Ground Truth | US midterms: What the blue wave means for business

Caspar Leighton: Welcome to Ground Truth, the podcast from Control Risks where strategic intelligence and security meet corporate strategy. I'm your host, Caspar Leighton. We're recording just a few days after a truly seismic midterm elections in the United States. The blue tsunami saw Democrats take control of the House of Representatives and the Senate, and Republicans lost almost everywhere, including places once thought unimaginable. 

This means that President Donald Trump's domestic agenda is going to be severely restrained for the remainder of his term, but importantly for international businesses, he does retain a lot of control over some pretty key policy areas, such as trade, national security, military operations and immigration policy. 

So, what does this mean for international corporations as they try to chart their way through the next 18 months, and also set sail for what the next administration might be in 2028? Well, I'm delighted to be joined by three members of Control Risks' new Advisory Council, which is a new body which brings together Control Risks experts, but also insiders from governments and industry to provide advice on strategic resilience, geopolitical resilience, to businesses across the world. 

In the studio with me is Control Risks CEO Bill Udell. Bill's been CEO now for four months, and you moved across from California with your family, who I'm sure are all thanking you immensely for the gift of a London winter. Then on the line from Washington, DC, we have Bob Scher, who is a senior advisor. Bob is co-founder of Sixth Street Associates, and until last year was VP and head of international affairs at BP Americas. And joining us from Dubai, the theater of the war, which many blame actually for the Republicans' defeat in the election, is Sorana Parvulescu, who is our global head of geopolitical and country risk. 

Thank you all so much for being here. Bob, I really want to turn to you first as a person who is sitting in the US. What's it been like for the past few days since this astonishing election? 

Bob Scher: Well, I think... look, it's caught everybody by surprise, to be clear. I think many people predicted that there would be a change in the House. I think many people thought there was a good chance of flipping the Senate, but I think only people who have 2020 hindsight looked at this blue tsunami, or this blue wave, coming in as much as it actually did. Look, the streets of Washington are relatively quiet because things are happening in the States. Everybody is in their respective places. But I think very quickly people are turning to, "Okay, what does this mean? What does this mean for policy? What does this mean for politics? What does this mean for the parties? What does this mean for the election of 2028?" And then there's a sinking recognition among the Democratic Party that it's got to figure out what it's for, not just what it's against. While the Republican Party has to figure out where its messaging leads it for the next two years. 

Caspar Leighton: And Bill, you've watched this election from abroad, the other side of the Atlantic, and in your travels around the world. How has it been for you?

Bill Udell: Yeah, I'm a US political junkie, so it's been quite strange to watch it from outside the US this time around. And as you said, I'm coming from California, and California was certainly never in play and was never in doubt for the Democrats. But I also spent a lot of time in Texas, went to school there. And to Bob's point, it was such a tsunami. The fact that Texas went blue is really stunning. And also, like Bob said, this was clearly a vote against Trump rather than a vote for the Democrats. The Democrats are still very unpopular. But yeah, to your point, it's been fascinating to see it this time around through the eyes of others. So during election season, I was in Riyadh, Abu Dhabi, Dubai, Tokyo, Singapore, Hong Kong, obviously here in the UK, and getting all of their views. 

The size of the victory is maybe not yet completely appreciated by the global community and the rest of the world. And certainly Western democracies see this as a victory for democracy and the rule of law. But on the practical side, I think companies are really just getting used to, over the last two years, dealing with Trump. And we're going to talk about this in a second, I know, but now they have to deal with Trump plus a massively emboldened Democratic Party. 

Caspar Leighton: And so obviously the US-Iran war is one of the key things cited at polling stations as to why Americans voted against the Republicans, against Trump in particular. Sorana, how's news of the election going down in your region? 

Sorana Parvulescu: Yeah, we don't have data, of course, but I bet that the top list of watchers for any US election might have been in Tehran this round, waiting to see which way things are going. Here in the Middle East in particular, there is a lot of nervousness, to be honest, around whether this could trigger another escalation between the US and Iran, and whether, in fact, the size of the blue wave would incentivize the president to go for a foreign policy action to move the conversation away from this. So this is really on the immediate scan of everyone in the region right now. And I'm sure, for all the players that have been affected by the conflict as well. 

I think there's been some talk of what Trump won't be able to do, but I think it's much more important, really, to focus on what Trump can still do. I want to go first on what Trump is going to try and achieve in the next 18 months. Do you want to take that, Bill?

