Anti-Establishment Nationalist Wave still Trumps Democrats

It feels as if the 2016 Presidential election was just yesterday but yet it is already November 2018 and the US midterms are here. Will they be a replay of the anti-establishment nationalist wave that trumped Hillary Clinton in 2016?

Millions of voters will soon go to the polls across the US on November 6th, in an election exercise that could deliver a significant outcome for US policy. One could argue that all midterm elections are somewhat special. However, with a Trump administration that has been noticeably out of the ordinary, and with such a polarized voter spectrum, the political battle during these midterms is particularly fierce. 

All 435 seats in the House of Representatives will be contested, and 35 seats in the 100-member Senate are on the ballot this year. As for governships, there will be voting in 36 states. House, Senate and governors’ races are being held in the midst of a fragmented field, with healthcare, the economy and immigration as voters’ prominent issues. Some contested races are in states Trump won in 2016. Trump’s name is not on the line, but these elections might be seen as a referendum on how American citizens are ranking his performance as leader, and Trump’s ability to deliver his policies might be hindered by the results.

In the photo: Trump Tower, New York. Photo credit: Eric Muhr

Trump has shown an impulsiveness at times that makes his decision-making appear erratic. However, he has also successfully managed to have a “teflon” nuance to his presidency, with numerous accusations and attacks towards him, his associates, and his presidency failing to inflict serious political damage. Even if some in the Republican Party seem to disagree with Trump’s modus operandi, criticism within the party has remained, for the most part, muted. His popularity with a seemingly broad conservative base, helps.

According to Gallup, Trump’s approval rating is at 40%. Trump’s political boost for this election is America’s economic performance. Questions on the health of this economy and his macroeconomic policy could merit a whole other article. However, whether it is Obama’s doing, former Fed chair Janet Yellen’s actions of keeping interest rates low and the quantitative easing program, or Trump’s policies that overheat the economy like the tax cuts, the fact is that the positive spillover for voter perception is happening now. Real GDP growth in 2018 is expected to reach 2.9%, according to the IMF.

The escalating trade dispute with China might start to weigh on growth later in 2018 and into 2019 and the long­term outlook for fiscal health is troubling. But, strong economic growth, a surging stock market, the lowest unemployment in a generation and increases in consumer and business spending, are sure to bring political dividends to Trump.

Foreign policy-wise, Trump has followed his game-plan, generally speaking. He is openly disdainful of multilateralism or what he calls “globalism”, which plays well with his support base. The three-party trade deal, the United States Mexico Canada Agreement (USMCA), reached in late September, to replace the North American Free-Trade Agreement (NAFTA), and the negotiation efforts on the Korean peninsula, are two developments that follow a pattern of tough talk and ultimately reaching an unexpected agreement, given the rhetoric. Doubts remain on the substance and sustainability of such an approach.

On immigration reform, a highly partisan issue, Trump has stuck to his narrative: calls for immigration crackdowns and his desire to build a wall on the southern US border.

In the photo: Trump and Putin Russian dolls. Photo credit: Jørgen Håland

Meanwhile, the “Mueller investigation” commissioned by the Department of Justice into potential links between Trump and his advisers and the Russian state has not yet delivered what Trump’s rivals hoped for. There are reports that special counsel Robert Mueller’s team is shrinking and signs that the investigation may be nearing its final stages. Mueller’s lawyers are still negotiating with the president’s lawyers for an interview with Trump. If Democrats retake the House in the midterm elections, they might go after Trump’s finances and connections to Russia with greater power. However, it is also not proving to be an effective political instrument at the moment.

Currently, Republicans have majorities in both chambers of Congress and have more power than the Democrats at state level. If the Democrats take the House and Senate, Trump’s agenda is will not progress until 2020. If the Republicans win the House and Senate, Trump will push for the border wall, dismantling Obamacare and perhaps a second tax cut, in addition to more conservative judges to the federal bench.

