Democrats have seen their brand become highly toxic to working class and rural voters. The party lacks new ideas and a coherent message and is really leader-less right now. Call me cynical, but I don’t have confidence that the party’s campaign committees such as the Democratic Congressional Campaign Committee (DCCC) and Democratic Senatorial Campaign Committee (DSCC), can be counted on to advise candidates with winning policies to help them flip the House next year.
Now, I’m well aware that it’s not enough to throw a handful of white papers in a voter’s face and expect them to carry a candidate to victory. But by the same token, having no cogent platform to run on is also foolhardy. Over the course of my 45-year career, I’ve helped candidates like Tom Harkin, Barack Obama and Amy Klobuchar craft policy positions for their elections. So here are some ideas that Democrats seeking House and Senate seats could champion in the 2026 midterms:
The Federal Reserve System’s Board of Governors has been in the news recently as President Trump tries to wrest control of the central bank and weaken its independent authority over monetary policy. The Fed’s governors serve 14-year terms and for decades they have mostly come from two camps: Wall Street titans and insiders and economists from the Ivy League. But what if candidates made the case for putting a small businessperson and family farmer on the board?
Small businesses account for almost 50% of the workforce in the United States. When a large corporation needs money for products, equipment or accounts payable, it has plenty of capital around, merely due to the nature and size of the establishment. When small businesses have to pay their bills, they must borrow. A small business simply does not have the capacity to keep large amounts of capital lying around.
It was President John F. Kennedy who rightly said, “the farmer is the only man in our economy who buys everything at retail, sells everything at wholesale, and pays the freight both ways.” Family farmers are traditionally heavy borrowers, due to their need to finance farm inputs and expenses. Loans are paid off when their crops and livestock are sold. Farmers pinched by mounting debts, low crop prices and skyrocketing costs due to inflation and tariffs are now cutting back on not only farm equipment and supplies but also on consumer goods.
Democrats should push legislation that puts teeth into the Federal Reserve Act of 1913 by requiring the president to provide representation of commercial and agricultural interests. Section 10 of the law says the president “shall have due regard for fair representation of the financial, agricultural, industrial and commercial interests, and the geographical divisions of the country.” But for at least the past 45 years, Section 10 has been virtually ignored when appointments were made to the Board of Governors. Today, all seven members of the Board come from either academia or the financial sector.
If Democrats are really interested in economic growth, the creation of jobs and the preservation of our family farms and rural communities, they should advocate to give small business and agriculture a voice at the Fed.
Get Pharmacy Benefit Managers to lower drug costs
As Trump’s pathetic promises to lower the cost of things go by the wayside, affordability still dominates the list of voter concerns. Maybe nowhere is this more apparent than in the continued rise of prescription drugs.
Not long ago, it was thought that drug costs could be controlled by entities called pharmacy benefit managers or PBMs, which act as middlemen between drug makers and insurers. PBMs negotiate prices in exchange for including drugs in insurers’ formularies. They are supposed to pass the savings to patients. However, PBMs—often working hand-in-hand with insurance companies that own them—pocket the discounts, leaving patients to foot the bill.
The top three PBMs are CVS Health (Caremark) which has 32% of the market, Cigna Corp (Express Scripts) with 24% market share and UnitedHealth (OptumRx) with 21% market share. As these three continue to gobble up market share, they are creating pharmacy deserts in census tracts all across the nation. And it is not just mom-and-pop drugstores closing down. National chains like Walgreens are also going belly up.
A report issued by the U.S. Government Accountability Office on September 5, 2023 recommended that the administrator of Centers for Medicare and Medicaid Services should monitor the effect of rebates on plan sponsor formulary design and on Medicare and beneficiary spending to assess whether rebate practices are likely to substantially discourage enrollment by certain beneficiaries.
A national poll from March 2023 found that 84% of likely voters say it’s important or very important to have rules that require PBMs to provide value and lower drug costs for consumers. What’s more, respondents want elected officials to take on the issue of regulating PBMs, with 73% saying it should be a high or top priority for Congress and their state legislatures, and 72% saying they are more or much more likely to vote for a candidate who supports regulating PBMs.
It should be embarrassing to Democrats that some of the strongest efforts to rein in PBMs right now are coming from red states like Arkansas and Montana. In Congress, a PBM reform bill has been introduced in the House by Rep. Buddy Carter (R-Ga.), who is running against Democratic Sen. Jon Ossoff next year.
Democrats should get behind legislation to establish various requirements for pharmacy benefit managers (PBMs) with respect to services provided to health insurance plans. These would include mandating PBMs report annually to the plan sponsor specific information about the PBM’s services, including the amount of prescription drug copayment assistance funded by drug manufacturers, a list of covered drugs billed under the plan during the reporting period, and the total net spending by the health plan on prescription drugs. PBMs must also provide plan sponsors with a supplementary report every six months with specified information about drugs that were dispensed under the plan by pharmacies that are wholly or partially owned by the PBM—such as CVS.
Democratic candidates should insist on a bill that prohibits spread pricing, which occurs when a PBM charges an insurance plan (or an insurance plan charges its participants) a price for a prescription drug that exceeds the price paid to the pharmacy for the drug.
Finally, PBMs must remit to the plan sponsor all rebates, fees, alternative discounts and other remuneration received from a drug manufacturer.
