President Donald Trump

Here are some raw, in-the-moment thoughts about the surprise victory in the U.S. presidential election by Donald Trump over Hillary Clinton.



The saddest reaction to the unfolding election I've heard is from a friend who said to me "It makes me wonder if I really fit in as an American". There may be many hyperbolic opinions expressed in coming days, but hers definitely is very identifiable right now. I'm forcing myself to write down some thoughts on what has been a profoundly surprising, deeply depressing night.

The obvious: regardless of political viewpoint, it is unconscionable that a vulgar individual who has enthusiastically indulged in insults and violent threats, cons and scams, religious and racial bigotry, gross misogyny and debasing conspiracies and outright lies--that such an individual will be the leader of this country. I try to convince myself that Italy survived Silvio Berlusconi, and we too, can withstand the psychological embarrassment of a Donald Trump presidency.

America's Forgotten Poor

Scant attention has been paid to the record rise of poverty levels in America.

Click graphic above to see a detailed breakdown on poverty in the U.S. (Source: NPR)

Mitt Romney and Barack Obama and their campaigns have spent much of this election season tripping over themselves to appeal to all-important middle-class voters.  During the political conventions, Ann Romney spoke about how she and her husband once lived in a tiny apartment using an ironing board as a table.  She didn't note that they were living off of Mitt's investment income -- hey, he was the son of a multimillionaire governor -- while Mitt finished his studies.  Michelle Obama told a story about how when she began dating Barack his car was "rusted out" and had a hole in the door.  She skirted the fact that the pair met while working for a prestigious Chicago law firm.

The point here isn't to attack either candidate for their typical stretched "we're just like you" spiel, but to draw attention to the entire large segment of the populace that no one is overly concerned with winning over: the poor.  Over 15% of Americans, nearly 50 million people, live at or below the poverty line, defined as $23,000 for a family of four.  While much election-year rhetoric concerns the tax burden of the rich, or who is the real champion of the middle class, little more than lip service is paid to the lower rungs of our society.

Engagement, Not Isolationism

There are a number of reasons one could be excited about the upcoming U.S. presidential elections. The remaining applicants competing for the job are a politically battle-tested former first lady; a charismatic fresh face who has inspired many across generational and racial lines; and a former war hero with a history of political independence.

Each of these candidates has many positive attributes. Yet I remain dismayed that they represent political parties with many adherents who have profoundly incorrect worldviews. In both the Democratic and Republican parties, there is a general lack of confidence in our country’s abilities and a mistrust of those outside our borders.

Among Democrats, this view is manifest chiefly in its opposition to free trade. Hillary Clinton, whose husband’s advocacy of the passage of NAFTA was among his administration’s top achievements, has transformed herself into a champion of protectionism. Barack Obama, no less eager to appeal to heartland voters, sings a similar tune.

A New York Times editorial chastised both earlier this month, reminding them that “trade is good for the economy, providing cheap imports and markets for exports, spurring productivity and raising living standards.” The Times urged the candidates to “offer policies that will help American workers embrace rather than fear a globalized world”, such as increased investments in education and physical capital.

While in Hong Kong last week, I read an excellent column in the Wall Street Journal Asia by Rupert Murdoch in which he spoke out against the protectionist sentiment. Never mind the blathering idiots on his Fox News Channel, Murdoch rightly points out that refusing a trade deal with countries like Colombia sends the message that America does not see them as partners. Murdoch argues that we must help developing countries which share our values of democracy and capitalism achieve prosperity, which will enable us to benefit from their valuable alliance in the future.

Turning to foreign policy, I generally agree with John McCain about the U.S.’s two most important engagements abroad. I am an advocate of a continued U.S. military presence in Iraq and a sustained effort in Afghanistan. Yet I have come to detest the segment of the Republican Party that tosses around nonsensical phrases like “Islamofascism” and obsesses over a “war on terror” while ignoring the important economic and political challenges this country faces.

September 11, 2001, will forever be a day impossible for any American to forget. The fear and uncertainty we felt then were very real. It seemed as if that attack had ushered in a new world order. But it didn’t really—terrorism is just a tactic, not an ideology like communism which directly threatened our values of freedom and democracy. Thankfully we have avoided catastrophe since 9/11, and though it’s probably inevitable that we will be hit again, Americans go about their lives today feeling relatively secure.

