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Analysis
Elon Musk in an America Party hat.
“Today, the America Party is formed to give you back your freedom,” he announced a day after President Donald Trump signed into law the One Big Beautiful Bill Act (OBBBA), the deficit-busting tax-and-spend package that Musk had blasted as a “disgusting abomination.” The megabill that broke the bromance will add an estimated $3-4 trillion to the deficit over the next decade thanks to large tax cuts for the wealthy and corporations, increased spending (especially for defense and homeland security), and higher debt interest payments, making what’s already an unsustainable fiscal situation much worse. If some of the law’s now-temporary provisions are eventually made permanent, as this bill did for the 2017 “temporary” tax cuts, the total cost could be as much as $6 trillion. “When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy,” Elon wrote on X.
What exactly does the America Party stand for? Details are scarce, but Musk says his goal is to disrupt the uniparty’s hold over American politics and reduce federal deficits (oh, and uncover the real Jeffrey Epstein story) – for real this time. Elon went all-in on support for Trump in 2024, who in return installed him to lead the Department of Government Efficiency’s efforts to slash government spending. Himself a disruptor of the uniparty, President Trump has broken with bipartisan consensus on immigration and foreign policy, tightening border enforcement and actually trying to end foreign wars (even if not very effectively). But Trump has governed like a card-carrying uniparty member when it comes to expanding the size and cost of government.
This grievance is the core driver behind Musk’s creation of the America Party. He was right to ask ‘what the heck was the point of DOGE’ once the OBBBA’s debt blowout was codified – although in fairness to Trump, DOGE did deliver less than $175 billion in “savings,” a rounding error in the overall federal budget and far short of the $2 trillion in “waste, fraud, and abuse” Musk had promised to cut initially. Even before the ink dried, the bill was polling deep underwater with the American people. But most voters hate the OBBBA not because it increases the deficit and debt, but despite it. By revealed preference, voters support politicians who spend on them and punish those who threaten their benefits or raise their taxes. It’s no wonder that the biggest wealth transfer from the working class to the top 1% in modern US history, which kicks more than 10 million Americans off Medicaid to make the rich richer, is so deeply unpopular. But fiscal discipline? That has had no real constituency in our spend-happy nation – and, accordingly, no home in either major party – for a very long time.
The America Party faces a product-market-fit problem that everyone but Elon seems to recognize. Most voters claim to be deficit hawks in the abstract – it sounds so serious and responsible! – but few support the broad-based tax increases and spending cuts on everything from entitlements and healthcare to defense, education, and border security that balancing the budget entails in real life.
If Elon wanted to create a party that represents the interests of “the 80%” of Americans “in the middle” and not just a fringe of too-online libertarians, its platform would have to consist of higher taxes on the wealthy and corporations, cheaper healthcare, childcare, energy, and housing, congressional term limits and lobbying reform, common-sense gun regulations, comprehensive immigration reform, and other such policies supported by bipartisan majorities. Some positions may be accommodated by one or the other major party, whether now or in the future. It’s even possible that there may exist a majority for an economically populist, socially moderate third party today. But there’s definitely no popular appetite for the kind of America Party that Elon has in mind.
So, does that mean that Elon is going to fail? Not necessarily ... but probably.
On the one hand, unlimited funds plus razor‑thin congressional majorities equal mischief potential. We’re talking about the wealthiest dude in the world perhaps being willing to throw a blank checkbook at America’s coin-operated political system. Musk poured nearly $300 million into GOP campaigns in 2024 and happily spent over $20 million on a single Wisconsin Supreme Court race earlier this year. And while he’s highly unlikely to be able to get America Party candidates elected to Congress, he may not need to. Musk could plausibly influence primaries, spoil close races, and force Republicans to tack (slightly) toward fiscal discipline. His stated goal of controlling “2 or 3 Senate seats and 8-10 House districts” by 2026 sounds modest until you remember that four Senate races and 11 House contests were decided by under two points in 2024. In a 50‑50 nation, margins that slim turn even a 2% spoiler vote into real leverage. And if he’s willing to burn, say, $250 million coaxing ten safe‑seat incumbent Republicans to switch jerseys, he could build himself a small blocking coalition in the House with veto power over key legislation before voters ever see the America Party on a ballot.
