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India hikes spending, shuns ‘outright populism’ in last pre-election budget

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  • Capex to rise 33% to 10 trillion rupees in 2023/24
  • Govt targets gross borrowing of 15.43 trillion rupees
  • Eyes fiscal deficit of 5.9% in 2023/24, 4.5% by 2025/26

NEW DELHI, Feb 1 (Reuters) – India announced on Wednesday one of its biggest ever increases in capital spending for the next fiscal year to create jobs but targeted a narrower fiscal deficit in its last full budget ahead of a parliamentary election due in 2024.

Prime Minister Narendra Modi’s party has been under pressure to create jobs in the populous country where many have struggled to find employment, although the economy is now one of the world’s fastest-growing.

“After a subdued period of the pandemic, private investments are growing again,” Finance Minister Nirmala Sitharaman said as she presented the 2023/24 budget in parliament.

“The budget makes the need once again to ramp up the virtuous cycle of investment and job creation. Capital investment is being increased steeply for the third year in a row by 33% to 10 trillion rupees.”

Reuters Graphics

The capital spending increase to about $122.3 billion, which would amount to 3.3% of gross domestic product (GDP), will be the biggest such jump after an increase of more than 37% between 2020/21 and 2021/22.

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Reuters Graphics

Total spending will rise 7.5% to 45.03 trillion rupees ($549.51 billion) in the next fiscal year starting on April 1.

Sitharaman said the government would target a fiscal deficit of 5.9% of GDP for 2023/24 compared with 6.4% for the current fiscal year and slightly lower than a Reuters poll of 6%. The aim is to lower the deficit to 4.5% by 2025/26.

Reuters Graphics

STEADY ‘MACRO BOAT’

Brokerage Nomura said the budget “prudently pushes for growth, without rocking the macro boat”.

“In the event, the government has presented a good budget. It has pushed for growth via public capex and continued on the path towards fiscal consolidation, without offering much in terms of outright populism.”

Capital Economics said the “absence of a fiscal blowout”, a recent drop in inflation and signs of moderating growth could convince India’s central bank to slow the pace of rate hikes next week.

It said there was still a chance of fiscal slippage as campaigning kicks off for the election, in which Modi is widely projected to win a third straight term.

The finance ministry’s annual Economic Survey, released on Tuesday, forecast the economy could grow 6% to 6.8% next fiscal year, down from 7% projected for the current year, while warning about the impact of cooling global demand on exports.

Sitharaman said India’s economy was “on the right track, and despite a time of challenges, heading towards a bright future”.

India’s real GDP is forecast to grow in the range of 6-6.8% in FY24

Her deficit plan will be aided by a 28% cut in subsidies on food, fertiliser and petroleum for the next fiscal year at 3.75 trillion rupees. The government cut spending on a key rural jobs guarantee programme to 600 billion rupees – the smallest in more than five years – from 894 billion rupees for this fiscal year.

Reuters Graphics

The government’s gross market borrowing is estimated to rise about 9% to 15.43 trillion rupees next fiscal year.

Reuters Graphics Reuters Graphics

CONSTRAINTS

Moody’s Investors Service said the narrower fiscal deficit projection pointed to the government’s commitment to longer-term fiscal sustainability, but that a “high debt burden and weak debt affordability remain key constraints that offset India’s fundamental strengths”.

Among other moves to stimulate consumption, the surcharge on annual income above 50 million rupees was cut to 25% from 37%.

Indian shares reversed earlier gains to close lower on Wednesday, led by a fall in insurance companies after the budget proposed to limit tax exemptions for insurance proceeds, while Adani Group shares tumbled again as it struggles to repel concerns raised by a U.S. short seller.

Since taking office in 2014, Modi has ramped up capital spending including on roads and energy, while wooing investors through lower tax rates and labour reforms, and offering subsidies to poor households to clinch their political support.

A lack of jobs for young people, and meagre wages for those who do find work, has been one of the main criticisms of Modi.

Sitharaman also said the government was allocating 350 billion rupees for energy transition, as Modi focuses on green hydrogen and other cleaner fuels to meet India’s climate goals.

($1 = 81.7725 Indian rupees)

Reporting by Shubham Batra, Nikunj Ohri, Shivangi Acharya, Sarita Singh, Nigam Prusty, Manoj Kumar, Rupam Jain and Indian bureaux; Writing by Krishna N. Das; Editing by Kim Coghill, Jacqueline Wong and Gareth Jones

Our Standards: The Thomson Reuters Trust Principles.

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US

Hardline Republicans dig in against McCarthy’s House speaker bid

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WASHINGTON, Jan 5 (Reuters) – Hardline Republicans in the U.S. House of Representatives rejected Kevin McCarthy’s speakership bid for an 11th time on Thursday, while his supporters worked behind closed doors in hopes of cementing a deal that could bring success.

The voting propelled the House to a level of dysfunction not seen since the turbulent era just before the Civil War, even after McCarthy offered to curb his own clout, raising questions about the party’s ability to wield power.

After the 11th ballot, the House adjourned for the third time this week without electing a speaker. Lawmakers will reconvene at noon (1700 GMT) on Friday.

McCarthy’s opponents say they do not trust him to fight for the deep spending cuts and other restrictions they want to impose on President Joe Biden and the Democratic-controlled Senate.

But some Republicans held out hope of an agreement between the California Republican and at least some of the 20 hardline conservatives who have opposed his candidacy in ballot after ballot.