Accordingly, I wish that certain Republican politicians and pundits would abandon their xenophobic impulses and look toward forging stronger alliances around the world. One thought Murdoch emphasized in his column was the importance of common values in a globalized era in which geography’s importance is diminished. So, for example, acknowledge the value of good relations with major European powers, and don’t dismiss the Muslim world as a breeding ground of anti-Americanism (it’s simply not true).

I think the U.S. can remain the leader of a global community, but to do so, we must embrace an optimistic mindset. We should be confident in our own abilities and we should believe that we can lead through engagement. That attitude, though tested at times, has served us best since 1776.

Support "Sweatshops"

For my column in the Diamondback this Wednesday, I was going to tackle the issue of the third-world factory labor, something I touched on last year on the blog. Unfortunately for me though, another staff columnist drew the assignment and his column will run in tomorrow's newspaper, so I'm out of luck. I've reproduced my version below.

* * *

Last week the Diamondback reported a campus group’s effort to ban sweatshop labor used for school apparel and other gear. Never mind that no Terp merchandise has specifically been traced to factories with abusive labor conditions. It’s time to set the record straight. If you really care about helping third-world workers, you should be pro-sweatshops.

That’s not just me being irreverent. Jeffrey Sachs, the influential economist, says “My concern is not that there are too many sweatshops, but that there are too few.” He means that international trade makes everyone better off over the long-run. Developing countries get to use their comparative advantage of cheaper labor to gain access to factories, jobs, and skills they could not otherwise get. Meanwhile developed countries get to specialize in other areas and receive lower prices at home.

You might expect liberals to have bleeding hearts over the plight of third-world workers, and conservatives to coldly favor Big Business. But this is not your typical liberal-conservative issue. Sachs is a liberal anti-poverty crusader who works with the U.N. and teams up with rock star Bono on Africa aid.

In fact, my first introduction to this subject came from reading a 2001 column by Paul Krugman, the well-known economist and dependable lefty. He wrote: “Third-world countries aren't poor because their export workers earn low wages; it's the other way around. Because the countries are poor, even what look to us like bad jobs at bad wages are almost always much better than the alternatives.”

Those alternatives that he speaks of are lower-wage jobs such as subsistence farming, menial labor, and prostitution. In 1997, UNICEF discovered that 5,000 to 7,000 Nepalese children turned to prostitution after the U.S. banned carpet exports from that country in the name of labor standards. Worse yet was the infamous Child Labor Deterrence Act of 1995, which UNICEF, Oxfam, and others have said led to tens of thousands homeless and forced into jobs like “stone-crushing, street hustling, and prostitution.” Yes, that’s a worse outcome.

Keep in mind next time you hear someone lay into Wal-Mart or Nike for paying $1.50 an hour, in most cases, that worker is glad for it. Not to mention it's probably a buck more than they'd be getting working a local job. NY Times columnist John Tierney wrote last year that third world factory jobs “may sound like hell to American college students” but that they “provide enough to lift a worker above the poverty level, and often far above it.”

Tierney cited a recent study of 10 Asian and Latin American countries, which had many insightful revelations. In Honduras, for example, the average apparel worker makes $13 a day, while nearly half the country’s population makes less than $2 a day.

Obviously I am not in favor of labor conditions that are actually abusive. There are several all-too-true examples of factories where workers are subjected to threats and beatings, prevented from going to the bathroom, required to be on birth control, etc. Those are abhorrent practices and we should wholeheartedly oppose them. However, those instances are in the minority.

Third world workers take factory jobs because it is their first step toward integrating into the modern industrialized world. They get away from their rural villages and into the cities. They support their families and provided a better upbringing and education for their children. Later on their children can take advantage of the more advanced jobs that have come to the country after the success of the initial low-level factory work.

If you really are serious about wanting to help third-world countries, think twice before you protest third-world factory labor. You could be doing more harm than good.

