Don’t Count on Elections to Save You

After three years of Joe Biden’s presidency and after having suffered the highest inflation in 40 years, you would think that Americans would be tired of having Democrats in power. But as this week’s elections demonstrated, that doesn’t seem to be the case.

Only a handful of states held elections this year, including Kentucky, Ohio, Virginia, and Pennsylvania. But in all of them support for Democrats seems to be strengthening, an ominous indicator for 2024. Whether that’s due to actual support for Democratic policies, or Republican voters sitting out elections this year is perhaps debatable.

But if this trend holds for the 2024 general election, it could impact government policies for years to come. And if you thought things were bad now, they could get even worse.

Why Are Democrats Gaining?

There are a number of reasons Democrats could be gaining support, but here are three things to keep in mind when it comes to projecting what will happen in elections.

1. Voters Don’t Always Vote Economic Self Interest

The first thing to realize is that voters don’t always vote in their economic self interest. Even if Democrats have a reputation as free spenders, voters may very well place more emphasis on other issues.

During this election cycle, abortion was a big issue and drove many Democrats to the polls. Many Republican voters may also have sat this election out, whether due to jaded belief that all elections are rigged or for some other reasons.

Hot button issues like abortion will get people to vote for candidates who aren’t necessarily going to benefit them on issues of economics and finance. And that’s because…

2. Voters Focus on the Short Term

Many voters focus on the short term. And by short term, that doesn’t mean a matter of months or even weeks, but possibly just days.

Remember the 2008 bank bailouts? Voters were enraged at the federal government bailing out the banking sector to the tune of $700 billion, a sum that at the time was astronomically large.

Yet despite the fact that the bailout was signed into law only about a month before the 2008 elections, those who voted in favor of the bailouts didn’t suffer any negative fallout. All that voter anger in late September and early October didn’t translate into anything at the polls.

In fact, despite the bailout being passed by a Democratic-controlled Congress, voters handed Democrats an even larger majority in the next Congress. There was so much vitriol against George W. Bush that the blue wave that swept Obama into office benefited the very same Democratic Congressmen who passed those bailouts.

Of the nineteen total incumbents who lost their elections that year (Democrats and Republicans), only five of them had voted in favor of the bailouts. So despite voters having been absolutely infuriated at their tax dollars going to bail out Wall Street, voters actually disproportionately punished the Congressmen who sided with them. And that’s because…

3. Voters Fail to See Cause and Effect

Most people are unable to put together cause and effect, and not just second and third order effects either. Direct cause and effect might as well be Greek to most people.

In the case of the bailouts, voters were upset at the Bush administration, rather than the Democratic Congress that introduced and advanced the legislation, and thus rewarded the people who introduced that legislation.

Those of you living in Georgia, Tennessee, Texas, Florida, and other states seeing influxes of new residents coming from California, New York, Illinois, and New Jersey have probably witnessed something like this.

The new transplants express discontent with the high taxes, high prices, and high cost of living of where they came from, which is why they look for places with lower taxes and a better quality of life. But then they start to want their new state to do things the same way things were done “back home,” and so they vote for the same people and policies that ruined their home state.

In this way, states that were once solidly red start turning purple and then blue. And the voters who cause this never learn from their mistakes.

The Lesson to Be Learned

The takeaway from all of this is that if you’re expecting a red wave to materialize in 2024 and sweep fiscal conservatives into power, you shouldn’t hold your breath. Knowing what happened in elections in 2008 and more recently, don’t be surprised if Democrats win not only the White House but also take back control of Congress.

So if you hoped that 2024 would lead to a restoration of fiscal sanity, lower taxes, and an economy no longer weighed down by excessive federal spending, keep hoping. Even if Joe Biden came out today to announce that he’s doubling taxes, that might not even be enough to sway voters in 2024.

For every voter going to the polls hoping for policies that will improve their 401(k)s, there are more going to the polls hoping for more student loan forgiveness, more welfare benefits, and other government handouts. The prospect of government freebies is alluring to many, more alluring in many cases than the prospect of freer markets and economic prosperity.

With all that in mind, this means that the outlook post-2024 could remain bleak. The federal government will continue to spend money like it’s going out of style, tax rates likely will reset after 2025 with no extension of the Trump tax cuts, and markets likely won’t see anything positive coming out of Washington.

That’s why it’s important to take steps to prepare yourself against a worst case scenario. With recession growing ever more likely, a negative electoral outcome could only add fuel to the fire. If you haven’t thought about protecting your assets already, when will you?

Many Americans have already started to protect their wealth by buying precious metals like gold and silver. Gold and silver were breakout performers in the aftermath of the 2008 financial crisis, and if they perform as well during the next recession as they did then, precious metals owners will be very happy.

But the time to start protecting yourself is before a recession occurs, before you start losing money. Whether you’re looking to protect tax-advantaged retirement savings with a gold IRA or just looking to buy some gold and silver coins to store at home, Goldco can help.

Our over $2 billion in precious metals placements and over 5,000 5-star reviews are testaments to our commitment to quality precious metals products and outstanding customer service. If you’re interested in buying gold and silver to help safeguard your savings, call Goldco today to learn more about how gold and silver can benefit you.