On the other hand, not even Musk’s eyewatering fortune is likely to be able to override the laws of political physics that have humbled every third‑party crusader before him. America’s deep-rooted two-party presidential system is designed to strangle third parties in their crib: first-past-the-post, winner-take-all elections herd voters into two big tents, and state ballot-access and federal campaign-finance laws pose formidable entry barriers even for someone with Musk’s resources. Worse still, there are fewer true independent voters than polls suggest: most Americans who dislike both major parties (and there are many of us) tend to hold their noses and often vote for one of them, fearing “wasting” their ballot. The few voters out there who actually affiliate with neither party and are open to voting for a third party don’t agree on much with one another – certainly not on an uncompromising commitment to austerity. Musk may soon discover that building a successful third-party bid in America, especially one centered around Making Fiscal Responsibility Great Again, is not rocket science … it’s harder.
Then there’s Elon himself – a wellspring of liabilities matched only by the depth of his pockets. There’s no denying that he’s a generationally talented entrepreneur and an incredibly hard worker, but the mercurial billionaire’s popularity trails even Trump’s, his attention span is legendarily short for ventures that aren’t core to making him money, and he has a history of not following through on his most outlandish and overconfident promises. Leading a political party will cost him a fortune, distract from his business activities and humanity-saving mission, end in failure and frustration, and otherwise make his life more difficult than it needs to be.
This is especially true if President Trump reacts as viciously against Musk’s betrayal as I expect him to. Should he decide that Musk’s America Party threatens not just MAGA’s political agenda but his personal spotlight, there’s no telling how far he’ll be willing to go to punish him – and to what extent he will be constrained by the rule of law in doing so. Based solely on what Trump has gotten away with doing to other people who have harmed him far less grievously, Musk’s federal contracts, tax subsidies, even his security clearance and US citizenship could be on the chopping block. That risk alone may deter Elon from sticking with this effort for very long, and would-be recruits (many already skeptical about Elon’s long-term commitment to the bit) from joining it.
Musk may yet scare a few vulnerable incumbents or win over the handful of principled libertarians like Rep. Thomas Massie (R-KY), but the structural logic of US politics still points to a binary choice in 2026 and 2028. If the history of US third parties is any guide, his latest moonshot will flame out faster than a Tesla battery. Even in the strongest-case scenario, the America Party is likely to end up looking more like a successful pressure group – something closer to the Tea Party, the Club for Growth, or the Sierra Club – than an electable third party.
Of course, the man who builds reusable rockets and is landing them on barges in the middle of the ocean thrives on low-probability bets. So keep an eye on the launchpad and enjoy the show. After all, even if the party fizzles, Musk is always sure to deliver the one thing Americans consistently reward: entertainment value.
Chancellor of the Exchequer Rachel Reeves (right) crying as Prime Minister Sir Keir Starmer speaks during Prime Minister’s Questions in the House of Commons, London, United Kingdom, on July 2, 2025.
A week is a long time in politics, so the expression goes. A year? Well that must feel like a lifetime – especially for UK Prime Minister Keir Starmer.
It was just over one year ago that Starmer took up residence at 10 Downing Street. With a 174-seat majority in parliament, and the opposition Conservatives in shambles after their worst election ever, the new Labour PM seemed ready to hit the ground running with a center-left agenda of better healthcare, lower immigration, and economic growth that benefits everyone.
He’s stumbled out of the starting blocks.
Just last week Starmer suffered a ringing defeat on a key agenda item, failing to pass welfare reforms that would have saved a mere £5.5 billion ($7.5 billion) by 2030 – just a small fraction of the overall government deficit. Members of the prime minister’s own party had objected to the cuts to disability benefits. To make matters worse, Starmer’s Chancellor of the Exchequer Rachel Reeves was seen crying in the House of Commons after the government had to gut key provisions of the legislation.
The debacle reflected larger problems for the prosecutor-turned-politician. Starmer has failed to revive the UK’s long-sputtering economy, struggled to make good on a promise to stop illegal migrant crossings by boat from mainland Europe (they are actually rising), and had little-to-no effect on long waits for National Health Service appointments and treatments. These issues have overshadowed the prime minister’s successes elsewhere, notably the trade deals with the US and India.
The result: the Labour Party is now polling at just 24%, and Starmer’s net approval rating is a crushing -40.
