Trump’s victory

Donald Trump’s electoral victory proved that the idea US voters would be inspired by anything other than their own personal economic circumstances was just a short-sighted pious hope. As Bill Clinton once famously said: ‘It’s the economy stupid!’

Even though on paper the US economy was strong, the average US citizen was not protected from inflation and the Democrats underestimated the size and feelings of the average low-income worker. For low-income workers inflation is a major issue followed by illegal immigration, because both devalue one’s wages and undermine one’s livelihood.

Four years ago, Joe Biden won the US presidential election not because the majority of US citizens suddenly started to share the liberal values espoused by the Democrats, but because the average US citizen felt the administration had negatively affected their personal finances. In truth, this was the result of the economic collapse caused by the COVID crisis. Now, Trump has been forgiven and was trusted to make a better job than Kamala Harris of handling the economy and controlling migration.

Writing in The Atlantic, Annie Lowrey put it this way: ‘Anger at inflation lingered, even among tens of millions of working-class Americans who had gotten wealthier. This is not a purely economic story; it’s a psychological one too.’

To quote from her article: ‘In poll after poll, focus group after focus group, Americans said the economy was bad – and the economy was bad because prices were too high.’ This was always going to be a problem for Kamala Harris. ‘Excess’ inflation – defined as the cumulative growth of prices in one presidential term compared with the term preceding it – is highly predictive of US presidential electoral outcomes, according to American economist Robert Gordon. It is a crucial part of how voters decide whether they are better off and want to stick with the incumbent. Excess inflation strongly pointed to a Trump victory.

Indeed, since the global post-pandemic inflation spike began, ruling parties around the world, on the left and the right, have been toppled because of inflation.

Scandals and abuses have practically nothing to do with how the majority of people everywhere vote. It is their perception of their spending power that counts. This should also be a lesson to the Nationalist Party in Malta and other anti-government NGOs who criticise the current Abela administration. It’s the pocket – not the heart or the brain – of the voter that decides.

Trump’s victory will inevitably affect every area of EU policy, from drug pricing to green technologies to artificial intelligence standards. European policymakers have spent months preparing for Donald Trump’s potential return to the White House, though they don’t really know what this means to the EU because of Trump’s notorious unpredictability.

Naturally, no US voter considered EU-US relations as an issue that leads to voting one way or another. The US voters’ only motive was the increase or decrease of their perceived spending power.

Even so, Politico – the global authority on the intersection of politics, policy, and power – has made an interesting assessment on how a Trump administration will probably affect the EU.

Under Biden, the EU was on speaking terms with the US on technology. Trump could change that by spelling the end of the US-EU Trade and Technology Council, the biannual transatlantic political gathering where Americans and Europeans discuss technology policy and coordinate on topics such as semiconductors and artificial intelligence standards at a time when international alignment on AI governance is needed urgently.

Another liability is Trump’s alliance with Elon Musk, the owner of X, who has become a big Trump supporter. Musk shared his joy at Donald Trump’s expected victory by posting an artificial intelligence (AI) image of himself on his social media platform carrying a sink into the White House with the words: ‘Let that sink in’, referring to his purchase of the company formerly known as Twitter.

Studies have found that many of his posts have promoted false or misleading claims about the US election and that Musk may have tweaked the social media company’s algorithm. At least 87 of Musk's posts this year have promoted claims about the US election that fact-checkers have rated as false or misleading, amassing 1.7 billion views, according to a recent report from the Center for Countering Digital Hate.

What happens if the EU fines X for breaches of its policies?

Trump has boiled down his energy policy to three words: ‘Drill, baby, drill.’ Donald Trump’s victory spells environmental disaster. To avert catastrophic levels of global warming, the world has very little time to reduce emissions dramatically. Yet, under Trump – who plans to pull the US out of the Paris Agreement once again and double down on fossil fuels – the pace of the green transition is projected to slow down rather than speed up.

‘America First’ will again sum up Trump’s approach to trade policy. If he goes ahead with even half the ideas, he has suggested on the campaign trail, one expects serious pain for the European economy. Analysts at Goldman Sachs said the euro could drop as much as 10% against the dollar if the new administration enacts its across-the-board tariff plan.

Donald Trump’s victory is likely to hurt European carmakers. “I want German car companies to become American car companies,” Trump recently told his supporters, promising “the lowest taxes, the lowest energy costs and the lowest regulatory burden” for automakers that choose to move production to the US and “a very substantial tariff” on cars produced outside the US.

It is no surprise to anyone that Trump is not a fan of green policymaking. Trump’s animosity for environmental policy will widen the gap between the US and the EU on the international stage and harm the EU’s ambitions to promote multilateral cooperation.

Most observers fear that Trump will once again withdraw from the World Health Organization (WHO). Biden overturned Trump’s previous withdrawal on his first day in office. The US is the largest financial contributor of WHO, so this withdrawal would have a huge impact on global health projects.

Trump’s victory also means Europe can no longer – or at least much less – rely on the US for its defence and security.

The list of possible frustrations haunting the EU because of Trump’s policies seems endless.