‘Meaningful risk’: Why a former US Treasury secretary and Wall Street banker sees trouble for investors after the midterms

But one former treasury secretary is arguing there is one threat to the economy that’s being underestimated: Trump’s comments about overturning and interfering with the Nov. 3 election.

In an op-ed written for the New York Times, former Treasury Secretary Robert E. Rubin, who served from 1995 to 1999 during the Bill Clinton administration, argues the midterms will be a test for U.S. democracy — and the potential for political chaos could have a lasting impact on the economy.

Short- and long-term concerns

According to Rubin, the Trump administration “has already thrown up obstacles to fair and free midterm elections” by making false claims of fraud, attempting to bully states and cutting back on defense against foreign interference.

While Rubin acknowledges the election could pass smoothly, any disputes could lead to both short- and long-term economic issues. Fights over the outcome of the election could have an immediate impact on the economy, Rubin argues, citing Trump’s apparent willingness to invoke the Insurrection Act during elections.

But Rubin’s fear is that the chaos will stretch long past the election, arguing the economic impact will outlive the “immediate political crisis.”

The former treasury secretary says ongoing political chaos will disrupt the bond and equity markets. At the start of October, 10-year treasury yields briefly hit 5.36% — the highest level since 2002, according to JPMorgan Chase.

Rubin argues investor concerns about the political system’s ability to deal with economic issues could drive these yields even higher.

Foreign and domestic investor confidence

Rubin is also arguing that democracy and the peaceful transfer of power is essential to America’s role on the world stage. He says a free political system supports business in the U.S., backs the dollar as the global currency, attracts foreign investors and bolsters investor confidence.

“The integrity of our elections, in other words, has been one of the keys to American prosperity,” Rubin writes.

Rubin points to Turkey as an example of this, using a quote from an unnamed Turkish executive who spoke to The Financial Times in 2025.

“We can live with high inflation,” the executive said, “but our biggest disincentive to invest is the lack of the rule of law.”

Rubin also references a 2024 State Department report that found China’s lack of freedom and issues with its rule of law have been major roadblocks to its business climate.

But Rubin warns the U.S. does not need to get to the point of Turkey or China to feel the economic effect of political chaos. He argues the market activity of Americans has been bolstered by “the knowledge that their country is the best place on earth to start or invest in a business.”