There are plenty of triumphant Maga-hat wearing X-warriors trumpeting the dawn of an age of enlightenment with an all-knowing “I told you so” attitude, says Steven Joyce. Photo / Doug Mills / The New York Times
There are plenty of triumphant Maga-hat wearing X-warriors trumpeting the dawn of an age of enlightenment with an all-knowing “I told you so” attitude, says Steven Joyce. Photo / Doug Mills / The New York Times
Opinion by Steven Joyce
Steven Joyce is a former National Party Minister of Finance and Minister of Transport. He is director at Joyce Advisory, and the author of the recently published book on his time in office, On the Record.
Trump is promising to introduce trade tariffs and end the war in Ukraine.
Steven Joyce is a former National Party Minister of Finance and Minister of Transport. He is a director at Joyce Advisory and the author of the recently published book on his time in office, On the Record.
Newsthat the Republicans have also taken the United States House of Representatives means that once again a Trump-led White House has control over all three branches of the Federal Government, at least for the next two years. So far so familiar.
Many hundreds of millions of people around the world have spent the last week or so asking themselves ‘how can this be?’.
Sure, in 2016, Trump was the antidote to the Clintons, and in particular the widely disliked Hillary. Back then he was also an unknown quantity. Now there is no excuse.
All of us who lived through Trump 1.0 saw up close his foibles and weaknesses in an erratic soap opera-like performance that culminated in a self-absorbed inability to accept defeat in 2020.
And yet Americans put him back into office four years later, emphatically.
What is going on?
There are plenty of triumphant Maga-hat wearing X-warriors trumpeting the dawn of an age of enlightenment with an all-knowing “I told you so” attitude.
However, in my experience, the partisans of both sides are not the most calm and reflective when their tribe wins. For the rest of us, it’s worth trying to divine what all this means, both for the world we live in and for our little outpost in the South Pacific.
The first lesson might be the now age-old truth in politics, “It’s the economy, stupid”.
In these angst-filled days, each candidate for high office likes to tell the voters that the current election is the most existentially important in our time. The Democrats spent much of the last two weeks of the campaign sounding the alarm that the future of American democracy was at stake. Many American voters had more prosaic concerns.
Things like the cost of living, inflation, their chance at getting ahead in the world. Trump’s remedies for their ills might not be likely to help any of these things, but at least he had some. It’s hard to focus on the future of the democratic project if you are struggling to put food on the table. And when the incumbent party gets too shrill, the cologne of desperation often switches voters off.
The other political lesson from this American election might be that the modern form of identity politics has run its course. The political left the world over has become fond of labelling everyone according to their gender, race, and anything else that might downplay their agency as an individual to influence their destiny.
Identity politics started out as an explanation for why certain groups are marginalised, but has moved on to describing anyone who disagrees with the preferred order as “privileged”, “racist” or “Cis” with opinions which should be banned or de-platformed.
It is clear from this election that American working-class and middle-class voters are not buying what the left are selling. Identity politics has severely damaged the Democrats’ vote, as it has for Labour in New Zealand, and will likely in Canada and Australia in upcoming elections there.
Going on her recent pivot away from identity politics, Kamala Harris realised it was a dead-end. But it was all too late. Her past positions made her platform for this presidential campaign inauthentic, which is political death.
There is a real question here for the old social democratic parties to answer – who exactly do they stand for in the 21st century? At the moment they look weak, and it is not good for politics for right-wing parties to win by default. The Republicans needed competition to encourage them to focus on the broad middle, who are getting shouted down by extremes at both ends of the spectrum.
Beyond the political lessons that parties might take from this election, there are broader lessons for this country.
It is clear that Trump’s America First approach to world politics and economics is not an aberration. Nativism and isolationism are proving enduringly popular in America and the broad sweep of American history shows that shouldn’t come as a surprise.
America was isolationist from independence through to Pearl Harbour, famously turning up late to two world wars. It was only competition with the Soviet Union and then the idealism of the Berlin Wall coming down that encouraged them to be the free world’s protector and policeman. Plenty of Americans clearly still don’t see that as their role.
Donald Trump campaigns for President of the United States in Grand Rapids, Michigan. Photo / via Meta
Trump’s natural strongman tendencies mean he is unlikely to take a back seat in world affairs. But his decisions will be made through an even more America First lens than has been usual recently, which spells trouble for places like Ukraine.
He will also be unpredictable, which his supporters spin as a strength. We will get to see whether that’s so.
For New Zealand, it means we are going to have to be more adept and more agile than we normally do.
I often think of us like the nuggety little first five-eighth on the world stage, spotting the gaps and looking to get over the advantage line without getting king-hit. We are going to need all that skill and more to avoid being inadvertently squashed between the superpowers over the next four years.
Economically, it is likely we will be caught up in the backwash of a great American experiment. A Trumpian recipe of increased trade tariffs, a crackdown on immigration, the attempted resuscitation of a manufacturing sector which is vanishing worldwide, and increased government deficits as a result of further tax reductions, are all likely to mean more inflation in the US, higher interest rates and a stronger US dollar, at least initially.
All else being equal that means a lower kiwi, which might be good for exporters (provided we retain market access) but inflationary for consumers. And likely a higher track for our interest rates than we would have expected even a month ago. To prosper, we are going to have to be even more economically sharper and more growth oriented than we were.
The world is entering uncharted territory. It’s apparent already the Trump team is ready to govern this time around, which it wasn’t in 2016. A steady stream of appointments, from the sensible to the bizarre, offer a precursor to what lies ahead.
That means we will truly find out whether the MAGA economic prescription works or it doesn’t. Personally, I think it is a doomed attempt to wind back the clock to a world that doesn’t exist anymore. But we shall see.
In fact in some ways we have already seen this movie. The advertised economic prescription of the Trump administration (although with a different reason for the big deficits) has many strands in common with the Ardern-Hipkins Government of New Zealand. And we know how that ended.
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