Bill Udell: Yeah. I mean, Trump is obviously going to be locked out of a lot of domestic policy priorities, because with the Democrats having both the House and the Senate, and with big majorities, anything he's going to want to do, or anything that was on his legislative agenda, is obviously dead. So he's going to be pushed towards foreign policy, and he'll be wanting to really build his legacy over the next two years, the remaining two years that he has in office. 

I would not underestimate how much interest he genuinely has in vanity projects in Washington, DC. His first reactions were talking about these vanity, infrastructure and monument projects in Washington, the ballroom and things like that. So I think he is going to genuinely spend a lot of time on those. But on things that matter to companies and things that matter to the global community, he is absolutely going to really look at foreign policy. I think his messages in the first couple of days since the midterms have been quite contradictory. The blue wave is so enormous that it pushed him, in the very beginning, to say that he was going to work with Democrats. And then he, of course, kind of theatrically put the veto hat on, which contradicted what he said. I think there is a possibility that he actually does work with Democrats on things that are truly bipartisan: infrastructure, things that might bring down costs, and things that Democrats really care about around consumers. 

But it's quite hard to tell, because his messages have been kind of all over the place as he looks at legacy. Look, we can take some messages from the things that he focused on in the first two years. So the things that he can do unilaterally, without much support or say from Congress: things like regime change in Cuba. What can he do around the Panama Canal, Greenland? Maybe revisiting some of those things, but also potentially, he's meeting Xi and Putin soon, maybe some sort of a deal with China. There's a lot of things on the table in terms of what is now a foreign policy unleashed from ever having to be on the ballot again. 

Caspar Leighton: Right. And Sorana, with your hat of geopolitical and country risk, the global view, what's your list of things where we might see some Trump initiatives in the coming 18 months? 

Sorana Parvulescu: I mean, as Bill says, certainly we're looking at the foreign policy options that he has, and some of that legacy question of what he can put on the list as he draws the balance. But I would probably argue also that we have to keep in mind that it takes two to tango, and the perception and the policy objectives might have changed on the other side of the equation. So yes, certainly he will. I'm sure Cuba is an option, and a deal with China is an option. Maybe even North Korea is an option, certainly a deal with Iran, or a deal on Ukraine, probably with Putin, over Ukraine. 

But I think it's worth also thinking about how the objectives and the agenda of the other side are changing in light of the size of the win, of the blue wave, and the fact that we're now basically in the lame duck part of the presidency. That will change the calculations on the side of these foes and allies, if you want, and how they engage with the US, and what they are prepared to give away in these remaining two years of mandate, or keep aside for whatever they expect for the next mandate or next administration. 

Caspar Leighton: And Bob, what are your thoughts? 

Bob Scher: So I kind of divide it into a couple of different areas. One, we do want to look at domestic policy, and I think we need to look at regulatory policy and other pieces, especially for businesses. There are two parts that I see to that. One, I think states will be playing a bigger role than we may have thought in the past. And we're looking now at a lot of states that used to have very open, and continue to have very open, if you will, permitting issues, and that could change. I think the Democrats flipped three governorships and, fascinatingly, for the first time, and I wish I knew how long, a long time, there's a Democrat on the Texas Railroad Commission, which, as I think many people, certainly in the energy sector, know, is not just about railways, it's about oil and gas and permitting. That, I think, will be interesting to watch at the state level. 

I think it's also important to note that in addition to foreign policy, what the administration can do is regulations. And they've been very active on the regulatory agenda. And I think you're going to see that stepped up even more, especially because if you can't get regulations through until the end of the second year, or just before a new president, that can be changed very quickly by Congress. So the first thing I would say is that both international businesses and US businesses need to look at the regulatory environment, at the state and the federal level, to see what's going to continue on. 

Certainly from a foreign policy level, Trump has a broad swath and ability to do things. He's going to have to figure out some way to deal with Iran and figure out how he has his legacy there. I think he has an incredible interest. He has shown repeatedly that Russia is something that interests him from a business perspective and other pieces. I think that's something that he's going to want to deal with. I also think he's going to want to not do anything to upset his agreements with China and keep that kind of working. It will be interesting to see how it all plays out. It'll be interesting to see how the Congress decides it does or doesn't want to play in foreign policy, while it is focused on showing that it understood the message from the American voters of affordability, affordability and affordability, and what it's going to be doing on that, which obviously will also affect businesses. And we'll see how much Trump feels he has the ability to veto things that are scheduled and look exactly like what the Democratic Party focused their message about in the midterms. 

