One big thing – Political predictions for 2026

Policy and Politics: Get ahead of a fast-moving political environment with this quick read on one big thing to watch in the month ahead coming out of Washington, DC.

The amount of news coming out of Washington, DC, over the past year surprised and, at times, overwhelmed longtime political pundits.

On his first day in office, President Trump signed more than two dozen executive orders (EOs); since then, he’s signed nearly 200 more on issues such as immigration, government reform, trade and foreign policy. That’s more EOs than President Biden signed during his entire four years in office, and nearly as many as Trump himself signed in his first full term from 2017 to 2021.

Congress also defied expectations. Republicans passed a major piece of tax legislation in time for an ambitious July 4 deadline. But things began to get more challenging in October when, failing to pass funding measures, Congress oversaw the longest government shutdown in history, clocking in at 43 days.  

In this environment, it is challenging to make accurate predictions; nevertheless, there are some indicators that point toward the following political trends for 2026 and beyond:

• Legislative progress will be slow and look even slower.
• Regulatory change will accelerate.
• The Supreme Court will be in the spotlight.
• The midterms are likely to result in a divided Congress – Democrats are well positioned to win the House, while Republicans are well positioned to retain the Senate.
• The fight for both parties’ leadership will begin to heat up.

Legislative progress will be slow and look even slower

It is often seen as politically imperative for Congress to tackle thorny, high-profile issues that make headlines. Party leadership and the White House also tend to force attention on major issues such as taxes and healthcare.

Yet these issues are harder for lawmakers to consider. In a deeply partisan district, a member of Congress may be primaried for compromising with the opposition party; whereas, in a purple district, they may face pushback in a general election for being too partisan.

For this reason, legislation to address high-profile issues such as expiring healthcare tax credits and possibly broader reforms hasn’t been and won’t be easy. Every member will have to weigh up the policy proposal and the politics they will face in an election year before casting their vote.

Then there are new policy issues such as crypto market structure and artificial intelligence (AI) regulation. Views on these newer technologies don’t tend to split along traditional party lines. And Congress often feels it’s important to make progress on these technologies as they proliferate society. Yet the Trump administration has also drawn attention to crypto policy, making it a political issue for some members. Clearly, there are competing pressures on newer technology legislation that make it more or less likely to pass out of this Congress.  

Finally, there are smaller bipartisan issues that Congress debates in committee and sometimes has a chance to pass into law. Work on these measures continues while high-profile debates rage on. 

Regulatory change will accelerate

Executive agencies, including financial services regulators, can start moving more quickly than Congress. With leadership at the Securities and Exchange Commission (SEC) and Department of Labor (DOL) now in place and having had time to settle in, their next slated release of regulatory priorities should give a reliable indication of near-term priorities.

Given the White House’s stated goal to become the "crypto capital of the world" and expand access to alternative investments, it is expected that the SEC and DOL will prioritize rulemaking to accomplish these goals. While newly proposed rules will start coming out in 2026, they will still be subject to a public comment period and then finalization, and this takes some time. In short, regulatory progress will be fast, but it will appear even faster than it is.

The Supreme Court will be in the spotlight

There are hundreds of legal challenges to Trump’s executive orders and actions. Several of these challenges have already been added to the docket at the Supreme Court, and undoubtedly more will be considered in 2026.

So far, the Supreme Court has agreed to hear a tariff-related case and two cases on the removal of federal employees, including a member of the Federal Reserve Board of Governors, Lisa Cook. Other cases that could reach the court include redistricting efforts, the Voting Rights Act, and immigration-related issues.

Yet the Supreme Court cannot and will not hear most cases. Both the decisions it makes and the cases it opts not to consider will be closely monitored for how they shape precedent.

The politics of the Court’s decisions will also matter. Republicans and Democrats will build messaging on the Court’s decisions to motivate their respective bases in the 2026 midterms.

The midterms will likely result in a divided Congress

In three of four elections since the end of WWII, the party in the minority has flipped a chamber in the midterm elections. In 2026, it seems most likely that Democrats will flip the House.

In the Senate, Democrats would need to flip four seats to take control. Given only one of the most competitive seats is in a state that Kamala Harris won in 2024, Susan Collins’ in Maine, that margin of victory seems unlikely. And Democrats must defend their own competitive seats, including in Georgia and in Michigan, states Trump carried in 2024.

The House is shaping up much better for Democrats, where they need to flip only three seats out of 435. This looked more challenging when the GOP began redistricting ahead of the midterms in places such as Texas and Missouri, but Democrats answered with their own efforts in California. In another positive sign for Democrats, moderate and very progressive candidates overperformed in "off-year" elections in 2025.

A year is a lifetime in politics, and anything can happen, but the odds right now have to be on Republicans holding the Senate and Democrats flipping the House.

The fight for both parties’ leadership will heat up

After the midterms, members of both parties will pore through the results to decipher what their party’s strategy should be in 2028. Ultimately, the direction they take will depend on whether they exceed or fail to meet expectations in 2026.

For Democrats, a poor performance in 2026 midterms may prompt the ousting of congressional leadership, particularly in the Senate. For Republicans, poor performance may cause more members, particularly in moderate or purple states, to distance themselves from the White House, taking positions that don’t conform to the President’s stated goals.

And, of course, we’ll begin to see who among national- and state-elected officials begins to opt out of answering whether or not they’re considering a 2028 run.

Of all the predictions in this article, one is almost certainly a truism. As soon as the midterm is over, the Presidential race begins.