The Senate May Turn Republican: 3 Ways This Could Impact the Cost of Everyday Items
Written by
Kerra Bolton
Edited by
Amber Barkley
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Republicans are favored to win the U.S. Senate in this year’s elections, which could signal a possible shift in economic policies, from trade to regulatory practices, that would affect the cost of living for everyone in the U.S.
“A GOP-led Senate will undoubtedly reduce [business] regulations, which [would] reduce consumer costs,” said Dustin Siggins, a political analyst and co-founder of Proven Media Strategies, a PR firm. “But a GOP-led Senate may also support increased tariffs on countries like China, which, while defensible on a geopolitical and macro-economic level, [would] likely increase consumer costs.”
Nevertheless, the current polls indicate the Senate may turn Republican. Here are three ways this could impact the cost of everyday items.
Lower Gas Prices
Christopher Stroup, the founder and president of Silicon Beach Planning, said Senate Republicans are likely to prioritize policies aimed at increasing domestic production.
“This could involve rolling back regulations they believe hinder production and [investing] more heavily in energy independence,” Stroup said. “By working to increase domestic production, especially of energy sources, gas prices could decrease as we reduce reliance on foreign oil.”
Gas prices could decrease regardless of the election results, however, as the United States has produced record levels of crude oil for the past six years, according to the U.S. Energy Information Administration.
Possible Lower Health Care Costs
Stroup said Senate Republicans could advocate for healthcare reform through deregulation and tax incentives.
“This could include reducing regulations on the healthcare market and expanding health savings accounts (HSAs),” Stroup said. “If successful, these measures could lead to lower healthcare costs and more options for families.”
Stroup explained, “Reduced premiums and out-of-pocket costs would allow families to allocate more of their budgets to other essential needs. On the other hand, if deregulation leads to reduced coverage and higher costs for specific services, families may be burdened with unexpected expenses, potentially straining their budgets.”
Increased Spending Power
Historically, Republicans have championed lower tax burdens, which would give families more disposable income and spending power.
“This extra income could lead to greater consumer spending on essentials and discretionary items like housing, education and entertainment,” Stroup said. “However, if tax cuts are not offset by spending cuts or increased revenues, they could also lead to larger deficits, which may require future tax increases or reduced public services.”
It Depends
Ultimately, changes to policies that affect the daily living costs also depend on who wins the presidential race.
“Under a [Vice President Kamala] Harris presidency, a Republican Senate [would] serve as an important check on some of her more costly regulatory and tax increase proposals,” said Wayne Winegarden, an economist at Pacific Research Institute. “Since high corporate income taxes ultimately lead to lower wages and higher costs, a Republican Senate [would] play an important role in keeping costs down for consumers and keep real wage growth stronger, which also helps affordability for families.”
Similarly, a Republican Senate could rubber stamp or block former President Donald Trump’s economic proposals on government spending, tariffs and tax code changes.
“Which way it goes is simply unknown at this point,” Winegarden said.
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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