The Democrats’ stunning midterm victory should broaden Australia’s alliance with the US, observers say, even as a new power base emerges in Washington, affecting Aukus, datacentre development and relations with China. Cabinet ministers, diplomats and Australia’s defence industrial sector closely watched the results this week, with control of the US Congress flipping to the Democrats and the outlook for Donald Trump’s final two years in office badly dinted. Public fury over rising living costs, particularly fuel prices, and the impact of datacentres, were also two factors in the midterms results that carry warnings for the Australian government, analysts said.
Bruce Wolpe, a senior fellow at the United States Studies Centre, said Trump’s ability to rile up voters had been undermined by cost of living. Wolpe said the Albanese government was taking a hit because of the economic fallout from the Iran war. But now, after going through a budget process and the war … people are just very uncertain as to where this is going to end up.
The Brent crude benchmark, which had threatened to pass its April peak, has instead plunged by 20%. More confidence in a potential resolution in the Middle East would also help curb inflation and help central banks hold back on rate hikes, according to Clarke. Coalition frontbencher Andrew Hastie said the results showed economic messaging was critical.
We’ve already had a lot of volatility in that regard.” “The Congress may put more pressure on the administration to support Ukraine and pass measures that involve funding munitions to Ukraine. Trump has made it clear in the past that they won’t do anything on his watch, and I think he would feel bound to act if they did.” Sinodinos praised prime minister Anthony Albanese’s professional approach to dealing with the often unconventional US president. Trump claimed that Republicans had fared poorly because he was not on the ballot, despite repeatedly urging voters to pretend he was on the ballot.
The vice-president, JD Vance, called Trump’s war in Iran “the obvious culprit”. Ed Husic, former industry minister, wants a radical shake up in the alliance. The challenge for Canberra, as with all allies and partners, will be to differentiate political positioning from durable policy.” Denmark said the Democrats could take a different view from Trump on Aukus spending, as the US submarine industrial base needs a dramatic step up in production.
He said a government funding deal and passage of a key defence spending bill were urgent priorities for Congress. Husic also flagged possible changes to the US’s approach to AI regulation, and a flow on effect as the Albanese government prepare major legislation for 2027. Vermont senator Bernie Sanders has already called for a moratorium on new construction, warning that voters wanted the environment and humanity itself protected.
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