For enforcement, any legislation needs to establish civil penalties for violations of these requirements and provide funding for the Centers for Medicare & Medicaid Services and the Department of Labor to implement the provisions of the proposed bill.
Trade with Cuba
The Trump years have done more to focus Americans on trade policy than at any time since the debates over the North American Free Trade Agreement (NAFTA), China Most Favored Nation status and the creation of the World Trade Organization during the time of President George H.W. Bush and his successor Bill Clinton.
The tariff-obsessed Trump is good at telling us what he hates about foreign trade but not what he would do to fix it. His boasts about a series of promised forthcoming trade deals now ring hollow because it takes months and often years to hammer out the details to put a free trade agreement in place. Meanwhile, farmers are locked out of foreign markets with no clear path forward.
Democrats should be pushing to allow Cuba to purchase American farm, forest and fisheries products on credit—like all our other trading partners—instead of cash, as the Cubans now must do. A decade ago, a Texas A&M University study found that if we let Cuba buy chicken, rice and other exports on credit, it would bring $1.24 billion in annual sales to U.S. producers and create 6,000 new American jobs.
Cuba is a deficit milk producer and currently imports 50,000-100,000 tons of milk powder annually, primarily from New Zealand, South America and Poland. This milk powder and butter could come from US dairy farms. Cuba currently imports almost 10 million board feet of softwood lumber annually, valued at $4.6 million, mostly from Brazil and Spain. Forest landowners across the northeastern U.S. produce thousands of board feet of white pine and hemlock lumber and could reap the benefits of the Cuban export market while allowing our sawmills to keep and add jobs.
Trump has resisted Cuba agriculture trade to appease the hard right base of anti-Castro voters in south Florida. But the idea has bipartisan support from Republicans like Sens. Jerry Moran and Roger Marshall of Kansas and Rep. Rick Crawford of Arkansas as well as Sen. Amy Klobuchar of Minnesota, the ranking Democrat on the Senate Agriculture Committee. The argument that we can’t trade with Cuba because they abuse human rights also completely falls apart when we look at our trade with China and that nation’s horrific treatment of their ethnic and religious minorities such as the Uyghurs and Tibetans.
Take on private equity
A 2019 study by the government’s National Bureau of Economic Research found that among 10,000 company buyouts between 1980 and 2013, employment dropped by 13% when a private equity firm took over a public company.
The celebrants for the rapacious economic acts of corporate takeovers and subsequent downsizing and layoffs are often found in the private equity industry. Over the years, they have skillfully lobbied Congress for a host of laws and regulations that have allowed them to lick the plate.
In These Are the Plunderers: How Private Equity Runs—and Wrecks—America Gretchen Morgenson and Joshua Rosner document the nefarious ways financial wheeler-dealers, in the form of private equity, have ravaged almost every sector of the American economy, from jobs to housing to health care and public pensions.
To drill down how this appears on a state-by state basis take a look at the Private Equity Risk Index. It shows that 20 states (40% of the nation) are at “very high” or “high risk” from the actions of private equity financiers. Take Georgia. The Peach State is among the top 10 states for the number of layoffs at private equity-controlled at private-equity owned companies as a share of the state’s private sector workforce. Between 2015-2022, 9,785 layoffs occurred companies in the state. Georgia also has more than 68% of its population in a metro area where a single private equity firm controls over 30% market share of one or more physician specialties.
Democrats could support legislation that would control and limit the worse abuses of private equity. American Prospect editor David Dayen has laid out key actions that could be taken. At the top of the list would be the IRS treatment of “carried interest” which is how private equity structures some of its compensation packages. Carried interest, or carry, in finance, is a share of the profits of an investment paid to the investment manager specifically in alternative investments. It is a performance fee, rewarding the manager for enhancing performance.
The tax as capital gains at 28.3% and not at the top regular income rate of 40.8% is a yawning gap. Changing this would cut the deficit by some $13 billion over 10 years according to the Congressional Budget Office, allowing Democratic candidates to run as deficit hawks.
Amending the Investment Advisers Act of 1940 to strengthen financial oversight of hedge funds and other private investment funds is another good idea. It would require the people who advise hedge funds, private equity funds, venture capital funds and other private investment pools to register with the Securities and Exchange Commission. The SEC needs the authority to collect data from the hedge funds and other investment pools including the risk they may pose to the financial system.
The National Securities Markets Improvement Act of 1996 (NSMIA), which was a total sell-out to Wall Street, also needs corrective surgery. This law did several very harmful things that should be repealed. It weakened investor protections by prohibiting state securities regulators from being able to scrutinize private investment partnerships of the kind the private equity industry likes to concoct. NSMIA made it much easier for private equity firms to raise cash from out-of-state investors but upped the odds that fraud in these partnerships could spread unchecked because, as Morgenson writes, “traditionally aggressive state cops were off their financial beats.” The law also drastically raised from 99 to 500 the number of investors who could participate in a private investment partnership deal of the kind favored by the big private equity players like KKR and Blackstone Inc.
Capturing control of the U.S. House will be a challenging task for Democrats next year. Republicans will enjoy the advantages of incumbency, money and redistricting. But running on these populist issues outlined above, and others dealing with antitrust and competition policy, would be a good way to constructing a solid platform that can appeal to voters who Democrats have lost in recent election cycles—voters they need to win back if they want to reclaim any power on Capitol Hill.
Matt L. Barron is a political consultant and rural strategist based in Chesterfield, Massachusetts where he runs MLB Research Associates.
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