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AI boom tests GOP’s midterm affordability pitch as price pain spreads

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Republicans are warning that their ability to deliver on lowering everyday costs, one of their core campaign promises heading into the 2026 midterms, is being tested by an AI-driven chip shortage that has spilled into consumer markets.
«When you have a big race like we have with AI, there are secondary effects that we need to be very concerned about,» former Rep. Patrick McHenry, who served as House Financial Services Committee chairman, told Fox News Digital, adding, «It is hurting Republicans.»
Tech industry reports have for months been raising alarm over a global chip shortage. In January, a report predicted that this year, 70% of the high-end memory chips produced would go toward data centers, which store AI memory, constraining all other downstream technology and driving up prices, directly undermining Republicans’ affordability agenda.
AFFORDABILITY: THE ISSUE THAT BOOSTED TRUMP AND REPUBLICANS IN 2024 DEFLATED THEM IN 2025
President Donald Trump delivers remarks at the «Winning the AI Race» AI Summit at the Andrew W. Mellon Auditorium in Washington, D.C., on July 23, 2025. (Andrew Caballero-Reynolds/AFP)
«We see this from our handheld devices to our computers, to TVs,» McHenry, a North Carolina Republican congressman turned policy advisor, said in an interview. «Even autos are impacted, and even things such as what we think of as average everyday things that aren’t particularly high-tech, like the things we use to manicure our lawns are impacted by rising prices of chips, so there’s a lot of secondary effects across consumer goods and should be a huge concern.»
Heading into 2026, President Donald Trump framed the midterms as a referendum on cost of living, saying in a Politico interview the elections «will be about pricing.»
Historically, the party in control loses seats during the midterms. One Republican strategist told Fox News Digital that AI’s well-documented dominance over the chip market should be viewed as hurting voters’ pocketbooks. The strategist called on the three largest chip manufacturing companies to expand production, which he said would help bolster the GOP’s campaign message.
«America must win the artificial intelligence race. Companies like Samsung, SK Hynix and Micron understand that,» the strategist said. «At the same time, we can’t forget about consumer goods. Memory chip manufacturers need to increase production to boost both American AI and lower the cost of consumer goods. If they don’t, it will undoubtedly hurt Republicans politically in the midterms. How can Republicans campaign on ‘lower costs’ in 2024, but see computer and car prices rise in 2026 due to a lack of chip production?»
TRUMP TORCHES DEMS’ ‘FAKE AFFORDABILITY’ PITCH – BUT GOP PANIC IN DEEP RED STATE HINTS VOTERS AREN’T BUYING IT

The OpenAI logo appears on a mobile phone in front of a computer screen displaying ChatGPT output in Boston on March 21, 2023. (Michael Dwyer/AP)
The AI boom is increasing demand for memory chips, which are semiconductor components used in data centers, laptops and smartphones.
That chip consumption has rippled across industries. Microsoft this month attributed its rise in laptop prices to «recent increases in memory and component costs.» The smartphone market remained «under pressure,» with shipments down 6% this year, largely because of chip shortages, Counterpoint Research found.
Sen. Bernie Moreno, R-Ohio, previously a car dealership owner, warned in a letter this month his state was seeing «immediate and severe» consequences of rising chip prices and that automakers have said they could begin halting assembly lines as early as next month.
While affordability has been a resounding priority for Republicans seeking to retain control in Washington, AI advancements are also a pillar of Trump’s agenda. The White House declared last year in a sweeping plan that the country was in «a race to achieve global dominance in artificial intelligence» and cited the need for a «revitalized U.S. chip industry.»
Asked about the AI-driven affordability concerns, White House spokesman Kush Desai told Fox News Digital in a statement that the White House was cognizant of the clash and balancing it with a «nuanced» economic plan, which includes Trump’s signature worldwide tariffs, which the president restructured after the Supreme Court struck down his initial plan implementing them in the name of what he said was a global economic emergency.
«The fact that semiconductor chips are absolutely critical for everything from cutting-edge AI technology to everyday consumer goods only reinforces the importance of President Trump’s push to reinvigorate America’s semiconductor industry,» Desai said. «Hundreds of billions in semiconductor manufacturing investments reflect how the private sector is enthusiastically responding to the Administration’s nuanced and multi-faceted agenda of tariffs, deregulation and tax cuts.»
KEVIN O’LEARY WARNS CHINA ‘KICKING OUR HEINIES’ IN AI RACE AS REGULATORY ROADBLOCKS STALL US

