The Democrats have achieved majorities greater than expected in Congress and the Senate in the United States midterm elections. As our baseline scenario predicted, control of both chambers will change hands, but at the time of writing this report, the Democrats have secured 54 seats in the Senate and 225 in the House, and both numbers are likely to continue increasing.
A Democratic Congress will scrutinise the president's agenda more closely, but Trump has already indicated that he intends to resort to the presidential veto to curb any legislative attempts. It is likely that congressional investigations into the president's actions and those of his allies, as well as into the security of artificial intelligence, will take place.
The president will still have broad powers in foreign policy, including future decisions regarding the United States' actions in Iran. His frequent use of presidential decrees regarding immigration and trade policy also limits the likelihood of significant changes in these areas.
Nevertheless, the magnitude of the shift in trend in these elections could lead to increased ambitions of the Democrats in Congress. Legislation aimed at introducing greater federal oversight of artificial intelligence and the expansion of data centres, as well as measures intended to promote clean energy projects, is likely to be attempted. However, any legislation will probably require cooperation from both parties in the Senate and must avoid the presidential veto, which limits its chances of success.
More significant changes in the regulatory landscape for data centres may occur, which could include the elimination of tax deductions and less flexible zoning legislation, in light of the Democrats' sweeping victories in the gubernatorial elections, including those in Texas and Ohio.
The Democrats will take advantage of their majorities, which are larger than expected, in the House and Senate to push for the reversal of cuts to healthcare funding approved as part of the "One Big Beautiful Bill" (OBBBA) passed last year. The reversal of these cuts is likely a condition for additional defence spending to be approved. Consequently, we consider it probable that a modest fiscal relaxation will occur.
The magnitude of the outcome will also have repercussions on the 2028 primaries of both parties. Trump-backed candidates achieved overwhelming success in their primaries but have had significantly lower-than-expected results in key contests. This could foster a greater variety of candidates in the Republican primaries. The list of Democratic candidates, already expected to be broad, will likely encompass a wide ideological spectrum, given the successes of high-profile progressives and southern moderates in key contests.
But a key question remains unresolved: whether the midterm elections represent a transitional moment in American politics, driven by voter frustration with President Trump's political decisions, or if they are a test of whether the Democrats have expanded their electoral map.