Caspar Leighton: Bill, how do you see that playing out on the domestic agenda? What do you think the Democrats are going to be able to do? 

Bill Udell: Yeah, I mean, I would strengthen Bob's point there. He's exactly right. Outside of the Iran war, which the Democrats tightly linked to prices, and obviously gas prices and the impact on consumers, which is what they rode the blue wave on, basically. I think the thing for international business to remember about the Democrats is that they came to power, exactly as Bob says, on domestic issues. I would not underestimate how little the American electorate really cares about foreign policy until it hurts, until it's something as acute as the direct link between the Iran war and the price of filling up. The price of filling up my car went up. 

And the Dems, if we look at their history, they are also not free traders. So it used to be the Republican Party was the free trade party, and the Democrats were the sort of protectionist party. So they obviously don't want a trade war with Canada. But I think it's important for international business, as it relates to the Democratic impact on US policy, on trade and things like that: they're not necessarily going to be a force for bringing us back to where we were ten years ago, and that's not going to be their priority. 

So on the domestic side, as Bob said, I think we really have to watch regulation. They very much came to power in this blue wave on an anti-data center, not-in-my-backyard kind of agenda. And it's hard to overstate how much, over the last two years, the regulatory infrastructure has really been gutted. So there's going to be a regulatory whiplash for sure. The other thing is investigations. The incoming chair of the House Oversight Committee tweeted out two words: "Lawyer up." 

Caspar Leighton: Yeah, I saw that immediately after the election. 

Bill Udell: And this is going to pull in companies and entire sectors. It's not just going to be about looking into Trump corruption. It's going to be about looking into companies and sectors that the Democrats feel are responsible for prices, for corporate greed, for all of these things that they feel they came to power in the House and the Senate on. And these business leaders are going to be pulled in front of Congress. They're going to be dragged through the mud reputationally, as the Democrats set their agenda and their narrative for 2028 and what they're going to run on. 

And obviously the Democrats have limited authority around foreign policy. There are a few things that they control. They obviously control the purse strings, so they could attach the end of the Iran war to future funding of the government. They could filibuster the funding bill that's coming up in December and push it until January, which would risk closing the government. There are a lot of things that they could do on the funding side. They also have some influence over deployment locations. So to Bob's point about Russia, if Trump wanted to pursue a Ukraine deal that was more favourable to Putin and, as part of that, Trump wanted to redeploy troops outside of Europe, Congress and the Senate would have something to say about that. They would have some control over that, which would be interesting. 

So we always talk about how there's limited influence that Congress and the Senate have on foreign policy, and that Trump has this free hand on foreign policy. With the size of the blue wave, there are some things they can do that would be meaningful. 

Caspar Leighton: So, Bob, what are Democrats going to do with their new power in Congress? 

Bob Scher: Well, that is a question that I think Democrats, that soon-to-be Speaker Jeffries and Leader Schumer, are thinking about right now. You get to enjoy the victory for about a day or two, and then you have to move on. And look, I think the first part of that question is, what does Congress do during what we call the lame duck session here, before the new Congress is seated? Congress has to deal with budget issues. I think it's December 11th that the continuing resolution runs out from the beginning of the fiscal year. They're going to have to do something. It's hard to imagine that there will not be some kind of an extension. The question becomes, is it an extension for a long term or a short term? I suspect the answer is going to be short term. It's not in anybody's interest to have a shutdown of the government coming up right before the Christmas holidays. 

Secondly, permitting reform is something that everybody continues to talk about and maybe can get done in the lame duck. You've recently seen where the Senate has passed a permitting reform bill. The administration wants to have permitting reform. It actually benefits both renewable energy as well as traditional oil and gas. It's very much focused on how you reduce costs to the American public and the consumer. So there's a lot of push behind it. But Jeffries has made the point that he needs to look at this a little bit more. So you will absolutely see a push for permitting reform to get done. Whether or not it'll be successful is hard to know, given how big the majorities are upcoming for the Democrats in the next year. So I think those are things to look for in the near term. 

