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Gay voters are smitten with Kamala Harris

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In the days after President Joe Biden announced his withdrawal from the election, a short clip from 2013 went viral on Twitter. It showed the then attorney-general of California speaking to the County Clerk of Los Angeles on the phone: “This is Kamala Harris—you must start marriages immediately.” The Supreme Court had just dismissed a case brought by opponents of same-sex marriage and Ms Harris was instructing the clerk to get to work.

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Economics

Donald Trump also won a reprieve from justice

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IT WAS A high-stakes election for all Americans, most of all Donald Trump. Had he lost, there was a fair chance that he would have gone to prison. He faces four separate sets of criminal charges, each with a prospect of jail time. Instead, once back in the White House, Mr Trump will be able to quash his two federal indictments and the two state cases against him are all but certain to be frozen.

That Mr Trump has managed to largely evade legal accountability is partly a result of his stalling for time, in anticipation of this very outcome. His strategy was aided by the Supreme Court, a third of whose justices he appointed. And yet his supporters see a justice system that is pliable and easily weaponised. To some in MAGA world, Mr Trump’s threats to train it against his political enemies now sound eminently reasonable.

The first post-election piece of business in Mr Trump’s trials will come in the hush-money case in Manhattan, where, barring further delay, he is due to be sentenced on November 26th. In May he was convicted on 34 counts of falsifying business records to conceal a payment to a porn star. Each charge carries a maximum of four years in prison. Yet there is hardly any chance of the judge imposing jail time—constitutional scholars agree that a sitting president cannot be locked up. In any event Mr Trump’s lawyers will probably ask to postpone sentencing until after his term in office ends.

Next come the two federal cases brought by Jack Smith, a special counsel in the Department of Justice (DOJ). Mr Trump stands accused of refusing to return classified documents upon leaving the White House and of attempting to overturn his defeat after the 2020 election. He denies wrongdoing in both. DOJ policy says that a president cannot be prosecuted while in office. Extinguishing these cases is simple: Mr Trump can fire Mr Smith and direct DOJ lawyers to drop them. He can do this even before his attorney-general is confirmed, notes Mary McCord, a former federal prosecutor.

In Georgia, meanwhile, Mr Trump faces charges in state court over his meddling in the 2020 election. The case is on hold while an appeals court weighs whether the prosecutor who brought the charges should be removed for alleged impropriety. If it ever gets going again, it will not include Mr Trump so long as he is the sitting president. But his 14 remaining co-defendants could still stand trial.

Then there is the civil litigation against Mr Trump for his role in the January 6th riot. Several Capitol police officers have sued him, alleging that he instigated the attack; courts are in the middle of sorting out whether his conduct is immune from civil liability. If they say it is not immune, precedent suggests that civil suits against a sitting president can proceed.

Soon enough attention will turn from Mr Trump’s legal jeopardy to that of his opponents, whom he has vowed to target. At a MAGA victory party attended by your correspondent, shortly before the conga line started, several of his supporters suggested that Joe Biden ought to drop the federal prosecutions against Mr Trump as a show of goodwill. Then one gleefully added that she would love to see their man “take the Bidens down”.

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What Trump’s historic election victory means for the global economy

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A worker is making textile export orders at a production workshop of a textile enterprise in Binzhou, China, on July 8, 2024.

Nurphoto | Nurphoto | Getty Images

Donald Trump‘s election victory over Vice President Kamala Harris marks a historic return to the White House — an extraordinary political comeback that is likely to have seismic ramifications for the global economy.

Speaking to his supporters in Florida early Wednesday, Trump said an “unprecedented and powerful mandate” would usher in “the golden age of America.”

The former president’s litany of campaign pledges include steep tariffs, tax cuts, deregulation and a push to withdraw from key global agreements.

Analysts say it is hard to pin down the extent to which Trump will seek to implement these measures in his second four-year term, but the consequences of any will have clear repercussions across the globe.

Lizzy Galbraith, political economist at asset manager Abrdn, said it remains to be seen exactly what style of presidency investors can expect when Trump returns to the White House.

“Congress has a really big part to play in this,” Galbraith told CNBC’s “Squawk Box Europe” on Thursday.

Trump's principle tariff focus will be China — not elsewhere, says political economist

“If Trump does have unified control of Congress, as is looking very likely and is what we expect to happen over the next few weeks and days, then he does have greater latitude to implement his tax-cutting agenda, his deregulatory agenda, for example, but we are also likely to see elements of his trade policy sitting alongside that.”

