The fear that has spread around the globe as US president-elect Donald Trump prepares to take office is to be expected. His rhetoric covers almost every aspect of life, from relations between the sexes to relations with China.
For people who live far away from the US it might seem that most of the immediate concerns lie within the civic society of the US itself — chauvinism, aggressive rhetoric, anti-migrant ideology and potential overt racism, depletion in social and health expenditure, the creation of powerful enemies abroad, all such things seem on the cards for Americans if “Trumpian” rhetoric should turn into packages of ratified policy.
For Taiwan and its commercial fortunes, it might be that such elements eventually tend toward a commercial meltdown — as the US retracts from importing, Europe implodes politically, Russia runs amok and growth slows in the developing economies.
However, such forecasts remain only that. Most of the Trumpian world is undefined in terms of actual policies. On Wednesday last week, Trump did explicitly and quite carefully reiterate his Mexican wall proposal, and went on to speculate on the manner in which Mexicans would actually bear the financial cost. He did not specify any political cost. He seems also to be retaining his anti-China aggression. However, in general, it might be hoped that such issues will be controlled by the White House itself as well as US Congress and the more thoughtful portions of the media.
There are two more long-term trends that “Trumpism” illuminates that should be very concerning.
The first is political and global. Trump has brought right-wing radicalism into the very heartland of the existing US two-party system. This is something that would have been very difficult to predict. In most broadly democratic systems that are facing diminishing returns — that is, are achieving only low turnout in national and presidential elections, exhibit a general distrust of politicians, a powerful counterculture of social media lying outside of the established political discourse, and so on — radicalism might be expected to enter the system through the breaking up of established major parties or the direct formation of new parties, or through extra-parliamentary agitation, as in a smaller and newer system such as Taiwan since the 1990s.
In contrast and representing a great danger, Trump represents a right leaning populism within a major party at the center of the US system. The only light in this tunnel is that remaining within the two-party conventions seemingly means that Trump is supposedly subject to the boasted “constraints of reason” exhibited in that system.
However, in the meantime, that same US system has given birth — without much of a period of confinement — to one of the most radical political packages of modern times. However much we might abhor it, in the Trumpian world extreme populism remains legitimate, laws are adhered to, violence is eschewed and there is no direct threat to the commercial welfare of powerful democratic allies. So, it might well be that the new model of change in erstwhile democracies, especially in those with fairly rigid two-party systems, low turnouts in elections and large numbers of citizens who feel left behind in a world of new industries and technologies, is Trumpian.
Secondly, in a Trumpian world, the intimate links between politics and economics are made far more clear than in the ordinary times of established democracies. The relative closure of the trading economy that Trump is leading to will have very particular impacts on smaller economies that are heavily trade dependent.
Just as a move in Taiwan away from China trade requires alternative trading partners — the Democratic Progressive Party’s “new southbound policy” for instance — so the dwindling of a US market, even under the rational if nominal guise of protection of infant industries or fuller employment, means that much of Europe — the exemplary case is the UK — needs to rethink the pattern of export trades. It is imperative to recognize the importance of the global trade switches that a Trumpian world implies.
The movement against free imports into the US is important because it reverses an historical trend that has been of enormous importance to developing economies since the early 1970s, and because it seems central to Trump’s vision of relations between his political and economic regimes.
In earlier times, especially during the Cold War, the trade-deficit effects on the US economic system of huge imports were offset from the US point of view by certain advantages. Thus, importing from small systems created alliances in the Cold War world, while adding key raw materials to the US technological system; it provided cheap consumer goods to US workers helping to keep wages and inflation down; it prompted movements of US investment to trading partners and stimulated private sector direct investments in high-tech exports. None of this was unproblematic. Importing cheap goods might have held down wages, but it almost certainly increased the levels of unemployment in the US in areas that might otherwise have supplied the domestic market.
In a world of global recession, the world that created “Trumpist” populism, some form of protectionism or trade regime modification was probably in the offing anyway. The complete and unforeseen disaster has been that the reform has occurred in a regime of right-wing aggressive isolationism and modified neoliberalism, rather than as part of a more truly liberal reform package of welfare expenditure, military drawback and attempts at regional and city regeneration.
In addition, it has been mounted as a direct attack on China, which is by no means a clever way of doing global politics. Just when the Chinese economy might well be settling into a stable character of more moderate growth, progressive structural change and industrial devolution, so too Trumpian philosophy decides to use trade restriction as a crude tool of geopolitical suasion. This coincides with a period when China might have expected to be both seeking more areas of potential soft power through commercial alliances and new diplomacy as well as more liberal political projects in the inner China hinterlands, possibly led by the huge funds locked up in the coffers of local governments and their banks.
Trump is a complete disaster in global terms and for reasons that are not at the center of the media furore surrounding him. It really is a bit depressing.
True liberals in the US who might have had some case in addressing trade matters are now scared off by a fear of being thought allied to other elements of the Trumpian world, elements which even singly could not have been imagined even this time last year. It bodes badly for any ideas that new coalitions of interest might act as bulwarks against the onward movements of Trumpism.
So, for Taiwan, the future in a Trumpian world is highly problematic. Exporters in Taiwan must now face possible restrictions from both China and the US across a range of exports at the same time as Chinese-US relations more clearly deteriorate and the US becomes more inward-looking.
One final thought: No one with any historical knowledge could applaud the past impacts of free trade and neoliberalism. Even prior to the recession from 2008, market-led expansion was globally divisive. In the 20 or more years prior to 2008 the number of people living on less than US$2 per day rose by around 50 percent to nearly 3 billion, this despite the growth in China and Asia more generally.
Contrariwise, the fast growth of Japan after 1960 and the newly industrializing countries of east Asia from the 1970s were postulated on policy regimes that included quite extreme measures of protectionism, and no one can say that fast Chinese growth involves free-market policy in China itself.
However, acknowledging that free trade has serious drawbacks or that protectionism can work in certain circumstances, cannot become an argument for Trumpism. The US is the most powerful economy in the world, can gain little from infant-industry protection and needs its allies in a changing world. Even if the pure nonsense rhetoric is dismissed, the future in a Trumpian world looks very gloomy, even from distant shores.
Ian Inkster is professorial research associate at the Center of Taiwan Studies, SOAS, University of London, and the editor of the international journal History of Technology.
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