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Bavaria, Germany - June 6, 2025: PHOTOMONTAGE, Red cap with VOTE FOR ELON MUSK in front of US flag.
Can Musk’s “America Party” curb Trump’s power in 2026?
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.
U.S. Senator Thom Tillis (R-NC) speaks to reporters between votes at the U.S. Capitol building in Washington, U.S., January 23, 2024.
What We’re Watching: Senate vote on Trump’s big bill, Thai PM in hot water, Japan's name-change game
Trump’s tax-and-spending bill faces razor-thin Senate vote
The US Senate will vote today on President Donald Trump’s “Big, Beautiful Bill”. The legislation would make many of Trump’s 2017 tax cuts permanent and would boost spending on the military and immigration enforcement, but its proposed cuts could also leave nearly 12 million people without health insurance by 2034. That, and a projected $3.3 trillion national debt increase over the next decade, has stoked opposition even within the Republican party. GOP Senators Rand Paul and Thom Tillis – who announced he won’t seek reelection – are already opposed, meaning Trump can afford only two more defections. Expect today to be a marathon of votes and revisions to the legislation.
Thailand’s PM in hot water over cross-border phone call
Thousands of protestors gathered in Bangkok yesterday, demanding the resignation of Prime Minister Paetongtarn Shinawatra over a leaked phone call in which she was heard obsequiously flattering Cambodia’s still-influential former leader Hun Sen. The call played poorly in the light of a recent border spat between the two countries. Paetongtarn defended the call as a negotiation tactic, but the streets say she’s compromising Thailand’s sovereignty. Thailand’s Constitutional Court will rule this week on a petition calling for her removal.
Japan’s name change game
A campaign is afoot in Japan to relax a law that effectively requires women to take their husband’s last names. Proponents of the change, which is supported by most Japanese, say it will increase gender equality, boost Japan’s alarmingly low birthrate, and avoid a situation in which, over time, everyone ends up with the most common last name: “Sato.” But the governing LDP’s hard-right wing is opposed, and with an upper house election in July, the party wants no trouble. For now, “Satos all the way down” looks like Japan’s destiny after all.
Elon Musk's political donations 2020-2024
The Graphic Truth: Elon Musk's political donations
During his public spat with Trump on social media, Tesla CEO Elon Musk claimed credit for the Republicans’ electoral victories last year, writing, “without me, Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate.”
While Musk has indicated that he will pare down his political spending, he certainly possesses the financial power to tip the scales in campaign financing – he was the GOP’s largest donor last year. Here’s a look at where Musk, who publicly converted from Democrat to Republican ahead of the 2024 election, has put his money in the last two electoral cycles.
German Chancellor Friedrich Merz welcomes Ukrainian President Volodymyr Zelenskyy with military honors at the chancellery in Berlin, Germany, on May 28, 2025.
What We’re Watching: German boost for Ukraine, Musk jabs Trump bill, & More
Merz promises long-range weapons for Ukraine
On Wednesday, German Chancellor Friedrich Merz promised Ukrainian President Volodymyr Zelensky that Berlin will help Kyiv produce long-range missiles that can strike deep inside Russia. It’s another sign that Europe has lost patience with Vladimir Putin’s reluctance to talk peace and a recognition that whatever happens on the battlefield this summer will shape the outcome of eventual talks.
Musk jabs Trump’s signature bill
The House-passed “Big Beautiful Bill” has one unhappy customer: Elon Musk, who said he’s “disappointed” by the tax-policy legislation. He argued that it “increases the budget deficit … and undermines the work that the [Department of Government Efficiency] team is doing.” It’s the heaviest criticism that Musk, who spent over $250 million to help US President Donald Trump win the 2024 presidential election, has directed toward the administration. We’re watching to see whether this is merely a blip in the Musk-Trump relationship, or whether the Tesla owner now splits with the Republican Party – and takes his dollars with him.
