WEEK 20

WEEK 20

What if Democrats win the House in 2026?

Suppose Democrats win the House in 2026. What would be the consequences? Obviously, I am just speculating. But since this eventuality is the grand hope of many, the question of what would change is important.

Democrats would control the legislative agenda, the bills that come up for consideration. They would have the power to end the investigations launched by the Republicans and to conduct their own, including Trump's enrichment, the ethics of Supreme Court justices, and the conduct of ICE. They would control important committees. These are the formal powers they would acquire.

Now, whatever bills they would pass would be dead on arrival in the Senate, unless Democrats win it as well, or would be vetoed by the President. A legislative stalemate would thus arise. But one law has to be adopted, namely, the budget for the next fiscal year. By this time, we will inherit a fiscal situation in which (1) several tax cuts will have been extended and/or made permanent, (2) several programs, most likely including medicare, food subsidies, and Pell grants will have been reduced in size or eliminated, (3) several government agencies will have been defunded, (4) fiscal deficit and the debt will nevertheless have increased. To restore anything or to reduce the deficit, Democrats would thus have to increase taxes. To restore programs and to reduce the deficit, they would have to raise taxes by a lot.

Given that Democrats would win only if some voters will have suffered from the reduction of government services and transfers, restoring them would be electorally popular. But increasing taxes never is. American attitudes towards taxes and spending seem utterly confused. Most survey respondents support funding social security, medicaid, education, infrastructure, and Veteran's benefits. Most survey respondents think taxes are too high, in addition to being confusing and unfair. I vaguely remember a survey experiment in which one half of respondents was asked first whether they support particular programs and only then whether they support raising taxes while the other half was asked first about taxes and only then about programs. The results were quite different.

In contrast to several Latin American presidential systems, the US does not have constitutional provisions specifying what happens if no budget is adopted by some date. Such situations are typically handled by "continuing resolutions," which extend the date of the current budget. If continuing resolutions are not passed, the government partially shuts down.

This is then the situation a Democratic majority in the House would face. I do not fully understand all the procedural complexities of the budget process but it looks to me that they would face the choice of either producing a budget that would be tolerable for Republicans or provoking a government shut down. Even if Democrats control the Senate, the predicament remains the same. Their electoral victory would infuse fear among Republicans still holding onto marginal seats and it would augur badly for the 2028 potential Republican presidential candidates, so that Trump's control over the party may be undermined. Some kind of a centrist compromise about the budget may be thus possible. But, given the size of the fiscal deficit, reaching it will be extremely difficult.

Beyond the budget, I see little Democrats could do. I do not see how they could limit the scope of presidential powers.

Political inequality

Here is a quote from an exceptional article by Timothy Noah, in The New Republic, June 19, 2025: "In a follow-up paper in 2014, Page and Seawright zeroed in on billionaires. Noting that previous studies showed political influence to be proportionate to wealth, they calculated, in a manner they admitted to be speculative, that each member of the Forbes 400 exerted 59,619 times as much political influence as the average member of the bottom 90 percent in income distribution." (newrepublic.com/article/196176/trump-billionaires-america-wealth-inequality?utm_source=newsletter&utm_medium=email&utm_campaign=tnr_daily):

Democracy is a political system in which all qualified citizens ("qualified" because of age thresholds and some quantitatively minor specific exclusions) have equal procedural rights to exert political influence. Citizens are all equal because they are anonymous; as citizens they have no qualities. They are not rich or poor, male or female, tall or short, White or Black. Whatever qualities they have, whatever traits locate them in society, are irrelevant for citizenship. But this means only that anonymity is a veil over inequalities that exist in any society. Citizens are formally equal because they are anonymous but are effectively unequal because of the traits they in fact have. I often find that there is little to add to the diagnosis made by Karl Max in 1844: "The state abolishes, in its own way, distinctions of birth, social rank, education, occupation, when it declares that birth, social rank, education, occupation, are non-political distinctions, when it proclaims, without regard to these distinctions, that every member of the nation is an equal participant in national sovereignty.... Nevertheless the state allows private property, education, occupation to act in their way -- i.e., as private property, as education, as occupation, and to exert the influence of their special nature."

Ways in which economic resources influence politics are innumerable and often obscure by design. Individuals or groups with higher incomes have larger influence over outcomes of elections, government policies, and their implementation by state agencies. Some technical issues in identifying such influence are daunting: We know that in the US candidates who have more money are more likely to win elections but we need to sort out whether they win because they receive more money or they receive more money because they are more likely to win. Yet the evidence from many countries, over different periods is overwhelming. In many countries people with lower incomes are less likely to vote. In all countries the elected representatives are wealthier and more educated than the electorates that vote for them. But this is only the visible part of the iceberg that includes buying access to politicians, buying policies, buying politicians.

Influence of money over politics is the curse of democracy. Some of its emerges because being able to act in politics requires some minimal material conditions and some people do not have them. J.S. Mill thought that "decent wages and universal reading" are the prerequisites for a government of public opinion. But most of it results from deliberate actions of interest groups competing for political influence with unequal resources.