“I think of him more as a barrister than a politician,” Lord Gavin Barwell, who was former Prime Minister Theresa May’s chief of staff, told GZERO. “You deal with issues sequentially, like a barrister deals with one case at a time, [but then] you don’t have any kind of overall narrative about what the government is for.”
To be fair to Starmer, he inherited some of his troubles from his predecessors. The UK’s challenging fiscal situation and the turbulent international environment would be hard for any prime minister to address within a year. What’s more, while the Conservatives are in the wilderness, there is a resurgent opposition group in the form of Nigel Farage’s nativist Reform UK. It is now polling ahead of both Labour and the Tories, the two parties that have held a duopoly on power in the UK for nearly a century.
Even so, the prime minister has often been his own worst enemy. Polling data from the opinion-research firm Early Studies suggests the government’s priorities haven’t aligned with those of the voters, especially when it comes to cost of living – 15% of voters said it’s their top concern, making it the biggest singular issue of all, yet it attracts just 1% of parliamentary attention. What’s more, Starmer’s communication with Labour backbenchers has been lacking, so rebellions – like the one on the welfare bill – occur more frequently than they should.
“I've heard from a few Labour MPs that they've never spoken to him,” says Jon Nash, a fellow at the London-based think tank Demos. “It does feel like there’s a bad level of organization within the party.”
Ominous signs for centrists. Starmer’s struggles highlight a broader issue that centrist parties across the world face: they tend to work too methodically and timidly within a system that a growing number of voters think is broken, all-the-while focusing on short-term issues while glossing over longer-term ones. The Tony Blair Institute for Global Change conducts focus groups in most major Western democracies, and has found that the public’s frustrations are broad-based.
“There are these deep systemic trends where basically, voters and non-voters alike, just feel that around them is this pervasive sense of decline,” Ryan Wain, an executive director at TBI, told GZERO. “It’s mainstream politics’s job – I include the center-right in that, as well as the center left – to arrest and reverse that decline.”
And if centrist parties don’t reverse that decline, others are waiting in the wings to take their place, says Jon Nash of Demos.
“That inability to get anything done is what opens up the door to others coming along and saying, ‘Look, we’re going to do things differently. Vote for me, I’m a businessman,’ or, ‘vote for me, I’ll do something radical.’”
Demonstration of AI innovation at the AI for Good Summit in Geneva, Switzerland, on July 7, 2025.
Since ChatGPT burst onto the scene in late 2022, it’s been nearly impossible to attend a global conference — from Davos to Delhi — without encountering a slew of panels and keynote speeches on artificial intelligence. Will AI make our lives easier, or will it destroy humanity? Can it be a force for good? Can AI be regulated without stifling innovation?
At the ripe old age of eight, the AI for Good Summit is now a veteran voice in this rapidly-evolving dialogue. It kicks off today in Geneva, Switzerland, for what promises to be its most ambitious edition yet.
Launched in 2017 by the International Telecommunication Union (ITU), the gathering typically features conversations on AI safety, access, and governance, but also serves as a “show and tell” moment for innovators spotlighting the latest in robotics, autonomous vehicles, and AI-based tools to combat climate change.
This year, AI for Good is being held at the massive Palexpo, Geneva’s largest convention center, with thousands expected to attend over four days. GZERO is there all week for our Global Stage series, produced in partnership with Microsoft, to help you understand what this summit is and why it’s such a hot ticket (as far as international conferences go).
What is ITU, and why does it host AI for Good? The ITU, founded in 1865, is the UN’s agency for communication technologies. In fact, it was formed 160 years ago as the International Telegraph Union, just as that electronic correspondence method was changing how messages spread across the world. ITU is perhaps best known for establishing global telecom standards, but it’s been playing a growing role in helping more people access the Internet and all the benefits that can bring.
ITU launched “AI for Good” as a platform to connect technology developers and innovators with organizations working on the UN’s Sustainable Development Goals, which seek to bring more people into health and socioeconomic stability by eradicating key challenges like extreme poverty, hunger, and gender inequality.
“We’ve been very consistent and true to our original mission,” the ITU’s Frederic Werner, a summit co-founder, told GZERO. “It was identifying practical applications of AI to solve global challenges and to foster partnerships to make that happen for global impact.”
