Trump 2.0: it's happening
More chaos and drama ahead
Trump has won the 2024 US presidential election. This was an extremely close election, with the Harris campaign offering a younger, moderate, experienced candidate, appealing to national unity, the need to restore abortion rights, and rejection of a “petty tyrant.” A majority of the American electorate has chosen the riskier candidate, whether because of post-Covid inflation, opposition to immigration, or the appeal of a strongman who promises to overturn the status quo. Republicans have also won a majority in the Senate.
Trump thrives on chaos and drama. It’s suddenly much more difficult to predict what’s going to happen over the next few years, and to make long-term plans. Is he going to follow the path of macroeconomic populism, cutting taxes and running large deficits? Or is he going to listen to his business allies and bring in sweeping cuts to Social Security and Medicare?
For Canadians, the immediate question is what happens with Trump’s promised tariffs, and what the economic impact will be. Alexander Panetta on Twitter:
Canada has tried for months to get some indication of how Trump's tariffs would work, speaking with multiple US Trade Representative and Treasury officials who worked for him once, and could re-enter govt again. The result: No indication whatsoever of an exemption.
My best hunch on what Trump would do: Announce the tariffs quickly, maybe not taking effect everywhere immediately. I can't see oil, for instance, or winter fruit imports getting tariffed.
Then the tariffs would get adjusted, but in exchange for trade concessions. ie: they become Trump's brass knuckles at some never-ending bargaining session.
And that constant threat of tariffs - the constant threats that they could grow - becomes a feature of the US trading system, not a bug. The objective, of course, being to force companies to build in the US to spare themselves the perennial drama.
This permanent state of uncertainty is why it's so hard to project the economic impact on Canada. You have the Peterson Institute predicting a 0.4% hit to Canada's GDP (and bigger for the US).
Yet this analysis from University of Calgary's Trevor Tombe puts it at an eye-watering 5% of Canada's GDP.
Also a huge Quebec angle tonight. With a PQ government-in-waiting already talking about a Quebec independence vote, Trump could become a player in Canada's own national fissures.
1) Dairy. If Canada's getting a tariff exemption, can't imagine dairy demands aren't part of the conversation. A perfect opening for Pequistes to say: You're selling out our rural areas to protect Ontario's car plants!
2) Migration. Already a huge issue for Quebec, demanding more power over its borders. Would only intensify if there's a spike in asylum claimants, from Trump's mass deportation plan.
More
The Economist has a series of policy briefs on the election: world trade, taxes, energy and climate, defense, the Middle East, Ukraine, China.
Inside the Ruthless, Restless Final Days of Trump’s Campaign. Tim Alberta, Atlantic. A good illustration of Trump’s penchant for chaos and resentment of discipline.
Kamala Harris and Donald Trump: 15 Swing Voters Discuss. New York Times.
Howard Gardner, The Disciplined Mind, 1999:
Most five-year-olds have developed a Star Wars script. Life consists of a struggle between Good and Bad forces, with the Good generally triumphant. Many movies and television programs, and a few events in real life, can adequately be described in terms of such a script. Most historical events, however, prove far more complex.