“Things are coming together in a very healthy way,” said Representative Patrick McHenry, a McCarthy supporter who is poised to lead a top congressional committee.

“We don’t know the timeframe. But the engagement is there and that’s why I’m optimistic,” he said.

Among other things, a possible agreement would allow for a vote on term limits for members of Congress, according to Republican Representative Brian Fitzpatrick.

But McCarthy’s supporters stopped short of predicting a resolution to the stalemate anytime soon.

Because of its inability to choose a leader, the 435-seat House has been rendered impotent – unable even to formally swear in newly elected members let alone hold hearings, consider legislation or scrutinize Biden and his administration.

Republicans won a slim 222-212 House majority in the November midterm elections, meaning McCarthy cannot afford to lose the support of more than four Republicans as Democrats united around their own candidate.

McCarthy, who was backed by former President Donald Trump for the post, offered the holdouts a range of concessions that would weaken the speaker’s role, which political allies warned would make the job even harder if he got it.

At least 200 Republicans have backed McCarthy in each of the votes this week. Fewer than 10% of Republican lawmakers have voted against him but they are enough to deny him the 218 votes needed to succeed Democrat Nancy Pelosi as speaker.

“What you’re seeing on this floor does not mean we are dysfunctional,” said Republican Representative Anna Paulina Luna as she nominated a McCarthy rival, Byron Donalds, for the 10th vote.

‘CONSTRUCT A STRAITJACKET’

“I can tell you there’s some good things happening,” said Representative Marjorie Taylor Greene, a McCarthy supporter who is among the most outspoken conservatives in the House. “I think we’re going to see some movement.”

But some of McCarthy’s opponents showed no sign of yielding.

“This ends in one of two ways: either Kevin McCarthy withdraws from the race or we construct a straitjacket that he is unwilling to evade,” said Republican Representative Matt Gaetz, who voted for Trump for speaker.

As speaker, McCarthy would hold a post that normally shapes the chamber’s agenda and is second in the line of succession to the presidency behind Vice President Kamala Harris. He would be empowered to frustrate Biden’s legislative agenda and launch investigations into the president’s family and administration in the run-up to the 2024 presidential election.

In a late-night bargaining session, McCarthy offered the holdouts greater influence over what legislation comes up for a vote, according to a source familiar with the talks.

He also offered the ability for any single member to call a vote that could potentially remove him from the post – a step that helped drive at least one prior Republican speaker, John Boehner, into retirement.

Those concessions could potentially help McCarthy win over some of the holdouts but would leave him more vulnerable to the hardliners through the rest of the next two years if he ultimately wins the speakership.

That has even alarmed some Democrats, who have largely served as bystanders in the drama of the past three days.

“With every concession, he has to wake up every day wondering if he’s still going to have his job,” Democratic Representative Richard Neal told reporters.

The inability to agree on a leader also raises questions about whether Republicans will force a government shutdown or risk default later this year in a bid to extract steep spending cuts. Some of the holdouts say they expect McCarthy or any other Republican leader to take that approach.

If McCarthy ultimately fails to unite Republicans, they would have to search for an alternative. Possibilities include No. 2 House Republican Steve Scalise and Representative Jim Jordan, who have both backed McCarthy. Jordan received 20 votes when nominated by the holdouts on Tuesday.

Reporting by Moira Warburton, Doina Chiacu, David Morgan, Kanishka Singh and Gram Slattery; Writing by Andy Sullivan; Editing by Will Dunham, Howard Goller and Christian Schmollinger

Our Standards: The Thomson Reuters Trust Principles.

Gram Slattery

Thomson Reuters

Washington-based correspondent covering campaigns and Congress. Previously posted in Rio de Janeiro, Sao Paulo and Santiago, Chile, and has reported extensively throughout Latin America. Co-winner of the 2021 Reuters Journalist of the Year Award in the business coverage category for a series on corruption and fraud in the oil industry. He was born in Massachusetts and graduated from Harvard College.

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US

Supreme Court leans toward limiting judicial scrutiny of U.S. elections

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  • Justice debate “independent state legislature” doctrine
  • Liberal justices decry threat to “checks and balances”
  • Conservative-dominated court to rule by end of June

WASHINGTON, Dec 7 (Reuters) – The U.S. Supreme Court’s conservative majority on Wednesday appeared to ready to limit judicial power to overrule voting policies crafted by state politicians but might not go as far as Republican North Carolina lawmakers want in a case the liberal justices painted as a threat to American democratic norms.

The court heard arguments in a case the state lawmakers have used to try to persuade the justices to endorse a contentious legal theory gaining traction in conservative legal circles that would prevent state courts from reviewing the legality of actions by state legislatures regulating federal elections.

The Republican lawmakers are appealing the top North Carolina court’s decision to throw out the map they devised for the state’s 14 U.S. House of Representatives districts as unlawfully biased against Democratic voters. Another state court then replaced that map with one drawn by a bipartisan group of experts.

The Supreme Court has a 6-3 conservative majority, and its most conservative justices including Samuel Alito, Clarence Thomas and Neil Gorsuch appeared willing to embrace the “independent state legislature” doctrine presented by the Republican legislators.

While the conservative justices in general asked questions that indicated skepticism toward the state court actions, some signaled that the Republican argument that state constitutions cannot constrain the power of legislatures in setting rules for congressional and presidential elections might go too far.

Under the once-marginal legal theory they are now promoting, the lawmakers argue that the U.S. Constitution gives state legislatures – and not other entities such as state courts – authority over election rules and electoral district maps.

