What the US midterm elections mean for the rest of the world

One Congress, two parties.
One Congress, two parties.
Image: Reuters/Kevin Lamarque
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If you thought America was politically divided before, just wait until January, when the newly elected members of the US Congress take their seats.

After the Nov. 6 midterms, the House of Representatives will be controlled by Democrats, including many new progressive, female politicians. They will be pitched against a comfortably Republican Senate, including some new senators who rode to victory on Trump’s MAGA rally coat-tails.

The House of Representatives is, in some ways, weaker than the Senate; it doesn’t have confirmation power for judges or cabinet appointments, and its members are only elected for two years, not six, giving them less time for policy between campaigns.

But the House Foreign Affairs Committee, the House Appropriations Committee, and the Homeland Security Committee all have a hand in how money is allocated and spent at the State Department and on US borders, and what issues the US government focuses on overseas. And representatives’ most feared power may be the House Investigations Committee’s ability to open new investigations into the Trump administration.

Here’s what to expect:

A weakened US president under constant investigation

The biggest winner in last night’s elections was “subpoena power,” jokes Edward Goldberg, a professor of global economics at New York University, referencing the House Intelligence Committee’s power to force the White House to turn over documents, and administration officials to submit to questioning.

The committee is expected to be headed by Adam Schiff, a sharp Trump critic who is promising to “restore the relationship between our committee and the intelligence community and law enforcement” by holding the administration responsible for ethics lapses and misdeeds. Democrats have already crafted a list of things they plan to investigate, including the president’s reported tax-dodging, his campaign’s ties with Russia, and his company’s payments from foreign governments.

A country leader who is under investigation by his own government could be viewed as much more vulnerable in international negotiations with his peers.

A continued tough line on China, but…

The divided Congress doesn’t have to mean total gridlock, and being tough on China is one area where Democrats and the Trump administration agree, at least ideologically. Traditionally, Democrats are “not fans of China on trade or human rights, potentially even more than” Republicans, said economist Chris Balding. Before Trump, some Democrats had been “beating the drum” about China’s intellectual property theft, unfair trading practices, and human rights offenses; now these concerns are becoming mainstream topics in US politics, he said.

Issues that could get new focus include China’s jailing of its Uighur Muslim population, and the continued erosion of citizens’ rights in Hong Kong.

…pressure to end to the China trade war

Republicans in Congress, normally bigger proponents of free trade, have been trying to tamp down the trade war Trump started with China. So far they have balked at passing bills that would stop the White House from adding tariffs, even though Congress is supposed to impose tariffs.

That could change. Although Senate Republicans gained seats from Democrats in states that voted for Trump in the election, a flood of Democrats unseated Republican hardliners in the midwest, in gubernatorial races and House races. It’s a sign that farmers there are suffering from Trump’s trade tariffs, Goldberg believes.

Soybean farmers and grain farmers have been “substantially hurt” by the tariffs, he said. They’re a “major issue” that’s going to hurt Republicans in the Senate in two years, and that future is reflected in last night’s race.

An immigration stalemate

One of Trump’s signature promises, the border wall with Mexico, seems to impossible now, because the House will need to approve any spending bill to fund it. “While doing a deal with the Dems on the border wall might be in his interest, I don’t know what the Democrats would get out of this,” said Seth Stodder, a former assistant secretary for Homeland Security. The new Democrats in the House are a progressive caucus, one that’s unlikely to want to horse trade with Trump, he said.

“There might be grounds for a deal on DACA, on some wall funding, or on agricultural visas or H1B visas,” Stodder said, but that would assume that the White House is willing to make more compromises than it has in the past.

Hope for the Paris Accord

Several climate science deniers were run out of the House last night; it’s a strong signal to the rest of Congress that Americans want leaders who will factually address the weather extremes happening around them. While Trump has pulled the US out of the voluntary Paris Accord early in his presidency, the move was largely symbolic— the US can’t practically pull out until after the 2020 election.

As Trump did with the NAFTA trade agreement, he could circle back around under pressure and declare the accord “fixed” after some tweaks and protracted talks.

A weaker dollar

The US dollar’s continued strength through 2018 has been backed by Trump’s tax cuts and deregulation, but a new Democratic check in Congress could put pressure on the currency, as Quartz’s Eshe Nelson writes.

Looking ahead, a Democrat-controlled House of Representatives is expected to thwart any major fiscal spending plans, such as more tax cuts, especially if those could help boost support for Donald Trump ahead of his 2020 presidential re-election bid.

A renewed focus on fiscal responsibility, cutting the deficit, and a reluctance to pass big spending plans that could help Trump in the 2020 presidential election could curb US government spending overall, putting pressure on US companies and global markets, as Quartz’s Gwynn Guilford writes.

The melting pot

The election results showed two very different facets of America. Some candidates who embraced Trump’s antagonistic approach toward minority opponents—and in some cases, even aligned with white nationalists—won key races. On the other hand, the House has a new crop of politicians who prove that some voters are embracing a melting pot of races and religions.

“The idea of American multicultural society… Wow, is it alive,” Goldberg said, citing the states that elected Muslim American, Native American and African American women. “The beauty of America showed up,” he said.