Goldman Sachs Previews U.S. Midterm Elections: Democrats Likely to Win House, Fiscal Policy, Tariffs, and AI Regulation Emerge as Core Battlegrounds

BlockBeats news, November 2 - Goldman Sachs released a US economic analysis report indicating that the probability of Democrats winning a majority in the House of Representatives has exceeded 90%, while control of the Senate remains uncertain. If Democrats take the House, fiscal deadlines such as the December 11 expiration of spending authorization and the 2027 debt ceiling will become major legislative battlegrounds. Goldman Sachs expects that Democrats may leverage government shutdown risks or mandatory events like the debt ceiling to extract policy concessions. Under a Democratic victory scenario, although major fiscal policy changes are unlikely over the next two years, spending may increase slightly, projected to raise 2027 spending by approximately 0.25% of GDP.

On tariffs, Goldman Sachs believes that although Democrats intend to selectively reduce tariffs, Trump will likely announce the results of the Section 301 investigation and impose new tariffs after the midterm elections, and their impact will outweigh the Democrats' selective reductions, potentially raising the US effective tariff rate by a net slightly less than 2 percentage points. In the AI and data center sector, attention to data center issues is expected to cool after the election, with a low probability of a nationwide construction moratorium; Congress's focus will shift to AI regulation, possibly reaching a moderate compromise that includes basic federal oversight and company self-testing. If Democrats win either chamber, investigations into large tech companies are expected, and stricter AI restriction bills may also be introduced at the state level.