Voters could see the end of the Democratic Party’s two-year reign of power as the weight of the dire US economy slows its momentum heading into the midterm elections. Still, the same October surprises that would save Americans from another two years of Democratic rule could also bankrupt the nation financially.
The United States faces a full percentage point interest rate walk, a national crime wave, and the Obamacare time bomb, which may explode on seniors just before the nation decides America’s political destiny.
economists warned that US inflation would become a burden on an already weak average country unless the US Federal Reserve took action in 2021 to raise interest rates. But the Fed ignored the predictions and instead decided to wait until inflation hit record highs before raising the rate by 0.25 percentage point, which did little to solve the problem and made inflation worse.
After the recent Consumer Price Index (CPI) report showed that underlying prices grew up in August, the brokerage firm Nomura Securities foretold that the US Federal Reserve would make the biggest interest rate hike since the 1980s. Nomura Securities told clients in a report that they anticipate the Fed will raise the short-term rate by a shocking 1% at the meeting of the Federal Open Market Committee in September.
Economists at Nomura Securities have changed their forecast and expect a 100bp interest rate hike from the Federal Reserve next week (followed by 50bps each in November and December):
“The CPI report for August…suggests that a number of upside inflation risks may be materializing.”
— Nick Timiraos (@NickTimiraos) September 13, 2022
“We continue to believe that markets are underestimating how entrenched US inflation has become and the magnitude of the response that will likely be required from the Federal Reserve to dislodge it,” the Nomura Securities report stated, according to a Market Surveillance. “We think it’s becoming clear that a more aggressive path of interest rate increases will be needed to combat entrenched inflation stemming from an overheated labor market, unsustainably strong wage growth and higher inflation expectations.” (RELATED: America Hits Record Credit Card Debt)
Nomura forecasts that the Fed will raise the rate to 3.25-3.5% at the September 20-21 monetary policy meeting, a shocking increase since the rate was almost zero when Recently as March 2022. The brokerage firm also believes the Fed will eventually raise that rate to as high as 4.75% in 2023, according to the report.
The increase in the interest rate makes it more expensive to borrow money. If the Federal Reserve raises the interest rate by 0.25%, it adds $25 a year in interest for every $10,000 borrowed. This increase, especially for variable-rate debt like adjustable-rate mortgages, car loans, and credit cards, adds up.
Americans added more than $67 billion in new debt during the second quarter of 2022, averaging around $8,942 per family, according to to a study analyzing data from TransUnion, the US Federal Reserve and the Bureau of Labor Statistics. The data showed that this increase is 3.5 times greater than the average debt incurred during the second quarter of the post-great recession.
As the United States braces for a prolonged recession to combat recent historic inflation, Democrats failure Saving expiring Obamacare subsidies would compound the problem for older Americans who could be forced to shoulder the burden of steep premium increases.
Health policy analyst Charles Gaba found that a couple in their 60s could will face a premium increase of $17,000 per year if Affordable Care Act (ACA) subsidies funded in the American Rescue Plan (ARP) are allowed to expire on December 1. 31
“There’s no denying that if they don’t spread, there could definitely be a political impact,” Gaba saying Business Insider.
in georgia toss race, where Democratic Sen. Raphael Warnock is battling Republican Senate candidate Herschel Walker, Gaba predicts that a 60-year-old early-retired couple earning $75,000 per year will see a 224% increase in their health care premiums for the silver of lower plan cost if ARP subsidies are not extended. This means this couple will see an approximate $1,190 monthly increase over what they are already paying to maintain their insurance coverage.
Similarly, in Democratic Senator Joe Manchin’s state of West Virginia, health care premiums for the same elderly couple are up $32,448 a year, a staggering 542% increase, according to Gaba.
Emily Gee, health policy coordinator for the progressive think tank Center for American Progress, warned that if the subsidies expire, the US would be missing out on a “great achievement.”
“Come fall, people are going to be looking for higher premiums, and that’s going to be the highlight, not the fact that Congress lowered premiums,” Gee told Politico.
The premium increase could affect up to 13 million people in the US, including the more than 2.5 million new members who joined because of ACA subsidies provided in the American Rescue Plan.
The head of DC’s Obamacare exchange, Mila Kofman, told Politico that the extra spending on health care is “just not going to be sustainable for people.”
“They will have to choose between their food, going to work or keeping a roof over their heads,” Kofman said.
Compounding the problem, Americans feel less and less safe due to rising violent crime. The Major Cities Chiefs Association (MCCA) released a report that found violent crime was on the rise in the US (RELATED: Hide Yo’ Kids, Hide Yo’ Wife: The Democracy-Driven Crime Wave Is About To Get Worse)
“Compared to 2019 mid-year figures, MCCA member cities have seen a 50% increase in homicides and an approximately 36% increase in aggravated assaults,” the MCCA said. said. “These shocking figures demonstrate how the sustained rise in violent crime has disproportionately affected major urban areas.”
There have been nearly 7,000 additional robberies and 4,000 more aggravated assaults in 2022 than were recorded in 2021 by the 70 US law enforcement and law enforcement agencies that participated in the report, according to the MCCA.
Voters say the two biggest issues heading into the midterms are crime and inflation. according to to the Rasmussen Reports survey of August 22.
Rasmussen probed 1,000 likely voters on August 17-18 with a +/- 2% margin of error and found that 86% of likely voters said they were at least somewhat concerned about rising violent crime. At the same time, 85% of Americans shared similar concerns about inflation.
Most political pundits believe the Democratic Party will keep its grip on the US Senate and lose its power in the US House of Representatives. But these October surprises could bring down the Democrats and the United States. United with them.