On Grameen & Helping the World's Poor

Last week, the Nobel Peace Prize was announced to a most deserving candidate, Muhammad Yunus and the Grameen Bank, for their pioneering use of "micro-loans" to help villagers in third world countries. In a year where the finalists for the prize reportedly included Cindy Sheehan and Bono of U2, it was nice to see a great cause receive world attention. Apparently Yunus had long been championed by his friend, former president Bill Clinton.

I read about Yunus, the founder of Grameen, in an international economics class I took last year. His simple but powerful idea--that even a very small amount of money could make a disproportionate difference to a poor person--sprung from the need to give villagers access to capital. After all, banks will loan to the middle- and upper-classes, but not the poor, because there is a great risk they will not be able to repay the loan.

Since Yunus gave out his first loan--$27 of his own money in Bangladesh in 1974--Grameen has been giving out small loans (typically less than $150) at reasonable interest rates to poor villagers. To help ensure repayment, the bank lends money not to individuals but "solidarity groups" of villagers, who apply for the loan together, act as co-guarantors together, and work together to make proper use of the funds. The idea has proved surprisingly effective--the bank reports a repayment rate of over 98%.

Another important feature of Grameen is that they predominantly lend to groups of women, helping empower them in a society where they are traditionally repressed. Over 6.5 million people have borrowed from the Grameen Bank, with over $5.7 billion given out in loans. It has enabled social transformation from the bottom up.

Congratulations to Yunus and the Grameen bank.

* * *

One observation I haven't seen in the news is the significance of another Muslim winning the Nobel Peace Prize. With all the contemporary tension between the Muslim world and the West (for example, recall recent Muslim anger at comments by Pope Benedict XVI), Yunus proves that there are real idols to look up into in the Muslim world (read: not Osama bin Laden) who are affecting positive change on their societies.

For the record, the past two winners of the Peace Prize have been Muslim: Yunus this year, and Mohammed ElBaradei in 2005. Don't forget three out of the past four have been Muslim--human rights activist Shirin Ebadi won in 2003.

* * *

In today's New York Times, John Tierney commends the selection of Yunus for the award before cheekily suggesting that Wal-Mart is even more deserving of recognition for its role in alleviating world poverty. Tierney points out that the thousands of third world villagers who gain jobs in factories make more than the prevailing labor rate in their home country.

"Making toys or shoes for Wal-Mart in a Chinese or Latin American factory may sound like hell to American college students — and some factories should treat their workers much better... But there are good reasons that villagers will move hundreds of miles for a job.

Most 'sweatshop' jobs — even ones paying just $2 per day — provide enough to lift a worker above the poverty level, and often far above it, according to a study of 10 Asian and Latin American countries by Benjamin Powell and David Skarbek. In Honduras, the economists note, the average apparel worker makes $13 a day, while nearly half the population makes less than $2 a day."

That distinction is one many people don't seem to grasp. Especially on a liberal campus here at the University of Maryland, it is common to see various student groups demanding "appropriate" pay for these workers, or for me to see a fellow student in one of my business classes go off and rip Wal-Mart (happened this evening, in fact).

Rest assured, I abhor sweatshops and abusive labor practices, but it's important to note what the facts are. This is not a liberal-conservative issue either; my first real introduction to the subject came from reading a Paul Krugman column in 2001 entitled "Hearts and Heads." Anyone familiar with Krugman knows he's a dependable lefty, so try this on for size:

"[T]hird-world countries aren't poor because their export workers earn low wages; it's the other way around. Because the countries are poor, even what look to us like bad jobs at bad wages are almost always much better than the alternatives."

Keep that in mind next time you hear someone lay into a Wal-Mart or Nike for paying a buck fifty an hour, remember that in most cases, that worker is glad for it. Not to mention it's probably a buck more an hour than they'd be getting working a local job.

More importantly, many people have shown (and I think I've read this either from Thomas Friedman or Jeffrey Sachs) that these type of factory jobs are the first step in the advancement of the poor in third world countries. As I recall, it works like this: rural villagers move to the cities and work in aforementioned factories, where they make more money than ever before.

