Photo source: Newsbook
Donald Trump has been elected as the 47th president of the United States, marking his return to the White House. According to The Associated Press, he secured at least 277 Electoral College votes in the recent election.
The announcement of Trump’s victory has been met with international accolades, although it is expected to contribute to ongoing uncertainties in a volatile geopolitical landscape.
Trump’s win over Vice President Kamala Harris was more decisive than many anticipated, as he claimed vital battleground states. His victories in Wisconsin, Georgia, North Carolina, and Pennsylvania enabled him to surpass the crucial 270 Electoral College votes needed to reclaim the presidency in Tuesday’s election.
How the Electoral College Votes Work
Electoral College votes are the votes cast by electors in the U.S. presidential election, totaling 538. Each state has electors based on its Congressional representation, and most states use a winner-take-all system, where the candidate winning the popular vote in that state receives all its electoral votes.
A candidate needs at least 270 electoral votes to win the presidency, which can lead to scenarios where a candidate wins without securing the national popular vote. This system aims to balance the influence of populous and less populous states in elections.
As it stands, Trump holds 277 electoral votes compared to Harris’s 224. Despite predictions of a closely contested race, Trump’s resurgence appears to have been driven by voter discontent and anger following his defeat in 2020 and the backlash against his refusal to concede.
This refusal led to a violent insurrection at the U.S. Capitol, and Trump faced felony charges along with surviving two assassination attempts. Nevertheless, his campaign effectively resonated with a significant portion of the electorate by targeting perceived grievances against political opponents, immigrants, and various minority groups in an increasingly divided nation.
In his victory speech to supporters, Trump asserted that he had received “an unprecedented and powerful mandate.” He expressed gratitude towards his supporters, saying, “This was a movement like nobody’s ever seen before, and frankly, this was, I believe, the greatest political movement of all time. There’s never been anything like this in this country, and maybe beyond.”
Potential Economic Consequences
Trump’s election brings significant implications for the global economy, especially given his threats to impose tariffs on all imports into the United States. The U.S., recognised as a leader in technology and innovation—spending more on research and development than any other nation—has become a focal point of envy globally. However, there are concerns that excessive dependence on U.S. markets could be detrimental for other countries.
This scenario would not have drastically changed had Harris emerged victorious. The “America first” policy espoused by Trump has gained bipartisan traction since former President Barack Obama’s focus on energy independence. The U.S. has largely pursued an inward-looking strategy to maintain technological leadership while curtailing offshoring of jobs.
During his first term, Trump opted for higher consumer prices to bolster domestic producers by imposing steep tariffs on numerous trading partners. For example, tariffs implemented in 2018 on washing machines resulted in a 12% price increase for American consumers.
President Joe Biden has also escalated some of Trump’s tariffs—raising them by up to 100% on electric vehicles and 50% on solar panels from China—albeit in a more diplomatic manner. This decision was made amid a climate emergency and illustrates a choice to decelerate energy transitions in favour of protecting U.S. manufacturing.
While Biden reached an agreement with Europe regarding tariffs, he initiated a potentially more damaging subsidy competition through legislation such as the Inflation Reduction Act, which allocates USD$369 billion toward electric vehicles and renewable energy initiatives. Additionally, the Chips Act commits $52 billion to support semiconductor production.
Global Reactions
The U.S.’s industrial policies have outstanding repercussions worldwide. China faces challenges related to industrial overcapacity after decades of export-driven growth and is now focusing on boosting domestic consumption while diversifying its trade partnerships.
Europe is also investing heavily in subsidies despite tight budget constraints. Germany is committed to matching U.S. subsidies. For instance, it has pledged €900 million to Swedish battery manufacturer Northvolt for continued production within its borders.
These subsidy wars are detrimental to the global economy and could have instead funded urgent initiatives like solar electrification across Africa. Meanwhile, China has emerged as a leading investor in Africa, driven by its need for natural resources.
Trump’s new mandate could present an opportunity for innovative solutions. For example, one might argue that clearer communication from the Biden administration regarding potential consequences could have deterred Russia from invading Ukraine.
However, much responsibility lies with Europe. Trump had previously cautioned Germany about becoming overly reliant on Russian gas during his first term. A potential path forward could involve Europe aiding China in addressing its overcapacity issues by negotiating an end to tariff conflicts over solar panels and electric vehicles.
In exchange, Europe could regain autonomy by boosting its own clean energy production instead of relying heavily on U.S. liquid gas imports. It could also benefit from partnerships with Chinese firms that might leverage China’s influence over Russia to aid in resolving the Ukraine conflict.
The European Union might also focus more on its strengths—establishing trade agreements that can contribute to reducing global carbon emissions.
It seems improbable that a Trump administration will shift away from reduced U.S. involvement internationally or spearhead initiatives addressing peace or climate change or advocate for trade liberalisation.
Trump’s return could either perpetuate existing trends or lead to economic isolationism that diminishes U.S. relevance globally—a reality that Americans have chosen and one that others must deal with accordingly. In this context, global cooperation without excessive interdependence may be essential moving forward.
What Trump’s Victory Means for NZ
Trump winning the presidency could significantly impact New Zealand’s economy and international relations. His administration’s protectionist trade policies, including potential tariffs on imports, pose risks to New Zealand’s agricultural exports, particularly in meat and dairy.
Experts warn that these tariffs could diminish trade between the two nations and lead to increased inflation in the U.S., resulting in higher interest rates globally. This scenario may strain New Zealand banks that rely on offshore funding, ultimately affecting home loan costs for Kiwis.
Additionally, Trump’s presidency could alter New Zealand’s diplomatic landscape, potentially increasing pressure to align with U.S.-led initiatives like AUKUS—a trilateral security partnership between Australia, the United Kingdom, and the United States, that aims to enhance defence cooperation in the Indo-Pacific region, primarily through the development of nuclear-powered submarines and advanced military technologies.
Meanwhile, Prime Minister Christopher Luxon has acknowledged the need for New Zealand to brace for a more complex geopolitical environment.
Moreover, there are indications that Trump’s presidency might encourage an influx of American migrants seeking stability in New Zealand, which could worsen existing housing shortages in cities like Auckland. Overall, the shifting geopolitical landscape will require active cooperation and collaboration among countries to tackle new uncertainties and build resilience.