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Aug. 18, 2022, 9:46 a.m. EDT

Republicans need a new standard-bearer

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By Peter Morici

The Republicans desperately need a new generation to step up, challenge Donald Trump for the party nomination, and craft a new party agenda.

The odds are decent that Republicans will capture the House in November and the  Senate remains in play . Even if they prevail, however, they won’t gain veto-proof majorities necessary to significantly alter the path of public policy before the next presidential election.

Related story: Liz Cheney ‘ thinking about’ running for president after primary loss, vows to ‘continue this battle’ against Trump

Economic future

With the Senate they could hold up many of President Joe Biden’s more  woke judicial  and administrative appointments, but he already has much of what he needs to pursue an expansion of the administrative state.

The Federal Reserve will slow the economy to  moderate inflation . Likely a soft landing—only two quarters of negative growth without a big surge in unemployment—or a recession— two quarters of negative growth  with unemployment reaching about 5%—and then a rebound.

Stagflation —lethargic growth, the paradox of falling real wages with a nonplus overall jobs market and inflation above 4%—is likely.

Labor markets in many activities will remain tight because the  skill mix of the labor force does not match well with the postpandemic economy .

Food and energy inflation won’t fully abate without reopening Ukrainian seaborne grain /zigman2/quotes/210389638/delayed W00 +0.76% exports and reintegrating Russia into Western petroleum /zigman2/quotes/209723049/delayed CL00 -0.94% markets.

Challenge Putin

Those won’t happen without the United States  breaking the Russian embargo of Black Sea ports with naval convoys  and some kind of military confrontation that forces Russian President Vladimir Putin to sue for peace.

All of that is in the hands of the president—not the Congress—and Americans have little appetite for  risking war with Russia .

European  political leaders  have  acute domestic challenges too . If America aggressively confronted Putin, it’s questionable whether they would follow.

The GOP will bloviate about inflation and the president’s energy policies, but boosting U.S. oil and gas /zigman2/quotes/210189548/delayed NG00 -1.65% production by perhaps 10% would add  1.5 million barrels a day to global supplies . That’s not enough to compensate for the West losing access to  Russian production .

Europe’s drive to  end dependence on Russian gas , while shutting down  Netherland’s Groningen gas field , will  drive up prices everywhere .

Beyond Republican orthodoxy

The answer lies in prudently planning more growth in wind, solar and electric vehicle production. And reassuring oil companies they can invest—without vengeance from Washington—to meet demand from internal combustion engines, which will remain substantial until the  end of the 2030s , and the needs of the petrochemical and other industries that use petroleum as raw material.

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