There's been a lot of discussion, and we will continue to discuss all the things that Democrats are going to look for in the new term. Affordability is always going to be the case. It's going to be interesting to look at the investigations, I think. But I think the main piece for business to look at is that Jeffries will be able to lose over three dozen members of his own caucus before he has to worry about losing a vote. The size of the majority for the Democrats in the House gives a lot of flexibility for Leader Jeffries, and Speaker Jeffries upcoming, to be able to do whatever he wants to do across a range of issues and not have to be whipsawed by the extremes within the Democratic Party. So those are some things I want to look for, and I think businesses need to look for. But boy, it's going to be fun. 

Caspar Leighton: And Sorana, for the businesses you deal with across the world, how much recognition do you think there is of the momentous nature of this change, and are they ready for what they are going to have to deal with in the next 18 months, if they've got exposure to the US, investments in the US, if they're looking to expand there? 

Sorana Parvulescu: I mean, I'm sure the penny is just dropping, if you want. And maybe for now it's very much focused, depending on where you are, either on a sort of breath of relief. I'm thinking of Europeans. Canadians may be thinking, "Okay, so we're heading in a direction that would be more favorable to us one way or the other." Or if you're looking at the Gulf here or elsewhere, companies and governments which have been far closer to the Trump administration are probably watching with more worry, both around how this competition, or potential animosity, between Congress and the administration will play out, to Bill's point, maybe some of the investigations that they're triggering, but also some of the regulatory changes or legislative pushes, and maybe investment screening and so on, and how much of that will actually change. 

And then I think maybe understated, to go back to Bob's point, to some extent underestimated in our discussions with clients often, is that element about changes at the state level, and what sort of regulations we see changing at that level. There are very few, I find, as an outsider in the US, there are very few people who quite understand the federal system in the United States and how much leverage and how much leeway there is in state-level regulation, and how much that can count for the success of your business and long-term company value. And there's so much headline and so much talk about the administration and what happens in DC, but very little coming back to the fact that there are actually rules that can change whether we make money or not here. 

Caspar Leighton: Okay. So we've been talking a lot about what might happen. Now to the hard bit: what do companies do about it? Bill, you spend a lot of time traveling around the world meeting clients across the world. What do you think is the big learning for them in this situation? 

Bill Udell: Yeah, I think there's a real risk. And I'm going to piggyback off of some of Sorana's comments, because I think there's a real risk that they actually take the wrong lesson from this. They sort of think that things are going to go back to normal, and the Democrats are going to impose some kind of return to a traditional US policy, or traditional US, particularly foreign policy, agenda: Trump's tariff policy, those sorts of things. I think the lesson to learn is that normality is not immediately coming back, and that we're actually going into a more destabilized period. 

And that's largely because there is going to be this tension between the really emboldened Democratic Party, because of the size of the blue wave, trying to push their agenda domestically, in particular around regulation in the AI space, in the data center space, and then Trump trying to push his agenda in the foreign policy space. So in some ways, for international business, where they had gotten used to being able to deal with Trump, or navigate a completely Republican, or more like it, Trump, foreign policy, they're now going to have to deal with, and bring in Bob's point about, state-to-state regulation and state-to-state policy. 

They're going to almost have to have three strategies as it relates to dealing with the United States. One is for Trump: what is Trump going to do in foreign policy? The other one is: what are the Democrats in the House and the Senate going to do around federal-level regulation, and what can they influence, and what kind of constraints can they put on Trump? And then the third one is state-level regulatory and policy issues. And those three things can diverge very meaningfully, so the scenario planning that they have to do has to change. The level of intelligence gathering and the inputs that go into decision-making have to change. And the level of advice and networking that they do, via government affairs or networks that they have with the US government, those have to change, and they have to get much more granular than they were before. 

Caspar Leighton: Bob, imagine you're there in your capacity on our Advisory Council. Somebody else comes to you and says, "Bob, how do I handle the next 18 months? What's top of your list?" 

Bob Scher: Right. Look, I think the overall approach is, frankly, you should be handling the next 18 months the same way you should be handling political risk, geopolitical risk, all the time. But I think there are some specific pieces in that. Look, first of all, the administration has two years to pursue its agenda, and it's going to try to do so. It's unclear, I think, to everybody right now whether or not Trump and the people very close to Trump are worried too much about the Republican Party as it continues on after him, or who takes up his legacy, versus what they want to do now. And so I think there's no one right answer. I think there will be some people trying to pursue "How do we continue to support other parts of the Republican Party for 2028?" And some who will see this as "I only have these 18 months to do things, we have to run even faster and harder." I think Democrats now have considerably more power to challenge that agenda, and we will see what they choose to focus on. 

