The Economic Impact of Gerrymandering

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2:00But for three weeks this spring, Beyer's district shifted in a big way. Coming up, Virginia has decided. Voters have said yes to redrawing Virginia's congressional districts. It was part of a concerted effort from Virginia Democrats to create new Democratic seats in Congress. Virginia is a purple state with nearly 9 million people. It has 11 representatives in the House, six Democrats and five Republicans. By breaking up some key Republican districts and folding them into Democratic ones, the state's Democrats hope to shift that balance even more in their favor and create 10 Democratic districts, leaving just one to Republicans.

2:38My new district had 16 new counties, most of them very rural. And so I was going to need to dive into the fact that their Internet service is terrible, that they have to go 45 minutes to have a heart attack or two hours to have a baby. Historically, Bayer has been against this kind of map redrawing, sometimes referred to as gerrymandering. For the last decade, he has pushed legislation that would make the practice a thing of the past. But he backed the recent effort to create that Democrat-friendly map because he says, well, Republicans, at the urging of President Trump, were doing the same thing in a bunch of other states.

3:14The phrase everyone used, Stacey, again and again was, you know, you can't just roll over, that we can't take a knife to a gunfight and Donald Trump has got the gunfight. In the end, Byers' new district lasted only a few weeks. The state Supreme Court threw out the map earlier this month. Democrats tried to get the U.S. Supreme Court to intervene. But when that court declined to do so, it was a nail in the coffin. Bloomberg government's Greg Giroux says rapidly shifting maps like the ones in Virginia are all part of a bigger and highly unusual redistricting fight that's been playing out all across the country.

3:49I did not have on my bingo card, and certainly my editors didn't, having so many states to cover in these mid-decade redistricting wars. So this is very unusual. We have one of the tiniest House majorities in modern U.S. history right now. The Republicans control just 217 seats, 212 for the Democrats, one independent, five vacancies. And really, with Democrats needing just a net gain of three seats to get to that majority of 218 in the House, every seat seems to magnify an importance. People who think about politics are saying, oh, gee, it's political, but it's also very economic. Dr. Julianne Malveaux is a D.C.-based economist and president emerita of Bennett College for Women.

4:33She says beyond voting in elections, this gerrymandering will have a profound impact. People will experience less economic access, less economic freedom because of this redistricting. And I think that's quite frankly the point. I'm Stacey Vanek-Smith, in for David Gura and Sarah Holder. And this is The Big Take from Bloomberg News. Today on the show, the race to redistrict, why it's happening now, what the political and economic impacts could be for voters, and, of course, who's winning.

5:12The term gerrymander dates back to 1812, when then-Massachusetts Governor Elbridge Gerry signed into law a redistricting plan that would favor his party. The Boston Gazette compared the shape of one of the contorted new districts to a salamander. The headline combined Governor Jerry's name with salamander and gerrymander was born. Bloomberg government's Greg Giroux has had a front row seat to many gerrymandering battles. He's covered politics for 30 years and says redistricting tends to follow a familiar rhythm. So redistricting is usually the once per decade process of modifying congressional district lines after every census and after the reapportionment of the 435 House seats among the states.

5:56That number is fixed, so it's very much a zero-sum game. States that grow faster get more seats at the expense of those that don't grow as fast or those that lose population. That leads to some very, very difficult political fights in the states, usually in years ending in one and two. Years like 2021 or 2022. Redistricting has that predictable cadence because it usually follows the census. And who gets to draw the lines varies by state. Traditionally, the job has fallen to state legislatures and governors. So if the same party controls both, it can redraw the maps in its favor. Several states have tried to protect against this and now leave redistricting responsibilities to an independent or bipartisan commission.

6:41Greg says normally all of that work and any related political fights are wrapped up in the first couple years after the census comes out. But this wave of redistricting has been an exception. What's different about this decade is that we've seen an explosion of states that are enacting redistricting new maps in the middle of the decade. The mid-decade scramble to rapidly redraw congressional districts kicked off in 2025 in Texas. At the urging of Trump White House, Texas Republicans enacted new maps in that state that could deliver up to five additional seats for the GOP and help them rescue their very shaky House majority in the 2026 election.

