Why does US politics matter more than ever in 2020?” asked Dr. Narayan Lakshman, Associate Editor,
The Hindu, while initiating a discussion titled “Election Year Politics in the USA” at Observer Research Foundation, Chennai, on 11 January 2020.
“Because they reflected a global paradigm-shift,” answered himself Dr Lakshman, who was the newspaper’s former Special Correspondent in Washington earlier.
“The global mood is shifting. There is an anti-liberal movement gaining at the moment,” he observed. The mood everywhere was the same, whether amongst the mill workers of the UK who voted for Brexit, the rust belt in the US who voted for Trump in 2016, as well as across Europe, he said.
Incumbent US President Donald Trump, Dr. Lakshman explained, had delivered on his 2016 election promise of going after nations that enjoy a trade surplus with the US. However, what is striking about Trump is that he sees such imbalances as signs of tariff and currency manipulation rather than genuine differences in comparative advantage.
It was necessary to probe the question, “Is Trump, in revamping America and delivering on his dream of ‘America First’, trying to undo the effects of globalisation and comparative advantage?” Though China has been the main target of the Trump Administration’s trade tariffs, other nations have also been impacted such as EU and India, particularly by the tariffs on steel and a range of consumables.
World markets have been affected by the uncertainty engendered by the trade war between China and the US, noted Dr. Lakshman. The US unemployment figures had been gradually going down since the end of global recession under Obama’s presidency and this was sustained under Trump. However, the uncertainty endangered by the trade wars have impacted on Trump’s monthly job results, pointed out Dr. Lakshman. This was also owing to an overall global economic slow-down.
Tax cuts & healthcare
Tax cuts and healthcare have been two much publicised policy areas under Trump. The tax cuts were introduced at the end of 2017 and its most striking features included, $1 trillion permanent corporate tax, slashed tax rates for those making more than $1 million and a roll back on the estate tax. Though the benefit was mainly felt by corporates and the tax laws generally favoured those in a higher income bracket, it was important to note that there were also some benefits for lower income families, such as child tax credit expanded and the standard deduction nearly doubled, he said.
Dr. Lakshman explained that the Trump Administration tried repeatedly to repeal and replace several core features of Obama’s landmark healthcare reform policy known as the Affordable Care Act. He explained that though the Republicans failed to do so, in March 2019, the White House had filed a legal brief to hold Obamacare unconstitutional. The important point to note here is that Trump is wary of being seen as supporting the American health insurance as he fears this might turn public opinion against him, and therefore doesn’t want to be seen as publicly stating his position.
Foreign policy: Axis of hostility
President Trump’s foreign policy goals have been focused on Iran, China and Syria. “Iran is the age-old bogeyman in US politics and Trump has not shown any restraint in pandering to this narrative.” From pulling the US out of the Iran deal, to resuming sanctions and the recent assassination of General Soleimani, “Trump has upped the ante on the national security threat narrative. This could yield dividends in the election,” Dr. Lakshman argued.
President Trump’s confrontational trade war with China should be seen as a sharp contrast to Obama’s policy of gradual strategic encirclement. In Syria, Trump’s rhetoric has been consistently focused on pulling US troops out of Syria. Dr. Lakshman felt this has created strategic space for Russia.
Impeachment
“Talk of impeaching Trump began as far back as 2017, shortly after his election,” said Dr. Lakshman. The allegation was that he may have breached the Foreign Emoluments Clause of the US Constitution which bars the President from accepting payments from foreign dignitaries. However, the impeachment trial began in 2019 following Trump-Ukraine scandal, in which Trump allegedly threatened to withhold military aid to Ukraine unless its President Zelensky agreed to investigate Hunter Biden, the son of Joe Biden, former Vice -resident and current Democratic front-runner.
Though the next phase of the impeachment is on-going, Dr. Lakshman felt it was unlikely that President Trump will be convicted or removed from office. “Removing President Trump from office requires 67 votes, that would mean 20 republicans would have to join Democrats, and this is a highly unlikely prospect,” said Dr. Lakshman.
India, credible counter-weight
India hardly matters to the US in the context of elections. In the coming year while China, Iran and Russia may get an occasional mention in the presidential debates, India is unlikely to feature. Dr. Lakshman said, “this is actually because the US India policy always enjoys bipartisan support.” India matters more in terms of US foreign policy, both as a credible counter weight to China in Asia and as an economic partner with vast potential to expand bilateral trade and investment.
India has, however, been affected by Trump’s views on immigration reform, explained Dr. Lakshman. Recent data has shown that denial rates for H-1B petition have increased from just 6% in 2015 to 24% in the third quarter of the current fiscal year. He felt this could be linked to Trump’s executive order ‘Buy American and Hire American’ to create higher wages and employment rates for workers in the US.
The other policy area in which India has been affected under the Trump administration is trade. Trump has hit out at India’s tariff regime and in connection to this withdrew the special duty benefits under the Generalised System of Preferences (GSP) which has impacted Indian exports to the tune of $5.6 billion.
Summing up, Dr. Lakshman said, in most policy areas, Trump essentially wants to undo Obama’s legacy. This is particularly true in healthcare and the Iran Deal. “He wants to stamp his legacy on these issues,” Dr. Lakshman observed. Immigration is always an important issue in US election, but the tone and tenor under Trump has been strident, he remarked.
Given the apparent comradery between Trump and Putin and the evidence regarding Russian political interference unearthed by Robert Mueller’s investigation, Dr. Lakshman ended by asking “What is Russia’s big game and how will it play out globally? Will a convergence of interests between Trump and President Putin, undermine the quality of America’s Democracy?
This report was prepared by Dr. Vinitha Revi, Independent Researcher, Chennai
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