Bill's absolutely right: oversight is going to be key. And let's remember that the administration has the ability to stonewall oversight from Congress, whereas businesses probably shouldn't take that path. So Congress may focus even more on businesses than it might otherwise. I also think one of the things I would tell companies is, look, don't overreact to everything that happens in Congress. There's going to be a lot of motion, but not necessarily a lot of action, as a lot of these things will be messaging. It's not all preparation for 2028, but in fact a lot of it is going to be preparation for 2028. So understand what your exposure is, what parts of your business depend on federal policy, on international, on tariffs, on sanctions. Where are you on the state side? Where's your vulnerability to change in policy? And then, as we've said a lot, don't just look at Washington, look at the states. 

And then I think overall, as opposed to having one idea of what the point solution is, in many cases businesses looked and said, "We've got four years of Donald Trump. We need to go all the way in with Donald Trump and do whatever we can to make sure he and his administration don't go against us." And that's true, a lot of companies did that. I think a lot of those companies are now saying, "How can I think about being more broad in my approach to outreach?" But it all goes around developing scenarios rather than betting on a single political outcome. What happens if, depending on what the administration does, what Congress does? How do you think through that? You have to develop that resiliency as a company and as an approach. And I think this surprise tsunami, or wave, points that out even more. 

I'd also say companies need to be talking to policymakers, regulators, but also, frankly, the people in their communities. Some businesses do this very well. I think data centers are going to see a lot more outreach to people, a lot more outreach to the communities. It's not partisan. It's about understanding the direction of policy, making sure that businesses represent where they bring value to communities and what they need from stakeholders. Look, the companies that navigate this period most successfully are those that are really going to integrate both geopolitical and political risk into their business strategy, and not just treat this as something that the government relations teams have to deal with. 

Caspar Leighton: So what sectors can look to pull some wins from this situation? Bill? 

Bill Udell: Yeah. Well, slightly tongue-in-cheek answer, but also a real answer: law firms. Law firms are going to hugely benefit from the number of investigations that are going to happen, and from the huge changes in regulation that are coming at the state level as well as the national level. But beyond that, there is bipartisan agreement on some things, like the protection and the enhancement of US manufacturing. So the manufacturing sector, particularly domestically, will benefit. And if we look at how international businesses can angle themselves, the Democrats are going to be hyper-focused on affordability and the things that brought them on this blue wave. So anything that benefits US consumers, anything that can be pivoted towards seeming to benefit US consumers, is going to certainly play well in the House and in the Senate. 

Caspar Leighton: So, Sorana, can you see clients out there across the world looking for a win here? 

Sorana Parvulescu: I mean, there's always business to be done, right? Whichever way the political weather moves. And I'm sure there will be a middle there as well. Following on from what Bill was saying, for example, we have seen some divestment from Europe when there was a concern about more environmental regulation coming through. If we see the same type of concern about what follows 2028, you could see a switch of roles, with some selling, some buying on this. And as already mentioned, the energy sector, which I think both traditional, conventional and renewable, will be fighting for a seat at the table. 

The more interesting one is going to be, I think, the tech and the AI sector, which has already kind of taken a beating on the stock exchange, and of course where there are expectations, again, of changes in regulation and a tighter regulatory environment coming down the line if we have a Democratic administration from 2028. So those would probably be the additional sectors that would draw the most attention right now. But look, these are all the kind of top layers, right? There is always interest. And we see a lot of investment elsewhere still going on when we're talking about pharmaceuticals and other types of manufacturing. And they will continue, one way or the other, at a lower level, where they feel there's not a lot of political heat. 

Caspar Leighton: And what sectors would you be encouraging to feel optimistic about in the coming months and a couple of years? 

Bob Scher: Yeah. So I think I'd build on some of the things that have already been said. There's a lot of opportunity. Republicans and Democrats both want jobs, right? A friend of mine is fond of saying, "Jobs are not red or purple or blue, as we talk about with these election maps. They're red, white and blue." Everybody wants jobs. I think what is interesting to see is what will be continued. I think we saw the Trump first administration had a lot of tariffs. Not what we have now, but certainly significant tariffs. And the Biden administration maintained them. I don't know if that's going to be the same now, but it certainly will be something that I think people should look at. 

