Before Trump launched his ill-considered Iran War, many of us thought that Democrats would take the House in the November midterms, but were unlikely to take the Senate. That still could prove true, but polls now show that Democrats have a solid chance of taking full control of Congress. If Democrats win Senate and House majorities on November 3 and are sworn in on January 3, they will be the dog that caught the car. Their big question will be: now what?
Three voices will compete to steer Congress: the 2028 left-versus-moderate campaign agenda, the strong urge to hold Trump accountable, and improving the affordability of everyday life in America. Agenda, accountability, and affordability all matter, but they have vastly different political consequences. To grow as a party, Democrats should prioritize affordability, then accountability, and worry least about their 2028 agenda.
Agenda 2028. After the midterms, many leading Democrats will immediately surface a manifesto for the 2028 presidential election. The left will claim that its leftism did the trick, and moderates will do the same. Manifestos will be everywhere. This is understandable. After all, Donald will be the lamest of ducks, and the 2028 presidential campaign will begin as soon as the midterms end. Building on midterm momentum will be top of mind for many Democratic leaders.
Many groups will compete for electoral attention. Advocates for climate, labor, AI, women, immigrants, housing, LGBT, education, energy, and civil rights policies will clamor to be heard. Their issues matter, as does the 2028 election, but not yet. First, Democrats need to focus on measures to improve everyday affordability and, to a lesser extent than they’d prefer, to increase executive accountability.
Accountability. Many Dems want redress, if not revenge. There will be massive pressure to hold Trump and his cronies accountable for their corruption, chaos, illegal orders, and other violations of their pledge to protect and defend the Constitution. Senators will salivate at the chance to haul Trump’s clown-car cabinet before Congress. They badly want to grill Pete Hegseth about his purge of high-quality military leaders, ammo shortages, and security leaks; Pam Bondi on her suppression of the Epstein files, weaponized prosecutions, and termination of DOJ ethics officials; RFK, Jr. for compromising CDC and FDA independence on behalf of an anti-vax agenda; Howard Lutnick for his shambolic tariff implementation and epic financial conflicts. The list is endless – as is the appetite to expose, humiliate, and possibly impeach the wrongdoers.
This work is important. But it matters less than showing working Americans that Democrats take their standard of living seriously. If Democrats want to earn the vote of everyday working families, they need to put their concerns first.
Affordability. Democrats should remember why working families went for Trump to start with: Dems had become a party of professionals that ignored inflation and a chaotic southern border. A Democratic Congress should focus on raising pay and reducing living costs, especially in health care, housing, and energy. In each area, legislators should begin long-term reforms while giving Americans immediate income increases or expense reductions. And Democrats should embrace immigration reform as part of this affordability agenda.
Trump will obviously be tempted to veto these bills. But a president who vetoes a series of measures designed to raise wages and benefits, reduce the cost of health care, housing, and energy, and address immigration intelligently will leave his successor with a great deal to answer for. By championing higher living standards, Democrats can make it very difficult for Republicans to claim to represent the interests of working-class voters.
Increase Incomes
Affordability is more than rising prices—it also includes stagnating wages. RAND found that if worker incomes had grown with the economy the way they did between the end of World War II and 1975, the median full-time worker would have earned between $92,000 and $102,000 per year in 2018. Instead, that worker earned about $50,000. If you apply RAND’s findings to today’s median full-time paycheck of about $65,000, a median worker would earn $120,000—$133,000 today.1
That’s not the only reason wage growth has slowed in the US, but in 1975 the private sector was 25% unionized. Today, it is less than 6%.
Democrats should push hard to correct this. In the long term, Congress should experiment with sectoral bargains backed by wage subsidies for low-wage industries. But Congress can do at least three things in the near term.
Index the minimum wage. We effectively have no federal minimum wage. It has been stuck at $7.25 since 2009, so that today it affects only 1% of all workers. Even a high minimum wage of $17 or $18 will erode the way $7.25 did. So set the federal minimum wage at 60% of each state’s full-time median wage. The range would run from about $18/hour in high-wage states like Massachusetts, Washington, and Alaska to $12 in lower-wage Mississippi, Arkansas, or West Virginia. Instead of setting a one-size-fits-all minimum wage, this approach respects regional differences. More importantly, it resets the wage floor each year.
If wage growth had kept up with the economy as it did before 1975, a median full-time worker would earn $ 120,000- $133,000 instead of $65,000 today.
Ban noncompete agreements. About 30 million workers are bound by noncompete clauses. Banning them would raise pay by almost $300 billion a year, according to the FTC (the Chamber of Commerce disputes the math). Oregon banned noncompetes for low-wage workers, raising their pay by 2% to 3%. It costs taxpayers nothing, and Trump’s own FTC chair calls noncompetes “pernicious.”
Make work pay. Start by expanding the Earned Income Tax Credit. Today, workers without kids only get about $600 in credit. The 2021 Biden budget temporarily tripled it. Reinstating a higher credit would cost roughly $140 billion over ten years. Democrats should also reverse Trump’s SNAP and Medicaid cuts and restore the 2021 Child Tax Credit, which cut child poverty to a record low of 5.2%. These are the most market-friendly, worker-friendly, anti-poverty measures we have.