What happens this week? Expect lots of discussion about the future of jobs and how agentic AI – meaning AI that is autonomously self-improving – could impact companies and the workforce. Salesforce CEO Marc Benioff will address participants on that theme, and Black Eyed Peas frontman will.i.am, now an ITU ambassador, will speak about the importance of training and educating people to work effectively with AI.
Throughout the Palexpo, startup founders and established companies alike will be sharing their creations — like interactive robots and flying cars (more like drones that can carry people, but cool nonetheless). The summit also highlights AI youth initiatives and inventions from around the world.
There will also be a day devoted to policy and regulatory frameworks surrounding AI, a speech from Estonia’s President Alar Karis, and a presentation of suggested standards for AI encompassing everything from healthcare applications to the risks of AI-generated misinformation.
Why does the summit matter right now? For starters, the global “digital divide” remains vast. An estimated 2.6 billion people, a third of the world’s population, still lack Internet connectivity altogether. And nearly 150 years after Thomas Edison introduced the incandescent light bulb, 700 million people still don’t have the electricity to power one. Most are in the Global South.
As more and more industries adopt and deploy AI, the technology could contribute as much as $20 trillion to the global economy through 2030, driving as much as 3.5% of the world’s GDP by then. But the largest and most developed economies, primarily the US and China, stand to gain the most right now, while poorer countries fall further behind.
Conversations in Geneva this week are confronting that concern, calling for “cooperation” and greater global inclusion in the AI economy. In today’s deeply fragmented geopolitical reality, that may be much further in the distance than a self-flying passenger drone.
See GZERO’s complete interview with AI for Good co-founder Frederic Werner here.
Bavaria, Germany - June 6, 2025: PHOTOMONTAGE, Red cap with VOTE FOR ELON MUSK in front of US flag.
It started, as most of Elon Musk’s moves do, with a post on X. On July 5, the Tesla CEO and former adviser to US President Donald Trump announced the formation of the America Party, a new political movement meant to upend what he called “a one-party system, not a democracy.”
Why start a party? The two men have been feuding over the president’s “One Big Beautiful Bill,” which became law July 4. Musk slammed the package – which pairs tax cuts with massive spending hikes for defense and immigration enforcement – for adding trillions to the US debt. He now plans to defeat legislators who supported it, vowing that “They will lose their primary next year if it is the last thing I do on this Earth.”
Will voters bite? Musk posted a poll on X on July 4 – American Independence Day – asking whether voters wanted “independence” from the American two-party system: 65% of 1.2 million respondents answered “Yes.” A subsequent Quantus Insights poll found that 40% of voters are open to supporting his America Party, though just 14% are “very likely” to vote for it, with skepticism highest among Democrats and older voters.
Have third parties ever made a difference? Alternatives to the Republican-Democrat duopoly have periodically emerged. And while a third-party candidate has never won the White House, they’ve helped other candidates to do so. In 1912, Theodore Roosevelt’s breakaway Progressive Party won 27% of the popular vote, dividing the Republican base and handing the presidency to Democrat Woodrow Wilson. In 1992, billionaire Ross Perot’s independent candidacy captured nearly 19% of the vote and helped Democrat Bill Clinton defeat incumbent Republican President George H. W. Bush. In 2000, Ralph Nader’s campaign under the Green Party banner swung the election to George W. Bush by drawing Florida votes away from Democrat Al Gore. Most recently, Robert F. Kennedy Jr. ran as an independent in 2024 but dropped out to endorse Trump, later becoming his secretary of Health and Human Services. On Capitol Hill, meanwhile, no significant third party has ever emerged.
President or power broker? Musk isn’t aiming for the presidency himself (as a foreign-born American he isn’t eligible anyway). Rather, he says he wants to target two or three Senate seats and eight to ten House races to act as a swing bloc in a polarized Congress. He promises to champion fiscal discipline, deregulation, and centrism, positioning him as a potential spoiler for Trump in the 2026 midterms. But Musk’s personal brand is polarizing: a Morning Consult poll from late June showed his overall net favorability at -14, and an Economist-YouGov poll found that Musk’s net favorability dropped from -9 to -23 after his feud with Trump.
