ELECTIONS are supposed to be a period of exciting campaigns, after which everyone goes back to business as usual.
In last Tuesday’s US mid-term elections, the Democrats regained the House of Representatives and the Republicans increased their majority in the Senate. The next day, President Donald Trump held an ill-tempered press conference when he called CNN an enemy of the people and then immediately after the conference, tweeted thanks to Attorney General Jeff Sessions for his services.
In this firing, Trump did not lose a beat in his relentless campaign for 2020 re-election. Expect in the next two years more fire and fury for not just America, but the rest of the world.
Trump saw the mid-term results as a “tremendous success and Big Victory”, mainly because his campaigning for three key Senate seats made the difference for his Republican candidates. Moreover, large numbers of his supporters came out to vote, creating the biggest turnout in mid-term since 1970 at 114 million. The Republican party is now his to direct.
Nevertheless, the election was a vote on his performance to date. Surprisingly, even though the US economy has been doing well, the swing to the Democrats showed that America is fundamentally divided over different values.
By getting 83 Democrat women elected compared with 14 Republican women, including two Muslim and the first Native American woman representative, the Democrats showed that they now have cornered the diversity, youth, suburbia and women’s votes. In contrast, the Republican Grand Old Party appears more like being led by Grumpy Old White Men with rural support.
For those who are surprised that the Democrats can garner more than 9% majority votes but still lose the Senate, it is because the Senate is biased for the rural vote. Twenty senators from urban states represent roughly half the country’s population, but 80 senators represent the smaller rural states.
Furthermore, optimists on this side of the Pacific who think that the elections might tone down the unfolding US-China trade dispute are likely to be disappointed. As former US Treasury Secretary Hank Paulson remarked in Singapore this week, an economic Iron Curtain is being built around China, with support from both sides of the US political spectrum. This is going to be a long-haul disengagement on multiple fronts. Paulson rightly pointed out that this is not a divorce between two parties, because the differences involve many other parties.
European commentator Jean Pisani-Ferry (http://bruegel.org/2018/10/the-global-economys-three-games/) calls the new order as a chess game with three players, the US, China and a loose coalition of other G-20 countries. Welcome to the New Romance of Three Kingdoms. G-2 alone can try to shape the new order, but cannot dictate how it will emerge without the consent of the others.
Former US Secretary of State Henry Kissinger got it right in his July interview with FT: “I think Trump may be one of those figures in history who appears from time to time to mark the end of an era and to force it to give up its old pretences.”
One of the critical pretences is that since it began to shape world affairs after the First World War, America “considers itself unique – that is “exceptional” but with a moral obligation to support its values around the world for reasons beyond raison d’etat.”
Furthermore, the real victor of the Second World War, President Franklin Roosevelt was magnanimous in leadership “the only way to have a friend is to be one. We can gain no lasting peace if we approach it with suspicion and mistrust or with fear”.
But for Trump, “power is fear”, as quoted by Bob Woodward in his new book.
Why is fear and anger driving the rise of the populist right?
Recent surveys in Europe suggest that the extreme right’s anger comes not from neo-Nazis, but middle and low income people who feel insecure because they felt abandoned by the establishment. While the neo-liberal ethos preached globalisation, diversity and political correctness, it tended to solve all problems by writing more and more laws that gave more power to the bureaucracy.
The middle class felt that the establishment was captured by the 1% for the 1%, and completely ignored their basic needs for more social security, education, health and stable income and less corruption or red tape. The neo-liberal ideology fails because it fatally promised to deliver to the majority what only the minority can enjoy under the limited resources of One Earth. Worse, the system has been captured by the 0.1% for its own interests.
These were the oxygen that fuelled the populist desire by erstwhile White House adviser Steve Bannon to “deconstruct the administrative state”. The irony is that the 90% is voting in the 0.1%, who are more likely to change the game, not to fix the 90% problem, but to consolidate their hold on power.
The underlying reason that enables capture and concentration is technology, which actually is dominated by tech giants and the state. Metcalfe’s Law states that the value of network hubs rises exponentially with the number of users. Globalisation and technology enabled a winner-take-all effect, in which those with access to Big Data and Artificial Intelligence (AI) have huge advantages for the incumbents.
This explains why the largest markets in China and America are the sources of fastest tech giant growth.
Hence the 90% feels helpless in the threat of job loss, not blaming faceless algorithms, but by lashing out against foreigners and human immigrants.
The US-China competition is therefore not about trade, but about really who commands the Big Data and AI that will determine their future competitive edge. The Americans feel that they should have access to global Big Data, China thinks that this is a sovereign matter, whereas the Europeans think that this is a private individual right.
On these differences of values and perspectives, the new International Order is unfolding in disorderly fashion. Election campaign noises serve to blind our attention to the key signals of this fundamental change.
To the media, please give us some Trump-free time to think. Fat hope.
Tan Sri Andrew Sheng writes on international issues from an Asian perspective.
Did you find this article insightful?