I'm staring at this headline for Monday, and
I honestly had to check if I was reading a parody
site. You have the leader of the Republican parter,
the party whose entire brand for, what, 50 years
has been states' rights. Right. Keep the feds
out. Exactly. And now he's suddenly proposing
that the federal government should nationalize
elections. But, and here's the kicker, only in
the blue states. It does feel like a glitch in
the matrix, doesn't it? But if you look at the
whole stack of research we have for this week,
it's early February 2026. This isn't just some
random outburst. It's part of a much larger stress
test on the American political system. We're
seeing a total scramble for control because the
ground is moving under everyone's feet way faster
than they expected. That's exactly what we need
to figure out today. We have this just... bizarre
flip -flop on election control. We have a special
election result in Texas that is objectively
mind -blowing. Oh yeah, we have to get to that.
And then just to confuse matters, we have the
financial markets doing something completely
different than the political world. Right. While
the politics are getting, I mean, more chaotic
and polarized, the economy is actually stabilizing.
But in a way, most people aren't really noticing
yet because they're just so focused on the noise
out of Washington. OK, let's start with the state's
rights reversal then. Donald Trump wants the
feds to run elections. What's the actual logic
here? Or is there one? The stated logic is to
save money and to ensure that, and I'm quoting
the source directly here, illegal immigrants,
Democrats, and other riffraff don't vote. Riffraff.
But functionally, what he's suggesting is that
the federal government seize control of election
machinery, but specifically excluding states
that voted for him. Which seems... legally impossible.
I mean, I am not a constitutional scholar, but
I'm pretty sure the president doesn't run elections.
You are absolutely correct. He has zero role.
In fact, the Constitution is, well, it's very
specific that powers not granted to the feds
belong to the states. We've been running decentralized
elections for 250 years for a reason. Right.
Ironically, the only person in the executive
branch with any role in counting votes is actually
the vice president. Who presides over the Senate
count. Exactly. The president is basically just
a spectator in the mechanics of the vote. So
if it's unconstitutional, and let's be honest,
obviously for critical, why is it making such
waves? Because the reaction from Republicans
hasn't been that... You know, unified applause
Trump usually gets. No, and that's the key insight
here. You've got Senate Majority Leader John
Poon pushing back and pushing back hard. He's
arguing that decentralized systems are safer.
His line is that it's harder to hack 50 separate
servers than one central mainframe. But his real
worry is strategic. He's thinking about H .R.
1. The For the People Act, the one the Democrats
tried to pass back in 2021. That's the one. Thune
knows that if Republicans set the precedent that
the feds can control elections, just to help
Trump today, the second Democrats get power back,
they will use that exact same precedent to pass
H .R. 1. And that bill would, what, mandate early
voting, same day registration? And end partisan
gerrymandering nationwide. Thune is trying to
keep that door locked, even if it means disagreeing
with Trump right now. So he's playing defense
against his own team's offense because he sees
the long game. But not everyone agrees with him.
The source says Brad Raffensperger in Georgia
is shifting. This is a fascinating pivot. Raffensperger
made his name standing up to Trump in 2020, right?
Refusing to find those votes. Of course. Now
he's running for governor and suddenly he's open
to federal intervention, specifically to ban
ballot harvesting. That term gets thrown around
so much, harvesting. It just implies someone
running around stealing votes in a sack. But
in practice, What are we actually talking about?
Well, the source gives a really sobering example.
Nursing homes. OK. You have disabled or elderly
people who fill out a ballot but literally cannot
walk to a mailbox or drive to a drop box. So
a staff member collects those five or six ballots
and drops them off. Technically, under some definitions,
that's harvesting. And Raffensperger wants to
ban that. His new stance is that the voter must
deliver it personally. The source points out
that for a bedridden person, that effectively
deletes their right to vote. It's a mechanic
that sounds tough on fraud in a sound bite. But
in reality, it just purges vulnerable voters
from the rolls. Exactly. It really seems like
they're fighting over the machinery of voting
because they are terrified of the actual voters.
Yeah. Which I guess brings us to Texas. Ah, yes.
