James Bosworth on What Comes After Lula's Stunning Win

James Bosworth · Hxagon

Lula's win reflects an anti-incumbent backlash and Flavio Bolsonaro's weak candidacy, not a rightward shift.

Bosworth says Flavio Bolsonaro was a weak candidate, weighed down by his father's coup conviction and his own money-laundering accusations and Banco Master links. Latin America has been in an anti-incumbent environment, and the first round was a referendum on Lula, who sat around 45% in polls. Finishing first put Flavio under the spotlight and let Lula catch up. Lula's campaign also used WhatsApp groups and short social clips to mobilise voters, and the margin of about 4 million votes came from small shifts in turnout and blank or invalid ballots.

“It wasn't about Flavio Bolsonaro. In some ways, coming in first place in the first round was the worst thing that could happen to Flavio Bolsonaro”at 6:24

James Bosworth · Hxagon

Iran-war fuel price spike is hurting Latin American incumbents, while commodity exporters like Brazil are roughly net neutral.

The Iran war pushed oil prices and fuel costs up across Latin America. Higher fuel costs and inflation hurt every incumbent, as seen in Chile. Voters are angry about inflation and blame local incumbents for gas prices whatever the cause. Brazil is a commodity exporter selling oil and soy, so it has partly benefited from higher prices, and the net effect on Brazil is roughly a wash. That may have helped Lula, though the data to confirm it will take time.

“At the same time, the Iran war has driven up oil prices and fuel costs around the region, which is just bad for incumbents in general.”at 19:33

James Bosworth · Hxagon

No Venezuelan election in 2026; a vote is more likely around mid-to-late 2027 under the Rubio plan.

A Venezuelan election needs six to nine months of preparatory steps, such as a declared vacancy and a new electoral board. Under the current Rubio plan, Rodriguez declares a vacancy, a new board is set up, and elections follow six months later, ideally around July 2027 and possibly pushed to September or November. Bosworth worries the steps could drag on for years. Rodriguez would probably prefer 2028 or 2029, and Rubio wants the election on his watch, so he will push for elections in the coming year.

“There's about a six to nine month run up for any election that has to happen because there are steps that must occur.”at 21:33

James Bosworth · Hxagon

Maria Corina Machado would win a free, fair Venezuelan election over Delcy Rodriguez with over 90% probability.

Bosworth says there is essentially no doubt that Machado would beat Rodriguez in a free and fair vote, with odds rising if Venezuelan expats, about a quarter of the population, could vote. He cites the Trump administration's earlier reluctance to back Machado, which was based on doubts that she would command the armed forces. He also says she would then have to rebuild the economy, fix the currency and restore multi-party democracy.

“Yes. There's essentially no doubt that if you were to put [Maria Corina Machado] versus Delcy Rodriguez tomorrow in an election, better than 90%, assuming everything was free and fair, [she] wins.”at 31:01

James Bosworth · Hxagon

Prediction markets were overconfident in Bolsonaro's Brazil win and missed the outcome.

Bosworth's own model had Bolsonaro at about 64% to win the night before the vote, while prediction markets priced him at about 80%, and at one point 87%. Lula's campaign was steadily catching up in the polls, and the polls were herding together and were correlated, which the model accounted for. Bosworth argues the markets were wrong to be so confident, and that the outcome was a miss rather than the 20% tail event.

“I will tell you, they missed. They were overconfident on this election.”at 9:18

James Bosworth · Hxagon

Latin American leaders must respond to Trump regardless of ideology, so the orange shift continues for two years.

Bosworth sees recent right-leaning wins as mainly an anti-incumbent pendulum, not an ideological shift. Even so, the orange shift continues because Trump forces every Latin American leader, left, centre or right, to respond to him. Lula must work with Trump on tariffs, and Sheinbaum in Mexico faces the same. This pressure will define the region until Trump leaves office in January 2029.

“you have this element of every Latin American leader, right, left, center, must respond to Trump. He forces them to respond.”at 18:44

James Bosworth · Hxagon

Large oil majors will stay out of Venezuela until contract certainty exists; only small firms are entering.

Venezuela is a sea of oil and would be a great place for the majors, and Chevron is already in. Exxon and Conoco are interested but not jumping in. Larger firms want certainty that their contracts will be respected before committing, and they plan on 10- to 30-year investments that must survive government changes. What is entering instead are small firms focused on quick deals, not long-run rebuilding. So a rebuilt Venezuelan oil sector depends on rule-of-law certainty, which in turn argues for a democratic transition.

“None of the larger firms want to go into Venezuela prior to some certainty that their contracts will be respected.”at 29:06

James Bosworth · Hxagon

Democrats will almost certainly win the US House; the Senate is closer to a coin flip.

Bosworth puts the chance of Democrats taking the House at 96%, and says he feels confident discussing what that means. The Senate is closer to a coin flip than Nate Silver's forecast. A blue wave is possible but not certain, so he makes a call on the House and not on the Senate.

“I am 96% certain the Democrats are gonna take the House of Representatives.”at 33:09