They are able to better support their families and provided a better upbringing for their children, which includes a better education. Their children then can take advantage of the more advanced jobs that have come to the country after the success of the initial lower-level factory-type work.

Anyone see a problem with that, let me know.

File under: current affairs, economics, globalization

Not Business as Usual

(Click to enlarge.)

Bummed out by layoffs, corporate scandals, and outsourcing? Chin up, there's good news too. Readers of this blog will recognize a combination of ideas from a couple of previous posts last month in my newest Diamondback column, "Finish Your Homework". Here I acknowledge the threat of international competition in the "flat world" but point out why the U.S. needn't be too worried. Space restrictions required my magnum opus to be trimmed a bit, but I think it still gets the point across. An excerpt:

...several factors stand in the way of either China or India knocking the U.S. off its preeminent perch. Let us not forget the world’s most important and admired businesses today — companies such as Apple, Starbucks, Google, eBay and Goldman Sachs, to name a few — are distinctly American. I would tell my fellow Robert H. Smith School students it is probably unnecessary to bone up on Mandarin (though it couldn’t hurt) and we should not worry about spending our careers chasing after jobs in New Delhi or Shanghai. Nonetheless, one thing is clear: There are a lot of people on other continents out-hustling us Americans. While for now they might only represent a minority of their populations, more of them are springing up daily to take advantage of increased opportunities.

Click here to read the rest.

The Bright Side of American Business

Last week, I talked about foreign competition to U.S. business, citing reasons why countries like China and India are succeeding in the New Economy. But in closing, I also provided reasoning for why the U.S.'s strengths will allow it to maintain its superiority. For example, I offered that our "service-oriented economy" was equipped for the globalization era and pointed out that "our country is second to none at fostering an innovative and entrepreneurial environment."

In today's Washington Post, Sebastian Mallaby picks up where I left off to argue that "the heyday of American business may actually be now." Among the factors he lists are worker productivity, companies' return on equity, American management techniques, and better business practices. The "X factor", he says, is that we can meet contemporary challenges.

American business excels at managing service workers and knowledge workers: at equipping these people with technology, empowering them with the right level of independence and paying for performance. So the era of decentralized "network" businesses is the American era.

Moreover, America's business culture is perfectly matched to globalization. American executive suites and MBA courses are full of talented immigrants, so American managers think nothing of working in multicultural firms. The immigrants have links to their home countries, so Americans have an advantage in establishing global supply chains. The elites of Asia and Latin America compete to attend U.S. universities; when they return to their countries, they are keener to join the local operation of a U.S. company than of a German or Japanese one.

So the shift from manufacturing to services; the gallop of globalization; and the rise of information technology that flattens corporate hierarchies: All these forces come together to create an American moment.

Read the whole article; it's an interesting counter to the popular notion that America's competitive edge is in decline. And, if you're discouraged by news stories about companies like Enron and GM, check out the newly released BusinessWeek 50. Apple, Halliburton, Amgen, Goldman Sachs, Starbucks, and a plethora of energy companies, among others, highlight the best that American business has to offer today. For now, it appears Uncle Sam is doing A-OK.

Finish Your Homework!

The popularity of the "flat world" idea and the notion that China and India will be eating our lunches in the not-too-distant future rank among the reigning themes discussed over the past few years. During this time, Thomas Friedman's book, Bill Gates' analysis of the American brain drain, and worries about outsourcing have permeated the popular consciousness. On the flip-side, counter-arguments have emerged in recent months which claim that America's preeminent status is not in jeopardy. See, for example, David Brooks ["The Nation of the Future" ($), 2/2/06] and Robert Samuelson ["A Phony Science Gap?", 2/22/06].

While I'm not one to turn alarmist from a few anecdotes about Beijing or Bangalore entrepreneurs, I do think that there is something to be concerned about here. The most important lesson on this subject that I have taken away comes from a story that Friedman relates:

"When I was growing up, my parents would tell me 'Finish your food, people in China and India are starving.'

I tell my kids 'Finish your homework, people in China and India are starving for your job.'"

Innumerable factors currently stand in the way of either China or India outstripping us, but one thing is clear: there are a lot of people in both of those countries that are out-hustling us Americans. While for now they may only represent a minority of their population, more of them are springing up daily to take advantage of increased opportunities.

