

Democrats capture a majority in the US Senate

John Kehoe
John KehoeEconomics editor

US President-elect Joe Biden has taken control of the US Congress after two victories in Georgia's run-off elections gave him a majority in the Senate, opening the way for his agenda of corporate tax rises and climate change action.

It was a stunning defeat in Donald Trump's last days in office while dramatically improving the fate of Biden’s progressive agenda.


Warnock, who served as pastor for the same Atlanta church where civil rights leader Martin Luther King Jr. preached, becomes the first African American from Georgia elected to the Senate. And Ossoff, who was born to an Australian mother, becomes the state’s first Jewish senator and, at 33 years old, the Senate’s youngest member.






Before the result, the growing possibility of Democrats controlling Congress to increase corporate taxes and more heavily regulate big technology platforms and oil and gas caused US stock futures to drift lower on Wednesday. Australia's S&P/ASX 200 Index fell 74.8 points, or 1.1 per cent, to 6607.1.

However, an upside for markets could be a bigger Democratic fiscal stimulus, Goldman Sachs said.

Chaos on the Capitol


The US Capitol was locked down on Wednesday after protesters breached barricades amid violent clashes between President Donald Trump's supporters and Capitol police.

The protesters marched through the Capitol building, shouting and waving Trump and American flags and forcing a halt to congressional deliberations over challenges to Joe Biden's Electoral College victory.


Democrats needed to pick up both seats to cut the Republicans' 52-48 Senate advantage to 50-50.

That gives incoming vice-president Kamala Harris a tie-breaker vote to determine the passage of legislation, including the Democrats' progressive agenda.

Mr Biden had campaigned to increase the US federal corporate tax rate from 21 per cent to 28 per cent, take strong climate change action, transition away from the oil and gas industry and spend $US2 trillion ($2.6 trillion) on green infrastructure.


Senate control makes it easier for Mr Biden to have the Senate approve his nominees for cabinet positions and judges to America's courts.

Democrats already control the House of Representatives.

If Democrats had failed to pick up both Senate seats, Mr Biden would rely on moderate Republicans such as Utah's Mitt Romney, Alaska's Lisa Murkowski and Maine's Susan Collins to pass legislation.

Mr Biden, a centrist in a now more radically left Democratic Party, has said he would govern as a president for all Americans – a signal he may be willing to compromise with the few moderate Republicans in Congress.

On Wall Street, many investors preferred Mr Biden's predictability compared to the volatile Mr Trump.

But investors had been betting on a divided government in Washington to keep a check on Mr Biden's left-leaning Democracts and to block his policies to increase business taxes and regulation.


Long a safe red zone

Democrats have not controlled all of the White House, House of Representatives and Senate since Barack Obama's early presidency between 2009 and 2011.

Georgia, in the US deep south, had long been considered a safe red state for Republicans.

Before Mr Biden's surprise win by a narrow 12,000 votes in Georgia in November, the state last voted for a Democratic presidential candidate in 1992, with Bill Clinton taking 43.5 per cent of the vote to George H.W. Bush's 42.9 per cent.

That was achieved only with conservative independent Ross Perot snaffling 13.3 per cent of the vote –mostly from Mr Bush Snr.


The state voted for a Democrat in Georgia-native Jimmy Carter's 1980 presidential campaign, but he lost to Republican Ronald Reagan.

The Democrats last held a Senate seat in Georgia in 2005, when conservative Democrat Zell Miller (who supported Republican George W. Bush at the 2004 presidential election over Democrat John Kerry) was in power.

The run-off elections for the two Senate seats were held after candidates failed to receive a majority of the vote at the November 3 election and following the retirement of a Republican senator in December.



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