Cheaper Health Care
Today, a family of four on an employer plan pays about $27,000 a year in health care insurance premiums. Workers pay for all of this: $6,850 as a co-share of the premium taken out of their paycheck, and the rest through wage increases they never see. Viewed this way, health care now accounts for a quarter of average household spending.
We plainly need health care reforms that reduce costs. We need to train more physicians, retool fee-for-service models, and restructure hospital markets. This requires years of policymaking, whether payors are private or public. Some of that work falls to state lawmakers, governors, attorneys general, and insurance commissioners. Medicare for All polls well, with 66% favoring a national plan, but it will take years to pass and may not address the underlying cost problems. Congress can cut costs now by restoring income-based premiums and targeting the biggest health care line items.
Limit hospital charges. Hospitals account for almost 40% of health spending, in part because they charge employer plans 254% of what they charge Medicare for the same services. The Urban Institute estimates that capping payments at 125% of Medicare rates in 2022 would have saved Medicare $107 billion. When Oregon tried it, outpatient prices fell by 25%. Congress should phase in a price ceiling indexed to Medicare reimbursement rates, knowing that private insurance will follow Medicare’s lead. Won’t hospitals fight it? Of course they will. Democrats should welcome the fight.
Require site-neutral payments. Medicare pays much more for an X-ray in a hospital clinic than for one you get in your doctor’s office. Same with dialysis. The government has begun closing this gap for drug administration and may do the same for imaging. The Congressional Budget Office says that simply making all payments site-neutral would save Medicare $157 billion over ten years. It would save commercial health care plans even more.
Restore the Obamacare premium subsidies. In 2025, Trump allowed enhanced health care credits to lapse to fund tax cuts for the wealthiest Americans. No surprise, average deductibles suddenly jumped 37%. Democrats should restore these credits and make more people eligible. It would cost $335 billion over ten years, assuming Democrats cap premiums at 8.5% of income to keep coverage affordable for middle-income workers.
Negotiate prices for more drugs. More than 80% of US adults want the federal government to negotiate lower drug prices. Today, the feds negotiate for only ten meds, although this number is scheduled to rise steadily.2 Democrats can and should expand this to hundreds of currently excluded medications, including GLP drugs, cancer and heart disease meds, and the specialty biologics used to treat autoimmune conditions. Lawmakers should also extend the $2,000 annual prescription spending cap and expand the $35 monthly insulin cap to all private employer plans. Doing this would reduce health care costs for 160 million Americans.3
Cheaper Housing
Households spend a third of their money on housing, though spending varies widely by region. Making housing affordable over the long term requires more construction, especially in blue cities. It can take time for Congress to create laws or incentives to reform zoning and permitting. In the short term, Congress should:
Create a large carrot to reward cities and states that reform zoning. The new budget offers cities a $200 million annual grant to reform zoning to permit more housing. That is a baby-cut carrot — far too small to matter. Congress should tie existing large transportation grants and HUD block grants to reward states and cities that eliminate single-family-only zoning, parking minimums, and barriers to accessory dwelling units. California now does something like this at a state level.
Ban algorithmic rent-fixing. Congress should pass the End Rent Fixing Act to outlaw software like RealPage or YieldStar that landlords use to fix prices. This not only protects renters, but it helps preserve starter homes for actual families.
Put builders back to work. We need to rebuild our building trades with a mix of training, continued wage increases, and smart immigration reform. 92% of construction firms report difficulty finding qualified talent. Even with wages averaging $40/hour, well above the private-sector average, the industry believes labor shortages cost it $11 billion annually.
Demographics are not helping. More than 20% of the construction workforce is over 55 and nearing retirement, while fewer than 3% of young people enter the building trades. Immigrants make up more than 25% of the construction workforce.
Cheaper Energy
US households spend about 11% of their income on energy. This is split roughly evenly between home energy and gasoline. The single biggest step Congress could take to reduce energy prices would be to open the Straight of Hormuz by ending Trump’s war on Iran. This will require distasteful concessions to a horrible regime, so Democrats will be deeply tempted to let Trump swing in the breeze on this issue. Electricity prices are the second front.
Congress can design electricity markets for affordability by requiring grid upgrades, ensuring that data centers reduce electric bills, and making it easy for consumers to invest in technologies that lower energy costs.
Make data centers pay their way. Twenty-three states have already approved large-load tariffs to help achieve this. Congress should require data centers to cover the complete incremental capital costs of new power generation, high-voltage transmission lines, and local distribution upgrades required to bring them online. Even if demand for data centers is overstated, many are coming, and local communities can and will demand labor and community agreements.4
Require utilities to upgrade. Replacing old cable with advanced conductors could save $85 billion by 2035. FERC already requires planners to consider it. Congress should make it mandatory before asking ratepayers to fund new lines.
Cap utility profits. Regulators grant monopoly utilities higher profits than private investors demand. In 2024, regulators authorized an average return on equity of 9.7%, but 34 major investment firms forecast an average long-term equity return of 6.7% for the broad US market. A UC Berkeley study estimates that consumers pay $7 billion a year to cover these excess costs. The Lowering Utility Bills Act would set returns at the low end of the allowed range nationwide.
