Four more years for
George Bush: the prospects
Whether the world
likes it or not George W. Bush will run America and at least influence the
way the rest of the world is run for the next four years. Unlike the 2000
elections, the mandate was clear and unambiguous. A post-election edition of
the Economist featured the re-elected American President on its cover with
the call "Now Unite Us." That is wishful thinking at its most fanciful, and
the evidence is striking. The second Bush administration will be the most
conservative that country has seen in decades, and the policies will be
shaped by the neo-cons in the Republican Party who took a largely back seat
in the elections, and will be influenced by the fundamentalists in the Bible
I recall speaking
with a friend only a couple of days ago and suggested to him that the real
aim of the fundamentalists is the undoing of Roe v Wade (the landmark case
on abortion in the USA). Already there is evidence of the rolling back with
the House and Senate negotiators tucking in a potentially far-reaching
anti-abortion provision in a recent spending bill. The provision appears to
be an early indication of the growing political muscle of social
conservatives who provided the winning votes for President Bush in the
No lame duck
The US Congress and
Senate are supposed to be in lame-duck mode, but President Bush and the
Republicans are obviously fired up by his re-election. They are making full
use of the time when the Democrats are licking their wounds and wondering
how long their sojourn in the wilderness will last. The Democrats'
difficulties will make it all the easier for Bush to have an easy run at
pursuing his domestic agenda, and this column predicts that by 2006 Bush
will have irreversibly altered the social landscape of that country.
tax cuts that will benefit the rich but which will offer some crumbs to the
poor will become firmly entrenched. Who else but the rich will benefit from
cuts in capital gains tax and further savings for those who earn in excess
of $200,000? The country's social security system will be substantially
privatised, justified by the persuasive argument that the people should have
a say in how they save for their old age. For many 'social' will be taken
out of 'social security,' and the possibility of the system going bust will
become even more likely.
But that is okay -
the administration can always borrow and bail out the system. And who will
pay for it but those who bear a disproportionate share of the tax burden and
whose support John Kerry felt he could count on, ie the middle class?
And in addition to
the issue of abortion rights we can expect some strong and popular measures
when it comes to the matters of gay rights, gun control and personal
liberties which have been contracting in the wake of 9/11. Expect the
Supreme Court to be packed with conservative judges who will shape the
country's landscape in the mould of the conservatives.
And then Rice
There will be no
Colin Powell to caution restraint among secretaries of state, all of whom so
far are definitely Bush insiders. Alas, his replacement, Dr Condoleezza
Rice, was appointed not because of her brightness - she speaks four
languages, is a competent pianist and well-respected academic - but because
she is another insider who is unlikely to challenge hardliners like Cheney
and Rumsfeld the way Powell did, but which finally wore him down and then
drove him out. That relationship alone will guarantee that Dr Rice will not
be warmly received in European capitals, a rapprochement critical to
rebuilding the Atlantic alliance so badly scarred by the invasion of Iraq.
France can sneer and snigger as much as it wishes, Bush knows that he can
count on the governments of new Europe - as opposed to Rumsfeld's 'Old
Europe' - who are ever so thankful to another American conservative Ronald
Reagan for their freedom, and his soul-mate Tony Blair in the UK.
will maintain its supremacy with Putin's Russia pre-occupied with Chechnya,
economic reforms and rolling back some of the 'democratic' gains which have
permitted the kind of scandal epitomised by that country's privatization
programme that made billionaires of some low-level administrators in the
system. China's agenda is to continue its increasing economic dominance, the
like of which the world has never seen - sustained growth of close to 10%
for almost a decade! India too will be similarly occupied partly as the
Congress Party sees to create the resources to enhance the status of its
poor, partly to stay in the economic race with China and partly to finance
the millions it spends on maintaining its territorial integrity.