The world’s poorest owe China big money
“In 2025, the world’s poorest and most vulnerable countries will make record high debt repayments totaling $22 billion to China,” according to a report by the Lowy Institute, an Australian think tank. That’s mainly thanks to the Belt and Road Initiative. which has loaned more than 150 countries a total of more than $1 trillion since 2013 for infrastructure projects. The initiative risks becoming an albatross for both China and its debtors.
Finding America's most spineless
Who do all these abandoned spines belong to? You tell us... #PUPPETREGIME
Watch more of GZERO's award-winning PUPPET REGIME series!
Trump in front of a downward trending graph and economic indicators.
America is souring on Trumponomics. Trump may not care.
For someone who campaigned on lowering grocery prices on day one and rode widespread economic discontent to the White House, Donald Trump sure seems bent on pursuing policies that will increase that discontent.
If you don’t believe me, take it from the president himself, who refused to rule out a recession last Sunday and acknowledged that his sweeping tariff plans would cause “a little disturbance.” But, he added, “we are okay with that.”
Are we okay with that, though?
From Trump pump to Trump dump
Trump’s election victory unleashed “animal spirits” as many business leaders and investors hoped he’d follow through on his campaign promises to cut red tape and lower taxes while ignoring the more disruptive planks of his economic platform: tariff hikes and immigration restrictions. Surely much of it was posturing and bluffing, they thought, and Trump’s more extreme impulses would be checked by market-friendly advisers like Treasury Secretary Scott Bessent. In the worst-case scenario, they assumed Trump would course correct when confronted with sliding stock prices or signs of economic cracks.
Slowly but surely, they are starting to realize they got it wrong. Trump meant what he said and is less bound by constraints than during his first term. (I hate to say I told you so, but it wouldn’t have taken them so long to figure this out if they subscribed to this newsletter.)
The S&P500 has dropped by 8% over the last month (so far) as the president’s promised “golden age” of growth collided with the chaotic reality of Trumponomics. American equities are not only lower than they were before Trump’s inauguration but have erased all gains since he became the odds-on favorite to win the race in October. This represents the worst stock market performance in a president’s first 50 days since Barack Obama took office in the midst of the global financial crisis.
But it’s not just Wall Street that’s souring on Trump’s plans. Consumers, small businesses, and CEOs alike are all reporting sharp declines in confidence, largely due to record uncertainty about tariffs. Manufacturing activity is slowing, retail sales and construction spending are falling, and businesses of all kinds are paring back their investment plans as threats to the US outlook mount.
Inflation expectations are on the rise, with 60% of Americans believing Trump isn’t doing enough to bring down inflation and 68% fearing that his tariffs will lead to higher prices. Most Americans think the economy is on the wrong track and disapprove of the president’s handling of it. No wonder Trump’s net approval has taken a quick hit, his honeymoon ending faster than any other president’s save one: Trump 1.0.
It's the economic uncertainty, stupid
Businesses and investors have reason to worry.
In his first six weeks in office, Trump has made it clear that he is dead serious about building a “tariff wall” around America, not as a negotiating tool but to reshape global trade flows. The US effective tariff rate is set to rise to its highest level since the 1940s by the end of the year, raising prices for American consumers and businesses and slowing down growth. Trump has virtually closed the southern border and ramped up the pace of deportations, which will constrain the labor supply and lead to higher prices and lower growth. He has threatened to eliminate government subsidies, contracts, and grants that businesses, universities, and other organizations rely on. And he has empowered Elon Musk’s chaotic effort to purge, downsize, and capture the administrative state, threatening the delivery of critical public services, amplifying these macroeconomic shocks, and destroying US state capacity.
And yet, these first-order consequences of Trump’s policies are not the core reason why traders and boardrooms are freaking out about the outlook for the US economy. Don’t get me wrong, businesses prefer good policies to bad policies. But they can adapt to bad policies. You know what they can’t adapt to? Policies that can turn on a dime based on the president’s whims.
Maybe you agree with Trump that “trade wars are good and easy to win,” or perhaps you believe his policies will cause short-term pain but be worth it in the long run. But whatever you may think of the merits of his agenda, there’s no denying that the constant uncertainty he brings to the table is terrible for business.