I thought of political inequality because direct rule by oligarchs is historically unprecedented in democracies. Typically, governments in democracies obey the structural constraints imposed by the capitalist economy; they are to varying degrees legally open to the influence of money; and sometimes they are just corrupt. In a classical 1967 book, The State in a Capitalist Society, Ralph Miliband collected data showing that people occupying government posts tend to be richer than their constituents. But direct participation of the wealthiest people of a country in government is a novelty. In the US Senate used to be referred to as a "millionaires club." Now millions lost their symbolic significance but Trump's cabinet includes eight billionaires. They no longer need to lobby, buy access, buy influence: they are lobbied, already have access, already have the power to decide. And their plan is to effectuate a revolutionary transformation of the relations between the State and society: to free themselves from the burdens of taxation and regulation and to grab a larger share of income.

New York

The result of the Democratic primary in the New York mayoral election is a bombshell. A self-declared Socialist won in what someone has dubbed "The capital of capitalism." The big money that went to Cuomo, his support by the sleaziest leaders of the Democratic Party, the accusations of anti-Semitism all failed. Mamdani had ideas, Cuomo had only "experience," and having ideas triumphed. I am not claiming that Mamdani won because he had ideas, just observing that he offered some hope for the future while Cuomo offered none. New York City is not the Iowa or Georgia. But the New York City election made something glaring: the only ideas offered by Democrats come from its left wing. The rest of the party is just catatonic. Its leadership is patiently waiting for Trump to fail, generously granting them electoral victory while attending weddings of billionaries.

While both Schumer and Jeffries congratulated Mamdani on his campaign, neither endorsed him for the forthcoming second round. Are they waiting for Cuomo to decide if he runs as Independent? Would they be willing to support Adams against Mamdani? If they do, the Democratic Party will be irremediately split. Perhaps more: turnout among 18-24 nearly tripled in comparison to the 2021 primary and the young people who found some hope in Mamdani will abandon the Democrats for ever. Some of the upstate NY House Representatives were immediately vocal in condemning City voters for having voted for Mamdani. The lessons of history suggest that Democratic establishment may be right: perhaps saying and doing nothing is the best they can do electorally. But, as I repeatedly realize, these are unprecedented times and I think one of their unprecedented features is that everything goes. Trump would have been just an irrelevant politician under normal times. Yet he broke the dam: his use of language is responsible for broadening the spectrum of acceptable political positions, on the extreme Right but also on the Left. Trump already called Mamdani a "100% Communist lunatic." So now Communist lunatics are winning elections in the United States.

One way to think is to ask whether electoral successes of parties at an extreme end of a political spectrum signals that the entire spectrum moved in the same direction or does it announce that people are searching for any kind of a solution that has not been tried in the past. The evidence we have speaks in favor of the first answer: studies of European electoral manifestoes show that when the Right moved to the right, the center-Left parties followed. But these were the times when the distribution of voters preferences was unimodal and pretty much symmetric. To win elections, parties had to move in the direction in which centrist (technically, the median) voters moved. But now distributions of voters' preferences are bimodal and the center is thinning. With apologies to my professional colleagues who studied polarization with all the due care, I have a sweeping intuition about why in so many countries the political center is eroding. The analogy I tell myself is about a cancer patient who consults several doctors, all of whom inform him that there is little they could do, and then he encounters one who sells him snake oil with a promise that he would be cured. He has nothing to lose and, by prospect theory, all he wants is to avoid the losses, so he swallows it. For decades, people voted for the Center Right or the Center Left parties, parties alternated in office, and lives of ordinary people remained unchanged. The victories of Trump, Brazil's Jair Bolsonaro, and Argentina's Javier Milei show that when people are desperate, they are willing to grasp at straws, whatever they are. As a Rio de Janeiro Uber driver told a New York Times interviewer, "You see this decay, this moral crisis, these politicians who steal and don't do anything for us. I'm looking at voting for somebody completely new." When people have nothing to lose, they just want "change." If this is true, "Socialism" is as good a bet as MAGA. Mamdani's triumph, even if numerically miniscule at the country level, may be an opening for forward looking alternatives to the extreme Right. It offers young people some glimpse of hope. It may transform the resistance to Trump from protest into a vision of the future.

Supreme Court

The ruling of the Supreme Court that federal courts cannot issue universal injunctions evokes strongly mixed reactions in me. I had always thought that governing is not possible when any of the seven hundred or so federal judges can bring to a still actions of the executive and even the execution of well established laws. I remember having this reaction when some judge decided that the Consumer Protection Bureau that had functioned for 20 years was unconstitutionally established. Many federal justices are just political hacks. Still, when applied now to the Trump administration, this is clearly a partisan motivated ruling. Its effect will be devastating. The subject matter to which it was applied -- birthright citizenship -- is a separate issue. What matters is that whatever Trump decides is now the status quo unless and until the Supreme Court invalidates it. This was the last judicial barrier and is gone.