The Texas shock. I saw the numbers for this special
election in Senate District 9, and I had to check
the math twice. Republicans are absolutely reeling
from this one. So just to frame this for you,
this is a district near Fort Worth. In 2022,
the Republican won this seat by 20 points. 20
points, a safe seat. Very safe. Two years ago,
Trump won it by 17, last week. The Democrat,
Taylor Remit, won by 14 .4 points. Wait, won
by 14? That's a swing of over 30 points in less
than 24 months. It's a 32 point swing. It's unprecedented.
Usually a wave election is a five or eight point
shift. 30 points is a total collapse. What on
earth caused it? Did the Democrat just run an
incredible campaign? It appears to be almost
entirely demographic and frankly, reactionary.
The district is heavily Latino. OK, that makes
sense. And the reporting suggests this is a direct,
just a visceral reaction to the current administration's
enforcement policies, specifically the images
of masked government thugs and detention centers.
So the tough on immigration rhetoric isn't just
energizing the base anymore. It's actively driving
away a demographic that Republicans thought they
were making inroads with. It is backfiring spectacularly.
You have Ted Cruz calling it very concerning.
Rhonda Sanders. says it's a wake -up call, they
can read the census data better than anyone.
Latinos are 40 % of Texas. And 20 % of the entire
US population. So if you apply a 30 -point swing
to the national map... The GOP gets wiped out,
right? Completely. I mean, the source highlights
the stakes for 2026. You're talking about Senate
seats in Texas, Florida, Colorado. Plus, there
are 38 congressional districts that are majority
Latino. If those flip, the House is gone. Wow.
We're talking about a potential realignment that
could end the current Republican majority just
instantly. It's amazing how fast political capital
can evaporate. And speaking of capital, let's
talk about campaign money. The Republicans have
raised a fortune for the midterms. Can't they
just buy their way out of this with ads? History
says no. The source did a deep analysis of wave
elections, 2006, 2010, 2018. The data is pretty
consistent. When the national mood shifts, money
just stops working. Really? Yeah. In 2010, 43
Democrats lost their seats, even though they
outspent their Republican challengers. So if
a voter is angry about their grandmother in a
nursing home not being able to vote or about
raids in their neighborhood, a slick TV commercial,
it doesn't fix it. There's a point of diminishing
returns. If this Texas shock is real, all that
cash is just papering over a dam that's about
to burst. Meanwhile, JD Vance seems to be trying
to build his own life raft. He's doing this weird
dance where he's attacking elites, but specifically
focusing on. Prince Andrew. It's a very specific
bank shot, isn't it? Vance is in a bind. He needs
to separate himself from Trump to have a future,
but he can't alienate the Maggier base. It's
a tightrope. So he keeps bringing up the Jeffrey
Epstein scandal and incestuous elites, but he
targets Prince Andrew because he's a safe foreign
target. It feels like he's trying to channel
that populist anger about corruption without
pointing the finger at the guy in the Oval Office
who also has, let's say, connections to that
world. That's it, exactly. He calls the elites
gross and incestuous. It allows the voters to
fill in the blanks about who he really means
without Vance having to go on record attacking
his boss. It's pure survival instinct. He's looking
at 2028 while trying to survive 2026. OK, so
the political world is on fire. Usually that
means the markets are crashing. But I'm looking
at the February financial newsletter in our stack
and the economy looks fine. Better than fine
actually. It's resilient. GDP is forecast to
grow over 2 percent. Unemployment is staying
low under 4 .6 percent. But the really interesting
story for anyone with a 401k is where the money
is going. It's not just the tech show anymore.
No not at all. For years the S &P 500 was basically
five tech companies in a trench coat. If big
tech was up the market was up. But in January
tech and financials were actually negative. So
what was up? The winner was the Russell 2000.
It was up over 5%. Okay, for people who don't
day trade, explain why the Russell 2000 mattering
is a big deal. The Russell 2000 tracks small
cap companies. These are domestic manufacturers,
regional banks, construction firms, you know,
real companies making real stuff in America,
not just AI software or ad algorithms. The real
economy. Exactly. When investors rotate money
there, it means they have confidence in the actual
broad economy, not just in a tech bubble. It's
arguably a much healthier signal than, say, Nvidia
going up another 10 percent. So the underlying
economy is broadening out. That's good news.