Can Musk really pull this off? Despite Musk’s deep pockets, money might not be enough: in April, his $20-million political push in Wisconsin failed to sway a key judicial race. Logistical barriers might prove even tougher. Starting a nationally-competitive third party requires navigating a maze of state-level signature thresholds and party-registration deadlines, as well as building campaign infrastructure and volunteer networks – his disruptive intentions aside, does Musk really have that level of patience for politics?
And what if Trump acts against him? Last week he threatened to strip him of citizenship, and Sunday night called his third-party effort “off the rails.” With stakes this high, this next chapter in the clash between the world’s richest man and the president could have huge implications.
Demonstrators with US and Ukrainian flags rally near the U.S. Capitol ahead of President Donald Trump’s address to a joint session of Congress in Washington, D.C., USA, on March 4, 2025.
Earlier this week, the US cut shipments of a number of weapons to Ukraine, including Patriot interceptor missiles, a critical part of Kyiv’s air defenses. Here’s a short guide to making sense of why that happened, and how it could affect the course of the Russia-Ukraine war.
What is a Patriot interceptor? It’s one of the world’s most advanced air defenses, able to shoot ballistic missiles out of the sky. The US-made system is sold to nearly 20 countries, and was first given to Ukraine in early 2023. The Patriot’s main theaters of action are Ukraine as well as in the Middle East, where it has protected US forces and Israel from ballistic missiles launched by Iran or Iran-aligned groups.
Why did the US stop sending them to Ukraine? Low stockpiles, evidently. Nearly two years of intense use in both Ukraine and the Middle East have crushed supplies of Patriot missiles, of which only about 500 are made annually, and drawn resources away from other critical weapons systems as well.
After the Trump administration bombed Iran’s nuclear facilities ten days ago, for example, American forces fired the largest salvo of Patriots “in history” to repel Tehran’s (well-telegraphed) retaliatory airstrikes on the US base in Qatar. That may have pushed supplies below critical levels, raising concerns about broader US weapons production capacity.
Still, this is a message to Ukraine, right? Even if concern about scarcity was the primary motivation, US President Donald Trump – who won the election in part on promises to cut aid for Ukraine and force both sides into a “deal” – has clearly hit Kyiv with the short end of the stick here.
It’s worth noting that the decision to cut the shipments to Ukraine reportedly came from Pentagon policy chief Elbridge Colby, a prominent China hawk who sees support for Ukraine as a distraction from challenging Beijing.
And that’s not the only China connection in this story. Amid a growing trade and technology war with Washington, Beijing recently banned the US-bound export of certain minerals that are essential in weapons manufacturing. Among them were gallium, antimony, and germanium, critical components of various weapons and ammunition systems, including the Patriot.
“To me, this is the most interesting untold story,” says Eurasia Group research director Marc Gustafson, a former national security intelligence chief, “mostly because the Pentagon cannot talk about it. China’s bans have been crushing for the US defense industry, particularly regarding the weapons the US has been providing to Ukraine and Israel.”
How badly will this decision hurt Ukraine? Kyiv called the announcement a “total shock.” At a moment when Russia has been launching its most ferocious – and increasingly indiscriminate – aerial assaults of the entire war, losing the Patriots will leave Ukraine’s cities and civilians vastly more exposed to the Kremlin’s missiles and drones.
But the move will have less effect on Kyiv’s primary goal of simply holding off Russia at the front lines, says Alex Brideau, Eurasia Group’s top Ukraine and Russia expert. “It’s not a back breaker,” he says. Still, if the Trump administration cuts to conventional ammunition last for any length of time, Ukraine could be in more serious trouble fast.
Zohran Mamdani was a long shot. But the 33-year-old democratic socialist state assemblyman flew past former New York Governor Andrew Cuomo’s name recognition and money advantage to win the Democratic primary for New York mayor last week.
On paper, the upset may seem like a parochial story of quirky turnout math and a uniquely flawed opponent in a city so blue it’d elect a Smurf. In reality, Mamdani’s victory is a canary in the coal mine, less for what it says about him and New York politics than the conditions that made his message land. Dismissing it as an intramural oddity misses the broader point: when voters believe the deck is stacked against them, they look for candidates who promise to reshuffle it.
First, a reality check: There’s no guarantee Mamdani will win in November. Only registered Democrats vote in primaries, and the general electorate is a different animal. Moreover, while New York is reliably blue, big outside money is lining up against him, so it remains plausible (even if not super likely) that he could lose to an independent candidate.
