US Trade Policy after the 2026 Mid-Term Elections

Multiple domestic forces will almost certainly be working against Donald Trump’s erratic, unilateral trade policies after the mid-term elections. But any return to the global, neo-liberal, rules-based WTO order dominant before Trump came to power is unrealistic during his presidency. As the evolving global and domestic landscape comes into clearer view, however, there may be an opportunity for limited trade liberalization initiatives.

 

Public opinion in the United States has already turned against Trump’s tariff regime. A recent poll by ABC News found 64% of respondents said it had gone too far. A Council on Foreign Relations poll showed 83% blamed high tariffs for at least partially driving inflation, a major negative factor for Trump in the likely switch of control of at least one if not both chambers of the US Congress in November. The US business community, including the politically important agriculture sector, has also openly criticized the new high tariff regime.

A more fundamental problem for Trump’s Presidential unilateralism–in terms of both domestic law and international convention—approach to trade is that US courts have consistently ruled against the President’s seemingly unfiltered interpretation of law and precedent. The Supreme Court decisively ruled against reviving an obscure provision of US trade law, the International Emergency Economic Policy Act (IEEPA) to impose his broad and economically inconsistent tariffs in April 2025. When this use of a decades-old statute was invalidated, Trump reverted to another more recent law, section 122 of the Trade Act of 1974, designed to respond to national emergencies. The specialized US Court of International Trade lost no time in ruling against that justification as well.

The US Constitution clearly assigns authority over international commerce to the legislative branch of government.  The court decisions cited above are grounded in large part in this division of responsibility. They rejected Trump’s attempt to justify his actions based on an implied delegation of authority which had evolved over the last 100 years in favor of the executive branch.

Responding to both the negative economic impact of Trumpian trade policy and belated concern about the erosion of one of its primary responsibilities, Congress has begun to consider ways to claw back its constitutional authority over international trade. Election results will reinforce this trend, with likely Democratic Party gains in both chambers. Democrats have clearly signaled their intent to undermine Trump’s dominance of trade policy while reclaiming the prerogatives of the legislative branch. Enough Republicans are troubled by Trump’s unilateralism and concomitant loss of congressional authority to help form majorities to roll back his trade policies.

 

Read also: The Price of Access to the US market

 

In preparation for their improved, post-election political position, Democratic leaders have already surfaced ideas for reclaiming control over trade policy. The likely new chairman of the Senate Finance Committee, which has jurisdiction over trade, Ron Wyden, and the presumed Majority Leader, Charles Schumer, have introduced bills to invalidate Trump policies. Schumer’s bill would repeal several of the laws invoked by Trump, as well as the widely used Section 301 authority on “unfair trade practices,” to justify his trade actions.  Wyden’s proposed bill, as well as similar bills introduced in the House of Representatives, would repeal even more statutory authority deemed inconsistent with Congressional authority to shape trade policy, and require Congressional approval for all trade agreements.

Further reinforcing the will of Congress to reassert its trade authority, when Trump announced a recent deal with Vladimir Putin to buy Russian diesel fuel, a bipartisan group of 6 Democrat and 6 Republican Senators called for invalidating it because Congress had not approved a reversal of statutory sanctions on Russian fuel (based on 2022 legislation).

None of these proposed statutory limits on Presidential authority would receive enough support in any likely post-election scenario to survive a Trump veto, but they will contribute to the turn in broad public opinion and in expert and business circles against the President’s actions. They will help arrest any momentum in support of Trump’s approach if he should attempt to keep the overturned 2025-26 initiatives operational or even expand them. This is especially true given judicial actions that invalidated the main authorities the President invoked in the first half of his current term.

Notably, none of the proposals for new limits by Congress have included repeal of the 10 “reciprocal trade agreements” negotiated by the Trump team since 2025. Trump is certain to maintain his focus on “rebalancing” trade relations, and many of the reciprocal agreements enjoy bipartisan support in Congress.

US Trade Representative Jamieson Greer and Treasury Secretary Scott Bessent have also pursued other nominally trade opening arrangements such as renewal of the US-Mexico-Canada Agreement (USMCA) – concluded by the first Trump administration in 2020. This process maintains active engagement with Mexico. The Chairman of the Ways and Means Committee in the House of Representatives, Jason Smith from rural Nebraska, has opined that the renewal will be completed before Trump exits Washington, despite the determined, and probably counterproductive, resistance from Canadian Prime Minister Mark Carney. US officials have also signaled interest in a Free Trade Agreement with Brazil.

Of greater importance, the Trump team has clearly articulated its willingness to continue work to undermine the aggressive mercantilism of Xi Jinping’s China. In preparatory meetings ahead of the December G20 meeting which Trump will chair in Miami, Bessent and Greer worked on consensus to align opposition to the predatory Chinese economic policy grounded essentially in the dumping (selling at below production costs) of manufactured goods. Attention among market economies has been galvanized recently by the growing Chinese exports of electric vehicles and chemicals into Europe and South Asia. But this is only to add to traditional below-market priced exports of steel, solar panels and consumer electronics.

The so-called “Milwaukee Framework,” hammered out in this Midwestern manufacturing center by G20 sherpas last month, aims to address the long-festering problem of steel overcapacity, mainly in China, and the resulting need to dump the huge excess of supply in foreign markets worldwide. Bessent and his market-oriented counterparts in the G20 hope that this is the start of coalition building among nations willing to put limits on endemic Chinese overcapacity and dumping. Trump’s reciprocal trade agreements also aim to counter overcapacity and move toward more balanced goods trade with other partners.

It is unfortunate that Trump himself is a poor messenger for rebuilding a reciprocity-based trade regime. But if economic interests are the driver of international trade arrangements, then the advanced market-oriented economies of North America, Europe and East Asia ought to pursue opportunities for better cooperation such as those suggested by the examples of the new steel framework and efforts to build a critical minerals supply chain not dependent on China. Both European and East Asian economies are experiencing substantial impact from China’s “weak consumption, high investment” model which produces consistent and ever-growing overcapacity and huge trade imbalances.

 

Read also: How America’s trade war is Europe’s strategic problem

 

Additionally, given the state of domestic political and legal resistance to his untethered trade program unleashed in 2025, Trump himself will have to be more open to a turn toward coalitions of the willing to preserve a reciprocal and balanced trade system if he wants to pursue a more positive personal legacy over the remaining two years of his mandate than appears achievable toward the close of 2026.

 

 

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