The most likely result of the midterm elections is one of mixed results. According to the latest polls, the Democrats have a decent lead, so they might win control of the House. As for the Senate, Republicans are likely to hold on to their majority. The Democrats would need to win 26 of the seats that they currently occupy that are up for re-election and two Republican seats for a majority. A scenario in which Democrats control the House and the Republicans have a slim Senate majority would mean that legislation-passing would be a struggle.

But what’s behind these trends?

In my view, what we have been witnessing ever since the Brexit vote is something counter-intuitive to most analysts – something that made most analysis fail to envisage a Trump win in the US or a Bolsonaro win in Brazil: morality, reason, and civility have lost their foothold in voters’ priorities when choosing a representative. It is easy for most people to agree that any individual should have a minimum of morality, integrity and dignity. However, with society so tribalized, divided and polarized, the aforementioned principles have lost value and leverage. It is extremely difficult to find people who can have intellectually honest debates with each other. Reason and facts disappear in most exchanges.

In the photo: The White House, Washington DC. Photo credit: Louis Velazquez.

Something that a decade ago would make a candidate immediately drop his name from the ballot is nowadays pushed aside and goes unpunished by most voters. Politically, accusing a candidate of being racist, classist, a tax-dodger, corrupt, homophobic, or misogynist – independent of the validity or not of the accusation – does not seem to be the appropriate strategy to undermine their electoral support. We are seeing that the moral debate within politics is no longer effective.

So, why is this phenomenon happening?

A large chunk of voters is deeply upset because they feel as if no one is addressing their perceived real issues. This voter fatigue reached a turning point in 2015. There has been a deep dissatisfaction over immigration, security, stagnant wages and slow economic growth that have created the anti-establishment wave that elected Trump. Some (a lot of) voters are tired of the status quo, inaction and political correctness, and therefore want to see change at the top, leaving major parties struggling to adjust.

These voters see their enemies as globalization, free trade, offshoring, free movement of people, market-oriented policies, supranational authorities, and even technological change. The right wing in the US and elsewhere will continue to milk this moment to the last drop using current tactics that are seemingly highly effective (see response to Migrant caravan, Trump’s middle-class tax cut). Their pragmatism serves them well. The centrists and left wing have no choice but to regroup and reorganize their strategy. Taking its rust-belt base for granted, for example, was a huge mistake for the Democrats.

In the photo: an anti- Trump protester. Photo credit: Melany Rochester

Overall, if there is a lesson to be taken from recent years, it is that there is a need for policy to ensure that the gains from trade and growth are widely shared. Tax and transfer plans have not been capable of adjusting market income to a more equal household disposable income.

With public backlash against trade and globalization increasing, governments need to focus on ensuring the benefits of global trade and cooperation are shared broadly among their citizens. Most people became angry because of leaders’ inaction and inability to address their issues. Whereas previously people could feel the benefits of globalization, ever since the global financial crisis most citizens’ perception is that they have lost massively, while a small elite has acquired an incredible amount of wealth and is seen to be abusing power to protect its own interests.

Thus, bringing the political strategy to the level of moral debate has proven ineffective in successfully bringing people back from the negative sentiments that propel populism. The mere fact that the US has Trump as President is a crucial signal of the global anti-establishment period. Moreover, at this moment in time, I still see the anti-establishment nationalist wave as bigger than the blue wave. It may even deliver both chambers of Congress to the Republicans.

About the Author /

Pedro Sousa is a Market Intelligence Officer at the Food and Agriculture Organization of the United Nations (FAO) who specializes in providing political and economic donor intelligence, development policy frameworks, trends in ODA, and overall aid architecture and development finance. He has also worked as a policy analyst for the Trade and Markets division of the FAO. Prior to joining the FAO, he was a policy analyst for the Development Centre and for the Global Relations Secretariat of the Organisation for Economic Co-operation and Development (OECD). He graduated in Economics and has a Masters in Political Science, both from the University of Minho, in Portugal.

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