But then we hit the bureaucratic wall. It is
tax season. And it sounds like some of those
shiny campaign promises like no tax on tips are
colliding with reality. Collision is putting
it mildly. It's a train wreck. The House budget
hawks added so many conditions to these laws
that they are basically unworkable for the average
person. I laughed out loud at the overtime rule.
Apparently, to get the tax break, you have to
be covered by the 1938 Fair Labor Standards Act.
Right. And when people call the IRS to ask, am
I covered, the IRS lawyers are saying, we don't
know, call the Department of Labor. You're kidding.
Nope. You literally have one federal agency telling
tax debtors to call a different agency to figure
out how to file a form. It sounds like a Kafka
novel. Mm. And the no tax on tips thing. Yeah.
Reading the source, it sounds like an actual
trap. It is. Here's the catch. Income tax is
different from payroll tax FICA, which funds
Social Security and Medicare. Okay. Many service
workers haven't been reporting all their cash
tips. If they start reporting them now to claim
the income tax exemption, they suddenly owe 15
.3 % in FICA taxes on that money. So you file
the form to save money on income tax, and you
end up writing a check to the government for
Social Security taxes you didn't know you owed.
That's it! You might actually end up with less
take -home pay than if you had just done nothing.
The only people winning here are the accountants
who get to charge you to navigate this mess.
And speaking of mess, there's this one weird
detail about the car loan interest deduction.
You can deduct the interest, but only if the
car was final assembled in the U .S. And nobody
knows what final assembly means. The source jokes
about whether hanging a foxtail in the rearview
mirror counts. It sounds funny, but if you're
banking on a $2 ,000 refund and you get denied
because your Ford was assembled in Canada, you're
going to be furious. It creates this huge gap
between the promise I'll lower your taxes and
the reality, which is I'll make your taxes so
complicated you need a lawyer. And that frustration
matters. When voters get their tax returns in
April and the refund isn't there, that feeds
right back into the anger we saw in that Texas
election. Before we wrap up, we have to look
at the media landscape. There's a grim update
about The Washington Post. It's brutal. Jeff
Bezos's team fired a third of the staff. They
killed the entire sports section and gutted the
foreign bureaus. No sports section. In a national
paper, that feels drastic. Gone. The theory discussed
in the source is that Bezos is gutting the paper
to appease Trump, hoping it helps his space company,
Blue Origin, get government contracts. But the
source points out that Trump doesn't do gratitude.
So Bezos might be destroying a journalistic institution
for a favor he will never receive. That's the
fear. It's a heavy note on the state of accountability.
But we do have one actual bright spot to close
on. The oceans. Right. The High Seas Treaty.
Yes, it's officially in effect. Before this,
international waters were basically the Wild
West. Less than 1 % was protected. Now, 84 countries
have signed on to create marine sanctuaries in
the open ocean. That's a rare moment of global
cooperation working while everything else feels
fractured. It really is. So, pulling this all
together. We have a political system that's fighting
over the basic rules of the game. Who counts
the votes? Who gets to vote? We have a massive
demographic shift in Texas that suggests the
old strategies are just failing. And we have
an economy that is quietly getting stronger and
broader, even while the tax code becomes a nightmare.
It really does highlight a disconnect. You have
these top -down decrees, nationalized elections,
no tax on tips that are messy and just completely
disconnected from reality. And then you have
the reality on the ground, like the voters in
Fort Worth are the investors buying small construction
companies. The source mentioned a new Democratic
pilot program. It's called Local Listeners. I
loved this detail. Instead of sending people
out to preach or hand out pamphlets, they train
volunteers just to listen, to ask their neighbors
what they care about and then just shut up. It's
such a contrast. One side is trying to rewrite
the Constitution and the tax code from the top
down. The other side is testing out. Listening.
It raises a pretty big question for the midterms,
you know? Are we entering an era where the party
that focuses on those micro interactions, simply
hearing people, beats the party relying on grand
structural machinery? If that Texas swing is
real, the answer might be yes. Something to chew
on. Thanks for listening to this Deep Dive. See
you next time.