7:22Here's how Texas Governor Greg Abbott made the case for the move on Fox News. Look at the entirety of all of the New England states. In all of New England, there are millions of Republican voters, and yet there is no member of the United States Congress who is a Republican. So they drew their lines a long time ago to eliminate Republicans in Congress. And what has happened across America is lines have been drawn illegally based upon race. Texas acting prompted some other Republican governments to follow suit, and Democrats decided to counterattack in some states. After Texas redistricted, California soon followed with a new map that would add more Democratic seats.

8:01Virginia Democrats like Don Beyer also launched a bid to redraw their map. Republicans were able to redraw district maps in Missouri, North Carolina, Ohio and Florida. One notable exception was Indiana, where Republicans rejected President Trump's request to draw a new district map in their state. And that big fight that we've seen in 2025 and the first few months of 2026 was only super turbocharged by a U.S. Supreme Court decision in late April that basically restricted how much states could use race and redistricting. That late April decision was Louisiana versus Calais, which weakened key provisions of the Voting Rights Act.

8:41The U.S. Supreme Court struck down Louisiana's map, which has two black majority districts out of six in the state, and said that it was an unconstitutional racial gerrymander. And so as a result of that decision, Louisiana is trying to enact a new map, as are some other states. Those other states include Alabama, Tennessee and South Carolina. Since the Supreme Court decision, Republicans have introduced new maps in all three states. And those new maps will impact more than just politics. I think that the pundits have talked about this from a political perspective, which is absolutely right. But, you know, politics and economics are inextricably intertwined.

9:20They both deal with the same thing. Who gets what, when, where and why? Economist Dr. Julianne Malveaux. Economists talk about it from a money perspective. Politicians talk about it from a voting perspective. In some ways, in this case, they're literally the same thing. Dr. Malveaux says there are two commonly used techniques when it comes to gerrymandering. She has seen them play out many times in predominantly Black communities. We talk about packing and cracking. Packing is putting all the Black folks into one district, or they could be in two or three. Cracking is when you crack them like a wallet, crack them into several districts.

9:55To, like, dilute their voting power. Precisely. And to dilute their influence and representation. Malvo points to the 9th District in Tennessee, which used to include all of Memphis and has served as a Democratic stronghold in the state, represented by Congressman Steve Cohen. A new map adopted earlier this month splits the city into three districts. So now who among these three districts is going to advocate for resource allocation for Memphis? What if they need a new school? What if they need a new playground? Who's going to argue for that? And so the economic part of it is you've diluted not only political power, but also economic power.

10:35The ability to essentially advocate for economic issues, for community development law grants, for small business allocations. There are just so many things that a congressperson representing his or her district is going to push for, whereas three congresspeople in diluted districts, Memphis is not going to be the first choice for any of them. What kinds of things have you seen happen when this occurs? Well, first of all, the essential district gets ignored. The essential district, which is the Memphis City, it gets ignored when you now have three people representing central Memphis, three different members of Congress.

11:19So what could happen? Someone would take some legislation for a new school because some schools are eroding. So they take that legislation. Who takes it now? You got three people. Even in the best of circumstances, those three might decide we're not going to work together on this. And who gets ignored? The black community in this case. In other cases, you'd see other things ignored. But you basically have seen the essential interests of the community overlooked. And the economic impacts follow. If you dilute congressional power, you dilute other power, you dilute economic power. Often when there's an investment to happen in a district, the member of Congress is one of the people who may talk to investors, may talk to industry to say, look, this is what I can do for you.

12:09If you bring this investment to my district, I can promise you X. Might be a tax abatement, might be something else. Well, you can't really say that if you have less influence, less power. Research from the University of Southern California published last month found property values can be greatly impacted by redistricting, with homes losing or gaining nearly 8 percent of their market value when put into different districts. Redistricting has also been shown to impact people's access to credit. People often talk about your credit score as being your adult report card because essentially it does talk about your credit worthiness, your access to capital.

