Once again America has been to the polls, and while the counting continues in some key races, the picture couldn’t be clearer. And it doesn’t make for great reading if you’re Donald Trump.
The Democrats have taken both the Senate and the House, which means that whilst Trump remains at the wheel, he now has some rather powerful (and seemingly aggressive) backseat drivers to contend with.
Over here in the UK, what can politicians learn from the results?
Cost of living politics
The Democrats’ crushing defeat back in 2024 showed that the party’s messaging needed a total rewire. It seems this time, albeit largely aided by an increasingly unpopular administration, they hit the right chord. The cost of living was the key.
Having continually labelled affordability as a hoax throughout his presidency, it appears that a defiant Trump had also underestimated quite how strongly the issue resonated with voters, especially those in his own base. This was best underpinned by damning exit polling by CBS, which found that two thirds of voters thought his signature tariff policies had damaged the US economy.
From a British perspective, a congress now keen to wind down the conflict in Iran might be a useful ally for a Prime Minister grappling his own cost of living crisis. But with local elections looming, Andy Burnham would be wise to look anxiously over his shoulder, especially after a budget which has been widely criticised for kicking tough decisions on spending down the road.
The market wobble
Despite worries from some analysts, the global markets initially greeted the results positively. The Dow had its best day of the year, as analysts banked on a divided Washington struggling to pass on big spending plans which could threaten the market.
However, as with most celebrations, a hangover promptly arrived the next morning. AI stocks led a sharp sell-off over fears of slower data-centre building, egged on by the election of Democratic Governor Gina Hinojosa in Texas, which was primed for significant data centre development. Anything with a whiff of the White House fared badly, as SpaceX and Tesla stocks took big hits.
For a UK economy already constrained, expect that certain ripples in the markets could be felt rather harshly.
You might want to think twice about that…
The UK-US relationship has been built upon a uniquely close historical bond. Despite Trump’s isolationist stance, the UK has managed to mostly strike a stable balance in its relationship with the US in recent years, (though maybe slightly less so since Burnham took the reins).
Regardless, these results will have an impact on party political dynamics in the UK as many consider their relationship to the now lame duck President. In the minds of UK voters, associating with Trump brings to mind one specific UK politician…
On the eve of the vote, Reform UK leader Nigel Farage rejected claims that Trump was going to be dealt a crushing loss. As we know, that didn’t exactly go to plan. He later backpedalled and criticised the President for breaking his promises regarding foreign wars. For a man who’s never quite known how to market his relationship with the controversial US President to his UK audience, this was certainly a lesson.
And spare a thought for the crypto bros…
House Democrats have said they will prioritise investigating the Trump family’s connections to the crypto industry as part of a wider effort to regulate the industry. Robert Garcia, who is set to chair the House Oversight Committee, even warned them to “lawyer up”. While the White House insists there are no conflicts of interest in the Trump family’s dealings, an unfriendly Congress armed with a thumping mandate might come to a different conclusion.
So, what’s next?
For Britain, the results of the midterm won’t be seismic, but they’ll be felt. Politicians and businesses that come out of this well will be the ones who’ve remembered that in Washington, as in Westminster, power always moves on eventually.
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