After Hillary Wins….

Sorry for my blogging absence. I’ve got engaged, been thinking about my next steps in terms of honest (paid) toil, and been enjoying myself! I’m pleased to see my bullishness on Hillary coming to fruition in the General. After saying that Trump couldn’t win with only boosting the turnout of white men, it is nice to see this hypothesis seeming more likely to come true in November…

Anyway, I have been reading Michael Pettis’ ‘The Great Rebalancing’ and checking in with various economists and finance types over the last few weeks. And I got thinking. We know we’re still reeling not just from the Great Recession, but from the decades of debt build-up that led us there to begin with. We know that we need China to rebalance (although the political fallout as China tries to boost consumption and growth comes down would be fascinating if it were not also so scary) and the United States needs to keep on deleveraging its debt position and raise its saving rate while putting productive investment to work in domestic infrastructure. Pettis also raises the possibility of moving from the dollar to an international reserve currency (like Keynes proposed at Bretton Woods before White got his way instead).

But can we expect Hillary to make any bold macroeconomic or international political economy moves in her first 100 days? Or will she concentrate on domestic politics priorities (like immigration reform) and miss a possible window of opportunity?

Steve Keen has a smart column arguing that many Democrats will simply see a Clinton victory as a endorsement of the course we are set on and see Trump as a passing fad. Having just listened to a podcast on the Ross Perot revolt in 1992 (also during a sharp downturn), it seems like the politics of the pitchfork can always find a willing frontman. And the politics of concentrating on global trade, expanding investment in infrastructure, and raising taxes on the super-rich and evening out consumption (and helping poor, debt-laden households save), might attract people Hillary has been struggling to reach politically.

So, the election might be all over bar the shouting, but strap in, kids. Let’s see whether Hillary plays small-ball or goes big. If the rumours that she might not run for a second term are true, the logic of Clintonian calculation over principle might have run its course anyway…


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