Australia faces same issues that flipped control of US Congress in midterms, experts say
Anthony Albanese’s government has taken a blow due to Iran war but voter anxiety around cost of living and datacentres may hit harder Get our daily political email, free app or daily news podcast 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.…
Key points
- Analysts say US voter anger over living costs and datacentres carries warnings for Australia's government.
- Bruce Wolpe said the Albanese government is taking a hit from economic fallout of the Iran war.
- Former ambassador Arthur Sinodinos said the change on Capitol Hill lets Australia work with both US parties.
Analysts say the Democrats' midterm landslide in the US, which flipped control of Congress, offers warnings for Australia, where voter anxiety over living costs and datacentres could hit the Albanese government harder than the Iran war. Cabinet ministers, diplomats and Australia's defence industry watched the results closely, with the outlook for Donald Trump's final two years in office badly dinted.
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, and that the Albanese government was taking a hit from the economic fallout of the Iran war.
Economic fallout and oil prices
Westpac's head of international economics, Elliot Clarke, said the landslide had "dramatically changed" the outlook for the Iran war, which could affect Australia's economy. The Brent crude benchmark plunged by 20% as results filtered out, and Clarke said more confidence in a Middle East resolution would help curb inflation and help central banks hold back on rate hikes.
Coalition frontbencher Andrew Hastie told 2GB that the results showed economic messaging was critical, saying people feel worse off after tariffs and the Iran war.
The moment to reset the relationship with the Trump administration is right now
— Ed Husic
Alliance and datacentre concerns
Arthur Sinodinos, a former ambassador to Washington, said the change on Capitol Hill was a chance for Australian officials to progress policy goals with both US parties and to look beyond the 2028 presidential election. Abe Denmark, a partner at The Asia Group, warned against over-interpreting the results, saying power in Washington will be redistributed and Canberra must separate political positioning from durable policy.
Greens senator Sarah Hanson-Young said it was no coincidence that datacentre hotspots like Texas, Georgia and Ohio had shifted to the Democrats. Acting prime minister Richard Marles said the government was mindful of getting the social licence right for datacentres, including where they are built and their power and water needs.