On tariffs, Galbraith said there were currently two schools of thought. Either Trump seeks to use them as a bargaining tool to gain concessions from other parties — or he delivers on his promise and implements them much more broadly.

Trump’s favorite word

Trump has previously described “tariff” as his favorite word, calling it “the most beautiful word in the dictionary.”

In an effort to raise revenues, Trump has suggested he could impose a blanket 20% tariff on all goods imported into the U.S., with a tariff of up to 60% for Chinese products and one as high as 2,000% on vehicles built in Mexico.

For the European Union, meanwhile, Trump has said the 27-nation bloc will pay a “big price” for not buying enough American exports.

Former US President Donald Trump arrives during a “Get Out The Vote” rally in Greensboro, North Carolina, US, on Saturday, March 2, 2024.

Bloomberg | Bloomberg | Getty Images

“Now, I think it is worth pointing out that we do think that in any situation which Trump is using tariffs quite often, his principal focus is going to be on China. And we don’t see Trump’s secondary tariff pledge — that baseline tariff, which would hurt European companies — as being all that feasible,” Galbraith said.

“So, it’s not necessarily our base case that you see something like a baseline tariff applied that would really hurt European goods although there is still a distinct possibility there that specific European products could be affected,” she added.

Analysts have warned that Trump’s plan to impose universal tariffs are highly likely to raise prices for consumers and slow spending.

Europe

Ben May, director of global macro research at Oxford Economics, said the direct impact of Trump 2.0 on economic growth is likely to be limited in the near term, “but masks major implications for trade and the composition of growth, and for financial markets.”

For instance, May said that in a scenario in which the more radical aspects of Trump’s policy agenda are adopted, particularly on tariffs, the impact across the globe will be “very sizable.”

“A key unknown is whether a clean sweep raises the risk that a Trump administration will push through more extreme policy measures, such as larger, less-targeted tariffs,” May said in a research note.

“Uncertainty over Trump’s stance on the conflicts in Ukraine and the Middle East also adds to the risk of greater instability in both regions, which could take a toll on regional, and even global, growth,” he added.

Europe is seen as a loser of a Trump presidency, Barclays strategist says

The prospect of a second Trump presidency had long been viewed as negative for Europe and the European Union more broadly.

Yet, analysts at Signum Global Advisors said in a research note on Wednesday that “the magnitude of that truth remains underappreciated.”

Indeed, they argued that several factors mean the EU is likely to be “the biggest loser of a second Trump era,” citing trade tensions, an ongoing frustration with key European policy decisions and Trump’s likely desire to double down on America’s advantage at attracting capital relocation.

Asia

Analysts at Macquarie Group said Thursday that, at face value, Trump’s election victory is “bad news for Asia,” particularly China, but the region is “more prepared” than in 2016, when he first moved into the White House.

A cargo ship is sailing towards the docking of a foreign trade container terminal in Qingdao Port, Shandong province, in Qingdao, China, on June 7, 2024.

Costfoto | Nurphoto | Getty Images

“A key tenet of Trump’s campaign was higher tariffs. While well telegraphed, the headwinds that are likely to sweep across Asia, particularly China, should spike volatility and compress multiples as uncertainty prevails,” analyst at Macquarie Group said in a research note.

“A counter-balance to this is a likely acceleration in China stimulus measures,” they added. “The Chinese government has already outlined its ambitions to support economic growth at the 5% level and address property market woes to support domestic consumer confidence.”

Mitchell Reiss, an American diplomat and distinguished fellow at the Royal United Services Institute (RUSI) think tank, said there are likely to be some differences to the Trump playbook this time round.

A 'lot of opportunities for growth' in defense stocks after Trump's win, RUSI fellow says

“I think that President-elect Trump has said that he would like to increase tariffs on China again until the playing field is level, in his view,” Reiss told CNBC’s “Squawk Box Europe” on Thursday.

“What was interesting the last time when Trump won was the number of China hawks that staffed his administration. This was a very tough administration in terms of personnel and in terms of their view of how they saw China as an adversary, expansionist in the South China Sea and contrary to American values and friends and allies around the world,” he continued.

“So, I don’t think that that’s going to change. I think that might be mitigated a bit by the economic interaction that we have with China, but I think that it is going to be a complicated relationship going forward.”

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Economics

Democrats need to understand: Americans think they’re worse

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If you think Donald Trump is too crass or cruel or incompetent to be president—if you are disappointed or even astonished that, having tried and failed to subvert the will of the people in the last election, he has come back to win fair and square—you should be asking yourself this question: why, to so many Americans, does the Democratic Party seem worse?