Can do anything
North Korea and
Iran - the remaining limbs of Bush's axis of evil - will be major headaches,
but the President knows only too well that his country cannot stomach
opening another war front without a draft because its military is stretched
He knows that any
attempt to destabilise North Korea would have catastrophic consequences for
South Korea and Japan, two of America's very close allies, and he would
therefore be quite prepared to continue the multilateral negotiatiations
with Kim Jong Il.
Iran is a slightly
different matter, although whether there is any liklihood that the American
military will carry out bombing raids to neutralise that country's nuclear
ambitions is difficult to say at this stage.
So Bush clearly has
a lot going for him. He occupies the White House and has the freedom of not
having to bother about re-election; the Republicans control Congress and the
Senate which are likely to install a conservative Supreme Court. Republicans
hold the governorship of most states, including bastions of Democratic
support such as New York and California, and have such a stranglehold of the
south that John Edwards who promised so much could not deliver either of the
Carolinas where he was born or which he represents in the Senate. Bush's
swaggering walk and trademark smirk seem more than vindicated. He can do
anything - well almost.
instincts and doctrine of pre-emption are not under threat from any internal
or external sources, although a terrorist attack with indeterminate
consequences could derail the most cautious predictions. At least he knows
that the number of countries which can harbour terrorists have diminished,
even though the cases of terrorist attacks have climbed substantially since
Afghan-istan and Iraq. Successful elections in Iraq in January will offer
some marketing material to justify the invasion of Iraq and will give him
something to throw back at the world.
come January 2005 will be celebration time indeed. So where are the clouds?
Unfortunately there are quite a few. The war in Iraq is not going to end
with the elections allowing America to declare victory and pack up and go
home. They are stuck in that country for a long time yet, burning billions
in war expenditure that could have been better spent on the country's
failing social security and health care systems.
The budget deficit
is widening, jobs are not being created as fast as the country needs,
imports are rising while exports lag, the foreign debt continues to soar,
oil prices are at historic highs and that symbol of American economic
supremacy, the greenback, has plunged. Inflation seems to be returning with
its twin, higher interest rates. These are not insubstantial items to have
on the debit side of one's balance sheet, even if Bush famously said he
communicated with a father greater than his earthly and natural dad.
Greenspan, the revered Federal Reserve Chairman is now perhaps belatedly
suggesting that things are not rosy on the economic front. In recent days he
has expressed doubts that the US dollar will bounce back any time soon
(which is probably a way of saying that it is still on the way down) and has
sounded a warning over the country's huge and climbing trade deficit both of
which he opined could adversely impact on the flow of inward foreign
investment. But having gone along with Bush's tax cuts which exacerbated
some underlying weaknesses in the US economy, Greenspan can hardly be too
critical now, particularly if he wishes to exit with his reputation intact
rather than in tatters. The dollar has fallen by more than 30% against the
major currencies over the past two years, and is expected to decline even
further. The value of America's production falls short of expenditure by
more than US$600M annually, all financed by borrowings from abroad.
The rate of
borrowing is so rapid that before going off for an overseas visit, President
Bush had to hurriedly sign into law a new debt limit increase of US$800B to
$8.184 trillion (a million million) to allow for further borrowings and
prevent the risk of default.
Bush's options when
it comes to the economy are fairly limited but having promised his
constituency so much it is hard for him to retreat. Bush's conservative
instincts for low taxes, small government and the individual looking after
himself have run headlong into the other conservative value of not spending
more than you earn. But he seeks refuge in the belief that the tax cuts will
fund new investments, provide more jobs, taxes, etc, and thereby reduce the
budget deficit. John Snow, his Treasury Secretary, and his team of economic
advisers seem to have bought into this idea which many thought had failed
and died since Reagan. The current team still believes in it even if it is
only because that is how the boss wants it.
But there is more
to Bush's problems than just flawed theories and poor and objective advice.
Issues such as energy, the environment, outsourcing and globalisation are
assuming urgent proportions. How significant are these and how is Bush
likely to respond in the next four years?
looking at these next week.
(Back to top)