Every business decision is a bet about the future. The one non-negotiable before making any investment is a bare minimum of predictability. When the rules of the game can change any day (and when they’re no longer applied impartially), the rational choice is to put off costly long-term investment plans – even if the possible payoffs are high.
That’s why the extreme policy arbitrariness, volatility, and uncertainty that characterizes Trump 2.0 – best exemplified by his on-again, off-again, on-again tariffs – is the ultimate economic dampener. Even if Trump walks back some tariffs or implements his pro-growth promises, uncertainty – by some metrics already higher than it was during the pandemic, the 2008 financial crisis, and 9/11 – will remain near all-time highs for the foreseeable future, discouraging investment, hiring, and consumption, and raising prices. Its chilling effect will compound the direct impact of the administration’s implemented tariffs, deportations, federal layoffs, and so on. As I warned in Eurasia Group’s Top Risks report, “in the long run this will risk undermining the predictability and performance of the world’s most dynamic economy, preeminent investment destination, and issuer of the global reserve currency.”
No more Trump put?
Trump seems to have no intention of backing off his plans or moderating his “move fast and break things” approach, even in the face of economic dislocation. “Markets are going to go up and they’re going to go down, but, you know what, we have to rebuild our country,” he said at the White House yesterday.
This contrasts sharply with his first term, when Trump considered the stock market a barometer of success. Back then, investors and business leaders knew they could count on the “Trump put” – the president’s tendency to curtail his most economically harmful policies when faced with financial turmoil. Now, Trump is openly saying he doesn’t care that investors believe his agenda could cause a recession and raise prices – because it might, and he’s convinced the sacrifice will be worth it for the greater good. “Will there be some pain?” he asked in February. “Maybe (and maybe not!) But we will make America great again, and it will all be worth the price that must be paid.”
So the Trump put either doesn’t exist anymore, or the threshold is significantly higher than it used to be. This makes sense when you consider the president doesn’t have to (read: can’t) run for reelection again. After being twice impeached, convicted, nearly assassinated, and taken for dead politically, the 78-year-old Trump is in a rush to cement his legacy before his “enemies” get another chance to take him down.
True, most presidents – even lame ducks – would consider avoiding a crippling economic meltdown, scoring a decent result in the midterms, and handing the reins to a same-party successor essential to a good legacy. But Trump is no ordinary president. He does not, for example, care much about the Republican Party (after all, he hasn't been a member for long). What he does care about is his own image. In that sense, he is still constrained by public opinion – or rather, his perception of it.
The key question is whether there’s anyone around him who can speak truth to power to a man who has famously little patience for being told he’s wrong. As I wrote in Eurasia Group’s Top Risks report:
Not only does the president-elect have unified government and consolidated control of the Republican Party, but he is building a more personally loyal and ideologically aligned administration than last time. His team will come into office ready to implement – rather than thwart – Trump’s agenda.
If his first 50 days are any indication, the US economy may be in for a lot more trouble until reality pierces his bubble … if it ever does. The beatings will continue until morale improves.
Speaker of the US House of Representatives Mike Johnson (Republican of Louisiana) speaks on the importance he sees in the Laken Riley Act.
Republicans’ beachside budget battles
House Republicans are snowbirding from Washington, DC, to Florida’s Miami area this week for their annual policy retreat where they have to figure out how to fund a laundry list of legislative promises before the 2026 midterms.
“The goal is going to be to try to forge a consensus among the Republican factions – with the complication that [Speaker Mike] Johnson basically can't lose any Republican votes,” says Eurasia Group’s US expert Noah Daponte-Smith. Both House and Senate Republicans will need to agree on an identical funding package for it to sidestep a Democratic filibuster and be passed with a simple Republican majority.
But before they can do that, House Republicans need to figure out what’s going to be in the budget and what will be cut, a process that is expected to deepen the divides within the GOP.
