A Democratic House may restrain the worst impulses of the Trump administration. But the vote's outcome shows Trumpism is not a passing fancy.
Last week’s election offered some clarity and even comfort in the realm of economic issues.
With Democrats taking control of the U.S. House of Representatives, despite extreme gerrymandering to favor the GOP in many states, a check will be placed on President Trump’s most extreme tendencies.
Thus, for example, no draconian cuts to the social-safety net can make it through Congress. Millions of older Americans who are kept out of poverty by Social Security and Medicare can rest easier. The Affordable Care Act is safe from repeal, too, although not from administration sabotage. Further tax cuts for the rich, widening inequality and providing little broader economic benefit, would be dead on arrival.
Of great significance: The new House may be able to protect the integrity of the census and other federal data. Distorting and misrepresenting these data would be a calamity for business, as well as local governments, academics and informed citizens.
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On the other hand, conservatives can take comfort in keeping control of the Senate. This will thwart what, in their view, would be ruinous Democratic initiatives, such as Medicare for All. The Senate alone holds the power to confirm judges, Cabinet members and other high officials.
The House victory could also be fleeting, not least because another election will come two years hence in the formerly red districts that Democrats won. And if Republicans control most statehouses, they will continue gerrymandering.
New trade agreements, not being merely treaties, must be approved by both houses of Congress.
Washington state turned a little bluer. But Initiative 1631, a modest beginning to taxing the carbon emissions that are the biggest source of human-caused climate change, was defeated.
One can’t avoid the impression that a majority of Washington citizens are content to motor into a climate catastrophe, armed only with excuses against action or hopes for unlikely techno-magic “solutions.” If Washington couldn’t take a stand, don’t expect one in South Carolina.
The result of the successful disinformation campaign about economic pain from a carbon tax — never mind the potential economic gains from clean-energy industries and transit employment — ensures enormous real costs from a warming climate. This butcher’s bill is coming due now. But it’s easily dismissed, denied, explained away, and it’s not as compelling a story as potential job losses in oil refining.
Overall, the election appeared to sharpen and harden the great divide in America.
While Trump didn’t get the boost that a normal president might have received from the strong economy, it’s clear that Trumpism is here to stay. It has taken over the GOP, which as recently as 1990 was still a mass party with conservatives, centrists and liberals.
On the economic side, Trumpism shares some territory with Reagan conservatism. These include tax cuts, deregulation and greater military spending.
But a sharp departure occurs in other areas, especially trade, immigration, American leadership of the world liberal economic order and how to constructively engage a rising China.
The former similarities gave the rich and corporations a big tax cut (and most of the corporate windfall went to stock buybacks for shareholders, rather than raises for employees or investment in innovation). They rolled back regulations on polluters and finance.
But in the Trumpism departures from the past, business hasn’t even been a short-term winner.
Tariffs on China, which brought retaliation from Beijing and threaten to become a severe trade war, are hurting far more American companies than the few they are helping. American bullying of allies, and threats to withdraw from trade agreements, make other nations worry about our trustworthiness.
Trump’s antipathy toward immigrants and “political correctness” runs counter to the policies of most major U.S. firms. Inclusion, openness and diversity are especially important in technology centers such as Seattle.
A day before the election, the Financial Times’ Gideon Rachman wrote, “If the Republicans do well, then many will conclude that ‘Trumpism’ is here to stay. The rest of the world would have to make a long-term adjustment to an America that is highly protectionist and suspicious of treaties on principle — whether they deal with climate change, arms control, refugees or migration.”
Republicans, now the Party of Donald Trump, did well enough.
Trump supporters tell me that they’re willing to endure some short-term pain and dislocation to “deal with China,” as well as pressuring American industry to move jobs back home. They are also concerned about the high levels of immigration in recent years driving down wages, as well as destroying the nation’s historical identity.
These backers of the president also see the Democrats as a dangerous threat to freedom and the economy.
My pointing out various disconnects — such as how denying climate change and preventing urgent measures to address it are increasing immigration — make no headway with the right. But don’t underestimate its fervor or structural advantages in the federal government, especially the Senate. Trumpism will outlive the president.
Dismantling the America-led order and picking fights with allies and competitors make for a perilous business climate.
Henry Paulson, Treasury secretary under President George W. Bush, warned in a speech last week that “economic tensions are reaching a breaking point” between the United States and China. “I now see the prospect of an economic iron curtain — one that throws up new walls on each side and unmakes the global economy, as we have known it.”
Pay little attention to the stock market. It’s all about short-term gains in one segment of the economy. Wall Street is often late in realizing the wolves at the door.
From trade to bubbles to simple old age, this expansion faces multiple predators. Even a mild recession would give voters a chance to blame someone at the ballot box in 2020, deserved or not.