just retook control of Congress, channeling a wave of voter anger about the cost of living. And candidates across the country promised they're ready to get to work. I'll ban insurance companies from blocking carrier doctor approved and fine them when they wrongly deny claims. We have an affordability crisis because we have a corruption crisis. But we can end that in this election, in this state, in this race. But what options are actually within Democrats reach? And what can lawmakers get done before voters in 2028 get a fresh crack at shaking up Congress once again? Let's get right to it. Well, everyone knows the results by now. So what's going to get done when a new Congress is seated in January? Journal reporter Gene Whalen and Gavin Bade have been looking into that, the likely direction that Democrats and the Republicans willing to work with them could take in the next Congress on issues directly related to American pocketbooks. I think we need to start, Gene, Gavin, by looking at the actual mandate that lawmakers have been given in this election. And to do so, let's hear from a few voters. He supported the war. Gas prices are up. He supported terror. Everything else is up. Affordability and capital are always top of mind for me. So definitely played a big factor in why I voted the way I did, because over the last few years, I feel that the country hasn't been ran like it should have for the people, for the individuals. I've definitely noticed issues with like affordability and like groceries have gone up and just the general direction the country's taking. Gene, does that sound indicative of what Democrats are being tasked to address here? Absolutely. I was out talking to Ohio voters the last few days, and they're very angry about costs still being very high and rising because of the war in Iran, gasoline prices being high. They feel that their wages aren't keeping up in many cases. People cannot afford to buy or to rent in many markets. They're fed up. They feel that Trump promised them improvements to all of these issues, and they haven't really seen it. And so they want change. They want change. They want a lot of it. And to be clear, a number of candidates are not going to be able to afford to buy or to rent in many markets. And it's promised a lot as well. Let's listen to one of them. This is North Carolina Democratic Senator-elect Roy Cooper, who had this to say at his victory party on Tuesday. We have to work to make health care, housing and groceries more affordable, to end this war and stop the pain at the pump, to protect Medicaid expansion we worked so hard for, to stop corruption and take on special interests. That get rich while people struggle to get by. Gene, clearly that message resonated, but we're going to pressure test several of those promises here to consider what can actually get done in the next Congress. And maybe we should start with gas prices, which Cooper there tied to the war. Can Democrats really affect much change there? They could potentially take steps to try to push the war to a conclusion. They could try to withhold some funding for the Defense Department. They could really join forces with some Republicans who actually would like to do it. They could really join forces with some Republicans who would like to see that happen as well, if they can find four or five willing senators who would join them in that effort. Gene, a good reminder there, Democrats may have a majority, but they still need help to pass a lot of things. Gavin, are there other Iran-related dynamics before we move on that we should be keeping an eye on? Another thing to watch here is whether or not Trump goes ahead and sacks Pete Hegseth, his Secretary of Defense, or Secretary of War, as they say. If the Defense Department doesn't have a leader, that would open up another point of leverage for Senate Democrats, right? Well, if you want us to, in this next year, hold hearings and do a vote on your next, you know, head of the Department of Defense, maybe we need to extract some commitments that they're going to wind down this war. Gavin, I think there's a natural transition point here from Iran over to tariffs, because we have seen at times these votes to sort of try and rein in President Trump's war powers related to Iran, getting some Republican support or interest, even if some of that support actually sort of melts away right before a vote occurs. And tariffs is another one where we've heard some Republicans voice some regret about the fact that trade wars have been started and have hurt businesses in their districts and made products more expensive. What's the likelihood in the next Congress we see meaningful pushback on President Trump's trade agenda? I think you will see meaningful pushback on certain aspects of it where Democrats feel like they can unify their caucus. So what I heard from the incoming leader of the Senate Finance Committee, Ron Wyden, he's from Oregon, they are going to first go after, President Trump's trade war with Canada and try to put bills on the floor that would cancel out the tariffs on Canada, the import prohibitions that President Trump has put on. They feel like virtually every Democrat in their caucus, if not everyone, is on record against these Canada tariffs. And a lot of Republicans are pretty skeptical about them as well. We saw some resolutions last year, some Republicans came and joined against the Canada tariffs, right? That's still a pretty small slice of President Trump's trade war. And as you get broader and larger, you're looking at the other aspects of it, it gets more and more difficult to get democratic unity. So if you start going after the tariffs on steel and aluminum, for instance, do you have some senators or house members in Pennsylvania, other steel and aluminum producing states that don't like that? So I think they'll start off small and narrow and then see how far they can push it. But again, any lasting reforms to these presidential trade authorities, probably going to have to wait till the next presidential administration. Gavin, one more thing, and something Cooper mentioned in that clip we heard, which was, as he said, protecting Medicaid expansion we worked so hard for. I think this is about reversing cuts to benefit programs that have occurred in recent years. What are you hearing might be on the agenda here for Democrats? Similar to the trade agenda, if there are a couple narrow changes to Trumpian policies that the Democrats think they can get unity on and can put on the floor and really pressure the president, one is to reverse the cuts to Affordable Care Act subsidies that Trump did in the one big, beautiful bill. Democrats think that that is something that is something that they can get their caucus behind and that maybe they can even do a deal with Trump to get him to restore that stuff. But as you get into further reforms and into further efforts to expand the social safety net, which many Democrats want, that's probably going to have to wait till the next presidential administration at best. So kind of like the trade agenda, any sort of real lasting change is going to be challenging in this environment. Democrats broadly want to expand the social safety net, especially when it comes to health care policy. And we saw in a number of candidates go for Medicare for all or endorse an expanded government insurance program. The question going into 2028 is how do you get there? Looking at Senator-elect Abdul El-Sayed in Michigan, he has said he's endorsed Medicare for all. He's also said there are incremental steps