For a taste of the radically different work culture in those countries, check out this recent Fortune article on Infosys, the Indian software services company. The talent pool is staggering--1.3 million applicants for full-time positions last year, and only 1% of those were hired. The new hires receive rigorous training in state-of-the-art educational centers which house rooms like the "Gordon Moore Room" or "Jeff Bezos Room". Captains of industry, it appears, are to the outsourcing industry what Kelly Clarkson is to the American public--the real Idols.

For now, the lure of higher salaries and brand-name jobs in the U.S. may draw a lot of the immigrant talent pool, as it did with my parents 25 years ago. But with increased prosperity and the prospects of "boundless growth" back in their native countries, how much longer will those smart foreigners keep coming here?

I'm willing to believe that the American optimists are correct when they assure us that we still do produce enough engineers and scientists, that because our country is second to none at fostering an innovative and entrepreneurial environment, and because we are a service-oriented economy anyway, that we can remain successful in the New Economy. But does that mean we should nevertheless continue with business as usual, not worrying about the fact that the rest of the world is working night and day to whittle away at our lead? I don't think so.

Better finish that homework.

Friedman at the Brody Forum

Left to right: Doug Besharov (UMCP), Thomas Friedman (NY Times), Shibley Telhami (UMCP)

This Sunday I brought my parents to the Brody Public Policy Forum featuring renowned author and columnist Thomas Friedman. The event, sponsored by Florence Brody and Jehan Sadat (wife of Anwar Sadat), consisted of a discussion of a number of foreign policy issues with an emphasis on the Middle East. Friedman also spoke at length about topics raised in his new bestseller, which I've mentioned before on this site, called The World is Flat.

In this book, Friedman talks about how the pace of globalization has exploded in the past decade or so, to the point where booming countries like India and China are now serious competition for a diminished and complacent U.S. His contention is that today's ubiquitous information technology solutions, combined with the right political movements after the fall of the Berlin Wall, have fostered an environment where commerce can flourish throughout the world. As Friedman puts it, those homegrown geniuses in other countries "no longer need to immigrate in order to innovate."

Is he right? There's no doubt that our competition--chiefly Friedman's favorite examples: India and China--are making rapid strides. Talented individuals in those countries are taking advantage of the best that technology has to offer and are creating a transformation that is occurring in real-time. My parents' generation had to come to the U.S. in order to have the opportunities appropriate for their talents. That's not necessarily the case anymore. A few decades ago it likely was better to be an average student in the U.S. than a genius in China or India, but Friedman says the opposite is true now.

But in his remarks on Sunday, Friedman never acknowledged that it is only certain isolated segments in China or India that are making these rapid advances. A number of people have pointed out that while in Bangalore (Friedman's Indian Silicon Valley) a whole array of successful high-tech companies has sprouted up, they are situated amidst poverty and squalor. In a discussion of The World is Flat a few weeks ago, I remember someone noting with irony that the short drive to work a Bangalore programmer experiences will take two hours over roughshod roads.

So while India and China really are catching up to the U.S., I believe their pace is a bit slower than Friedman would expect. Those countries do not yet have a fully developed infrastructure--both physical as well as political--to take their game to the next level. Of course, acquiring this is only a matter of time--and when they do, look out!

The most important concern raised by Friedman, in my opinion, concerns the preparedness of the United States to deal with coming challenges. He says it's quite possible that we could experience a decline in our standard of living, unless we make changes now, chiefly to our education system. Unfortunately, I did not get a chance to ask Friedman for his thoughts on Bill Gates' recent comments that the American public school system is "obsolete" and that he is "terrified for our work force of tomorrow." Ouch! Coming from the icon of ingenuity himself, there undoubtedly exists a big problem, one with no easy answers forthcoming in this post.

Doug Besharov, who moderated the discussion, commented that Friedman's words had a "sobering" effect. They do indeed. To me, this flat world creates more questions than it does provide answers.

