In February of 2021, we wrote: “Before January 6th, TQC’s position was that Donald Trump was a depraved human who denigrated the office of the president and further polluted the very swamp he promised to clean up, but we credited him – and agreed with – some of his policies…After that, any goodwill we harbored towards him vaporized.”

Immediately after that and over the ensuing months, we argued that it would behoove the GOP to immediately pivot away from Trump and reject the two dead horses that he has continually beat since he lost the election: that it was rife with fraud thereby” stolen” from him, and that former Vice President Mike Pence could have overturned the results.

We added, “Democrats are in a horribly weak position. President Biden’s approval ratings are dismal, he’s been unable to pass a signature piece of proposed legislation (Build Back Better) while infighting between “the Squad” and more centrist Dems have sown division within the party…Republicans have a chance to massively outperform in November’s midterms. The roadmap for them is quite simple: repudiate and move on from Mr. Trump and proactively discuss substantive policies they champion.”

The GOP did not heed our advice to “call out Trump’s lies, forcefully condemn them, and move on from him.” Too many rank- and-file Republicans cowered under pressure and failed to challenge Mr. Trump openly. And The Republican National Committee (RNC) chose to defend Trump and discredit his detractors. The RNC’s stance was not only morally bankrupt but as we suspected, strategically inept.

The GOP performed horribly in the midterms. The “red wave” many had predicted and that the GOP hoped for, morphed into a red ripple. This, despite Mr. Biden’s appalling approval ratings, embarrassing gaffes, and ~8% headline inflation.

On the contrary, Democratic candidates' views appeared to echo ours from November 2020 when we argued that “Defund The Police Is Costing Dems Seats.” In the Midterms, those candidates declined to run on that and other more extremist ideology and were rewarded by voters.

Missed Opportunity

Midterms are typically unkind to a sitting president’s party; they almost always lose seats in aggregate. This election cycle was no different in that Dems – the sitting party – lost seats, but not nearly as many as the GOP would have liked. In fact, Republicans failed to retake the Senate despite needing to flip just 1 seat. They did manage to retake the House, barely, gaining materially fewer seats than anticipated.

While too many GOP operatives failed to challenge Trump and his tired, nonsensical lies, the thinning number of independent, but increasingly important swing voters, decided they had seen, and heard, enough. Indeed, GOP candidates that were unwaveringly loyal to Mr. Trump and championed his hogwash, massively underperformed. According to The Economist “Republican candidates backed by Mr. Trump did about five points worse than they would have without his endorsement.”

Almost all of Trump’s handpicked candidates, some of whom championed his baseless claims of widespread election fraud, lost. According to the non-partisan Cook Political Report, in Senate races, Arizona, Nevada, Pennsylvania & Georgia were all “toss-up” or competitive states, meaning they did not lean Republican or Democrat.

In Nevada, Adam Laxalt who argued “There’s no question they rigged the (presidential) election,” lost. In Arizona, Blake Masters, who ran an ad that “I think Trump won,” lost.

In Pennsylvania, Trump’s favored candidate, T.V. host Dr. Oz, lost to Democrat John Fetterman, a candidate who unfortunately suffered a stroke that rendered him severely compromised in debates and when articulating his views to the press. This defeat was particularly embarrassing for Trump & Co.

In Alaska, the race pitted incumbent centrist (R-AK) Lisa Murkowski against fellow Republican Kelly Tshibaka. (In Alaska, all candidates irrespective of their party affiliation run in a single primary). Trump, still seething at Murkowski for voting to convict him in his impeachment trial, endorsed Kelly Tshibaka. Murkowski handily defeated Tshibaka to win re-election.

In Georgia, the race has yet to be called but Trump’s handpicked candidate Herschel Walker, is losing.

In Governor races, the results in Arizona were analogous to a Trump flameout. Kari Lake, a former TV host who claimed the 2020 election was “stolen,” was defeated. Down ballot in AZ, Trump endorsed Mark Finchem for Secretary of State. Finchem claimed there was widespread fraud in the 2020 election; he lost. In Pennsylvania, Doug Mastriano said “There is mounting evidence that the PA presidential election was compromised” lost. In Maryland, Dan Cox who claimed, “Mike Pence is a traitor,” was soundly defeated. The examples above are microcosms of a broad theme that permeated the midterms.

Midterms

Said the Economist, “The most important result of the 2022 midterms, for America and for the West, is that Mr. Trump and his way of doing politics came out of them diminished…It turns out that common sense can still sometimes beat partisan reflexes after all. At the margin voters distinguish between good and bad candidates, which matters when the margins are thin. American democracy seems healthier and more secure as a result.” We agree.

One poignant example of this was the battle for the congressional seat in California’s 22nd district, located in the central valley encompassing the state’s farm belt where Republican David Valadao defeated Democrat Rudy Salas.

Prima facie, this race would seem unremarkable, however a few things stood out to us regarding the race for CA’s 22nd district. The first is that Dems outnumber Republicans by almost ~20%. The second is Mr. Valadao is known as a bi-partisan consensus builder. The third and perhaps most important is that David Valadao was one of just a few House Republicans that voted to impeach Trump and rejected his divisive, fantastical rhetoric immediately after January 6th.

Moving Forward

Donald Trump recently announced that he will be running for President in 2024. It is a long time between now and then, especially for a man who seemingly changes his mind almost as consistently as he lies. Furthermore, as per the SCOTUS ruling this week, Trump’s tax records will finally become public record after three years of legal wrangling.

To be sure, Trump remains firmly in control of the extremist group of the GOP. That will matter – and disproportionately so – during the primaries. However, in sum, it is clear Mr. Trump is vulnerable and continues to lose support within the GOP.

Following the midterms, Senator Todd Yong (R-IN) said he was “not even close” to being ready to back Mr. Trump again. Senator Cynthia Lummis (R-WY) said, “He (Trump) had a significant impact on the underperformance of the Republican party.” She echoed the views of an increasing number of Republicans when she argued, “In my opinion, the current leader of the Republican Party is Ron DeSantis.” (DeSantis is a potential challenger to Trump in ’24, he won re-election to FL Governorship by a convincing 20 points.)

Calling The Bottom

Following the events of January 6th, 2021, we wrote, “In our view, Wednesday, January 6, 2021, will have marked the trough in America’s ugly political divide.

Extremists on both sides get a disproportionate amount of media coverage; however, we believe there are a sizable cohort of reasonable, centrist Americans that are truly fed up with the divisiveness that has come to dominate many aspects of their daily lives.”

At the time, to say that we got a lot of push-back to this declaration would be a gross understatement. We are not so naïve to declare that we were correct. Any more progress towards a mean reversion to bipartisanship will be non-linear and fought with unforeseen setbacks. That said, one thing to take solace in during the holidays is that moderation “trumped” – excuse the pun – extremism.