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2018 Election Analysis

By John Sharbaugh, CAE
Managing Director, TSCPA Governmental Affairs

Nov. 12, 2018

It has been a week since the midterm elections. While the dust has not yet completely settled due to some election recounts underway, as well as waiting for the certification of final results in some others, here are some general observations about how things look heading into the 86th Session of the Texas Legislature and the 116th U.S. Congress.

Texas – Senate and House Races

Democrats picked up two seats in the Texas Senate, so there will be 19 Republican senators and 12 Democrats serving next year. Even with these losses, the Republicans still hold a large enough majority to bring any bills to the Senate floor for a vote. Republicans will control the agenda and the outcomes in that chamber, unless there are Republican defections.

Sylvia Garcia (D) resigned from the District 6 Senate seat upon her election to the U.S. House of Representatives. Gov. Greg Abbott has called for a special election on Dec. 11 to replace Garcia. Most believe a Democratic candidate is likely to win this seat. If that happens, then the numbers above will not change.

On the House side, the Democrats did well and picked up 12 seats. Thus, the numbers there will shift from a 95-55 Republican majority to one of 83 Republicans and 67 Democrats. Again, with this size majority, the Republicans will still control the chamber unless some Republicans join forces with Democrats on an issue.

There are a handful of very close House races where the final votes have not yet been confirmed. Counties have until Nov. 20 to accept provisional, overseas and military ballots. Most observers feel there will not be enough votes through this process to turn any of these races around. Thus, the 83-67 advantage for Republicans is likely to hold.

While the Republicans still hold sizeable margins in both chambers, some feel the outcome of this year’s election will serve as somewhat of a wake-up call for the party. The result could mean a greater focus on business issues rather than social issues. We will get the answer on that point in just a few months as the legislature is set to convene in Austin on Jan. 8, 2019.

Statewide Offices

The last time a Democrat won an election in Texas for a statewide office was 1994 and last week’s election did not change that fact. All of the statewide offices were once again captured by Republicans. But this year’s results were much closer, and the Democrats at least made a better showing thanks to what some think was the “Beto Bump” of the race for the U.S. Senate between the Republican incumbent Ted Cruz and his Democratic challenger Robert “Beto” O’Rourke. (More on that race below.)

During the last midterm election in 2014, Republicans won all statewide races by an average of 19 points, but that was not the case this year. While incumbent Gov. Abbott fared reasonably well defeating his opponent Lupe Valdez by 13 points, several other Republicans had much closer races when compared to the historical standards of the past several elections.

Incumbent Republican Dan Patrick won his race for lieutenant governor over his Democratic opponent – Mike Collier, CPA-Houston. But his margin of victory was only five points. The same was true for the race for Texas attorney general where incumbent Ken Paxton only won by three points and the race for agriculture commissioner where Sid Miller won by five points. George P. Bush (land commissioner), Glenn Hegar (comptroller) and Christi Craddick (railroad commissioner) all won their races by about 10 points.

While Republicans continue to rule in these statewide offices (albeit with smaller margins of victory), we will have to wait four years to see if these results are a changing trend in the politics of the state or an aberration caused by particular candidates (like O’Rourke) and/or the attitude of voters about Washington, D.C. and the current occupant of the White House.

Many also feel that the changing demographics of Texas will continue to push the state toward a different political landscape over time. Needless to say, both parties in Texas are going to be studying the results of this most recent election to plan their strategies for the future.

U.S. Congress - Texas

In the battle for the U.S. Congress, far and away the race that generated the most attention and interest (both in the state and nationally) was between Cruz and O’Rourke. Until recently, O’Rourke was a relatively unknown three-term member of Congress from El Paso who began his campaign to replace Cruz nearly two years ago. He gained fame by traveling to all 254 counties in Texas to make his case to voters and in the process became a “phenomenon” unlike any we have seen in Texas (or national) politics for some time.

O’Rourke generated tremendous interest and support from younger voters and others who historically had not participated in voting, especially in mid-term elections. While he fought the good fight, O’Rourke came up just short of unseating Cruz, losing by just 2.5 percent. Some are now pushing O’Rourke to take his new-found fame into the race for president in 2020, but as of this writing he has expressed no interest in doing so.

