Friday, October 13, 2006

Wall Steet Journal: Democratic Wins In Midterm Elections May Boost Economy...
Dem Control Might Help Economy, Survey Finds

Democrats wins in November might boost the economy, economist in the latest economists survey found.

Most economists said the economy would perform best in the coming years if Democrats take control of at least one chamber of Congress. Only 12 of the 35 who answered the question said the economy would perform best under continued Republican control of the House and Senate. The best scenario, the economists said, would be Democratic control of the House only. The economists were almost evenly split over whether the stock market would perform better with a continued Republican lock on Congress or some measure of Democratic control.

“The economy is doing very well,” said Allen Sinai of Decision Economics Inc. However, it “would do better if the geopolitical side wasn’t depressing Americans and injecting caution in business sentiment. The psyche of Americans is surprisingly low. New blood can improve sentiment.”

When asked what the new Congress should make its top priority, economists indicated their top two choices were health care and Social Security. Those two issues represent the difficulty of the aging U.S. population and growing entitlement spending. However, there wasn’t much optimism that much would be done to take on the issues in the near-term. “There just isn’t the political will to address these problems,” said Dana Johnson of Comerica Bank. – Phil Izzo