Sunday, May 22, 2016

Making Sense of Trump Rise and Hillary's Task

The world is perplexed about the rise of Trump in American Politics but the reasons are not intractable. Republican party has been selling prosperity to masses while castigating Barack Obama as the villain for years. Either GOP forgot or Tea Party voters failed to understand basics of our constitution - that winning both chambers of Congress does not nullify Presidency. As far as the promised prosperity goes, when there is no inclination to support any of Obama Administration's fiscal initiatives to spend more for Americans; we are going to be stuck in the 'secular stagnation'. Republican Bush Administration maintained the GOP orthodoxy of tax cuts for rich and open embrace of globalization with scant regard for loosing jobs in America resulting in perennial neglect of common Americans. Such a 'rich serving' policy of GOP never had any possibility of improving lives of common Americans.

That is the same orthodoxy with no track record of helping commons (but only rich) which was available for 'sale' in Republican Primary; least enticing for Republican primary voters. With zero credibility in nullifying Obama reign and no policy results to show; Republican Primary voters rejected the entire crowded field. Trump rode in and won the primarily on this background of 'credibility crisis'. In equal measure inability of GOP establishment to coalesce around one single candidate to fight Trump early on helped. Party Mandarins failed basic politics 101 - fight your enemy, in this case Trump, unitedly. Greed, ego, ambitions of many of the GOP candidates and incompetence of GOP Party bosses; all equally contributed for Trump to usurp GOP nomination. Then do we say that the dislike of all other GOP candidates and a visceral desire to 'teach a lesson' to party bosses; all led Republican Primary voters to ignore how faulty Trump candidacy is? It seems so, given that Trump is essentially a 'fraud'. 

To start with, Trump's claim for Oval Office rests on his business achievements. Those achievements are nothing very sterling. Sure, Trump did not loose what he inherited from his rich dad and in his own clumsy way built his current empire on top of that foundation. But his journey to Billionaire club went through multiple bankruptcy stops for his various businesses. Heart of the bankruptcy is an inability to fulfill financial promises to your creditors. A rare bankruptcy due to extreme external conditions, one can understand that. But when you have multiple of such and active boasting by Trump that he is master at negotiating debt down, which he stupidly wanted to apply to American Debt; it is clear that 'financial promises' to his creditors is not an obligation Trump takes seriously. What to make off then his promises to American voters that he will make America great? Any such claims simply do not look credible, worthy of a vote. Add to this his reluctance to release his taxes and in essence refusal to bring the necessary transparency to his financial dealings. How are Americans supposed to know that Trump Presidency would avoid any corrupting influences in decision making which will help his financial empire? His history shows that he is capable of undertaking any means to enrich his businesses. Why would he not do the same via Oval Office occupancy? Further, would we want our President as someone who has done financial frauds? Because in absence of his tax returns, there is no reason to believe otherwise; given the history of Trump companies. 

Meanwhile, it is not a case that Trump is advocating any credible, coherent, practical and innovative policy agenda to bring economic prosperity to America. The naivety he showed while talking about America's debt or his complete incoherence about tax policy or his tendency to talk global trade within an outdated mercantilism framework; all these are clear enough signs that the 'guy' does not know anything at all about how to strengthen American economy further. His vendetta driven approach to Yellen Fed would hardly assure global capital markets while his completely ignorant and partisan utterances about Dodd-Frank regulations deprive protections for common American in one fell swoop. As if all this is not enough, his white ento-nationalism, despicable utterances against Hispanics and Muslims around the world; would only unleash a chaos least acceptable to global capital markets. Trump famously predicted that a massive recession is coming. As he climbs in polls and people view glimpses of possibility of a Trump Presidency; 'fits to Capital Markets' are quite possible. In other words Trump himself, and all his ugly utterances, will be the chief cause for producing a recession![1] It also fits very well with the narrative of 'Trump as the seer who sees what is coming' and as a leader he will take us to the promised land. Predicting 'hard times' to claim the sole rights of 'savior of masses'; that is an old trope in politics.

It is on this background Hillary Clinton has to fight the 2016 election. Donald Trump and wounded Republican Party, which is trying to come around Trump[2]; would have every political incentive to talk down 'American Economy'. Barack Obama is doing his bit - telling rightfully Americans that Americans should not be excessively negative for our state of affairs; but it is the Hillary Campaign which will have to clear the fog.[3] The best way to achieve this will be:
- to challenge credibility of Trump (which is actually required given his utterly stupids pronouncements so far); and
- to continue to demonstrate the folly of Republican Proposals i.e. American Economy grew during a Democratic presidency when taxes on rich were high while recession happened when a Republican presidency provided tax cuts for rich, financed via deficits.

