The American mid-term elections took place during the first week of November 2018 and were keenly watched. Many have hoped that control by the Democratic Party of the House of Representatives and the Senate would have reigned in Trump’s “trade war” and other executive measures impacting on international relations. Since these elections take place in the middle of the presidential term, they are usually viewed as a popular verdict of the President’s performance. However, it is not unusual for the President’s party to lose seats during mid-term elections.

As expected, the Democrats took control of the House of Representatives, where they had been in the minority. The bulk of Democratic gains were in urban areas where voters, especially women, have become increasingly disillusioned with Trump’s divisive style of governing. The Republicans remain in charge of the Senate. The new term of Congress begins on January 3, 2019.

The United states now has a divided government, which will make it harder to govern and to implement some of Trump’s domestic policies, such as his anti-immigration measures. There will be increased oversight over the President’s actions and perhaps even budgetary controls, but he will still be able to make new appointments and take those measures where only Senate approval is required or where legislation allows executive action.

The US legislature has, under the separation of powers doctrine, an oversight function over the executive branch of government. The American Constitution gives, for example, the Senate the power to approve, by a two-thirds vote, international agreements negotiated by the executive. (The new US, Canada and Mexico trade agreement must still be ratified by the Senate before it will finally replace NAFTA.)

The Senate may also amend treaties or adopt changes to them. But the President may enter into executive agreements that are not subject to Senate approval. This includes trade measures for which the executive has been granted authority under previously adopted legislation. There are several laws on the statute book which allow the President to impose tariffs and trade related measures.[1]

The results of the US mid-term elections hold important implications for President Trump’s domestic goals, but it is unlikely that there will be substantive change to the trade and international policies of the United States. International trade was not a major issue during the mid-term election campaign. And both Democrats and Republicans are believed to favour a tougher stance with respect to Chinese trade and intellectual property practices. On this score the President may even enjoy bipartisan support.[2]

New tariffs on automobile imports into the US are said to be in the pipeline, which will impact on South African exports under AGOA. The Commerce Department has undertaken an investigation into the national security impact of automobile imports under section 232 of the 1962 Trade Expansion Act, the same provision used to justify steel and aluminium tariffs earlier this year.[3] President Trump has threatened a 25 percent tariff on imported automobiles.[4]

One consequence of the November elections is that the continued control by the Republican Party of the Senate will provide President Trump’s administration with legislative and constitutional protection. This scenario may only change if the economy of the US suffers significant setbacks and Trump’s policies are perceived as a liability for the Republican Party.

One immediate outcome of the mid-term elections is that rest of the world will still be faced by the consequences of “America first”. On issues where America’s allies have differences with the Trump administration (like climate change, Middle East peace, the WTO and Iran) it is difficult to foresee any major changes. China and Europe will have to design and implement their own responses against American measures which they consider to be unacceptable or illegal; or they will have to develop a modus vivendi with Washington. The global order has not become more stable because of the November American elections.

Those keen to see changes in American trade and international policies via domestic political developments, will have to wait for the next big event, when Donald Trump in 2020 campaigns for a second term as US President.[5] The mid-term elections of November 2018 suggest an emotionally charged campaign in an increasingly divided nation; which happens still to be the world’s major power.

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[1] Under the Trading With the Enemy Act of 1917, the President can impose a tariff during a time of war. The Trade Act of 1974 allows the President to implement a 15 percent tariff for 150 days. The International Emergency Economic Powers Act of 1977 allows tariffs during a national emergency. Section 232 of the Trade Expansion Act of 1962 gives the secretary of commerce the authority to investigate the impact of imports on the national security. The President may then adjust tariffs accordingly.

[2] https://www.cnbc.com/2018/11/07/midterm-elections-not-seen-impacting-us-china-trade-war.html

[3] See the tralac Working Paper by Eckart Naumann (2018), Trump’s steel and aluminium tariff action: Putting America first? available at https://www.tralac.org/publications/article/13008-trump-s-steel-and-aluminium-tariff-action-putting-america-first.html

[4] https://www.bloomberg.com/news/articles/2018-11-12/u-s-car-import-probe-advances-as-trump-plans-trade-team-meeting

[5] The next US president will take office on Wednesday, Jan. 20, 2021.