US Democracy in Crisis: Historians and Economists Warn Ahead of Midterms

As American voters head to the polls for the midterms, economic historians point to a historic low in public trust alongside deep institutional divisions. The political landscape shows little sign of an overwhelming shift between parties amid entrenched societal divides.

Gallup Data Documents Long-Term Decline in US Government Trust

Public confidence in federal institutions has steadily eroded over more than two decades, according to Gallup figures cited by economic historian Adam Tooze. While trust initially surged following the September 11 terrorist attacks in 2001, it has drifted downward with few interruptions since the mid-2000s. Today, roughly one-third of Americans express trust in the federal government to handle domestic and foreign challenges.

This declining legitimacy coincides with rapid technological shifts. Anxiety over artificial intelligence runs high among workers who fear displacement, even as tech sector advocates praise automation as the foundation of future productivity. Tooze describes this dynamic as an “AI Dutch Disease,” wherein a dominant economic sector attracts vast capital, strengthens the currency, and exerts severe pressure on traditional industries.

Financial Capitalism Speeds Up Currency Risks

Financial markets operate at an unprecedented velocity, a trend captured by the British magazine The Economist under the label “Speedball Capitalism.” High-speed financial transactions, public listings, mergers, and speculative borrowing unfold in shorter intervals, blurring the lines between technology firms, banking institutions, and political power centers.

Private Business Interests Shape US Foreign Policy

Political power and private commercial interests are increasingly intertwined inside the United States, a convergence historically associated with authoritarian states. Historian and publicist Anne Applebaum notes that American foreign policy risks becoming an extension of private enterprise, pointing to diplomatic discussions with Russia where energy ventures and economic investments overshadow traditional security talks.

Timothy Snyder describes Donald Trump as a political figure who systematically distorts reality. Snyder points to statements regarding Ukraine, where Trump framed American assistance as a one-way street while characterizing Kyiv as an ungrateful recipient. Snyder labels this narrative a false premise, arguing that Ukraine defends its own independence alongside European security and international law.

Global Parallels Emerge in China and Europe

Economic transformation extends well beyond Western democracies. In China, decades of rapid economic expansion have produced an entrenched, inheritance-based upper class among the nation’s 1,100-plus dollar billionaires, while the Communist Party retains political control.

As ballots are cast for the entire House of Representatives and one-third of the Senate, voters confront overlapping crises spanning international security, energy inflation, and monetary instability. The common thread across these disparate conflicts remains the volatile concentration of capital and a pervasive erosion of confidence in the political order.