Make taxes and economic policy as one of the main campaign issues of 2016. On GOP side that cannot happen, but Hillary Clinton can and should raise those issues.

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When it comes to foreign policy, one can argue that Republican predicament after Bush years and complete nonsensical utterances by Trump; it all makes easy to see the wrongness of GOP foreign policy prescriptions. Failed foreign adventures of George Bush humbled Republicans, at least Republican voters who started to doubt aggressive interventionist policy of GOP establishment. But foolishly, most of the Republican Primary field maintained 'rote recitation' of corroded GOP orthodoxy with no innovation. Trump cleverly side stepped this trap and famously attacked Jeb Bush for his brothers failed foreign policy.

But ducking orthodoxy is not same as advocating 'anarchy' which Trump seems to be doing subsequently. In Trump Presidency, Donald will start by insulting a close allay like UK; proceeding further to rip apart NATO. Next stop Moscow, to kiss a pal Vladimir Putin where two might cook a up plan or two to kick around Ukraine and to make co-habitation of Assad with Dayesh in Syria. For Iranians, he will rip out Iran Nuke Accord essentially letting Iran back on the 'nuke path' while President Trump would not mind at all Saudis pursuing their own atomic bomb to counter Ayatollah's of Tehran. Oh, for sure there will be a 'chick visit' to Jerusalem now that Sheldon Adelson has endorsed Trump; all vouching how much Donald 'loves and cares Jews'. Will Israelis be hood winked by that 'sweet talk' while ignoring how Donald would trigger atom bomb race in their own backyard? 

Before heading Asia, Donald will probably stop in India to thank those fellow Hindu Nationalists who prayed for Donald's win. It fits perfectly with Putin style Donald authoritarianism as he sides with extreme anti-Muslim sentiments of India and with RSS backed BJP Modi government in wihch Donald will find ample company. By the time Donald sets his foot in Japan and S. Korea; the message would have reached already. Beijing might not like it, but with a strong encouragement from President Trump; Tokyo and Seoul will join the nuclear arms race too.

If it were a cartoonish trip, we may get some levity. But by inflaming such a nuclear carnage globally; Trump retrenchment of America's global role will set the stage for preponderance of nukes all over the world increasing chances of extremists like Dayesh and Al-Qeda getting a handle on one of these weapons to create a mayhem. That danger is real. How will America be Great when Trump Presidency would have ignited 'weapons of mass destruction race' all over the globe while simultaneously triggering a trade war with China? Do Americans not see what will happen with Trump Presidency then? We are talking Daisy Ad baby here.

That is the task in front of Hillary Campaign. Addressing the issue of American Political System not taking care of workers who lose jobs because of Globalization and new Trade Pact is a genuine requirement for the next president. But that does not translate into a reckless foreign policy which will be blowing off international consensus achieved after decades of efforts. That is what Donald Trump is talking to do and that should be a simple case for Hillary to argue against. Doubts about whether Hillary campaign is up to the task are fair. But Hillary has withstood decades of Republican political attacks which should give her strength to undertake deconstruction of Trump. It may not be a 'sexy' campaignbut what matters is whether America avoids non-sense of Trump politics. 

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[1] When Sen. McCain overreacted to financial happenings in 2008, it hardly raised any confidence to financial markets; rather making capital markets nervous.

[2] Way back J Chait predicted that all this talk about Republicans splitting or contested GOP convention due to rise of Trump and his trampling of GOP establishment; is non-sense. Once the nominee, Republicans will eventually unite around Trump; and for sure that is what is happening.

[3] I would not argue lightly that Trump and Republicans will be actively sabotaging American Economy to gain a political advantage. It is a kind of treason charge. But having seen the politics of Obama years when:
- the single most important goal a powerful Republican Senator within months of Obama election of 2009 sets is to make Obama one term, or 
- consistent disregard of Republicans to undertake any fiscal spending to alleviate pains of American economy; or 
- the near constant fear mongering of deficits in times of recessions - precisely a wrong concern; 
it is hard to trust Republicans for our economic future. Just because your economic aspirations not fully met during a Democratic Presidency does not mean Americans should simply be accepting the non-sense of 'rich serving' GOP economic agenda with a view that 'what more bad can happen'. Because with Trump at the helm and GOP dominance in Congress; indeed lot worse can happen.

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