The court’s liberal justices suggested the doctrine could free legislatures to adopt all manner of voting restrictions. Lawyers arguing against it also said it could sow confusion by allowing voting rules that vary between state and federal contests.

“This is a proposal that gets rid of the normal checks and balances on the way big governmental decisions are made in this country,” liberal Justice Elena Kagan said, referring to the interaction between the executive, legislative and judicial branches of government. “And you might think that it gets rid of all those checks and balances at exactly the time when they are needed most.”

America is sharped divided over voting rights. Republican-led state legislatures have pursued new voting restrictions in the aftermath of Republican former President Donald Trump’s false claims that the 2020 election was stolen from him through widespread voting fraud.

The court’s eventual decision, due by the end of June, could apply to 2024 elections including the U.S. presidential race.

During the three-hour argument, the justices touched on the issue of enabling federal courts to review state court actions to ensure that judges do not behave like legislators or unfairly apply vague state constitutional provisions such as those requiring free and fair elections to disempower lawmakers.

Conservative Chief Justice John Roberts wondered whether such broadly worded provisions provide proper “standards and guidelines” for state courts to apply.

[1/2] A general view of the U.S. Supreme Court building in the rain the day before the start of the court’s new term in Washington, U.S. October 2, 2022. REUTERS/Jonathan Ernst

ALITO WEIGHS IN

Alito dismissed arguments that legislatures would be unchecked if the Republican position carried the day.

“Under any circumstances, no matter what we say the ‘Elections Clause’ means, Congress can always come in and establish the manner of conducting congressional elections,” Alito said, referring to the Constitution’s elections language.

The doctrine is based in part on the Constitution’s statement that the “times, places and manner” of federal elections “shall be prescribed in each state by the legislature thereof.” The Republican lawmakers argued that the state court usurped the North Carolina General Assembly’s authority under that provision to regulate federal elections.

Kagan said the theory would free state legislators to engage in the “most extreme forms of gerrymandering” – drawing electoral districts to unfairly improve a party’s election chances – while enacting “all manner of restrictions on voting,” noting that lawmakers by virtue of coveting re-election may have incentives to suppress, dilute and negate votes.

Kagan said the theory also could let legislatures insert themselves into the process of determining winners in federal elections – a sensitive issue following the Jan. 6, 2021, U.S. Capitol attack by Trump supporters who sought to block congressional certification of Biden’s 2020 election victory.

‘HISTORICAL PRACTICE’

Some conservative justices appeared to balk at aspects of the Republican arguments.

Justice Brett Kavanaugh emphasized the “historical practice” that “nearly all state constitutions regulate federal elections in some way.” Roberts said another check on a legislature’s power – a state governor’s veto – “significantly undermines the argument that it can do whatever it wants.”

David Thompson, arguing for the North Carolina lawmakers, said the Constitution “requires state legislatures specifically to perform the federal function of prescribing regulations for federal elections. States lack the authority to restrict the legislature’s substantive discretion when performing this federal function.”

Kavanaugh told Thompson that his position on the theory’s breadth “seems to go further” than that conceived by then-Chief Justice William Rehnquist in a concurrence to a 2000 ruling deciding a presidential election’s outcome – an opinion seeing state courts as exceeding their authority on federal elections.

North Carolina’s Department of Justice is defending the state high court’s February ruling alongside the voters and voting rights groups that challenged the map approved by the legislature in November 2021. They are backed by Democratic President Joe Biden’s administration.

Elizabeth Prelogar, arguing for Biden’s administration, said empowering state legislatures the way the Republicans want would “wreak havoc in the administration of elections across the nation” and cause federal courts to become flooded with lawsuits concerning state-administered elections.

Reporting by Andrew Chung in Washington and Nate Raymond in Boston; Editing by Will Dunham

Our Standards: The Thomson Reuters Trust Principles.

Nate Raymond

Thomson Reuters

Nate Raymond reports on the federal judiciary and litigation. He can be reached at nate.raymond@thomsonreuters.com.

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US

U.S. House Democrats elect Hakeem Jeffries as first Black party leader

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WASHINGTON, Nov 30 (Reuters) – Hakeem Jeffries was unanimously elected on Wednesday to become the Democratic Party’s top leader in the U.S. House of Representatives beginning in January, making him the first Black American to hold such a high-ranking position in Congress.

The vote by Jeffries’ fellow Democrats also marked the rise of a younger generation of leaders in the 435-member House, and the end of the Nancy Pelosi era and control by other Democrats in their 80s.

Jeffries, a 52-year-old New Yorker, will hold the position of House Democratic leader for the 118th Congress that convenes on Jan. 3.

Democratic Senate Majority Leader Chuck Schumer said he was not surprised that Jeffries, a fellow Brooklynite, was chosen.

Coming from Brooklyn means “you learn how to work with all kinds of different people. You learn how to stand your ground. You learn to not take things personally,” Schumer said on Wednesday, adding that Jeffries “exemplifies all these traits.”

The two leaders live just blocks apart in adjacent neighborhoods.

Jeffries formally announced his candidacy on Nov. 18, following a decade in the House, pledging to preside over a caucus that would return power to committee members and give junior lawmakers more say in shaping legislation and being rewarded with high-profile positions.

“Our commitment is always to extend the hand of partnership whenever and wherever possible, in order to get things done for everyday Americans,” Jeffries said, when asked how he will work with Republicans.

