US Elections webinar – Key Take Outs: The implications of a Biden presidency for businesses around the world

Across the globe, people have been on tenterhooks watching the US election play out. While Joe Biden was finally declared winner on Saturday, his battle for power may just be beginning. We invited a panel of leading international journalists, chaired by Robin Bew, Managing Director, The Economist Intelligence Unit, to discuss how the change in presidency will impact the domestic business environment, and what it will mean for international trade and investment.

Georgia is going to be key to the Senate

Bew’s first question to the panel was how challenging it would be for Biden to implement his policy agenda with the Democrats unlikely to carry the Senate. According to Jacqueline Alemany, Politics Reporter and author of the ‘Power Up’ Newsletter at The Washington Post, there’s still a chance for the Senate to tilt in the Democrats’ favour: “I think the runoffs in Georgia could give Democrats the majority they need to be productive members of the federal government,” she said, having been on the ground in Georgia in the week leading up to the election. She described a “burgeoning blue wave” in the state that had been building since 2016. If the Senate didn’t flip, however, it would be difficult for Biden to get anything other than a relief bill through in the first few months.

Derek Thompson, Staff Writer at The Atlantic, pointed out that Georgia was a 50:50 state and the runoffs were likely to be split equally between Democrat and Republican candidates. With the Republicans still controlling the Senate, it would be very difficult for Biden to push through anything productive, he said, and agreed with Alemany that Biden’s first bill would be some sort of Covid stimulus package.

Bew asked Jennifer Cunningham, Executive Editor, Business Insider and Insider News whether she felt Biden could use his “charm” to reach out and bridge some of the partisan divide. Cunningham felt Biden would leverage “what little goodwill there may be and try to turn that into actionable policy.” She also agreed that Biden would work on a stimulus package but stressed that it would be difficult to find one that both sides agreed on.

Courts may not favour executive orders

The panel’s outlook was pessimistic when Bew asked them whether they thought that the courts’ steady shift to the right would also make life more difficult for Biden. Thompson said it was going to be hard for Biden to do anything legislatively after he passed the Covid stimulus bill. “As result you’re going to have Biden leaning more on executive orders and those are more likely to be challenged in court.”

He said the Republicans’ game plan had been to establish themselves in the judiciary over the last four years, so that “when Democrats started to pass progressive legislation or do anything progressive from executive order, Republicans were already aligned like chess pieces on a board.” This was one of the reasons Biden was trying to cultivate individual relationships with Republicans to get things done, he said.

Stimulus package to help kickstart the economy

With the panel largely agreeing that it will be difficult for Biden to make much progress, Bew asked what this means for business leaders in America or those running a foreign business invested in the US economy.

According to Alemany, “The landscape will certainly be far more stable, which I think any business would welcome.” With the Coronavirus and other domestic issues a priority, a stimulus package would keep everyone afloat until there’s a vaccine, she said.

Charlie Campbell, East Asia Correspondent at Time, agreed that getting a handle on the coronavirus was key: “The world’s biggest economy is hobbled at the moment, so even if Biden is hamstrung or deadlocked by the Senate, if he can enact an aggressive policy to get a handle on the virus, this will be fantastic for any business which has to deal with the US, because at the moment it’s very hard to see the light at the end of the tunnel.”

Foreign policy an easier win for Biden

Bew asked Campbell what the change in presidency would mean from a South East Asian perspective. Campbell said there was a chance that if Biden was completely gridlocked in domestic policy, he may well look for some early successes with foreign policy. When it came to the trade war with China, however, Campbell questioned how much Biden would want to undo Trump’s attempts to impose tariffs. Thompson agreed that while Biden’s rhetoric may be more polite than Trump’s, not much would change underneath.

Likewise, with technology companies such as Huawei, TikTok and WeChat, Campbell said it seemed unlikely that Biden would rollback Trump’s agenda, which had strong bipartisan support for being cautious around national security.

Moving on to the UK, Bew asked Campbell whether Biden affected the chances of the UK and the US reaching a trade deal. Campbell said that Boris Johnson and the Conservative government were not in a strong position; as an anti-Brexiter with concerns about the Irish border, Biden was unlikely to give Johnson, ‘an easy win’ without some kind of concession.

A peaceful transition of power?

Next, Bew asked the panel if they had concerns about the about the legal challenges to the presidency.

”I’m not particularly worried about the legal challenges,” said Campbell, “but I do think that the next few months might be extremely dangerous times and the impulse to distract and cause a crisis to try and buy some time, or just deflect, or sew some discord might be too tempting.”

Cunningham agreed: “I think that the legal challenges are flimsy at best. Another concern is that he’s going to adopt sort of a scorched earth policy in these last two months at the helm of this country and I’m worried about what that’s going to mean for the American people.”

Alemany referred to a recent news story reporting that the General Services Administration Administrator had refused to sign off a letter that would provide the Biden transition team the office space, equipment and access to documents required to facilitate the transfer of power gracefully and quickly.

“The danger is not that Trump does anything,’ said Thompson. “The danger is that he does nothing. Presidential transitions are really hard; it’s very important that outgoing administrations help incoming administrations deal with ongoing crises. That’s more important than ever at a time when a thousand people are dying in the US every single day of Coronavirus.”

Is this the end of the Trump era?

So will Trump run again in 2024? “Trump has a tremendous following in the United States. I was really surprised that 70 million people voted for him and that the race was as close as it was,” said Cunningham. “But I don’t know how much appetite the public is going to have for Trump going forward, in light of the last six months or so.”

According to Alemany, “Don, Jr. definitely has a political future. He has become the top fundraiser for the party. And Ivanka Trump has seemingly moved to the right.” But there are lots of other people on the Hill preparing for a 2024 run, she said.

Will Biden take on the big tech companies?

Bew’s final question was whether Biden would contemplate breaking up the big tech firms.

Thompson believed the reason that so many liberals were concerned was because of the role they thought Facebook played in electing Trump. With a Biden administration, a growing economy and a vaccine, he felt they wouldn’t care as much about antitrust policy and would start focusing on other things. “I would be surprised if Biden prioritised big tech antitrust policy over some of the sort of meat and potatoes domestic economic policy,” he said.

Campbell agreed: “I just don’t think it’s going to be a priority. There’s so much going on at the moment. These are very powerful companies, and they can make it look like it’s a very bad thing for the economy, even if, in the broader scheme of things, it’s a net positive. In the short term, there may be economic harm. And that’s the last thing Biden needs.”

Final Thoughts

As the discussion came to a close, the World Media Group VP, Damian Douglas, thanked the participants, and presented his own 30 second takeout of the discussion:

“There will be an internal focus first; a return to consistency, stability and predictability – words that businesses like; but we’re not likely to get progressive international policy until Covid is under control.”

 

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