Democrats Win Congress on Affordability Pledge as Inflation Sits at 3.7% and Trump Holds the Veto

Democrats were projected to win control of both chambers of Congress Tuesday night after running almost entirely on one word: prices. Ballots are still being counted in some states, but the new Congress is set to be seated Jan. 3.

The NBC News Exit Poll found more than 80% of midterm voters worried about the cost of necessities like gas, groceries and healthcare. According to USA TODAY's reading of the same poll, 75% called the economy "not so good" or "poor." Voters also said they trusted Democrats over Republicans on the economy, a reversal from 2024.

The promises

House Democratic leader Hakeem Jeffries, a front-runner for speaker, said on NBC's "TODAY" show Wednesday that his party is "laser-focused on addressing the affordability crisis that has been crushing everyday Americans."

Jeffries has pledged to restore the Affordable Care Act tax credits that expired in 2025. He also wants to reverse the Medicaid cuts and work requirements in the Republicans' 2025 tax bill.

Sen. Ron Wyden of Oregon, in line to run the Finance Committee, says he wants it focused on taxes and healthcare costs. He also plans to investigate banks allegedly tied to Jeffrey Epstein's sex-trafficking crimes.

In Texas, Senator-elect James Talarico has proposed ending tax cuts for the wealthiest households, free pre-K for 3- and 4-year-olds, and more down-payment help for first-time homebuyers. He also said he is open to working with Trump on suspending federal taxes on gas and diesel.

The math

Promises are one thing. Democrats do not have two-thirds of either chamber, so any bill Trump dislikes dies at his desk. He has called himself "Mr. Veto" in an interview with the New York Post.

Trump said after the results that he is willing to work with Democrats. He made a similar offer after Democrats won the House in 2018, and it produced no meaningful legislation.

Democrats have discussed bills to limit Trump's tariff authority and make it harder for him to keep fighting in Iran. Either could lower costs if enacted. Both would need Trump's signature or a veto-proof margin that does not exist.

What is actually driving prices

Consumer prices rose 2.4% over the year in February, before the Iran war began. By September the annual rate was 3.7%, outpacing worker pay growth.

Economists point to the war, the AI buildout and tariffs. Blockades in the Strait of Hormuz, conflict in the Red Sea and the Russia-Ukraine war have cut global oil supply and pushed up gasoline and diesel prices.

"Affordability issues and price issues don't have easy fixes," said Mike Skordeles, head of U.S. economics at Truist Advisory Services. Francesco D'Acunto, a finance professor at Georgetown University, said the new Congress's ability to substantially reverse those causes "seems to be quite low."

Annual inflation has stayed above the Federal Reserve's 2% target for more than five years, a stretch that began before Trump's second term. Neither party owns that history.

Oil, markets and the Iran question

Brent crude settled nearly 9% lower Wednesday at $94.62 a barrel, falling below $100, as investors weighed peace talks over Iran and Ukraine. Stocks surged on the expectation that a divided Washington will struggle to pass major tax and spending packages.

Fox News reported that Trump has threatened to "finish the job" if Iran rejects a nuclear deal. Quds Force commander Brig. Gen. Esmaeil Qaani warned the U.S. against underestimating what he called a unified "Resistance Front," and mentioned the Bab el-Mandeb strait as another pressure point.

Republicans are also split on what went wrong. Vice President JD Vance has said the Iran war cost the party the midterms. Former White House press secretary Ari Fleischer disagreed on X: "The problem was not the Iran War. It was the cease fire." He argued the war should have ended six months ago with Hormuz open.

Oversight is coming too

Some Democrats are already talking about more than prices. Rep. Robert Garcia of California, ranking member of House Oversight, posted "LAWYER UP" on Wednesday. On Oct. 29 he had posted that Democratic priorities were "lowering the cost of gas, groceries, rent, and taking on this Administration's corruption."

Wyden posted a single word: "Subpoenas." Sen. Ed Markey said the administration would "need to plant new forests for all of the subpoenas we'll be printing." Rep. Delia Ramirez, D-Ill., told Kristi Noem, Stephen Miller, Tom Homan and Gregory Bovino to "clear your schedule."

The Daily Wire argued the posts show oversight, not affordability, is the real priority. Democrats' stated line is that corruption and cost of living are the same campaign. Garcia's October post put them in one sentence.

Texas shows how far the map moved. Talarico beat Republican Attorney General Ken Paxton, and Gina Hinojosa unseated Gov. Greg Abbott. Democrats also won the lieutenant governor and attorney general offices, their first statewide wins there since 1994, according to the Associated Press. Florida Gov. Ron DeSantis called the loss "a huge loss" for the GOP.

What comes next

The 119th Congress's successor convenes Jan. 3. The first test is whether Trump signs anything on ACA credits, tariffs or war powers, or whether Democrats send bills to his desk that he has already said he can veto. Gas prices are tied to the Strait of Hormuz, and no vote in Congress reopens it.