The World in 2020

On Friday, the National Intelligence Council (NIC) presented "Mapping the Global Future" (full text), its latest report offering predictions for the state of the world in 2020. Among the highlights:

- Asian Ascension

In the same way that commentators refer to the 1900s as the “American Century,” the 21'st century may be seen as the time when Asia, led by China and India, comes into its own. A combination of sustained high economic growth, expanding military capabilities, and large populations will be at the root of the expected rapid rise in economic and political power for both countries.

• China and India become major economic powers
• Japan challenged to reevaluate its role
• North Korean crisis has come to a head
• Russian influence important but limited

- The Global Economy

Asia looks set to displace Western countries as the focus for international economic dynamism—provided Asia’s rapid economic growth continues.

• World economy 80% larger than in 2000
• Average per capita income 50% higher
• The U.S., though still the single most important power, will lose ground to China and India
• China's GDP will exceed every Western country except the U.S.; India's GDP will equal or exceed all European countries

- New World Order

Informal networks of charitable foundations, madrassas, hawalas, and other mechanisms will continue to proliferate and be exploited by radical elements; alienation among unemployed youths will swell the ranks of those vulnerable to terrorist recruitment.

• Political Islam has significant global impact
• Democracy in former Soviet Union and Southeast Asian republics could be undone
• China/Taiwan or India/Pakistan issues could lead to one side taking preemptive military action and resulting in all-out war
• Al-Qaeda has been replaced by a numer of equally dangerous splinter groups
• Bioterrorism is the biggest security concern

The NIC considered four possible "futures", each having the potential to be realized:

• "Davos World" - globalization and the growth of China and India lead to a world not dominated by the West
• "Pax Americana" - the U.S. weathers global changes and maintains its hegemony
• "A New Caliphate" - a political organization of Islam challenges the West
• "Cycle of Fear" - concerns over security cause "large-scale intrusive security measures...possibly introducing an Orwellian world."

* * *

What does this all mean? Well, despite it being easy to get lost in gloomy speculation, the good news is that the rise to prominence of Bollywood will inundate the globe with sappy, melodramatic love stories full of song and dance. ("An expanded Asian-centric cultural identity may be the most profound effect of a rising Asia.")

Seriously though, the growing importance of Asia is hardly a surprise to anyone. I don't doubt that U.S. unipolarity will diminish as nations on the rise like China and India tap into the well of world power. Still, the U.S. will be at the forefront of all the major movements to come, helping to shape world affairs. Says Jessica Matthews (in the von Drehle article I link to below), "We're still best in the world at adapting to rapidly changing circumstances. No other nation takes disruption in stride the way we do." Phew!

Of the four scenarios presented by the NIC, I see the first and second as most viable--the most likely outcome may be a mix of the two. I have enough faith--for now at least--in common sense and an American's dedication to liberty that I don't see 1984 becoming a reality for us. The U.S., in my opinion, can and will win the war against Islamist extremism. We will do so not just through military force, but by demonstrating with the help of moderate Muslims that democracy offers people a better future.

The biggest threat to all this, of course, is what the NIC described in its third scenario--the formation of an Islamic caliphate that, through its religious and political authority, could mobilize Muslims across the globe into religious extremism. Bad news for us: the report warns that "[a] Caliphate would not have to be entirely successful for it to present a serious challenge to the international order." Furthermore, "[t]he proclamation of a Caliphate would not lessen the likelihood of terrorism and, in fomenting more conflict, could fuel a new generation of terrorists intent on attacking those opposed to the Caliphate, whether inside or outside the Muslim world."

We have our work cut out for us so that we can head off such a political organization, however unlikely its formation now seems. The entire mindset and cultural views of a generation of Muslims must be confronted. Radical elements of Islam are the 21st century equivalent of the Communist threat to the West. The task we are facing is difficult, but doable if we make the right policy decisions. Leading by example, we must show the people of the Middle East and elsewhere the benefits of rejecting extremism. It can be done, and I have every confidence that it will be done. I'm looking forward to the next fifteen years--it'll be one helluva ride!

Further Reading:
"The Yikes Years" - David von Drehle, (Washington Post Magazine, November 2004)
"World War IV" - Norman Podhoretz (Commentary, September 2004)