Republicans are opening a new line of attack on President Joe Biden and congressional Democrats as US stocks head for their worst year since 2008, sapping Americans’ retirement accounts in the run-up to the midterm elections.
Dropping balances in 401(k)s and IRAs have only just begun to surface as a concern among swing voters in focus groups, though usually as one complaint in a litany of grievances over the economy, still mostly driven by frustration over consumer prices, several Republican strategists said.
But Republican officials and candidates took notice of stock prices when they hit new lows in September, even as inflation, abortion, crime, and former President Donald Trump’s legal travails continue to dominate campaigns for the November vote that will decide control of Congress.
Although an early October rally may take some of the steam out of the GOP argument, the month is a notoriously choppy one for markets. Should stocks slide again as the nation moves closer to the election, it would reinforce the Republicans’ campaign theme.
Senate GOP leader Mitch McConnell took to the chamber’s floor last week to try to tie Biden to the tumult in markets as Federal Reserve interest rate increases and a crisis in British bond markets roiled investors.
McConnell, whose been working to bolster GOP chances of regaining Senate control in the midterm elections, said recent declines are “cutting the value of America’s retirement savings just as the cost of living has soared.”
On Twitter, Republican Nicole Malliotakis, who is running for re-election on New York’s Staten Island, warned, “retirement savings are being wiped out!”
It’s an appeal aimed at older voters, who have the most retirement savings at risk and who reliably turn out for midterm elections. The contest for control of the Senate in particular will be decided by narrow margins in roughly five states, and both parties are focusing on issues -- the economy for Republicans, abortion rights for Democrats -- that will motivate their voters.
Although October has begun in positive fashion for both stock and bond markets, the decline that, at the market’s recent nadir, wiped out more than $14 trillion in financial wealth this year still may resonate.
“We’re starting to find it more in our polls and more of our focus groups,” said Sarah Chamberlain, president of the Republican Main Street Partnership, a group that supports some centrist Republican candidates in tight races. “It’s not a massive group, but it’s started to grow.”
Chamberlain said her group’s internal polling showed a bump in support for Biden among older voters after enactment of Democratic legislation in August lowering prescription drug costs later tapered as market losses mounted. While Biden isn’t on the ballot, his already low approval ratings are a drag on Democratic candidates along with historical trends that favor Republicans.
Unlike his predecessor, Biden doesn’t regularly comment on swings in stock prices. The administration argues that markets are only one measure of the economy and point to a still-strong job market as well as legislation signed into law this year to spur the domestic semiconductor industry and clean energy projects.
White House Press Secretary Karine Jean-Pierre said last week in response to a question about market turmoil that Biden has presided over “one of the strongest job markets on record” and that the US economy is making “a transition to a more steady and stable growth.”