This victory is a tremendous achievement for Mr Trump, who after his loss in 2020 and the attack on the Capitol on January 6th 2021 was counted out even by leaders of his own party. At the time Mitch McConnell, the Senate Republican leader, who privately regarded Mr Trump as “a sleazeball” and “stupid”, called the insurrection “further evidence of Donald Trump’s complete unfitness for office”, according to reporting he has not disputed in a new biography by Michael Tackett, a journalist.

Yet what might seem a psychological frailty—an inability to brook criticism or concede mistakes, much less defeat—has for Mr Trump been a mighty source of political strength, one that intensifies his connection to the voters he has made the base of the Republican Party. As in 2016, Mr Trump wielded his command of that bloc of voters this year to clear a path through crowded Republican primaries, and then relied upon “negative polarisation”, or fear of the other guys, to unite the party. “Can you believe he endorsed me?” Mr Trump chortled at a rally in North Carolina on November 3rd, gloating over how Mr McConnell eventually fell into line. Mr Trump felt no obligation to reciprocate. “Hopefully we get rid of Mitch McConnell pretty soon,” he said.

Mr Trump has shown courage, not only in weathering assassins’ attacks but in insisting on views on trade, entitlements and other matters that a few years ago were heresy within his party. With his sophisticated grasp of new and legacy media and his instinct for the basic needs and fears of many Americans, he has revolutionised how American politics is conducted and shifted the policy terrain over which it is waged. In terms of disrupting what came before, he has had more effect than even Ronald Reagan.

Unlike Reagan—or the other two-term presidents since, Bill Clinton, George W. Bush and Barack Obama—Mr Trump has never been very popular, though he managed, in this third run as the Republican nominee, at last to win the popular vote. Unlike those predecessors, Mr Trump has relied upon division, not addition, for his electoral maths. In his first term his average approval rating of 41% was the lowest ever measured by the Gallup Poll, which began tracking the statistic under Harry Truman. Democrats have good reason to think Mr Trump repels many voters when he calls adversaries “vermin” or “the enemy from within” or says illegal immigrants are “poisoning the blood of our country”.

Yet, after this victory, whatever disdain Democrats have for Mr Trump should be cause only for humility and self-scrutiny. As in 2016, Mr Trump’s broad support will present his adversaries with a Rorschach test in which they can see their preferred image of America, and it will be ugly. For some, white supremacy and misogyny will explain Mr Trump’s success, while others may attribute it to tax cuts and greed. Some will conclude that poor, non-white or female Americans have been ensorcelled into voting against their self-interest. Rather than retreat into some grand theory, they would so better ro think through how, in a divided country, President Joe Biden might have nudged the balance a few points away from Mr Trump, rather than to him. Kamala Harris was no bystander, but pime responsibility lies with the president she served.

Mr Biden did not heed his own warnings about Mr Trump. He tried to eat into Mr Trump’s support with blue-collar workers through giant investments in manufacturing and infrastructure that offered something to everyone. But, unlike Mr Clinton or Mr Obama, he ducked choices that would have respected the concerns of most Americans but disappointed left-wing Democrats. A political strategy of addition still requires some division.

Most egregious, Mr Biden resharpened Mr Trump’s most effective political wedge by doing away with obstacles he had created to illegal immigration, with no alternative. By the time he restored some of Mr Trump’s restrictions this spring, more than 4m migrants had crossed the southern border, compared with fewer than 1m under Mr Trump. That was terrible for the Democrats as a party, and worse for people they want to help and the cause they believe in: under Mr Biden, Americans who say they want a decrease in legal immigration rose from a minority to a majority, as did the number who favour mass deportation.

How to defend democracy

Even where Mr Biden had accomplishments that undermined Mr Trump’s arguments, he let himself be constrained by his party’s loudest activists. Oil production rose to record levels, but Mr Biden did not boast about that. He was also no longer up to the demands of presidential communication that Mr Trump understands so well. He was not constantly, energetically promoting his success in sustaining economic growth and raising wages. His approval rating sagged as low as 36% just asother Democrats were forcing him to face the obvious: he should not be running again. In the short time Ms Harris had, she waged a good campaign. But any politician would have struggled under such burdens. She could not separate herself enough from Mr Biden, or from the video Mr Trump’s ads used, to devastating effect, of her recently declaring positions that were alienating to most Americans.

“We have learned again that democracy is precious,” Mr Biden proudly declared during his inaugural address almost four years ago. “Democracy is fragile. And at this hour, my friends, democracy has prevailed.” Now it has prevailed again. Will Democrats get the message this time? 

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