Planning for the anti-climax of US elections

Ben D. Kritz

Ben D. Kritz

JUST five days from now, Americans who have not already voted (some 20 million already have cast their ballots in early voting) will troop to the polls to choose either Hillary Clinton or Agent Orange Tiny Hands as the successor to President Barack Obama.

Despite a last-ditch (and possibly illegal) attempt by the director of the Federal Bureau of Investigation James Comey to derail the Clinton campaign by reopening the long-dead probe into Clinton’s emails, it seems reasonably certain at this point that she will win. The margin of victory might be narrower than it would have otherwise been without Comey’s interference, but it will be a victory nevertheless.

But even in the very unlikely event of a Trump win, people in this country or elsewhere should not expect much to change. The tension of the election campaign, which has gone on for more than a year, is real enough, but most of the possible impacts on the rest of the world, which have created uncertainty in world markets and among foreign governments, are largely imaginary, having been stoked by a media that has had to work hard to create enough drama to keep the public’s attention for so long.

What most people who are not intimately familiar with day-to-day life and business in the US do not realize is that the American system has a great deal of inertia. Large changes in policy can be accomplished, but only gradually over time. Unlike the Philippine system, where the president has a great deal of executive power, the US president needs the cooperation of Congress and an enormous bureaucratic framework to carry out major policy initiatives. No matter who wins the election, this is unlikely to be forthcoming; either of the two prospective presidents is going to face stiff opposition in Congress and relatively low levels of public support, and is going to have to invest a great deal of time and political capital to accomplish anything.

Between the two, Donald Trump has expressed more specific policy aims, notwithstanding that most of them sound like the fevered ravings of lunatic. But if he wins, not many of those bold ideas—such as building a giant wall to physically separate the US from Mexico, punishing companies that have operations overseas, or ejecting all the immigrants—will ever see the light of day. This is perhaps why Clinton’s policy platform has consistently come across as rather vague and subject to change; she has spent nearly 25 years wrangling with the legislature, either as a part of the executive branch of government or as a senator, and seems to have an altogether more realistic perception of what can and cannot be done.

What this means for people and businesses in the Philippines is that the status quo now will be nearly the status quo a couple years from now. However, the few changes that can be anticipated—the few areas where both the candidates, Congress, and a large enough part of the general population all happen to agree—are largely bad news.

The much-heralded Trans-Pacific Partnership (TPP), which the Philippines has aspired to for several years, is dead, at least as far as the US is concerned. The sweeping trade pact has run into considerable resistance in Congress already, and neither Trump or Clinton favor it; in Clinton’s case, her position is a somewhat awkward departure from President Barack Obama, who has been the TPP’s strongest advocate.

The death of the TPP, at least in its current guise, might work out favorably for the Philippines in the long run. The trade pact was originally a Singaporean initiative (along with Chile and Peru), and conceivably, the remaining signatories could resurrect it sans-America, which would make it more Asia-centric. Even if that eventually positive outcome comes to pass, however, it will take years, and in the meantime, the Philippines should shift whatever effort it is applying towards TPP accession elsewhere.

The other policy area that might have an impact on the Philippines is in monetary policy and investment controls. Although Clinton’s perspective is malleable, she leans towards greater government intervention in financial markets, and some analysts have suggested that a Clinton presidency will mean greater political influence on the nominally independent Federal Reserve. Moves in these areas—which are among the few where the US president has a little greater freedom of action—would impact US markets, probably negatively, which would have a knock-on effect on markets here. That might be positive as well, depending whether or not investors still consider the Philippines a safe haven for hot money at that point; however, the impact of hot money on the wider economy here, as in most places, tends to be relatively muted.

The bottom line is, whatever the outcome of the election next Tuesday, it will not shake the world. Given the lack of ideological appeal of both candidates, that is probably fortunate.


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