With Cruz’s re-election, the two Texas Senate seats remain in Republican hands. (Our other senator from Texas – John Cornyn – will be up for re-election in 2020). But that is not the case in the House where the Democrats picked up two Texas seats. In the Dallas area, challenger Colin Allred (D) defeated Pete Sessions (R) who had been a member of Congress for 20 years. And in the Houston area, long-time incumbent John Culberson (R) was defeated by Lizzie Pannill Fletcher (D).

With these two pick-ups by Democrats, the 36-member Texas delegation in Congress next year will stand at 23 Republicans and 13 Democrats. However, one race is still not finalized. Incumbent Rep. Will Hurd (R) has a slight lead of several hundred votes over his opponent Gina Ortiz-Jones in the 23rd District that sprawls from San Antonio nearly to El Paso. Ortiz-Jones has not conceded, but most observers feel she will not be able to overcome Hurd’s vote count and he will be re-elected.

In total, Texas will be sending nine new faces to Washington to serve in the House. Five men and four women. And we will also see the first two Latinas in our Congressional delegation - Garcia and Veronica Escobar. Both TSCPA members Rep. Mike Conaway (R), CPA-Permian Basin, and Rep. Bill Flores (R), CPA-Brazos Valley, were re-elected to Congress.

U.S. Congress – National

While Texas Democrats only picked up two Congressional seats, their counterparts nationwide fared much better and will assume a majority in the House of Representatives next year. Again, the final numbers are not yet confirmed, but at this juncture, it looks like Democrats will pick up at least 32 seats in the House and possibly more when all races are finally called.

On the Senate side, Republicans will maintain their majority and may pick up a few seats pending the final call in a couple of races. Races in Arizona and Florida have not yet been decided. Florida seems to be heading to a recount (shades of the presidential race in 2000).

Thus, we are headed to divided government in Washington next year with the Democrats controlling the House and the Republicans holding the Senate and the presidency. While some see this likely resulting in nothing but gridlock, others think there may be a chance for bi-partisan support on a very limited agenda of issues. Infrastructure spending seems to be the most likely issue for agreement.

Otherwise, many political observers think things will get even uglier in Washington as both sides gear up for the presidential election in 2020. We will begin to see various candidates declare their intentions for that race in the very near future.

Fewer Leadership Roles for Republicans

Democrats taking control of the U.S. House next year does not bode well for Texas leadership in that chamber. As a result of losing their majority, as well as the retirements of several Texans, we will see seven Texas House members lose their jobs as chairs of various House committees. Two notables are Kevin Brady (R) will no longer chair the House Ways and Means Committee and Conaway will no longer chair the Agriculture Committee.

The Year of the Woman

More women than ever before were nominated and elected to public office this year. At least 100 women will be sworn in as members of Congress next year – a record. And the next Congress will be the most racially and gender diverse in our history.

Voter Turnout Breaks Records

An estimated 113 million people in the U.S. participated in the 2018 midterm elections, making this the first midterm in history to exceed over 100 million votes, with 49 percent of eligible voters participating in the election. The last time voter turnout reached 49 percent was in the 1966 midterm elections. By comparison, the 2014 midterm elections had one of the lowest turnouts in American history, with only 36.4 percent of eligible voters participating. In 2010, the first midterm of President Obama's tenure, 41 percent of voters participated.

Here in Texas, the voter turnout was up, as well. Approximately 8.3 million people voted in Texas in last week’s election. That compares to 4.6 million in the 2014 midterm election and around 9 million in the presidential election in 2016.

Texas also set a new voter registration record of 15.6 million people in 2018. Texas Secretary of State Rolando Pablos reported that the state's voter rolls have grown by 1.6 million since the last midterm election in 2014. Election records show that Texas has seen a 400,000-voter increase since March. The state on average added just over 100,000 voters a year between 2002 and 2014.

 

 

 

Local Advocates
Needed

As a result of the many new members of the Texas Legislature and the U.S. Congress, TSCPA and AICPA will be looking to identify CPAs who know these new legislators and who are willing to get involved in the profession’s advocacy efforts.

As the saying goes “all politics is local” and we need to have members who live and work in the elected officials’ districts to help communicate with them on issues of importance to the CPA profession.  If you or someone you know has a relationship with an elected official, or is willing to build one, please volunteer and get involved in our Key Person Program.  We would love to have your involvement. - John Sharbaugh

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2019 Sunset Review

The Texas State Board of Public Accountancy is up for review during the next Texas Legislative session in 2019. Learn more about it.