President Joe Biden speaks during a signing ceremony for the CHIPS and Science Act of 2022 on the South Lawn of the White House in Washington, D.C., on Aug. 9, 2022. (Saul Loeb/AFP)
The strain on supply is also raising new questions about the effectiveness of the bipartisan CHIPS Act, a Biden administration bill designed to boost domestic production and prevent precisely the kind of shortage markets are now seeing.
McHenry, who specializes in fintech policy, said the CHIPS Act, a multibillion-dollar effort to pour federal subsidies and tax incentives into U.S. chip manufacturing, has been a «grave disappointment.» McHenry said both that the White House had «a lot more work» to do to address the supply shortage and that congressional reforms were another way to improve domestic chip production.
«Unfortunately for the taxpayer, they paid for the CHIPS Act the first time, and now they’re paying for it a second time with the rising price of consumer goods,» McHenry said. «Republicans need to address this on Capitol Hill. They need to clean up the CHIPS Act, so the president can deploy these tools to incentivize and grow chip manufacturing here in the United States.»
Rep. Darrell Issa, R-Calif., who founded a successful car security company, said he sees a need for chip production expansion, tying it to consumer costs, in a statement to Fox News Digital.
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«America leads the world in AI — and we stay there by unleashing the nation’s industrial base, ramping up chip production and memory as never before and lowering the consumer costs people pay every day,» he said.
The congressman said more chips were «essential» to delivering on the GOP’s promises of «opportunity, prosperity and affordability.»
Fox News Digital reached out to representatives of Samsung, SK Hynix and Micron for comment.
artificial intelligence, midterm elections, consumers, samsung, republicans
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AOC-backed candidate ripped for ‘bizarre response’ to transparency question: ‘Pretty basic’

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Abdul El-Sayed, a Democratic candidate for U.S. Senate in Michigan, says he’s waiting on outstanding paperwork needed to accurately fill out his tax disclosure forms.
El-Sayed’s statement appears to be trying to defuse allegations from his opponent, Rep. Haley Stevens, D-Michigan, that he is trying to mask his net worth, hiding the true nature of his wealth until after the Michigan Aug. 4 Democratic primary.
«You’ve sought an extension through August 13, I believe, which is after the primary,» El-Sayed, who is endorsed by Rep. Alexandria Ocasio-Cortez, D-N.Y, Sen. Bernie Sanders, I-Vt., and other far-left lawmakers, was asked on Wednesday. «Was this to avoid transparency with your voters? Why not release them before the election?»
DEM CIVIL WAR HITS PRIMARY DEBATE STAGE IN FIERY BATTLEGROUND SHOWDOWN: ‘WHAT ARE YOU HIDING?’
Abdul El-Sayed, candidate for U.S. Senate in Michigan, speaks before U.S. Sen. Bernie Sanders, I-Vt., takes the stage at Mumford High School on May 3, 2026 in Detroit, Michigan. (Sarah Rice/Getty Images)
«No,» El-Sayed replied. «Taxes get complicated.»
«My wife and her family own property abroad and getting all those tax forms is a thing,» he added.
As a part of his candidate disclosure report filed in June 2025, El-Sayed has reported a number of holdings. Among them: a salary from Wayne County worth $278,900 and an assortment of other assets bringing his net worth to somewhere between $580,000 and $1.7 million.
As a part of that disclosure, his wife reported a rental property in Bangalore, India worth between $100,001 and $250,000. The disclosure went on to say that his wife brought in between $5,001 and $15,000 in «income.» Another rental property in Ann Arbor, Michigan that was worth between $250,001 $500,000 brought in between $5,001 and $15,000.
To some viewers, El-Sayed’s responses this past week are confusing, given the existence of his 2025 filings.
«A bizarre response,» Chuck Ross, a Washington Free Beacon investigative reporter, wrote in a post to X. «He filed a Senate financial disclosure in June 2025 that listed his wife’s rental property in India.»
«When it comes to actual transparency and investment, the fact that he is saying ‘my wife has foreign assets. My wife has investments abroad.’ Look we need to know you have allegiance to the United States of America,» Sen. Katie Britt, R-Ala., told Fox News. «You need to come before the people that are working to elect you and you’ve got to show them what you’re about.»
«If you have nothing to hide, then just release the tax returns. These Trump tactics are an extremely bad look,» another observer wrote.
WATCH: SURFACED VIDEOS OF DEM SENATE CANDIDATE BACKING ‘DEFUND THE POLICE’ CONTRADICT RECENT DENIALS