Also elected as part of Jeffries’ team are Representative Katherine Clark, 59, of Massachusetts, who won the No. 2 Democratic job, a post known as “whip.” Californian Pete Aguilar, 43, and a member of the Congressional Hispanic Caucus, was elected to Jeffries’ current job of Democratic caucus chairman.

Their elections mean that for the first time in either party, the top three party roles are held by women or people of color.

[1/8] U.S. Rep. Hakeem Jeffries (D-NY) speaks to the media following the House Leadership news conference, after being elected as the new Democratic leader in the House of Representatives for the next session of Congress, on Capitol Hill in Washington, U.S., November 30, 2022. REUTERS/Michael A. McCoy

“Together, this new generation of leaders reflects the vibrancy and diversity of our great nation – and they will reinvigorate our Caucus with their new energy, ideas and perspective,” Pelosi said in a statement congratulating the trio.

The leadership change for Democrats comes as Republicans are set to take majority control – by a slim margin – of the House as a result of the Nov. 8 midterm elections.

Republicans and their leader Kevin McCarthy, who wants to become the next speaker, have put Democrats on notice that they will hit the ground running, launching investigations of administration officials and President Joe Biden and his son Hunter.

While they made tackling inflation the centerpiece of their 2022 congressional campaigns, Republicans have since said little about that subject.

OCTOGENARIANS TAKE BACKSEATS

The three House Democratic leadership jobs have been held for two decades by Pelosi, 82, Majority Leader Steny Hoyer, 83, and Majority Whip James Clyburn, 82.

They have been under pressure for years to give way to a younger generation. The moment for that came after Republicans won the majority, but without the “red wave” of wins they had expected – a turn of events that buoyed Democrats.

Their agreements to step down meant a smooth transition of power. Outside the closed-door meeting on Wednesday, reporters could hear loud celebrations in the room.

“Hakeem Jeffries spent a fourth of his time praising the GOAT (greatest of all time), Nancy Pelosi,” Representative Emanuel Cleaver told reporters afterward, referring to Jeffries’ speech to his colleagues before the vote.

Cleaver, an ordained minister, said caucus members “were on their feet, like at church” celebrating the election of Jeffries, “who I call the hip-hop juggernaut.” Jeffries is known to be a fan of the music genre and hosts an annual “Hip Hop on the Hill” fundraising event.

Reporting by Moira Warburton and Richard Cowan; Editing by Scott Malone, Alistair Bell and Lisa Shumaker

Our Standards: The Thomson Reuters Trust Principles.

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World

Explainer: What to expect as Malaysia’s split election leaves scramble to form govt

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KUALA LUMPUR, Nov 20 (Reuters) – Malaysia’s political leaders were scrambling to form a coalition government on Sunday after an election produced an unprecedented hung parliament, with no group able to claim a majority.

Longtime opposition leader Anwar Ibrahim and former Prime Minister Muhyiddin Yassin each said they could form a government with support from other parties, whom they did not identify. Muhyiddin said he hoped to conclude talks by Sunday afternoon, although negotiations could take days.

Here is what is happening and what to expect:

WHAT HAPPENED?

Anwar’s multi-ethnic Pakatan Harapan coalition won 82 seats in the lower house, short of the 112 needed for a majority but ahead of Muhyiddin’s Perikatan Nasional alliance with 73 and Prime Minister Ismail Sabri Yaakob’s Barisan Nasional with 30.

Muhyiddin’s alliance, which includes an Islamist party that has touted sharia Islamic law for the Southeast Asian nation, emerged as a third major bloc, dividing votes more than had been expected.

It made inroads in strongholds of Barisan, whose United Malays National Organisation (UMNO) – long Malaysia’s dominant political force – made its worst showing ever.

WHAT NEXT?

Analysts say the most likely government will again be a coalition of Muhyiddin’s bloc, Barisan and another group. But a minority government is possible if neither Anwar nor Muhyiddin can cobble together a majority.

Muhyiddin, who said he is open to working with any party but Anwar’s, said on Sunday he would discuss partnerships with regional parties in Sabah and Sarawak states on Borneo island.

Anwar did not say whom he would work with. In an interview with Reuters this month, he ruled out partnering with Muhyiddin’s and Ismail’s coalitions, citing fundamental differences.

Muhyiddin and Ismail’s coalition prioritise interests of the ethnic-Malay majority, while Anwar’s is multicultural. Race and religion are divisive issues in Malaysia, where the mostly Muslim Malays comprise the majority, with minorities of ethnic Chinese and Indians.

KING’S ROLE

King Al-Sultan Abdullah could potentially pick the next prime minister.

The monarch has a largely ceremonial role, but the constitution empowers him to appoint as prime minister a lawmaker who he thinks can command a majority in parliament.

Malaysian kings – the post rotates among the sultans of the states – have rarely exercised that power, but they have become more influential in recent years amid the political wrangling.

In 2020, when the government of veteran leader Mahathir Mohamad collapsed, King Al-Sultan chose Muhyiddin as premier after interviewing all 222 lawmakers to decide who had majority support. When Muhyiddin’s bloc also collapsed, he chose Ismail.

Muhyiddin said on Sunday he had received instructions from the palace on forming a government but did not disclose what they were. Anwar said he would submit a letter to the king detailing his support.

IMPLICATIONS?

Political instability is expected to continue for Malaysia, which has seen three prime ministers in as many years due to power struggles.

The country is adapting to the diminishing power of the UMNO and the Barisan coalition, which had ruled uninterrupted for 60 years from independence until 2018.