Nobody knows how Mamdani would govern if he wins, either. He could push the policies he ran on, some of which could create a crisis if enacted. In the worst-case scenario, they could result in capital flight, plummeting tax revenue, worsened public services, rising crime, and a host of other ills that would make the greatest city in the world slightly less great. (Though none of that would make me consider relocating my home and company HQ. Moose is up for anything.)
But Mamdani will also be a first-time executive constrained by Albany’s veto power and the tough realities and tradeoffs of city management. I wouldn’t be shocked if he governed more pragmatically than he campaigned. He’s already ditched some of his more controversial positions such as “defund the police,” and he’s shown a willingness to engage and evolve. He’s clearly a skilled and ambitious politician who wants to have a successful career in this business; to achieve this, he needs to be popular and win elections, and that means being seen as having done a decent job as mayor. If he does things that make New York’s tax base flee the city, crime go up, and public services fall apart, he will be seen as a failure. As Fiorello LaGuardia said, “There is no Democratic or Republican way to pick up garbage.”
Ultimately, though, how and what Mamdani does in the future is almost beside the point. Nothing will change the fact that he won the primary with an unabashedly far-left, economically populist, soak-the-rich message in the beating heart of global capitalism. New York is simultaneously one of the wealthiest and least affordable cities in America (and the world). Mamdani’s campaign was focused on slashing the cost of living and improving the quality of life for regular New Yorkers, promising a $30 minimum wage, free buses and childcare, city-owned grocery stores to slash food prices, rent controls on stabilized apartments, and higher taxes on the rich and corporations to pay for it all.
In the America I grew up in, this kind of platform would’ve been DOA, and Mamdani would’ve long been ostracized from polite society. The only political label that’s historically been more toxic than “socialist” is “communist.” Everyone knows that’s about as un-American as it gets, which is why Donald Trump calls anyone to his left a communist, from Mamdani to Barack Obama, Joe Biden, and Kamala Harris.
But here’s the thing: the slurs only carry weight if people still see the United States as capitalist. Increasingly, they don’t. The United States looks less like a free‑market meritocracy – the kind with equal opportunity, open competition, rags-to-riches possibility – and more like a pay‑to‑play kleptocracy where access and advantage are auctioned to the highest bidder.
When Mamdani said that “billionaires shouldn’t exist,” he wasn’t threatening to line them up at dawn, but rather just to tax them down to size – at least as long as the playing field looks as tilted as it presently does in the United States. A growing number of Americans, those for whom the American Dream is the stuff of history books and “socialism” gives more Sweden vibes than Cuba, are on board for that.
Socialists may still not be able to beat capitalists, but if voters conclude that America has devolved into a two-tier system that rewards proximity to power more than hard work, don’t be surprised when a Ugandan-born millennial socialist like Mamdani has a shot against oligarchs and kleptocrats.
This country’s last successful populist wave started with a Queens real-estate showman promising to blow up business as usual. Trump won the White House twice on the back of voters who believed that democracy was broken and the game had been rigged against average Americans by coastal elites and the “deep state.” He’s spent a decade blaming global trade and immigration for working‑class pain, to reasonable success. But when it comes to “draining the swamp,” Trump has done anything but. Instead, he has expanded the swamp – and I’m not just talking about the new Alligator Alcatraz he's so excited about. Now Republicans in Congress are ramming through the One Big Beautiful Bill, which is set to be the largest wealth transfer from the poor to the rich in modern US history and will burden future generations with trillions in additional debt. Talk about class warfare.
If you’re 25, saddled with student loans, priced out of housing, and watching Trump cut the social safety net you’re paying into to fund tax cuts for his billionaire friends and cronies, soaking the rich increasingly looks not just like common sense but like self-defense. It’s no wonder Mamdani’s message resonated.
And I suspect the demand for what he’s selling will only grow in the coming years. Advances in artificial intelligence threaten massive job losses among white-collar workers. The backlash this time around will be driven not by blue-collar, working-class men in the Rust Belt but by priced-out urban professionals with advanced degrees and politically active suburban moms whose over-educated, under-employed children won’t have the opportunities they thought they would. Trump’s protectionist, anti-immigrant crusade won’t win over that crowd. Establishment Democrats haven’t come up with a good answer yet, either.
