The U.S. at a Crossroad

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TRUMPING THE MASSES: President-elect Donald Trump’s shocking win has split the U.S. population and many have already started protesting his election.

It wasn’t Donald Trump’s victory, but rather Hillary Clinton’s loss.

By Steen Jakobsen 

Like Brexit, the U.S. vote was never about personalities or issues. Had the ìissuesî meant anything to U.S. voters, neither Clinton nor Trump would have made it to the ticket in November.

The very fact that someone like Donald Trump could lead the Republican Party into a presidential election is a testament to how it had nothing to do with the person, nothing to do with policy, but everything to do with Americans’ perceived need to escape what one strategist called “a soulless political machine.”

In the end, Hillary Clinton was simply unelectable. She ran a $1 billion campaign designed to cater to all manner of special interest groups, be they ethnically based, gender-specific, or concerned with very specific policy areas.

Trump’s campaign, conversely, consisted mainly of his Twitter account (and its many followers). That’s right: his Twitter account.
Conclusion number one, then, is very uplifting: spending more money does not buy you more votes, nor can it purchase integrity.

The Media and the Message
It seems that Trump, despite his often inflammatory persona, managed to transform himself into a candidate who believed in America as a whole rather than in specific groups. Several newspapers, including the New York Times, ran page after page of facts detailing how Trump degraded, disparaged, and broadly ignored the norms of political correctness, yet he kept rising in the polls.

If that won’t get the media and political strategists to think twice, what will?

Is the positive conclusion, then, that in the future, the “map to becoming president” has more to do with the desire, both spoken and implied, to be a president for all of America? A real person rather than a focus group approved construct?
Does it require concentrating on what makes America strong, and a decreased emphasis on the needs and grievances of specific sub-groups?

If that indeed is the case, then U.S. politics appears ready to rise from the ashes of destruction.

If this is in turn the case, then it means that Americans need to be American first and a member of whatever minority of special interest group second, but for decades it has been the other way around.

Equal Opportunity
Equal access to education, jobs and welfare will dictate the success of not only the U.S. but of all the world’s countries.
There exists a big misunderstanding that everyone needs to “have the same things”… no we don’t. What we need is equal access. America clearly lags behind here, in my opinion, because the soulless political machine has been flipping favors more than focusing on the bigger issue: unequal access to jobs, education and a future.

Growth and prosperity come through two major channels: demographics (more growth than prosperity) and productivity.
Possessing the ability to improve productivity is the only real way to escape the present low-growth environment, as monetary and fiscal policy is now exhausted. The beauty of that truism lies in the fact that the only way to force productivity upwards is to make people smarter.

The richest countries in the world simply consist of better-educated populations being more productive.
The conclusion, then, is simply to invest in education, research and people. Think about it for a second. It’s the exact opposite of what our soulless political landscape currently does.

The second part of all this is even more interesting. PayPal co-founder Peter Thiel perfectly sums it up in his classic book Zero To One: “At the macro level, the single word for horizontal progress is globalization–taking things that work somewhere and making them work everywhere. China is the paradigmatic example of globalization; its 20-year plan is to become like the United States is today. The Chinese have been straightforwardly copying everything that has worked in the developed world.The single word for vertical, zero to one progress is technology. The rapid progress of information technology in recent decades has made Silicon Valley the capital of ‘technology’ in general.”

Going Vertical
The Brexit vote and the election of Trump marked the twin antitheses of globalization and trade, and marked a protest from the 1989 “Berlin Wall” generation, who opposed the unending extension of “horizontal” progress because it lacked the vertical dimension of technology. Without the technological axis, of course, education, intelligence, and finally growth suffered.

Today’s wrongly directed macro policies focus on globalization as an end in and of itself, ignoring technology or, to return to my formulation, productivity. The way forward in a macro sense is simple–we need to create equal access for everyone as a constitutional right, focus on average education levels, and marry the good parts of globalization to the key vertical axis of technology. Only in this way will more people gain access to growth, and at lower prices and with more productivity to boot.

Today, Chinese productivity is less than 20 percent compared to that of the U.S. This means that the only way for Beijing to avoid a debt spiral is to unleash productivity. Hence the recent opening of China’s external account, its entry into the SDR currency basket, and it allowing foreign access to what were once “Red Chinese” financial instruments.

Similarly, the lost economies of Africa can come online via education, which itself can come through the extant mobile phone network; these are more widespread than even bank accounts in sub-Saharan Africa!

Innovation and technology will solve the issues of electricity storage, improve our collective understanding of the universe, and lead to other fundamentally needed changes of both the pragmatic and the theoretical sort.

This will not simply come because we design it, nor because we want it… it will come because we need it. Change only comes when it is truly needed.

The U.S. vote marked a first step away from a broken and soulless political machine, but the productivity focus and the concurrent investment in people will only come through a crisis.
Trump and his allies think that his way, the businessman’s way, can change the direction of U.S. growth. It will not, but the scrapping of the old, soulless model was the peculiar gift of this election, not any of Trump’s own policy ideas.

A U.S. recession is still likely despite expectations of a fiscal bonanza. The higher yields (which were the real result of Trump being voted into office) will kill whatever is left of U.S. growth because not only is the political system running on empty, so are many U.S. companies.

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