The next coalition will not have a convincing majority and could be plagued with more infighting, hurting the economy.

Voters, frustrated with the instability, may bristle at a new government if it includes the losing parties.

Reporting by Mei Mei Chu; Editing by A. Ananthalakshmi and William Mallard

Our Standards: The Thomson Reuters Trust Principles.

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US

Election denier Lake loses governor’s race in battleground Arizona

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Nov 14 (Reuters) – Kari Lake, one of the most high-profile Republican candidates in the midterm elections to embrace former President Donald Trump’s false claims of voter fraud in 2020, lost her bid to become the next governor of Arizona, Edison Research projected on Monday.

The closely fought governor’s race between Lake and Democrat Katie Hobbs was one of the most significant in the general election because Arizona is a battleground state and will likely play a pivotal role in the 2024 U.S. presidential election.

Lake’s loss is the latest defeat for a series of candidates endorsed by Trump, who on Tuesday is expected to announce another White House bid.

After the Arizona governor race was called, Hobbs wrote on Twitter: “Democracy is worth the wait.” Lake expressed disdain for the election calls, tweeting that “Arizonans know BS when they see it.”

Lake had vowed to ban the state’s mail-in voting, which conspiracy theorists falsely claim is vulnerable to fraud, fueling distrust among voters about the safety of a voting method used by hundreds of thousands of Americans.

Her defeat capped a triumphant week for Democrats, who defied Republicans’ hopes for a “red wave” in the midterm elections.

Democrats retained their control of the U.S. Senate after keeping seats in the swing states of Arizona and Nevada, with Vice President Kamala Harris holding the tie-breaking vote. The party could win outright majority control if Democratic Senator Raphael Warnock beats Republican challenger Herschel Walker in a Georgia runoff on Dec. 6, bolstering Democratic sway over committees, bills and judicial picks.

The Democratic victories in a swath of gubernatorial, congressional and statehouse elections defied expectations that voters would punish them for record inflation, including high gas and food prices. Instead, Democrats were able to curb their losses, in part by mobilizing voters angry over the U.S. Supreme Court decision to overturn the constitutional right to abortion.

Still, Republicans continued to edge toward control of the House of Representatives. As of Monday, Republicans had won 214 seats and the Democrats 207, with 218 needed for a majority. Control of the House would allow Republicans to stymie President Joe Biden’s legislative agenda.

It could take several days before the outcome of enough House races is known to determine which party will control the 435-seat chamber.

Lake, a former television news anchor, was one of a string of Trump-aligned Republican candidates who lost battleground state races. Voters in Pennsylvania, Michigan and Wisconsin also rejected election deniers in races for governor and other statewide election posts.

Biden narrowly beat Trump in Arizona in the 2020 election. Hobbs, Arizona’s current secretary of state, rose to national prominence when she defended the state’s election results against Trump’s claims of voter fraud.

On Monday, she won the seat currently held by Republican Governor Doug Ducey, who could not seek re-election because of term limits.

Vote-counting in Arizona continued for nearly a week after the Nov. 8 election. Arizona requires voters’ signatures on early ballots to be verified before they are processed. The counting was delayed this year because hundreds of thousands of early ballots were cast at drop boxes on Election Day, officials said.

Lake and Trump had pointed to temporary Election Day problems with electronic vote-counting machines in Maricopa County as evidence that Republican votes were being suppressed.

A judge denied a request to extend polling place hours, saying Republicans had provided no evidence that voters were disenfranchised by the issue.

In a Sunday appearance on Fox News, Lake said the lengthy counting process was “trampling” voters’ rights, and was further evidence of why election administration in Arizona needed to be reformed.

“We can’t be the laughing stock of elections any more here in Arizona, and when I’m governor, I will not allow it,” she said.

Reporting by Julia Harte and Brad Brooks; Editing by Colleen Jenkins, Alistair Bell and Edmund Klamann

Our Standards: The Thomson Reuters Trust Principles.

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US

Republicans close in on U.S. House majority, Senate still up for grabs

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WASHINGTON, Nov 10 (Reuters) – Republicans were edging closer to securing a majority in the U.S. House of Representatives early on Thursday, while control of the Senate hung in the balance, two days after Democrats staved off a Republican “red wave” in midterm elections.

Republicans had captured at least 210 House seats, Edison Research projected, eight short of the 218 needed to wrest the House away from Democrats and effectively halt President Joe Biden’s legislative agenda.

While Republicans remain favored, there were 33 House contests yet to be decided – including 21 of the 53 most competitive races, based on a Reuters analysis of the leading nonpartisan forecasters – likely ensuring the final outcome will not be determined for some time.

(Live election results from around the country are here.)

The fate of the Senate was far less certain. Either party could seize control by sweeping too-close-to-call races in Nevada and Arizona, where officials are methodically tallying thousands of uncounted ballots.

A split would mean the Senate majority would come down to a runoff election in Georgia for the second time in two years. Democratic incumbent Raphael Warnock and Republican challenger Herschel Walker both failed to reach 50% on Tuesday, forcing them into a one-on-one battle on Dec. 6.

Even a slim House majority would allow Republicans to shape the rest of Biden’s term, blocking priorities such as abortion rights and launching investigations into his administration and family.

Biden acknowledged that reality on Wednesday, saying he was prepared to work with Republicans. A White House official said Biden spoke by phone with Republican House leader Kevin McCarthy, who announced earlier in the day his intention to run for speaker of the House if Republicans control the chamber.