This doesn’t necessarily mean Mamdani himself is about to become the left’s new Trump. The fact is Mamdani is everything Trump wished Obama could’ve been: actually born in Africa, actually a Muslim, and actually a (democratic) socialist. That may be a winning combo in Brooklyn coffee shops and parts of the Bronx; color me skeptical it plays out as well in swing districts across the country. But the policy lane Mamdani has staked out – call it “anti-kleptocratic economic populism” – is wide open for someone with more national appeal to speed through it.
CEOs should worry less about Mamdani and more about the energy he’s tapping into. Those who mistake lobbying spend for sound strategy will one day wake to find themselves the targets of bipartisan populist pitchforks. If companies don’t start embracing genuinely open competition and mainstream politics remain unable to fix the optics of a rigged game, voters will send outsiders to rewrite the rules for them.
US President Donald Trump speaks to reporters aboard Air Force One after departing early from the the G7 summit in Canada to return to Washington, D.C., on June 17, 2025.
When US President Donald Trump announced a swath of tariffs on virtually every US trading partner on April 2 – which he dubbed “Liberation Day” – most economists had the same warning: prices will rise. What’s more, Trump’s plan to deport millions of undocumented migrants and his adviser’s idea to weaken the US dollar would add to the buoyant pressure on prices.
Exactly three months on, those inflation distress calls appear to have been misplaced: the inflation rate was 2.4% in May, within touching distance of the Federal Reserve’s 2% target, and far below the rates seen in 2022 under former President Joe Biden – even with the dollar having its worst start to a year in over 50 years.
So why haven’t prices skyrocketed, as some economists warned?
First of all, not all the tariffs have even been imposed. When US treasury markets began to suffer following the announcement of “retaliatory tariffs,” Trump pulled back, pausing these extra taxes until July 9. What’s left of his new tariff policies are a 10% across-the-board levy – even these were briefly invalidated – a 55% rate on Chinese imports (down from 145%), and sectoral duties on goods like steel, aluminum, and auto parts. The US president has also allowed for a smattering of exemptions, most notably on smartphones and computers – those must have been a rotten Apple.
Secondly, businesses have made choices that have put a cap on price hikes.
Part of this is simply due to firms waiting for Trump to finalize his tariffs plans before they start passing on the higher costs to consumers, per University of Missouri economics professor Joseph Haslag.
“During the heyday of the negotiations, I don’t think anyone wanted to start raising prices until they knew what the final deal was going to look like,” he said.
Some of it is also thanks to forward planning. When Trump initially announced the tariffs, some firms stocked up on inputs before the duties came into effect. This has allowed them to hold prices as they continue to sell inventory that was purchased at pre-Liberation Day prices.
Finally, there are some economic factors that are putting downward pressure on prices, per Haslag. The economy is slowing, reducing demand and lowering inflation rates. What’s more, artificial intelligence may have already started helping firms to lower prices: it boosts worker and business productivity, allowing them to produce more in less time and at less cost.
Trump feels validated. The president will see the misguided warnings of high inflation as the latest example of the media and the “deep state” trying, and failing, to take him down – he lauded the low inflation rates during a May speech in Saudi Arabia. As such, he will feel that he has the green light to continue advancing other elements of his agenda, safe in the belief that any cautions from the “establishment” can be shot down as “fake news.”
Aren’t those “reciprocal tariffs” coming back though? Affirmative – they return just one week from now, and Trump’s plans are still up in the air. He has only negotiated one trade deal – with the United Kingdom – despite saying soon after “Liberation Day” that he had made 200. Treasury Secretary Scott Bessent hinted that there might be some flexibility on the timing, which would be in line with the president’s past actions.
“July 9 is not a drop-dead date on which tariffs are going to be implemented across the board,” said Haslag. “We’ve had other sorts of deadlines that have come and passed over the past few months with regards to tariffs.”
The chickens always come home to roost. For any political gains Trump may have made thanks to lower-than-expected inflation rates, this upcoming deadline for the reciprocals creates a major dilemma for Trump: either he “chickens out” again, as one columnist jokingly suggested, or he actually imposes these hefty duties. The Fourth of July celebrations this weekend may not be as expensive as once feared – will Americans be able to say the same for Labor Day, Thanksgiving, or even Christmas?