I also think that data centres and AI certainly are going to face some headwinds that they haven't seen yet. A lot of Democratic candidates believe they got elected in part by saying that data centres and AI are problematic: they're increasing your costs, they're hurting your water and your air. That's not to say that data centres aren't going to continue. It's just going to be a broader focus. And I think there's a real responsibility within the tech community to do some things that other industries have done for a long time, which is really look at social corporate responsibility, understanding that they are in communities, they bring a lot of jobs and a lot of benefits to communities, but they also bring some other things that people don't understand or maybe don't like. How can these businesses go out and really look at being a part of the community, understanding that they have a role to play in these communities, and working on those social corporate responsibility type of things, which are not altruistic, frankly, they're important for business. And I think that's going to come to the fore a lot more. 

But there will be opportunities for businesses. Nobody wants to be seen as being entirely anti-business. That, however, will need to face up against the anti-corruption piece that I think is very much going to be a focus. So that balance within the Democratic Party, yet to be worked out after a whopping three days of the victory, is something that's going to continue to be worked through, frankly, within the Congress and within the states over the next couple of years as the Democratic Party gets its messaging right for 2028. 

Caspar Leighton: And Sorana, what's the grand geopolitical climate that we'll be seeing emerging as a result of this election? How much has it really changed for businesses across the world, and what do they do in approaching this? 

Sorana Parvulescu: I mean, I think, to add to what Bob said, there's an element around the US, and how to prepare and be ready to operate or succeed during these next three years, and with a view to what comes next. There's no guarantee on 2028 either. So again, scenarios and planning is equally relevant there. But also, I think one of the things that I've seen with clients, both from the Middle East and the Ukraine conflict and some of these significant changes, is thinking about the other implications and the other impacts, the first and second degree impacts as well. Because yes, there is a question around thinking about the geopolitical environment: how does this change the terrain, which is very important for any company operating out there? How will this change the Iran conflict, maybe, or the Ukraine-Russia conflict? But I think there's also a question of second degree impacts: how does this change the policy objectives of some of these other players? 

And so, for example, an interesting question is around how this plays in Europe. Europe has obviously been very much mobilized by the coldness and the rashness of how they've been dealt with by the Trump administration. But it's actually triggered some sort of unified effort on defense spending and some of these issues that have been lingering around for a long time. Now, the question is, does this blue wave relax Europe, or some of the European governments, enough to actually not stick to the plans that they had just made around defense investment? Because that is a critical question for some of our financial investors and some of the infrastructure clients that we serve that are looking at deals across Europe. They are part of this rearmament and logistical integration of European military. So that's a big question. There is also a question of whether this will influence in any way some of the upcoming elections in Europe and how parties position themselves, and so on. But equally, again, it's the question about how it impacts foreign policy, but to some extent domestic policy as well. 

In the Middle East, for example, you could argue, time will tell us, but you could argue that in some ways the Israeli elections are the first victim of this blue wave in many respects. And the relation of the US with Israel is probably going to be quite substantially changing over the next few years from here, and how that impacts domestic policies also. The Gulf countries would also have been very close to the Trump administration. They will have to find a way to pivot there. And then there's a question, when I think about the broader geopolitics, about how some of the other strongmen view this. As I said before, it takes two to tango. Putin, Kim Jong Un, Xi Jinping will have a view of what this means for their relationship with the US, and which way they could push or take opportunity from, depending on how they read this. Do they read this as "This is a weakened president and there will be room for us to manoeuvre or run interference"? Or are they still concerned about managing relationships or extracting some more favourable deal in this environment, because they feel that's possible? So quite a few questions on what the rest of the world will do about this as well. 

Bob Scher: Can I go back, actually, to Sorana's point about Europe? This is another area where I think that companies, and other countries and political leaders, could take the wrong lesson. And just to piggyback off of what Sorana said: in some ways, it was a blue wave in the United States, but it's more than a blue wave. It's an anger wave, right? And the anger wave is international. You see what's happening in France and in other countries, and protests in the street. And the anger wave is going to impact incumbents and incumbent governments in different ways. It just so happened the anger wave benefited the Democrats in the United States, and it was against Trump. It goes the other way in Germany. It goes the other way in France. So the anger wave is the more definitive and distinct wave here, rather than the blue wave, in my view. 

