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End of the US-Iran War: What's next for Republicans?
Economy
According to analysts, the war has become a political liability for the administration, as it has dragged on longer and proved more painful than expected
President Trump's approval ratings have been steadily declining since his inauguration, and this trend has continued amid the US-Iran war, creating unfavorable prospects for the Republican Party in the upcoming midterm elections, according to a research note from Wolfe Research.
According to analysts, the war has become a political liability for the administration, as it has dragged on longer and proved more painful than expected, further damaging Trump's standing and marginally improving poll numbers for Democrats in Congress.
As the ceasefire generally holds and pressure on energy prices eases, investors are wondering whether the end of the war could change the balance of power in the November midterm elections, according to Wolfe analysts.
The company noted that Trump's approval rating has been declining since he took office, and the war did not represent a significant turning point in this trend. Even a full recovery to pre-war approval levels would leave him more than 10 percentage points below 50%, the memo states.
Analysts also noted that the rise in Democratic support on the general question of congressional preferences lagged behind Trump's decline in approval ratings. They attributed this gap to Democrats' own unpopularity, as well as the fact that, with Trump's approval ratings so low, further discontent is increasingly coming from voters traditionally inclined to the Republican Party.
Bringing these voters back to Trump won't necessarily solve Republicans' broader problems in the midterms, although it could reduce the risk of low turnout among Republican-leaning independent voters, the memo notes.
Wolfe Research also noted that the war is unlikely to be perceived as a victory. Most voters are likely to see the country as worse off than before the conflict—analysts cite rising energy prices and what they see as a violation of the campaign promise not to engage in war. The company reiterated its forecast that Democrats will win the House of Representatives in November but lose the Senate by a small margin. It said it would update its forecast for the midterm elections in the coming weeks as voters react to the end of the war.
Wolfe stated that it expects the 14-point memorandum of understanding between the US and Iran, signed earlier this week, to be upheld and the war to end.