Redistricting is Bullish

The Census Bureau released its latest population data on Monday.

Results triggered reapportionment for the US House of Representatives. A population surge in Texas rewarded that state with two new seats, while California and New York joined seven states losing one seat apiece. Here’s the rundown:

States Gaining Two Congressional Seats
– – – – – – – – – – – – – – –

Texas

States Gaining One Congressional Seat
– – – – – – – – – – – – – – –

Colorado
Florida
Montana
North Carolina
Oregon

States Losing One Congressional Seat
– – – – – – – – – – – – – – –

California
Illinois
Michigan
New York
Ohio
Pennsylvania
West Virginia

Next comes the redrawing of political districts. According to Politico:

“Beginning with the 2022 midterm elections, House districts—which will be redrawn to hold equal population within each state—will reflect the new apportionment figures. … State legislators have the biggest say over redistricting in many states, but others use different methods for drawing lines, including independent commissions.”

New district maps frequently mean a new electorate for politicians to woo, which generally leads them to avoid controversy. Result: watered-down legislation or outright bill cancellations.

Politico calls redistricting “the most politically uncomfortable and unpredictable year Congress must face each decade, when new maps drawn in redistricting force veteran incumbents into retirement, turn former friends into fierce rivals and pitch safe-seat House members into hotly contested elections.”

Consequently, odds are now higher for dilution of tax hikes and spending bills. This should offset bearish analysis around last week’s talk of a capital gains tax increase.

Conclusion: Redistricting is bullish.

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