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Donald Trump will make America weak and the political right should admit it
By The Australian Financial Review, July 25, 2016
Among the biggest struggles unleashed by the rise of Donald Trump is within established right-of-centre politics.
Rocked by the 2008 financial crisis, the military failures in the Middle East, the war against Islamic terrorism and the pitchfork-bearing Tea Party, the established American political right is imploding.
Even the Wall Street Journal appears ambivalent about a Republican candidate whose platform is dedicated to smashing Wall Street.
But those of the political right should recognise that Mr Trump is a political huckster who is personally unfit to lead the global superpower and that his contradictory policy prescriptions would mostly worsen, rather than cure, the ailments he exploits.
No longer underestimated, Mr Trump has got to this point by appealing to the complaints of common Americans against Washington politics, left and right, and the special interests they represent.
He sets up the common person as a victim of big business, financial capitalism, immigrants and foreign regimes, including allies who free-load on American defence spending, and extending to China and unfair foreign trade deals that have promoted economic globalisation.
While some of these complaints are understandable, this puts him on the other side of the pro-enterprise and free market philosophy that has so guided the modern Republican party since Ronald Reagan.
And it creates common cause with the socialist Democrat Bernie Sanders, who Mr Trump promotes in luring the former working class Reagan Democrats to his support base.
The thrice-married Trump is no natural candidate of the religious right, as shown by gay technology billionaire Peter Thiel's appearance at the Republican presidential convention and balanced by his revealing choice of an evangelical Christian as his running mate.
Yet some are drawn to Trump's backlash against post-modern "political correctness" on race, class, culture and gender pushed by left-progressives; the correctness that censors plain speaking, or is soft on crime or blames the West for the rise of Islamic terrorism.
And, as displayed at the Cleveland convention, some on the right are united behind Trump's feral aggressiveness directed at Democrat contender Hillary Clinton.
The truth that Mr Trump exploits is that, in the age of economic globalisation, the nation state remains the central political organising force.
As we wrote in AFR Weekend on Saturday, globalisation has produced the rise of a middle class in emerging market economies such as China and India that now compete in a global labour market with the workforces of developed economies.
So global capitalism's immense achievement – the biggest poverty alleviation in human history – also has generated a rich-world political backlash.
That's been aggravated when nations lose control of their borders, as shown by Brexit. And it has exposed the rich worlds' welfare state excesses that, unlike Mitt Romney four years ago, Mr Trump seeks to pretend he can financially sustain in America.
Yet defenders of capitalism and free enterprise must respond that globalisation has also fed the consumer markets of rich nations, particularly the US.
This is an age of cheap abundance of material things, multiplied by the same technological advances that have allowed emerging market economies to approach – but not reach – the American production frontier.
The technology entrepreneurs who have built the internet economy – such as Mr Thiel, who invented PayPal, or Facebook's Mark Zuckerberg or, before them, Bill Gates – are part of the fabulously rich global "1 per cent".
But their wealth has come through creating benefits for everyone else, not at everyone else's expense. And they include immigrants of modest backgrounds such as Google co-founder Sergey Brin.
For all the burdens of being the global superpower, and the evident malaise of established Washington politics, American capitalism remains the foundry of the global economic ingenuity and opportunity.
Retreating from the global economy and from global leadership would not make America stronger or safer. It would make both America and the world weaker and more dangerous.
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