Tariffs, geopolitics and AI: what if Democrats win?
SPY•Investors are weighing how a Democratic sweep in the US midterm elections could affect trade, public finances, geopolitics and AI. Kairos strategist Alessandro Fugnoli expects practical constraints to limit dramatic changes.
1. Possible policy shifts
Fugnoli said a Democratic Congress could increase political friction in Washington and pressure for a harder line on Russia and China, making negotiations more complicated, though Congress would not determine foreign policy.
2. Limits on change
He said scrapping tariffs could leave a budget hole of more than $200 billion. A possible push for higher welfare spending and a higher minimum wage could increase the federal deficit by around two or three tenths of a point, he said.
3. AI and Congress
Fugnoli said hearings and investigations into AI were likely, but concrete action was unlikely because support for AI remained bipartisan at the federal level. He said data centers would get built, though there could be delays, and described the next two years as likely to be turbulent.