Rep. Alexandria Ocasio-Cortez of New York, a progressive champion, endorsed far left candidate Abdul El-Sayed in Michigan’s high-profile 2026 Democratic Senate primary. (Tom Williams/CQ-Roll Call, Inc via Getty Images; Jim West/UCG/Universal Images Group via Getty Images)
Hen Mazzig, a pro-Israel political commentator, also bashed El-Sayed’s response.
«Didn’t realize being unaware of the extent of your own wealth was a characteristic of the working class,» Mazzig said, referring to El-Sayed’s promises to represent everyday Michigan voters against corporate interests.
El-Sayed’s responses on Wednesday come after the Michigan primary debate on Tuesday evening, where Stevens accused El-Sayed of a lack of candor.
«Well, look, transparency is oh so important. This is why I have released my tax returns. My opponent, Abdul, he said that transparency is key, but yet he hasn’t released his tax returns,» Stevens said.
«Look, I am the only one running for United States Senate in Michigan who is not a millionaire,» Stevens said.
When asked if Stevens’ assertions were true, El-Sayed hinted that the figure was a little ambiguous.
«If you take my assets and my wife’s assets together, then I guess they add up to something like that,» El-Sayed said in his Wednesday interview.
In another sit-down with MS Now, El-Sayed pledged to release his tax documents ahead of the primary.
OMAR’S DISCLOSURES ERASED MILLIONS, LEAVING HER WITH POTENTIAL NEGATIVE NET WORTH. SHE WON’T EXPLAIN WHY

U.S. Senate candidate from Michigan, Abdul El-Sayed, has been endorsed by Bernie Sanders and embraced comparisons between he and Zohran Mamdani. (Bill Pugliano/Getty Images)
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«We absolutely will. Sometimes finances are complicated. I can only control what I can control, and unfortunately, when it comes to tax documents, sometimes they are really complicated to get,» El-Sayed said.
«We are absolutely going to release it before the primary.»
politics, taxes, democrats senate
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Panorama Internacional: Brasil, la guerra fría de juguete de los Bolsonaro contra Lula
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Fury erupts as US brand fires 1,600 employees after securing thousands of foreign worker visas