Bill Udell: And sorry, if I can just jump in to foot-stomp that idea. If the Democratic Party cannot figure out a way to show that it is representing the concerns of people and their anger, then you can imagine this flipping immediately as well in the next elections. Right? This was not so much a vote for the Democratic Party, as we've all made the point. The Democratic Party still has a question about what it stands for, what it's looking at, and does not have the greatest reputation if you look at the polling. But it was very much against where the Republican Party and where the Trump administration was taking the country. This will be the challenge for the next two years for both parties: to try to make the argument about why they have a vision of where things can go and how they can make life better here in the United States. 

And the Democrats have, I mean, the Democrats have a real risk, to Bob's point, of, number one, overreach, because they feel like they've come to power in Congress, in the Senate, with this real mandate. But then, number two, spending all of their time investigating. I mean, there is a will among the electorate to get to the bottom of the corruption business. And it's going to, to Bob's point, allow them to not develop a message going into 2028. They need to probably do some investigation, but really figure out how they address consumer concerns and affordability and all the things that actually brought them to this blue wave.  

Caspar Leighton: So the tsunami can come in, but as you know, the tide, of course, goes out. It does more damage on the way out than on the way in. So that's maybe the warning for everyone here.

Bill Udell: Very good metaphor. Yes.  

Caspar Leighton: We're getting close to time. So I'd just like to go round all three of you and say, what's the one takeaway you would give to international business from where we're seated now? Can I go to you first, Bob? 

Bob Scher: Sure. I think, first, the things that will make businesses successful over the next 18 months are the things that businesses should always be doing: understanding that policy change doesn't necessarily come with political change, that, in fact, you're going to have to look at the long game. Two-year cycles for elections are not how businesses operate, right? They're on ten-, 20-year cycles. So what is it that you can do at a business that makes sense for you, that can both pursue your interests and understand that the environment in which you're operating is almost guaranteed to change during the life of your investment? And that means you have to adapt and understand how you remain flexible, how you can be resilient in all sorts of opportunities. 

And then the other thing I think is, don't over-index on anything that's happening in either party. Both parties right now are going to be spending an awful lot of time trying to understand the messages of this election. And within each party, it's going to be different. And you will see different actors take different policy pursuits to make that point. So businesses know what it is that makes them money. They understand the environment, or should understand the environment. So spend time figuring out what the geopolitical environment and what the macroeconomic environment is, along with the local political environment, and make sure you have stakeholders to talk to on both sides of the political aisle, and understand what signals you need to look for to see if policies are dramatically changing or if it's really just people posturing. 

Caspar Leighton: A pretty comprehensive answer there from Bob. Sorana, anything you want to add to that? 

Sorana Parvulescu: I'd maybe just add that point about thinking about second degree implications. In the same way that there's always the focus on the big change, I think we've all learned the tough way how these transmission belts work, and how conditions changing in one place result in changes elsewhere as well. So having in the back of the mind also: what could that mean for me when I operate in another market, or I've looked at this investment that maybe has a US nexus or a trade war nexus related to it? How did that change for me? 

Caspar Leighton: Right. And Bill, last word. 

Bill Udell: So I'm really going to represent Control Risks here. 

Caspar Leighton: Absolutely. 

Bill Udell: And there are two things. One is that the Geopolitical Advisory Council, which we've just launched, has never been more necessary. I mean, this idea that you really, to Bob's point, you really have to dig into a US strategy in multiple parts, between the federal level, the legislative level, and now the state level. That requires a lot of advice, and a lot of new scenario planning, and a lot of new intelligence and networking. Then the second one is, we've just launched RiskMap. One of our top five risks is not playing it safe. And this is going to create even further disruption, particularly in the near term, where there is huge disruption, there's huge opportunity. So the right scenario planning, the right decision support, the right intelligence: there are opportunities out there to be had as a result of this. 

Caspar Leighton: Great final word. And that brings us to the end of this edition of Ground Truth, the Control Risks podcast. I'd like to thank all of our guests. We have Sorana Parvulescu joining us from Dubai, Bob Scher in Washington, DC, and here in London, Control Risks CEO Bill Udell. I hope to have you back on the podcast again before too long, Bill. 

Bill Udell: Thanks, Caspar. 

Otherwise, everyone else, thanks for listening, and you can hear us again in just about a month from now. Bye bye.