Why does this era of U.S. politics feel so different to any other in our lifetime? The answer is that President Trump’s leadership and policy actions are revolutionising both their public realm into something smaller, weaker, and harder, and also giving themselves over to the corporations and to their military, at a speed and scale we haven’t experienced before.
Let’s see where this heads them.
Alabama, the Senate, and Congress
The Alabama Senate race has been a useful pause to the politics of the U.S.A. For a moment it seemed as if feminism itself was contesting that Senate race, and through a great orchestration of media stories and minor triumphs, feminism won the battle even though the great electoral feminist war for the Presidency itself had been lost. Hillary was right all along – but that’s not enough.
It’s not hard to remind ourselves in this temporary breathing space that the Alabama race was really close. It is a reasonable bet that social conservatives and white blue-collar supporters in rural areas will continue to vote on the basis of nationalist and religious sentiment and antipathy toward secular coastal elites, rather than for their own financial interests.
A useful pause. A lull in a war for the very worst of plutocratic rule, coded racism, bullying, wealth-transfers to the 1%, corruption to the highest levels, political domination, and of accelerated decline in the United States itself. While feminism continues to win great battles, only feminism is winning. Not income. Not social division or social mobility. Not race or ethnicity or immigration. Not sound governance. Not media old and new. Not peace. Not nature. Not native peoples. Not disability. Not poverty. Not violence. Not any other liberative contest. They are all being lost.
What the electorate had been expecting was a revival in the interests of blue-collar, socially conservative whites who brought Trump to power. Nope. The Republican Party will continue to put in extreme candidates, who will continue to rule the Senate, Congress, White House and Supreme Court for many years to come.
With those majorities and a stacked Court, the President will never be impeached, will not walk from office, and will continue his current executive and policy direction for four more years. This is their political future until 2025 and probably beyond.
The U.S. Secretary of State and the President used to be the most effective diplomats in the world. Under President Reagan, the Cold War and all its smaller wars pretty much ended. Under Obama, deals were brokered with old enemies like Cuba and Iran, and boots-on-the-ground military were massively decreasing. Previously fully on board with climate change deals, now they are the only major country in the world outside it. They are burning.
The future of the U.S.A’s international influence is also decreasing because it is burning itself out in the Middle East like an underground coal seam fire. From World War Two until 1980, there were zero U.S. military deaths in the Middle East. Since 1990, almost all U.S. military deaths have been in the Middle East. The U.S. has spent trillions of dollars in multiple interventions across countries from Ethiopia, Egypt, Yemen, Syria, Libya, Iraq, Afghanistan, and Pakistan. Most of their effects have been profoundly retrograde. Even if they lessen, there is no sign that these interventions will stop. There may at some point be a great civic accounting for it all, but at the moment the American people are pretty much asleep to it all. This is their future in foreign affairs.
Trump and the Republicans’ plan to repeal the 2010 Affordable Care Act (Obamacare) would have left 24 million Americans – mostly poor or middle class, many of whom voted for him – without health care. His deregulatory policies are blatantly biased against workers and unions. And the Republican tax-reform plan that he has endorsed would overwhelmingly favor multinational corporations and the top 1% of households, many of which stand to benefit especially from the repeal of the estate tax.
The new tax plan about to be passed will take away the funding of plans for about 13 million uninsured Americans. Trump will continue to gut the Obamacare provisions through executive actions well within his remit in the next year and the full three years. There is no replacement plan.
Trump has abandoned his base in the area of trade, where he has offered rhetoric but not concrete action. Yes, he scrapped the Trans-Pacific Partnership (TPP), but Hillary Clinton would have done the same. He has mused about abandoning the North American Free Trade Act (NAFTA), but that may be just a negotiating tactic. He has threatened to impose a 50% tariff on goods from China, Mexico, and other US trade partners, but no such measures have materialized. And proposals for a border adjustment tax have been all but forgotten.
Trump’s bullying tweets against US firms that move production offshore or undertake tax inversions have been no more than cheap talk, and business leaders know it. Manufacturers who fooled Trump into thinking they would keep production in the U.S have continued to transfer operations quietly to Mexico, China, and elsewhere. Moreover, international provisions in the pending tax legislation will give US multinationals an even greater incentive to invest, hire, and produce abroad, while using transfer pricing and other schemes to salt away profits in low-tax jurisdictions.
Tax will be a massive legacy for this President this week – a major boost to the GOP to sustain their power at all levels of government and of law.
President Trump’s permanent cuts to the maximum corporate tax rate fall from 35% to 21%. Most corporations don’t pay more than 15% because they have excellent tax planners and tax lawyers. U.S.-based corporations will no longer have to pay tax on profits earned in other countries – this will be a real help to the big tech companies and big pharmaceutical companies. The seven personal income tax brackets stay, but all of their rates are lowered. It repeals the Obamacare tax for the uninsured, which will mean about 13 million Americans are without healthcare again. It allows oil drilling in the Arctic again.
The net effect is that it is estimated to add about US$1.5 trillion to the national debt, increase GDP about .5% per year, strip healthcare, massively assist the top 1% of earners and multinational corporations at the expense of most Americans, and overall weaken the federal government.
Nevertheless, Trump and the Republicans seem willing to risk it. By pushing the middle-class tax hikes to a later date, they have designed their plan to get them through the 2018 midterm elections and the 2020 general election. Between now and the midterms, they can sell cutting taxes on most households. And they can expect to see the economic-stimulus effects of tax cuts peak in 2019, just before the next presidential election – and long before the bill comes due.
Moreover, the final legislation will likely lower the federal deduction for mortgage interest and eliminate deductibility for state and local taxes. This will hit households in Democratic-leaning states such as New York, New Jersey, and California much harder than households in Republican-leaning states.
Another part of the Republican strategy (known as “starve the beast”) will be to use the higher deficits from tax cuts to argue for cuts in so-called entitlement spending, such as Medicare, Medicaid, food stamps, and Social Security. It’s a risky proposition, given that elderly, middle-class, and low-income Americans rely heavily on these programs and that is the Fox News and Trump supporter base. Yes, the working and non-working poor who receive welfare payments or food stamps include minorities who tend to vote for Democrats. But millions of the blue-collar, socially conservative whites who voted for Trump also rely on these and similar programs.
With the global economy expanding, Trump hopes that tax cuts and deregulation will spur enough growth and create enough jobs that he will have something to brag about. A potential growth rate of 2% won’t necessarily do much to help his blue-collar base, but could push the stock market up to its highest point ever. It’s a bet that only the rich like Trump and his family will win. In the near and far future, everyone else will lose.
Left and right are used to predicting the accelerated decline of America, but now we see it before our eyes and in our lifetimes. Its business as usual economy based on sharemarket performance and corporate profits will continue to do great. Its people will decline. Its social and hard infrastructure will decline. Its entire international standing and engagement will retreat fast. Its long term debt will massively increase and corrode the long term ability of the public sector to restabilise and expand. President Trump has done this inside one year.
None of this gives me any joy. There is no cosmic karma to be had here. There is no sign that the rest of the world appreciates that which the U.S. has done incredibly well. There is now only accelerated loss. We are all weaker and damaged by it.