Preserve incentives and rebates for households that want to invest in energy efficiency. The IRS offered investment and production tax credits that reduced the cost of generating new clean energy. It also offered consumers rebates for high-efficiency heat pumps, panel upgrades, and weatherization. This provides instant savings of $8,000-$14,000 for household energy retrofits that can cut monthly heating and cooling bills by 20-40%. Better yet, conservation and local generation place downward pressure on power prices.
Will Trump veto all of these initiatives if Democrats pass them? Let’s find out and give Democrats the chance to promise they'll sign these measures if elected in 2028.
Make Immigration an Affordability Policy
Democrats need to follow the successful leads of Bill Clinton and Barack Obama and embrace increased border security, workplace enforcement, and restricting public benefits for undocumented immigrants. They should also support skill-based immigration policies that help create high-quality jobs and raise incomes for everyday Americans. In other words, make immigration an affordability issue.
Enforce borders. Every nation needs secure borders. Without borders, no nation can reliably improve living conditions for its citizens. This requires enforcement not just by border agents, but by employers, banks, and government service offices like the DMV. And it requires that we deport those who arrive or remain here illegally. Clinton and Obama could say this without gloating or advocating cruelty. Every Democrat should do likewise.
Democrats should insist that nobody ever set foot in the United States illegally.
Legalize workers who are already here. Documented workers earn 19% to 22% more than undocumented workers with the same education and age. A Center for American Progress study also projects that increased legalization boosts wages slightly for other American workers. Congress needs to legislate a path to citizenship for those who have lived here for several years, paid taxes, and obeyed the law. These folks should pay a fine, demonstrate English proficiency, pass a citizenship test, and swear an oath of allegiance. Democrats should insist that nobody ever set foot in the United States illegally.
Bias immigration towards workers with skills we need. At the high end, technically skilled immigrants create higher-paying jobs for Americans already here. They are a positive-sum force in the economy, which is why we should staple a green card to diplomas earned by overseas PhD students. We should admit other immigrants when high wages alone don’t solve labor shortages. Some of these jobs are essential but less skilled, like farm work, home care, or child care. Others are skilled construction trades jobs. For example, immigrants fill about 28% of direct care jobs, even as the hourly wage for a home aide rose from $23 to $34 between 2019 and 2025. The Careworker Visa Act creates a visa for childcare and eldercare workers with wage standards and anti-retaliation protections. 5
The point is to admit immigrants based on what they contribute to American working life, as Canada does. Democrats should be clear: like citizens of every other country, Americans get to decide who we want to invite to live here based on who we think will contribute most.
A relentless focus on affordability will not come naturally to many Democrats. Many understandably want to focus on the White House and on pointing out that the current occupant is ethically, temperamentally, and cognitively unfit for the job.
But it is dangerous to confuse Trump’s crushing unpopularity with deep political support for the Democratic party. The Democratic brand remains deeply unpopular. It is so toxic that three red state candidates for Senate, Todd Achilles in Idaho, Brian Bengs in South Dakota, and Dan Osborn in Nebraska, are running without any party affiliation. Bill Hill is running for Congress from Alaska the same way. Even a majority of Democrats describe their party as “elitist”.
Many Dems sensibly want to use Congress to embarrass the president and tie his hands. But the single most important task of a Democratic Congress will be to show the American people that it understands their economic pain and is prepared to respond to it urgently. Doing this builds the credibility Democrats need to hold Trump accountable and defeat his successor in 2028.
ICYMI
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China’s economy is in trouble. In related news, its trade surpluses just hit a new record.
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Will “cockroach” protesters bring down Modi in India? Maybe.
RAND’s 2025 update found the bottom 90% of workers would have earned $3.9 trillion more in 2023 alone.
The top 50 physician-prescribed drugs account for 80% of Medicare Part D spending. This year, Medicare began bargaining prices for ten drugs. It will add 15 more drugs in 2027 and 2028 and up to 20 drugs each year thereafter, so if Medicare negotiates effectively, drug costs for many Americans should begin to come down soon.
Health care pricing is incredibly complex. The Medicare Claims Processing Manual is 40 chapters and thousands of pages long if anyone bothers to print it. Physical Coding Manuals contain tens of thousands of codes and thousands of more pages.
Naturally, health care providers have trained LLMs on these codes. As a result, health care costs are rising as AI agents become smarter at helping both public and private claimants maximize their Medicare revenue. At best, Medicare will build AIs that can help detect abuse. AI does not always reduce costs.
Tech companies are hedging their data center risk by requesting vastly more capacity than they can use. They have asked utilities for more than 1,000 GW of interconnection, but have financially committed to only about 28% of this. The rest is sometimes called “phantom load.” It is why the Uptime Institute says half of planned data centers won’t be built or will arrive late, and UC Berkeley’s Severin Borenstein says developers file duplicate requests across utilities with no plan to build them all.
Overall, the US needs more workers. Because the US population is aging and birth rates have fallen, more people now exit the workforce through retirement than enter as new workers, although churn remains enormous.