Boston federal judge blocks Trump fee for H-1B visas
A federal judge in Boston has blocked the Trump administration’s $100,000 H-1B visa fee, stating it is an unauthorized tax without congressional approval. The policy, enacted last year, drastically increased the fee from $2,000-$5,000 to prioritize U.S. citizens. The White House plans to appeal the decision.
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A popular U.S.-based gaming brand owned by Microsoft is facing fury after mass employee layoffs occurred in the wake of the company being approved for thousands of foreign worker visas.
Microsoft announced that it will lay off 4,800 people total and 1,600 from the corporation’s XBOX division, which makes and sells the dominant video game console.
Meanwhile, Microsoft has been approved this year to hire from foreign countries 2,273 employer-sponsored, non-immigrant workers under what is known as the H-1B visa program, according to data from U.S. Citizen and Immigration Services (USCIS).
Furious online critics claim that American jobs are being unfairly handed to foreigners in an effort to cut labor costs but at the cost of leaving U.S. workers in the lurch.
‘AMERICA FIRST’ IMMIGRATION OVERHAUL BILL WOULD CODIFY TRUMP’S CAMPAIGN PROMISES ONCE AND FOR ALL
Asha Sharma, chief executive officer of Xbox,, during the Bloomberg Tech conference in San Francisco, California, US, on Thursday, June 4, 2026. The event brings together the leading CEOs, investors and innovators who are harnessing technology to change the world around us. Photographer: David Paul Morris/Bloomberg via Getty Images (David Paul Morris/Bloomberg via Getty Images)
«A great way to fix this is to throw anyone doing this in prison,» said one user on X. «Fire Americans to replace with thousands of visa workers? Straight to jail, and assets seized. This story has been told countless times. Fire American staff and hire foreigners. Over and over.»
«It is the fault of our Government [sic] for approving the H-1Bs,» another social media user lamented. «Our Government [sic] has sold us out of jobs at home and those being moved to other countries.»
HOUSE REPUBLICANS RIP INTO SENATE FOR DELAYING IMMIGRATION RECONCILIATION PACKAGE: ‘I’M VERY FRUSTRATED’
Another user described the H-1B program as «industrial scale job theft from Americans.»
Microsoft is the sixth-largest beneficiary of H-1B visas, a program that is overwhelmingly dominated by workers from India. The company has even more H-1B applications pending. Microsoft has employees worldwide, but most are in the United States.
«These decisions are based on business need, not visa status. H-1B employees were also impacted by job eliminations in the U.S.,» a Microsoft spokesperson told Fox News Digital when reached for comment on the lay offs.

Fans compete in a gaming tournament at Microsoft retail store at the Florida Mall on November 21, 2013 in Orlando, Florida and another five cities across the country for a chance to win up to $25,000 in prizes and a chance to participate in a final showdown at the Jacksonville, Fla. Microsoft Store opening, featuring a performance by Macklemore and Ryan Lewis. Tournament finalists will receive an Ultimate Xbox One Gaming House including all launch night titles in each of the six participating stores. (Photo by Gerardo Mora/Getty Images for Microsoft) (Gerardo Mora/Getty Images for Microsoft)
«Every single employer is exploiting the H-1B visa program,» said the Project for Immigration Reform.
A lawmaker even called for a complete end to the non-immigrant visa program.
TRUMP TAPS ACTING LABOR SECRETARY KEITH SONDERLING FOR PERMANENT ROLE PENDING SENATE CONFIRMATION
«This is INSANE. LEGAL immigration is a major problem. These companies, especially big tech, are abusing these immigration programs to replace American workers with foreign workers,» said Rep. Riley Moore, R-W.Va.
«No more. It’s long past time to end the H-1B scam.»
XBOX CEO Asha Sharma cited the company’s financial health for the layoffs.
«Our business today is not healthy,» said a memo from Sharma, according to The Associated Press. «We are operating at margins that are 3-10x lower than comparable platform and publishing businesses.»
Sharma added that her strategy is to «reset» XBOX.
Some online critics, however, claimed Sharma’s Indian heritage played a role in firing the Americans, given the percentage of H-1B workers from India. Sharma was born in Wisconsin.
Vice President JD Vance announced on Tuesday a large-scale investigation into H-1B visa fraud.
«Today, I’m proud to announce that the federal Department of Labor has started dozens of subpoenas and investigations into foreign fraudsters who are trying to take advantage of the H-1B visa program,» he said during a press conference in Milwaukee, Wisconsin.
«American jobs ought to go to American workers and not foreign fraudsters and the Department of Labor is fighting back against it.»

President Donald Trump signed two executive orders on Sept. 19, 2025, establishing the «Trump Gold Card» and introducing a $100,000 fee for H-1B visas. The «Trump Gold Card» is a visa program that allows foreign nationals permanent residency and a pathway to U.S. citizenship for a $1 million investment in the United States. (Andrew Harnik/Getty Images)
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Recently, President Donald Trump tried to limit employers’ use of the H-1B program by imposing a $100,000 fee for companies seeking H-1B applications.
A federal judge struck down that order, reasoning that it amounted to a tax that only Congress has the ability to impose.
politics, jobs, tech, microsoft, big tech backlash
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