The Economics Behind the Senate’s Dysfunction: A Post-Election Reflection
Back in October, we discussed on our website how the over-influence of less populated states in the U.S. Senate is making progress in the Senate difficult and how this issue is nothing new; in fact, it was a key design put in place by our Founding Fathers. What is a new phenomenon, however, is the over-influence of states and regions that are providing little to the national economy. Indeed, in 2017, 69% of the total U.S. GDP was generated from the 15 states with the highest economic outputs. In the Senate, this means that 30 senators represent about 70% of our economy, while 70 Senators hail from states that each represent less than 2% of our economic output. Although this is bad enough, if we then breakdown the members of each party, we find that 45% of Democratic Senators represent states that each provide more than 2% of our country’s output, while just 20% of the Republican Senators can make the same claim. In other words, 80% of Senators from the majority party in the U.S. Senate come from states that are not strongly connected to the county’s current and future economy. This, to put it mildly, is a problem.
Looking ahead to the next session of the Senate, the economic misrepresentation of states will become even worse. After the 2018 midterms, Republicans gained 3 seats in the Senate, only 1 of which provides more than 2% of economic output (Florida). By winning a close race in Florida, Republicans gained a seat in a state that makes up 5% of the total U.S. GDP. However, Republicans are still far behind their Democratic counterparts when looking at representation of states who contribute the most to the GDP. Using 2017 economic data, we can see that when the next Congress is sworn in, 43 of the 53 Republican Senators (81%) will represent states that provide less than 2% output. For Democrats, 20 seats will come from the high producing states, and 27 from those in the 2% or less category (a more even 43–57% split).
Making matters even worse, GOP leadership will also become less connected to our new economy. While Mitch McConnell’s position as Majority Leader is not term limited, Majority Whip John Cornyn is stepping down after reaching the three-term limit for the position. South Dakota Senator John Thune will succeed him, representing a state that makes up just 0.3% of US economic output. While Senator Cornyn hails from a populous state that makes up 8.7% of the U.S. GDP, the new leadership team represents states that make up 1.1%, 0.3%, 0.2%, 1.6%, and 1.0% (Kentucky, South Dakota, Wyoming, Missouri, and Iowa respectively) for a grand total of 4.2% of our economy.
Across the aisle, we see a different picture. Now, it can be difficult to compare the leadership of the two main parties exactly due to each having its own unique structure, so in the interest of making the most equal comparison possible, you will see certain lower-level members of the Democratic leadership left out of the chart below. The six states we are left with represent 8.0%, 3.9%, 2.6%, 2.6%, 2.6%, and 2.7% of the country’s economic output (New York, Illinois, Washington, Michigan, Virginia, and Massachusetts respectively) for a total of 22.4% of our GDP overall. Said more directly, we are going into a Congress where not a single member of the Republican leadership represents a high-producing state and every member of the Democratic Party’s leadership does.
Between our divided government and the fact that the two parties in the Senate are representing completely different types of economies, anyone hoping for work to be done over the next two years should probably not get their hopes too high. While the disparity in representation of economic production is bad enough, more troubling for those looking for forward progress is that this pattern is unlikely to change. The rate of urbanization continues to increase with more people and economic activity concentrated in and around cities. Amazon’s recent announcement to open a second headquarters both in the DC area and in New York City is the latest example of what we should be expecting more of in the future.
This disparity of economic representation has been accelerating since World War II and America’s current political leaders seem hell-bent on continuing down this path. This is going to create some incredibly interesting challenges for our two-party system and the country as a whole. When we look to the past, even states that had fundamental differences on issues as large and consequential as slavery all had economic skin in the game. There was a vested interest for all parties to work together to keep the country moving forward. It is sobering to realize that these days, that is no longer the case.
The overrepresentation of the less economically-concentrated states in the Senate is likely to exacerbate as more people and businesses move away from the heartland and into urban areas. This phenomenon, coupled with the automation of more and more lower level jobs through machine learning and artificial intelligence, means there will likely be an incredible strain on our form of government if Senators who represent both a minority of the people and a minority of our economy continue to control the U.S. Senate.
There is no doubt that the framers envisioned a system of government where the majority cannot force their will on a minority (this concept was clearly designed to only apply to white, property-owning men in the late 1700s, but that is another topic on which many others have written eloquently). Due to the current state of this Republican Senate majority, along with the way it is run under Senator McConnell, states that are more populous and higher-producing are the minority and are therefore unable to shape policies that impact most of the country’s economy. Said in another way, the GOP has taken a system based on protecting the minority and made it into one of projecting power from a minority position. If history teaches us anything, it is that governments based on minority rule never last and that, soon enough, the problems of the Senate Republican’s minority-rule will likely come to fruition.