As the US
presidential election results poured in, the shocked elite of the US wept not
because Hillary Clinton lost but because Donald Trump won!
The
reason of a section of the US society lamenting at Trump’s election as the 45th
President of the US is mainly attributed to: his inexperience, character,
temperament and poor knowledge of the high office that he is going to occupy,
besides his hate speech, racial bigotry, and his sheer idiocy about political
policies that he exhibited during his campaign. However, his once described
character by the press as “at best undisciplined and at worst abusive” appears
to have undergone transformation as the calm and conciliatory tone of his
victory speech reflects. Nevertheless, toxicity, once injected into politics is
hard to exorcise.
Secondly,
no one is sure of what his policies would be, for, he is still a leader in the
process of making. And whoever is making any guess about his likely behaviour
as the President is simply based on whatever we all have heard him talking
during his campaign about his polarizing-agenda—his focused address to a
section of America which has felt socially and culturally threatened by the
globalization-induced transformation that America is witnessing through—for the
last one-and-a-half year. And unfortunately, his election rhetoric was so very
clear, consistent and for that matter was even insistent. It therefore, gives
strength to whatever the analysts are predicting about his likely benefitting
the enraged white working class by putting into practise his “ethnic
nationalism” and its impact on the world economy.
Which
means, he is sure to renegotiate the North American Free Trade Agreement
afresh—the most important US-led trade agreement under which the economies of
the US, Canada and Mexico are so deeply integrated over the years—and if
necessary even to withdraw it altogether. And, scrapping of the Trans-Pacific
Partnership, a trade agreement among 12 Asia-Pacific nations that President
Obama felt ‘pivotal’ for America’s Asian policy is a foregone conclusion. His
imposing the proposed high tariffs of 35% on imports from China and Mexico “to
discourage companies from laying off their workers in order to relocate in
other countries and ship them back to the US tax-free” will only engender the
risk of retaliation from the countries affected by his protectionist measures,
besides increasing the cost of living even for the white poor. Secondly, his
proposal to reduce the top individual tax rate to 33% and the corporate tax to
15%, while eliminating estate tax altogether will only widen the already huge
fiscal deficit, unless he cuts ongoing expenditure on defence, or other social
security measures. Ironically, he, at the same time, wants to increase spending
on infrastructure creation by inviting private investment, which by itself is
good. But the big question is: who will invest in a country that is known for
high cost of production owing to its aged-labour, and particularly in the light
of his proposed unabashed protectionist policies. Should this happen, the US public finances
are certain to weaken, which in turn will erode the world’s trust in the
dollar. This can cause instability in the global financial system. Thus the US
is all set to cede its central role in shaping the global trading system. That
side, intriguingly Trump is more likely to fail in delivering the promised
benefits to his support base.
All is
not well even on the geopolitical front: Trump’s plans to retreat from the
alliances that the US has had with European countries or to change terms of
agreement by demanding the allies to bear a larger share of costs is certain to
weaken NATO. Over it, no one is sure of
his policy towards Russia as also about nuclear deal with Iran. This fuzzy
scene when juxtaposed with the Brexit, makes one shudder, for, it may lead to
fragmentation of the EU besides geopolitical changes in West Asia. Similarly,
Trump’s threat to withdraw from his country’s alliance with Japan and Korea
provides enough space to China to assert its dominant position in the region.
This coupled with the likely trade war with China—the country with which it had
a bilateral trade of over half-a- trillion—resulting from his protectionist
measures, is certain to aggravate the existing security concerns in the South
China Sea. Cumulatively, all this means a more volatile world and the highly
vulnerable are the small countries. Some analysts however see a ray of hope:
the US constitutional provision for checks and balances might help in
checkmating Trump. But the reality is otherwise: With both senate and Congress
under the grip of Republican Party, Trump is sure to become an all-powerful
President.
Coming to
us, fortunately, Trump has only made a few positive references to India during
his campaign. Equally creditably, India too has not taken any sides during the
election campaign. So, there is enough scope for India to cultivate an enduring
relationship with him. And, his known stand against ISIS being what it is,
India can leverage on the US in fighting against terrorism. But when it comes
to our IT industry, we may face challenges, given his anti-immigrant posture.
So, the only known certainty now
is: World is heading for many challenging uncertainties.
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