“The American people have made clear, I think, that they expect Republicans to be prepared to work with me as well,” Biden said at a White House news conference.

If McCarthy is the next House speaker, he may find it challenging to hold together his fractious caucus, with a hard-right wing that has little interest in compromise.

Republicans are expected to demand spending cuts in exchange for raising the nation’s borrowing limit next year, a showdown that could spook financial markets.

Control of the Senate, meanwhile, would give Republicans the power to block Biden’s nominees for judicial and administrative posts.

MIXED RESULTS

The party in power historically suffers heavy casualties in a president’s first midterm election, and Biden has struggled with low approval ratings. But Democrats were able to avoid the sweeping defeat that Republicans had anticipated.

Tuesday’s results suggested voters were punishing Biden for the steepest inflation in 40 years, while also lashing out against Republican efforts to ban abortion and cast doubt on the nation’s vote-counting process.

Biden had framed the election as a test of U.S. democracy at a time when hundreds of Republican candidates embraced Trump’s false claims that the 2020 presidential election was stolen.

A number of election deniers won on Tuesday, but many who sought positions to oversee elections at the state level were defeated.

“It was a good day, I think, for democracy,” Biden said.

Trump, who took an active role in recruiting Republican candidates, had mixed results.

He notched a victory in Ohio, where “Hillbilly Elegy” author J.D. Vance won a Senate seat to keep it in Republican hands. But several other Trump-backed candidates suffered defeats, such as retired celebrity surgeon Mehmet Oz, who lost a crucial Senate race in Pennsylvania to Democrat John Fetterman.

Meanwhile, Republican Florida Governor Ron DeSantis, who could challenge Trump in 2024, won re-election by nearly 20 percentage points, adding to his growing national profile.

Reporting by Joseph Ax, Andy Sullivan, Makini Brice, Susan Heavey, Richard Cowan, Steve Holland, Jeff Mason and Doina Chiacu in Washington, Gabriella Borter in Birmingham, Michigan, Nathan Layne in Alpharetta, Georgia, Tim Reid in Phoenix and Ned Parker in Reno, Nevada; Writing by Joseph Ax; Editing by Tom Hogue

Our Standards: The Thomson Reuters Trust Principles.

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World

In Russia, some hope U.S. midterms will mean less Ukraine aid and more chaos

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  • U.S. midterms being closely watched in Russia
  • Some hope for Republican clean sweep, slower aid for Ukraine
  • Others hope elections will deepen political divisions

LONDON, Nov 8 (Reuters) – Pro-Kremlin forces in Russia are hoping that the Republicans win control of Congress, an outcome they believe could mean Democratic President Joe Biden faces a tougher and longer slog to get military aid packages for Ukraine approved.

But for now, few in Moscow expect the bipartisan U.S. political consensus on Ukraine to crack, whatever the result of Tuesday’s midterm elections. Nor do they expect Washington’s support for Kyiv to dip significantly anytime soon.

Instead, with an eye on the next U.S. presidential election in 2024 and the resilience of a geopolitical foe whose moment in the historical sun they believe is coming to an end, pro-Kremlin Russians hope the results will be disputed and that the American political system will face fresh turmoil in coming years.

Their stance reflects President Vladimir Putin’s own belief that Russia’s Feb. 24 invasion of Ukraine, something he calls a “special military operation”, is part of an historical realignment away from a U.S.-dominated world to a multipolar one where the views of countries like Russia and China must be reckoned with.

“A Republican victory in the U.S. congressional elections will not lead to a revolution in U.S. foreign policy and an end to Washington’s support for Ukraine,” Alexei Pushkov, a hawkish Russian senator and foreign policy specialist, wrote on the Telegram messaging service.

“However, the Biden administration will find it more difficult to push financial aid programmes to Kyiv through Congress, and the position of U.S. critics of unlimited aid to Ukraine will markedly strengthen.”

Pushkov, who had sanctions placed upon him by the European Union in March for voting to support Moscow’s Ukraine policy, said he thought there was a chance that Republicans might target what he called Biden’s “wasteful” Ukraine spending in the run-up to 2024 to try to hurt the Democrats’ ratings.

But a report drawn up by the Moscow-based Institute for International Studies, which shares its research with the Russian Foreign Ministry and other state bodies, concluded that the mood of what it called the U.S. establishment and the electorate meant the elections were unlikely to bring about major changes to Washington’s Ukraine policy.

Ukraine has rarely come up as a key voter concern, with those polled ahead of the election citing mostly worries on domestic issues like inflation, crime and abortion.

‘CRITICAL JUNCTURE’

Russian ultra-nationalist circles were more certain that the midterms – in which Republicans are forecast to win control of the House of Representatives and possibly the Senate – would be positive for their long-term interests.

Tsargrad, an online news portal and TV station funded by sanctioned Russian ultra-nationalist tycoon Konstantin Malofeev, predicted the elections would ultimately be America’s undoing.

“At a critical juncture in world history, this election could have a major impact on the geopolitical environment, and Ukraine in particular,” it wrote.

“But it could also be the detonator of domestic centrifugal processes that could end the United States as we know it today,” it said, talking of the theoretical possibility of civil war due to political polarisation and distrust of election outcomes.

If such a dramatic scenario unfolded, Washington, Tsargrad predicted, would not have the capacity to keep prosecuting its Ukraine policy.

In a column for the state-run RIA news agency, columnist Pyotr Akopov also forecast that Russia would be the real winner of the U.S. midterms because the vote would deepen political divisions ahead of the 2024 presidential election which he predicted would be disputed.