12:49And as we know, many small, minority, other businesses, but small businesses, are sitting at the edge. They don't have a lot of cash reserves. And their ability to access credit is often their ability to survive. And again, the question becomes, who will be their advocate? Now, the member of Congress isn't going to change, can't change the law for you, but they can certainly, that's why they have, you know, support staff. They can look into it. A letter from a congressperson's aide saying, Jane Jones says she didn't get a loan. Can you help us with that? Often they'll get an answer. But if there's no Congress to lift up Jane Jones, another one bites the dust.

13:32So who's winning and losing this year's redistricting race? That's next.

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16:15Bloomberg government reporter Greg Giroux says when it comes to redistricting, it's important to remember how midterm elections tend to pan out in the U.S. The trend is pretty stark. In 18 of 20 midterm elections since the end of World War II, the White House's party has lost seats in the House. Only twice has the White House's party gained seats. 1998 and 2002, when Presidents Bill Clinton and George W. Bush respectively had very high approval ratings. President Trump's approval rating is below 40 percent as we speak today. And so very much I think the Republicans knew just by the historical evidence last summer that their majority was very much at risk and that redrawing more seats of their advantage would help rescue the majority.

16:59And also by extension, the last two years of Donald Trump's presidency, because of Democrats take control of the House, they could initiate investigations and certainly block any of his legislative initiatives. Does one of the parties have a greater advantage right now as it stands? It seems like the Republicans have regained the advantage in the line drawing. However, I don't think with the midterm election history we just reviewed that any advantage that Republicans have in the line drawing will be sufficient to overcome what may be a Democratic wave election if it transpires. For Dr. Julianne Malveaux, the weakening of the Voting Rights Act and states scrambling to redistrict remind her of a different time and of different techniques used to manipulate which candidates got elected.

17:44I'm old enough, and I have relatives who are old enough. My aunt was a registrar of voters in Mississippi in the late 1960s, and she used to tell these stories about how you had to count the number of jelly beans in a jar to pass a voting test. And there are stories upon stories in the South, and especially in the Black Belt, Mississippi, Alabama, Louisiana. and you know Alabama and Louisiana now are two of the states where they're in contention about the lines. We end up in a situation where Black influence is diluted. We have fewer African-American members of Congress, but you also have fewer or less access to resources, and that's the economic part of it.

18:32Congressman Don Beyer shared that concern. If I look from South Carolina, Georgia, Alabama, Mississippi, Louisiana, Every single Democrat is a black Democrat in a seat carved out for voting rights. When they throw it out, it's not hard to imagine four years from now that there won't be a single African-American from South Carolina all the way over to Louisiana in a place that has 30 or 40 percent black population. When the Supreme Court said it's OK to redistrict based on political party, on ideology, it's going to be, sadly, we could go right back to the 1950s and earlier, where there just was no Blacker representation.

19:14But that's not a given. Greg at Bloomberg Government says as challenges to some of these new maps work their way through the courts and as voters head to the polls, there still may be some surprises in store. One thing I'm going to be watching for is, you know, to what extent do Democrats and Republicans realize their targeted gains under these maps? In Texas, Republicans aren't guaranteed to win all five of the seats they target because they have to unseat, you know, veteran Democratic incumbents. And some of the districts I think that were drawn made certain assumptions about how the electorate might act in 2026, say, similar to 2024.

19:50for maybe Hispanic voters don't continue trending Republican like they used to. And in California, where Democrats had targeted five seats, you know, I think, you know, three of them are very likely to flip, but a couple of them are gonna be a little bit harder. One of them involves unseating a Republican incumbent with some crossover appeal. So that's another thing I'll be watching is, are there any unexpected consequences to some of these maps? Do they backfire? Do the parties actually realize the gains they set out months ago?

20:24This is The Big Take from Bloomberg News. I'm Stacey Vanek-Smith, in for David Gura and Sarah Holder. To get more from The Big Take and unlimited access to all of Bloomberg.com, subscribe today at Bloomberg.com slash podcast offer. If you'd like this episode, make sure to follow and review The Big Take wherever you get your podcasts. It helps people find the show. Thank you for listening. We will be back tomorrow.

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