US election triumph gives Trump a powerful mandate

What’s happened?

On November 5th the former Republican president, Donald Trump, won a decisive victory at the US presidential election. His Republican Party has also retaken control of the Senate (the upper house of Congress) and is well positioned to keep hold of the House of Representatives (the lower house), although the latter result will take time to finalise. This surprisingly strong performance gives Mr Trump a powerful mandate, making it more likely than we expected that the radical elements of his far-right populist agenda will actually become policy. 

Why does it matter?

Although we had long believed that Mr Trump had a strong chance of winning, the scale and rapid pace of his victory was surprising. Polls had suggested an extremely close race with the Democratic candidate, Kamala Harris, which led us to change our election forecast in mid-October from a Trump win to a toss-up; however, Mr Trump ultimately outperformed expectations. He is on course to win most (if not all) of the seven battleground states, marking a reversal of his weaker performance in the 2020 presidential election, which he lost. He also appears likely to win the popular vote, which no Republican presidential candidate has done since 2004. Meanwhile, Ms Harris did not manage to capitalise on the strong momentum that she enjoyed right after becoming the late-entry Democratic candidate or during the final days of the race. The issue of reproductive rights, which had high visibility owing to ballot initiatives across several states, also failed to galvanise turnout and generate strong results for Democrats, as had occurred in recent election cycles.

The strong congressional election results for Republicans will give Mr Trump substantial latitude to pursue his policy agenda. A Republican Senate majority, which we already expected, will enable him to confirm cabinet appointments and judges (including to the US Supreme Court) with few obstacles. A similar majority in the House, which we did not expect but now appears likely, will make it easier for him to advance and pass legislation in Congress, even on contentious issues like taxes and healthcare. Mr Trump could still face pushback from moderate Republican lawmakers who may choose to block his more radical proposals, alongside Democrats; however, we expect that Mr Trump’s strong election performance will discourage dissent within his party. The prospect of wide congressional majorities, which remains possible, as several competitive races are yet to be called, would further reduce the significance of any moderate opposition among Republicans, which has dwindled into a minority in recent years anyway.

What next?

The final election results will become clear in the coming days. Democrats could still take control of the House, depending on how vote counting goes, but we no longer consider this a likely scenario. We expect Mr Trump to take office on Inauguration Day on January 20th, and his decisive electoral victory will facilitate a smooth transfer of power. Republican control of Congress will allow Mr Trump to push US policy in a more far-right populist direction than we previously expected, including on tariffs and immigration restrictions. Risks to our medium-term US and global economic forecasts are now more heavily skewed to the downside.

The analysis featured in this article can be found in EIU’s Country Analysis service. This integrated solution provides unmatched global insights covering the political and economic outlook for nearly 200 countries, enabling organisations to identify prospective opportunities and potential risks.