“Even if it survives as a single state, the United States will change dramatically and its global position will weaken under any circumstances,” Akopov opined.

“Confrontation with China will require the mobilisation of all of the country’s global resources – and attention to Europe will inevitably weaken,” he said. “Without a strong and united (United) States the West will not be able to maintain control over western Russian lands for long.”

Editing by Rosalba O’Brien

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Control of Congress – and Biden’s power – on the ballot in U.S. midterms

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WASHINGTON, Nov 8 (Reuters) – Americans on Tuesday cast the final ballots in U.S. midterm elections that will determine whether Democrats lose control of Congress, and with it the ability to push forward on President Joe Biden’s agenda in the next two years.

The party that controls the White House typically loses seats in midterm elections. Nonpartisan forecasts suggest Tuesday’s results will be no exception, as concerns about high inflation and crime outweigh the end of national abortion rights and the violent Jan. 6, 2021, assault on the Capitol in voters’ minds.

Thirty-five Senate seats and all 435 House of Representatives seats are on the ballot. Republicans are widely favored to pick up the five seats they need to control the House, while the Senate – currently split 50-50 with Democrats holding the tie-breaking vote – could come down to a quartet of toss-up races in Pennsylvania, Nevada, Georgia and Arizona.

But even before the midterm elections were completed, the 2024 presidential election was taking shape. Former President Donald Trump on Monday night sent his strongest hint yet that he would be kicking off his third consecutive White House campaign soon, telling supporters in Ohio that he would be making a “big announcement” on Nov. 15. He did not specify what that would be, but he has been telegraphing plans to run again since shortly after losing his 2020 reelection bid to Biden.

Hundreds of supporters of Trump’s false claims that his loss was the result of widespread fraud are on the ballot this year, including several seeking positions that would give them direct oversight of the 2024 president elections in competitive states.

More than 42 million Americans voted ahead of Election Day, either by mail or in-person, according to data from the U.S. Election Project. State election officials caution that full results may not be known for days as they count ballots in close races – with control of the Senate perhaps not known until a potential Dec. 6 runoff in Georgia.

In the swing state of Pennsylvania, Philadelphia officials on Tuesday moved to reinstate a process that can catch possible double votes from being counted but takes more time. This could shine a national spotlight on the state’s largest city if its high-stakes U.S. Senate race is as close as expected.

Meanwhile, the U.S. Department of Justice on Monday announced it would monitor compliance with federal voting rights laws in 64 jurisdictions in 24 states. Officials in at least one locality — Cole County, Missouri — pushed back against the move.

There are 36 governorships and scores of other state-level races on the ballot, including hotly contested gubernatorial campaigns in the swing states of Michigan, Wisconsin, Nevada, Arizona and Georgia.

In Congress, a Republican-controlled House would be able to block bills addressing Democratic priorities such as abortion rights and climate change. Republicans could also initiate a showdown over the nation’s debt ceiling, which could shake financial markets, and launch potentially politically damaging investigations into Biden’s administration and family.

Republicans would look to use their leverage to make permanent the 2017 individual tax cuts passed under Trump, and protect corporate tax cuts that Democrats have unsuccessfully tried to reverse over the past two years.

A Republican Senate, meanwhile, would hold sway over Biden’s judicial nominations, including any Supreme Court vacancy. Top Senate Republican Mitch McConnell has already hinted he might refuse to fill an open seat on the top court until after the 2024 presidential election if he returns to the majority leader’s position.

Divided government would intensify the spotlight on the increasingly conservative court, which has already issued sweeping decisions erasing a nationwide right to abortion and vastly expanding gun rights, among others.

Reuters Graphics

FINAL PUSH

Biden and former President Barack Obama, still the party’s biggest luminary, have crisscrossed the country over the past week, urging supporters to vote in hopes of stemming Democrats’ losses. Trump has done the same as he lays the groundwork for another run at the presidency.

However, some Democrats in tough races have deliberately distanced themselves from the White House as Biden’s popularity languishes. On Monday, the final day of campaigning, Biden headed to the politically safe turf of Democratic-leaning Maryland, rather than a swing state.

“It’s Election Day, America. Make your voice heard today. Vote,” Biden, who previously cast his ballot in early voting in Delaware, said in a post on Twitter Tuesday morning.

Trump is scheduled to vote in Florida later on Tuesday.

The Supreme Court’s June decision to overturn Roe v. Wade, the 1973 ruling that had established a nationwide right to abortion, had galvanized Democratic voters around the country, temporarily raising Democrats’ hopes they could defy history.

But in the closing weeks of the campaign, forecasters have grown more confident that Republicans will win a majority in the House, perhaps flipping 20 seats or more.

Despite one of the strongest job markets in memory, stubbornly rising prices have left voters dissatisfied, helped along by relentless attacks from Republicans over gas and food prices, as well as crime.

A Reuters/Ipsos poll completed on Monday showed more than two-thirds of Americans believe the country is on the wrong track, with just 39% approving of the way Biden has done his job. Trump’s polling is similarly low, with just 41% of respondents to a separate recent Reuters/Ipsos poll saying they viewed him favorably.

The increasingly grim prognosis has left some Democrats questioning the party’s campaign message, which centered on protecting abortion rights and American democracy.

