Make America Great Again

Posted by Daniel Joseph

So, that actually happened. Trump won and its looks like I’ll be hibernating for the next four years. I am proud, however, that the United States had the progressive will to appoint its first orange President.

It’s not the inexperience (first President-Elect to never hold a Government office or serve in the military) or constant gaffs that have me particularly bothered. Rather, it’s the fact that he doesn’t actually believe what he affirms. His policy positions have changed too frequently for that to be the case. Instead he says whatever will get him the most media coverage, and most of the time that’s by stoking fear.

His hyperbolic threats now carry the weight of the American presidency. His victory was enough to chill some financial markets. Like the Brexit vote, it marks a step away from a liberal, open economic order towards more isolationism and less prosperity.

In the last few days, however, we’ve seen a moderation or reversal of key policy proposals. The immigration ban has turned into more stringent vetting, the wall has turned into a fence and chants to ‘lock Clinton up’ have turned to calls to thank the former Secretary of State for years of public service.

Although it’s difficult to disentangle policy from rhetoric, Trump’s assertions about China are those with the potential to most influence Australia’s balance of trade. So where does a Trump victory leave China, the world’s second-largest economy? China accounts for roughly half of America’s net trade-deficit, so it has a lot to lose should America launch an all-out trade war. In fact, the resulting disruption to global supply chains would badly hurt American firms. Higher prices on imported goods would squeeze American consumers, especially poorer households, which spend proportionately more on them. As such, I’m of the opinion that this, like many of his policy positions will likely shift from right to centre.

If there’s anything we can learn from the exhausting election cycle it’s that sensationalism sells. Just make sure you’re not a buyer.

Posted by Daniel Joseph, on 15th Nov 2016