Six-Chart Sunday – The Big Six for ‘26

6 Infographics + 1 Video (Scott Jennings' "A Revolution of Common Sense")

Welcome to the 2^nd quarter of the 21^st century. If you were expecting a calm and predictable year in politics & policy, you’ve come to the wrong place. 2026 is a six-ring circus, so buckle up. Here’s what we’re watching:

1. Congress

2. Trump Administration

3. The economy

4. Trade wars

5. Geopolitics

6. Midterm elections

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1. CONGRESS — A little less conversation, a little more action

With an energized executive eager to act unilaterally and the third-smallest House majority since at least the Civil War, the 119^th Congress struggled to pass laws – the second fewest enacted in over a century & the longest government shutdown in history. (To be fair, while the numbers were small, the policies were big — permanent tax cuts, massive changes to Medicare, new outbound investment limits, Laken Riley, GENIUS, fentanyl). Expect greater output this year including:

• Funding government: Congress needs to pass FY26 appropriations (or a CR) by January 31 or the government shuts down again. Immediately thereafter, they’ll have just seven months to do it all again for FY27.

• Health care: Covid-era enhanced Affordable Care Act subsidies used by more than 20 million people expired 12/31/25, leading to significantly-higher health insurance costs absent renewal in 2026.

• Energy: The AI revolution is powering massive investments in data centers that demand big increases in electricity, with permitting reform legislation crucial to enable needed investments.

• Technology: The power of AI models is increasing exponentially with no federal guidelines to mitigate risk or ensure U.S. global leadership. States and foreign countries are moving to dominate and regulate, putting pressure on Congress to act. Congress is also aiming to legislate a crypto market structure bill & kids online safety legislation.

• Other deadlines: The Farm bill, Surface Transportation bill & Foreign Intelligence Surveillance Act Sec. 702 each expire absent re-authorization.

2. TRUMP 2.0 — Energized, flexible & fighting

The Trump 2.0 operating system breaks norms & confounds critics (see Decoding Trump 2.0). In 2026, the T2.0 playbook calls for:

• Continuing what is working and popular with the base (e.g. closed borders; deportations; battling crime in blue cities; investment demands on countries & companies; lawfare vs political opponents; patriotic celebrations at the winter Olympics in Italy, America’s 250th birthday, World Cup festivities in the U.S. & NASA Artemis II mission).

• Accelerating actions critical to economic or political outcomes (faster deregulation; turning FDI promises into actual spending; re-imagining defense priorities & investment; fundraising, campaigning & maybe changing voting rules to win midterm elections).

• Re-calibrating policies around China (more deals, less decoupling); foreign affairs (Russia, India, Americas); deficit reduction (DOGE 2.0; impoundments / rescissions); and affordability (reducing pricing pressures by cutting deals and/or delaying tariffs, & attacking companies that raise prices).

3. ECONOMY — Headwinds or Tailwinds?

The 20’s are roaring, again. “Even with the Covid Crash in 2020 and the bear market in 2022, the S&P 500 is up more than 200% in total since the start of 2019, good enough for annual returns of nearly 18% per year.” (Ben Carson). Every investment bank is currently predicting another year of S&P 500 gains in 2026. Policy makers are focused on:

• CapX Super Cycle: The already-epic AI hyperscaler arms race is set to accelerate in 2026. Trump deals with foreign nations & U.S. companies seeking government help or permissions may increase fiscal stimulus. Regulatory relief and potential permitting reform could accelerate energy investment. 2025’s OBBBA legislation is expected to boost real GDP by 0.6-0.9% in 2026 per the CBO. AI + FDI + Energy + OBBBA = Massive tailwind.

• Federal Reserve easing: President Trump’s pick for Fed Chair replaces Jay Powell mid-2026. Absent significant signs of inflation, expect more rate cuts goosing growth.

• Deal Boom: “Megadeals returned in full force in 2025. Wall Street is already bracing for another wave in 2026.” (WSJ) The main question is whether the “politics of prices” cause antitrust regulators to block more deals this year as consumers fret about “affordability” and midterms near.

• Jobscession?: Amidst the hopeful economic data one finds questions about U.S. employment weakness and whether we’re amidst a jobless boom. Some see anemic employment data and/or affordability politics as a reason to push a second reconciliation law, perhaps including stimulus checks, housing & energy support.

4. TRADE WARS — The battles of 2025 continue

• POTUS v SCOTUS (& Congress): The Supreme Court will soon decide whether the President can implement tariffs under IEEPA, and Congress may revisit efforts to limit Presidential flexibility on trade.

• US vs Canada & Mexico: The USMCA trade agreement is up for review in 2026.

• Tariff revenues vs Inflation: The threat of tariffs can lead to greater FDI and better market access for U.S. exporters, while the implementation of tariffs raises revenue but also increases consumer & manufacturer prices.

• China vs the rest of the world: Since the pandemic China has offset weaker domestic economics by flooding the world with subsidized exports and an artificially-low currency. Manufacturers outside of China are desperate to push back, but China has powerful retaliatory weapons & a readiness to punish critics.

5. GEOPOLITICS — A lot could go wrong. A lot could go right.

Recommended reading:

• Ian Bremmer’s Eurasia Group’s Top Risks 2026 report

• Hal Brands’ Bloomberg Opinion columns

• Niall Ferguson’s writing for the Free Press

• Robin Brooks’ Substack to understand the global economic angles

6. MIDTERM ELECTIONS — History doesn’t repeat, but it often rhymes

Midterm elections are almost always referendums on the party controlling the White House. The best predictor of House midterm outcomes is the President’s approval rating, which needs to be in the mid-60s to potentially not lose House seats (based on the past 20 midterms). President Trump’s job approval is presently 42%. The Senate, by contrast, is more influenced by which seats are up & candidate quality. Prediction markets currently give the GOP 2-out-of-3 odds to hold the Senate, with Dems 77% likely to capture the House. We’re watching candidate retirements (so far 45 from House & 11 from Senate), contested primary battles, fundraising totals and polls reflecting base voter enthusiasm.

SO WHAT? Even if the economy powers onward & markets continue upward, the policy, political & geopolitical environments will remain dynamic, volatile and biased toward action. We’re in an Age of Disruption. Successful organizations will work to understand real-time action, anticipate several moves ahead and strategically engage with leaders poised to impact outcomes.

VIDEO

CNN contributor / conservative political pundit Scott Jennings joined me for our last author discussion of 2025 to discuss his new book “A Revolution of Common Sense.”