Right now, Donald Trump has laid out a list of priorities costing $10 trillion over 10 years. Some of these issues could go in a separate, harder-to-pass bipartisan funding bill that will be negotiated with Democrats over the next two months. The highest priorities for the reconciliation bill will be energy, border security, and tax policy.
What are the sticking points? The far-right Freedom Caucus is expected to demand deep spending cuts, especially with the necessary debt ceiling increase looming. But determining which mandatory and discretionary programs to slash is contentious. Policy-wise, legislators differ on whether to raise or eliminate state and local tax deductions – an issue that Daponte-Smith says blue-state Republicans could end up holding the funding bill hostage over.
Former President Donald Trump and Vice President Kamala Harris take part in a presidential debate hosted by ABC in Philadelphia, Penn., on Sept. 10, 2024, in a combination of photographs.
Trump takes Harris’ bait in heated presidential debate
Vice President Kamala Harris had two opponents in Tuesday night’s highly anticipated presidential debate: former President Donald Trump and high expectations. She performed well against both.
Harris successfully put Trump on the defensive throughout much of the debate, ripping into him on issues ranging from abortion and his criminal record to Jan. 6 and his refusal to accept the 2020 election results.
“Trump was fired by 81 million people," Harris said in reference to 2020. “Clearly, he is having a very difficult time processing that.”
Meanwhile, Trump used the debate to play his greatest hits, offering doom and gloom messaging about immigration, crime, and the “radical left.” The former president, for example, said that Harris wanted to see “transgender operations on illegal aliens that are in prison.” Trump also veered into the bizarre and conspiratorial, pushing baseless assertions about immigrants eating pets.
Harris seemed to anticipate this approach and laid into Trump for recycling talking points he’s leaned on for years. “It is important that we move forward – that we turn the page on this same old tired rhetoric,” Harris said.
She explained how military leaders had described Trump to her as a “disgrace.” And when Trump attacked President Joe Biden, Harris fired back, saying, “You're not running against Joe Biden. You are running against me.”
Throughout the debate, Trump struggled to stay on topic and rarely answered questions directly. When asked about the war in Gaza, he focused instead on Russia’s invasion of Ukraine – saying it never would’ve happened under his watch (Please note: There was also an ongoing war in eastern Ukraine involving Kremlin-backed rebels throughout his presidency).
Harris also got Trump to veer away from talking about immigration, an issue that’s been the former president’s bread and butter since his 2016 campaign, by suggesting that people leave his rallies early out of boredom. Trump took the bait, going on to boast that he has the “biggest” and “most incredible” rallies in response to a question about his role in killing a bipartisan bill to strengthen border security.
Trump repeatedly came off as unprepared. When asked about health care, he openly admitted he didn’t have a plan, other than wanting to replace Obamacare. “We are looking at different plans,” Trump said. “I have concepts of a plan.”
Though some of Harris’s responses came across as scripted, she largely stuck to one key message throughout the night — portraying herself as a new generation of leadership who would turn the page on a historically divisive era in US politics. That said, the debate often lacked specifics on policy — as both candidates traded barbs and sought to portray the other as a danger to the US. “You believe in things that the American people don't believe in,” Trump said to Harris in his closing remarks, decrying her as “the worst vice president in the history of our country.”
After the debate, Trump allies appeared unimpressed by what they saw from him — with Republican Sen. Lindsey Graham describing the night as a "missed opportunity" for the former president.
Whether Harris won over any new voters remains to be seen, but her campaign is clearly feeling energized by the vice president’s performance and has already signaled a desire to participate in a second debate with Trump. In comments to reporters in the spin room on the prospect of another debate, Trump said, “We’ll look at it, but they want a second debate because they lost.”
Ian Bremmer says that Harris won the debate. And Taylor Swift, who endorsed Harris after the debate, seemingly concurs with this assessment. Do you agree? We’d love to hear from you here.
Also, please join our X Space today on the debate. We’ll start at 11 a.m. EST. Set a reminder or join here.