Politics with Michelle Grattan: Joe Hockey on how Trump would handle defeat in the midterms

Ahead of next week’s midterm elections in the United States, the Trump administration is unpopular and the polls are bad. The Republicans are expected to lose control of the House of Representatives and could forfeit the Senate, as well.

Eyes everywhere are on these elections, not just for the outcome itself but especially for how President Donald Trump, whose unpredictability has shaken the world over the past two years, might react to the results.

Joe Hockey, who joins us on the podcast, is former Australian ambassador to Washington, and former treasurer in the Abbott government. He is now based in Washington with Bondi Partners, an advisory and investment firm he co-founded. He has been a close observer of both the first and second Trump administrations.

On present polling, Hockey says the Republicans are headed for a “shellacking” in the House, with a “very real chance” of losing the Senate, too.

In a non-compulsory voting system, there’s usually low turnout in midterm elections. In this election, “the Republicans are competing with the couch – people who just stay at home”.

Bearing in mind that people that want Donald Trump to remain president don’t have to vote. He’ll be president on the fourth of January after the new Congress takes its place.

So if they want to send him a message in this election, one way to do it would be simply not to turn up to vote, which is the biggest threat to the Republicans in this race.

In terms of the issues at play, Hockey says cost of living is number one, two and three. The high cost of diesel flows right through the economy. And, after the administration’s immigration crackdown, the disappearance of cheap labour provided by undocumented immigrants in certain parts of the country has meant “the cost of construction in particular [has gone up], but also the basics like cleaning and general services have gone up significantly”.

The second factor is that tariffs have had a big impact and they are certainly a hot button issue in some of the northern states, like Michigan and Wisconsin, where tariffs, particularly on Canada, have flowed right through to American households.

So there is a long distance between cost of living as the major issue in the US election and the next issue, which may well be Iran, but it also, again comes back to some of the other things like national security.

Hockey doesn’t believe Trump would be particularly perturbed to lose the House and even the Senate:

Because at the end of the day, I think he’s governing by executive order and he would have the view having the Republican control of the House and the Senate hasn’t really done him any particular favours.

Also, Hockey says, Trump is:

at his performative best when he has an enemy. And even though, of course, he wants the Republicans to hold the Senate and the House, [he] may well be empowered by having a hostile Congress for the next two years.

And that in turn may be of assistance to his potential successor because again, it creates a battle.

On the other hand, a hostile Congress would mean greater scrutiny, inquiries, subpoenas, adding up to “a massive distraction” for Trump:

Knowing Donald Trump, I think he’ll double down, […] increase his decision making and will be even more aggressive than he is at the moment.

Hockey predicts Trump will escalate the war against Iran after the midterms – but certainly not put American “boots on the ground”.

The one thing I can be sure of about Donald Trump is that he doesn’t want body bags coming back to the United States under any circumstances.

So he will continue to use a python squeeze on the Iranian economy, combined with probably a significant missile launch on Iran probably after the midterms to try and bring the war to an end.

But that’s not going to change the price of diesel before the beginning of November.