Democrats may win Congress, but Thai tariffs won't just end

If Democrats win the US midterm elections on 3 November 2026, will Thai goods paying a 12.5% tariff get any relief, where will US stocks go, and how much power will Trump have left? These are the questions Thais who export to or invest in the US want answered.

Midterms are the elections for Congress held halfway through a president's term. Prediction markets, sites where people bet real money on outcomes, give Democrats a 71% chance of winning the Senate on Kalshi and 72% on Polymarket, and 93.3% and 95% for the House, WION reported on 2 November.

Alexis and Dean, an Instagram finance channel with about 756,000 followers, summed it up in a clip before election day: if Democrats win both chambers they control the budget, but Trump keeps his veto. That is mostly right, though some points need a closer look.

The Senate is not settled, and Democrats need 4 more seats

A 7 in 10 chance is not a certain win.

Put simply, if this election ran 10 times, market traders are guessing Democrats would win about seven and lose about three. Analysts are leaving room too. Cook Political Report estimated on 6 October that Democrats could gain two to six seats, and they need four. That number sits right in the middle of the range.

The contest turns on states where Republicans usually have the edge. These three show it most clearly.

• Texas: Democrat James Talarico faces Republican Ken Paxton, and Cook has rated the race a Toss Up, meaning too close to call, since 20 August
• Kansas: Cook moved Republican Roger Marshall against Democrat Adam Hamilton to Toss Up on 6 October, in a state where no Democrat has won a Senate election since 1932
• Nebraska: independent Dan Osborn faces Republican Pete Ricketts, with no Democrat on the ballot, and Osborn says he will not join either party. Sabato's Crystal Ball rated it as leaning Republican on 14 October

The last one matters, because even if Osborn wins, the seat does not automatically count for Democrats.

Democrats would hold the purse, but Trump keeps the veto pen

Picture Congress holding the purse and the president holding a pen.

The US Constitution says money can leave the Treasury only under a law, and bills to raise revenue must start in the House. With both chambers, Democrats could set more of the direction on the budget and on investigations of the government.

But every bill still has to get past Trump's pen. If he vetoes it, Congress needs two thirds of each chamber to override, which is hard. The American Presidency Project says Trump used the veto 10 times in his first term, with one overridden, and twice more this term up to 8 January 2026, with none overridden.

If Democrats win both chambers, Trump will face something he did not face in his first term. From 2019 to 2021 Democrats held the House, but the Senate stayed Republican. Alexis and Dean expect more investigations and oversight of Trump. That is the channel's view, and it has not happened yet.

The debt ceiling the channel mentions is not immediate either. The National Taxpayers Union estimated in August that the US would likely reach the limit around May 2027, and start running short of money to pay its bills around February 2028.

Thailand's 12.5% tariff comes from the executive, so the vote does not end it

This is the point that touches Thais most directly.

Most Thai goods entering the US have paid an extra 12.5% tariff since 24 July 2026 under the law known as Section 301. The Office of the US Trade Representative (USTR) announced it, saying Thailand has no ban on imports made with forced labour, as Tilleke & Gibbins explained. It comes on top of normal duties, but excludes certain goods already paying Section 232 tariffs.

So do tariffs simply stay in Trump's hands? That is half right. The Constitution gives the power to collect duties to Congress, and on 20 February 2026 the US Supreme Court struck down the tariffs Trump imposed under a law called IEEPA. The replacement tariffs under Section 122 then expired in July.

But Section 301 still works. That means if Congress wants this power back, it has to pass a new law, and Trump can veto that too. Winning the election alone does not make the 12.5% tariff go away.

The closer route for Thai exporters is the negotiating table. Transatlantic Law reported that Thailand has asked for a cut to 10% and more product exemptions. Suphajee Suthumpun, deputy prime minister and commerce minister, told The Nation in late September that the two sides had agreed in principle, with technical details still under review. As of the Tilleke & Gibbins report on 2 October, the rate was still 12.5%.

Past stock numbers look good, but they are not a promise

The record for stocks after midterms looks very strong.

Capital Group said the S&P 500 has returned an average of 15.4% in the year after a midterm election since 1950, and its chart shows no negative year. But SV News checked these numbers before and found that counting back before 1942, the index fell twice, and that 2026 starts near a record high.

On bonds, Alexis and Dean think the market may like the result, because new rules from Congress would meet a veto. That is the channel's view. FXStreet, citing Lombard Odier data, said Treasury yields have usually fallen in the months after a midterm, whoever won, but warned that this can reverse if investors worry about the government's finances.

For Thais, the real return also depends on the baht and on fund fees. SV News does not give investment advice. If you are making a decision about your own money, talk to a licensed adviser.

3 things to watch after the polls close

Thailand is 12 hours ahead of the US East Coast.

1. Wednesday morning, 4 November: the first polls close around 06:00 Thai time, Texas and Kansas around 08:00 to 09:00, and the last in Alaska around 13:00, based on each state's closing times
2. Do not rush to a conclusion: Kalshi warned that close races could take days or weeks. In 2022 the House majority took more than a week to call, and California counts mail ballots that arrive up to 10 November
3. 3 January 2027: the new members of Congress start their terms under the Constitution. Until then the current Congress keeps working

If you ship to the US, check now whether your goods fall under the 12.5% group or the Section 232 group, then follow news of the talks from the Commerce Ministry alongside the election results.

FAQ

If Democrats win, will Thailand's 12.5% tariff disappear?

Not automatically. It was issued by the US Trade Representative under Section 301. For Congress to change it, it would have to pass a new law, which Trump can veto. Talks between Thailand and the US are a separate route that could change the rate.

Where does the 71% chance come from?

It comes from Kalshi, as reported by WION on 2 November. It is the price people trade at in a prediction market, not a poll, and it can change at any time. On 22 October, Kalshi was at 67%.

When will the result be known?

Results start coming in on the morning of Wednesday 4 November, Thai time, but close races could take days or weeks, Kalshi warned.

Will US stocks rise after the election?

No one knows. Capital Group said the average has been a 15.4% gain in the year after a midterm since 1950, but that is past data, not a guarantee.

Sources

• WION: Prediction markets give Democrats 71% chance of Senate control, 95% for House
• Yahoo News: Cook Political Report moves Kansas Senate race to Toss Up
• The Daily News, USA TODAY Network: Texas Senate race is now a toss-up
• Newsweek: Pete Ricketts and the Nebraska Senate race
• US National Archives: The Constitution of the United States
• US National Archives: Amendments XI to XXVII
• The American Presidency Project: Presidential vetoes
• US House of Representatives: Party divisions
• Wikipedia: 116th United States Congress
• National Taxpayers Union: Projecting the debt limit
• Tilleke & Gibbins: Business impact of new US Section 301 tariffs on Thailand
• Holland & Knight: New Section 301 forced-labour tariffs imposed on 60 countries
• Transatlantic Law: Thailand, new 12.5% US Section 301 tariff takes effect
• The Nation: Thailand-US tariff talks reach in-principle deal
• Capital Group: Midterm elections and markets in 5 charts
• FXStreet: What the midterm elections mean for Treasury yields, the dollar and gold
• PollCheck: US midterms 2026 poll closing times
• Kalshi News: Midterm election results 2026
• Alexis and Dean: Midterms reel on Instagram
• Motion: Alexis and Dean creator profile