that we would take to get there. First, expanding vision and dental programs, expanding these things down to children and building the social safety net incrementally rather than doing it all in one fell swoop. Gavin, Gene, hold on to that one because we've got to take a very short break. When we come back, we'll be looking at some areas where Democrats might be able to enlist Republican support and some where they're very likely to run into stiff opposition from the president and his supporters. Stick around. Well, let's tick through a few more issues where newly elected Democrats are promising to take action to address Americans' economic frustrations. And to help do that, we're bringing Matt Grossman into the conversation. He covers for us out of Washington. Matt, we were just talking about health care there. This is a good issue where you really see a range of options being put forward. On one hand, you've got the Abdul El-Sayed's talking about Medicare for all. And in the beginning of the show, we played a clip from Sherrod Brown, Senator-elect for Ohio. And what we heard was an ad. He was promising to sort of address some of the pain points within insurance, an ad featuring a lot of people kind of on hold trying to talk to their insurer. Are there other issues you're keeping an eye on besides health care? Where there's an open question around whether Democrats just focus on addressing small grievances with the system or push for systemic change? Yeah, I think your point about hold times on the phone, for example, speaks to a challenge that Democrats are going to have. Some of the easiest levers for them to pull are programs that affect many, many people, but certainly not everybody. I think a challenge that the voters really expressed on Tuesday was that this affordability problem feels like it's affecting everybody. Even if you're not relying on federal programs, it just feels like your wages are not quite keeping up with the regular expenses of daily living. And that can be a much harder problem for Congress to legislate. Congress can't go around controlling the prices that are charged. They can't go around giving everybody a raise. So I think a challenge for Democrats here is to offer solutions that make the average person feel a bit better about how the math adds up in their budget, even though they're not going to be able to do that. And I think that's a challenge that that's a difficult place for Congress to reach exactly. Gene, I'm curious what you've heard speaking to voters about what they care about and how high their expectations are here. They certainly do have very lofty expectations. One of the most passionate themes I heard out there was the opposition to data centers. That was absolutely bipartisan. I stood outside one Ohio polling place where literally every person, Democrat, Republican, independent, undecided, they all knew they were going to vote to curb big, data center construction and I think it's possible that in Congress, lawmakers could latch onto that in some fashion. A lot of data center construction obviously is controlled by local governments. Potentially there could be some federal legislation to curb the amount of construction or the size of the construction or where things are built. And lawmakers could spin off of that as well to place a few other curbs here and there on AI as the broader issue about slowing the pace somewhat or offering more worker protections against mass unemployment. People are worried about that if AI takes their jobs. I'm not certain at all that any of that is going to happen, but it is one area where we could see some bipartisan consensus given that it's so bipartisan among voters. Gavin, other areas we should be watching for to see if Democrats can bring Republicans across the aisle? I do think there could be. Could be some momentum, if not in this next Congress, you know, maybe in the next presidential administration to raise revenues by taxing billionaires. This is something that I've heard from sitting House Democrats this week. And I think we've heard throughout the campaign season is that they want to raise taxes on the higher income brackets there and make sure that they are in their phrase paying their fair share. This is a way that, you know, Democrats are going to try to get out of their catch-22, which is, you know, interest rates are high. The national debt is at an all-time high. But they also want to expand. They want to expand on these social insurance programs. And so when I ask people like Debbie Dingell, the congresswoman from Michigan, well, how do you deliver on expanding the social safety net while also bringing the deficit down? The first lever they want to pull is taxing billionaires. I think given the populist upwelling that we saw across the nation this week, that could be a place where the parties come together, if not in this Congress, maybe in a future administration. The problem is, is to do the things that Democrats are going to want to do, you're probably going to have to do more than just taxing billionaires. So, you know, I think we're going to have to do more than taxing billionaires. So, you know, I think we're going to have to do more than just taxing billionaires. There's just not enough revenue there to continue all the programs we have, expand the social safety net to Medicare for all, and still have the global empire that we have. So there are going to have to be hard decisions made over military spending, over some of the, you know, American social insurance programs. And coming after an election, which even a number of voters in California didn't want to go along with a billionaire's tax. So we'll see truly how palatable that is once it's the talk of Washington and not just Sacramento. And where should we end? I mean, maybe something where you don't need to be a political expert to understand that tensions are going to get heated. And I think we can say that's taking on special interests. We have already spoken on the podcast about how Democrats are retaking the House and that that means they will be controlling the House Oversight Committee with all of its subpoena powers and its broad authority over government investigations. Matt, I don't know, maybe this is something you'll be watching. Or should we expect, I don't know, a lot more scrutiny of everything from mergers to the concentration of power in the hands of certain companies? The Democrats who I've spoken with who won their elections and will be heading to Congress in January really took a message from their voters that affordability is the priority. And if there are ways that they see to use investigative powers or committee hearings to be seen pushing that goal ahead in a meaningful way, I wouldn't be surprised to see that. On the other hand, I think they know that the voters want to see action on this and want to see real progress. And, you know, maybe that will instill a sense of discipline that those powers should really be put to use in a meaningful way that that are going to be addressing some of these everyday concerns. I've been speaking with reporter Gavin Bade, who covers trade, industrial policy and economics for us out of Washington, as does Matt Grossman. And we were also joined by Gene Whalen, who writes about the U.S. economy from our Chicago bureau. And that's it for what's news for Sunday, November 8th. Today's show was produced by Patty Moyer with supervising producers Sandra Kilhoff and Melanie Roy. I'm Luke Vargas, and we will be back tomorrow morning with a brand new show. Until then, thanks for listening.