“What we’ve seen over the last month is political gravity begin to reassert itself,” said Jacob Rubashkin, an analyst at the nonpartisan forecaster Inside Elections. “Biden never substantively improved his approval ratings from where it was in the beginning of the year. Voters care a lot about the economy, and they blame Biden for inflation.”

ELECTION DENIERS

Biden and other Democrats have sounded the alarm over a raft of Republican contenders who have either echoed or refused to contradict Trump’s false claims that he lost the 2020 election due to widespread fraud.

“Democracy is literally on the ballot,” Biden said on Sunday at a rally in Yonkers, New York.

The prevalence of election deniers among Republican candidates has elevated down-ballot races that typically receive little attention, including contests for secretary of state, the top election official in most states.

In swing states such as Nevada, Arizona and Michigan, the Republican nominees to head up the states’ election apparatus have embraced Trump’s falsehoods, raising fears among Democrats that, if they prevail, they could interfere with the 2024 presidential race.

Trump’s hold on the Republican Party remains formidable. His endorsement proved a potent tool during party selection contests, and his preferred candidates prevailed in several crucial Senate primaries, despite concerns from some Republican leaders that their far-right rhetoric would be a liability in the general election.

First-time Senate candidates such as Blake Masters in Arizona, J.D. Vance in Ohio and Mehmet Oz in Pennsylvania have struggled at times to moderate their tone for a wider electorate, giving Democrats hope in what might otherwise have been challenging races for Biden’s party.

In Georgia, Herschel Walker, a former sports star challenging incumbent Democratic U.S. Senator Raphael Warnock, has faced a raft of scandals. They include allegations he has called lies from two women who said he urged them to have abortions during past relationships – despite his uncompromising anti-abortion stance on the campaign trail.

“Winning the Senate would have been an easy thing to accomplish had the Republican Party been wiser in its selection of qualified candidates,” said Rick Tyler, a Republican strategist. “They really handicapped themselves.”

Reporting by Joseph Ax; additional reporting by Jarrett Renshaw and Susan Heavey; Editing by Scott Malone, Rosalba O’Brien and Chizu Nomiyama

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In final midterm push, Biden warns of threats, Trump hints at another run

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YONKERS, N.Y., Nov 6 (Reuters) – President Joe Biden warned that a Republican win in Tuesday’s midterm elections could weaken U.S. democracy, while former President Donald Trump hinted at another White House bid, two days before votes in which Republicans could gain control of both chambers of Congress.

The comments, made at dueling rallies held in New York and Florida, highlighted the grim prospects that Biden’s Democrats face, despite fulfilling his promises to boost clean-energy incentives and rebuild crumbling roads and bridges.

Republicans have hammered Biden for high inflation and increased crime in the wake of the COVID-19 pandemic, and non-partisan forecasters favor them to win control of the House of Representatives – and possibly the Senate as well. Democrats’ early leads in Senate races in Georgia, Pennsylvania and Nevada have evaporated.

Control of even one chamber would allow Republicans to stymie Democrat Biden’s legislative agenda and launch potentially damaging investigations.

Biden warned that many Republican candidates are threatening democratic norms by echoing Trump’s false claims about a stolen election in 2020.

“Democracy is literally on the ballot,” he told students at Sarah Lawrence College, north of New York City. “You can’t only love the country when you win.”

At a Trump rally in Miami, meanwhile, the former president recycled many of his unfounded complaints about the 2020 election and hinted that he may soon announce another presidential bid.

“I will probably have to do it again, but stay tuned,” he said, castigating the Biden administration for everything from violent crime to dirty airports.

U.S. President Joe Biden and former President Barack Obama attend a campaign for Democratic U.S. senatorial candidate John Fetterman and Democratic nominee for Pennsylvania governor Josh Shapiro in Philadelphia, Pennsylvania, U.S. November 5, 2022. REUTERS/Kevin Lamarque

Trump’s advisers say an announcement about the 2024 presidential election could come sometime this month.

Despite Biden’s warnings about democracy, many of his fellow Democrats have emphasized more practical matters, such as their work to lower prescription drug prices and defend Social Security. While many have campaigned on abortion rights, opinion polls show that has faded as a top voter concern.

Republicans have questioned Democrats’ support for law enforcement and harnessed concerns about crime, which has emerged as a major election issue after murder rates increased during the COVID pandemic.

“In two short years, do you not feel the pain?” Republican Senate candidate Herschel Walker said at a rally in Georgia. “This is on their watch.”

Democrats have been saddled by Biden’s unpopularity, which has forced him to hold back from campaigning in competitive states. Only 40% of Americans approve of his job performance, according to a Reuters/Ipsos poll completed on Tuesday.

Biden spoke in normally safe Democratic territory outside New York City, where Republicans are threatening to make gains.

New York’s Democratic Governor Kathy Hochul is facing an unexpectedly stiff challenge from Republican Lee Zeldin, while Democratic House incumbents are locked in tight battles throughout the state.

Vice President Kamala Harris visited Chicago, another Democratic stronghold, where she said Democrats could pass national abortion-rights legislation if they added to their margins in the Senate. “If we pick up two more senators, the president can sign it into law,” she said.

First Lady Jill Biden visited Texas, a Republican-dominated state that has a handful of competitive races. “Choosing who leads our community is one way we can live out our faith,” she told worshippers at Wheeler Avenue Baptist Church in Houston.

Additional reporting by Nathan Layne in Georgia, Tyler Clifford in New York and Gram Slattery in Washington; Writing by Andy Sullivan; Editing by Daniel Wallis, Deepa Babington and Kenneth Maxwell

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