Republicans divided over pre-election stimulus push as economy slows

With roughly 10 weeks until the November midterms, Republican lawmakers are publicly feuding over whether to push emergency economic legislation. GDP growth slumped to an annualized 1.5% in the second quarter of 2026, down from 2.1% in Q1, while inflation continues to hover well above the Federal Reserve’s target. The numbers behind the nerves The Commerce Department’s August 26 revision confirmed the 1.5% GDP figure for Q2, offering no upward surprise to cling to. Consumer spending, which had grown at a 3.4% clip during the quarter, hit a wall in July. Adjusted for inflation, it flatlined entirely. The Personal Consumption Expenditures price index, the Fed’s preferred gauge, held at 3.7% year-over-year in July. Core PCE, which strips out food and energy, sat at 3.3%. Both figures remain above the 2% target. July marked the 65th consecutive month that PCE inflation has exceeded that goal. Monthly PCE ticked up 0.2% in July, slightly hotter than the 0.1% economists had penciled in. A party at war with itself A growing faction within the GOP has begun openly criticizing the Trump administration’s tariff regime, particularly trade actions targeting Canada and restrictions on beef impo...