[Skip to Content]

Register to receive the weekly OMFIF Commentary, on the stories behind global economic and financial news.

* Required Fields

Member Area Login

Forgotten Password?

Forgotten password

Analysis

Testing the separation of powers

Republicans win, win, and win again

by Brian Reading

Fri 11 Nov 2016

Brianreading -banner

Donald Trump defeated Hillary Clinton. Equally important, the Republican party retained control of both the House of Representatives and the Senate, though without a two-thirds majority in either. Apart from 2003-07 under President Bush, the Republicans have not controlled the executive branch and both legislative chambers at the same time since 1932. Democrats have controlled all three more often, but the norm has been a division of power. The Senate and House are often on different sides. Is Trump the most powerful president in recent times? Yes and no. The battleground is now within the Republican party.

Presidential power is limited. As commander-in-chief Trump can push the nuclear button. He can start but not declare war without Senate approval. Trump can also meddle in other people’s wars. He can make treaties, within limits, and receive foreign ambassadors. He can’t make appointments to executive offices or the Supreme Court without Senate approval, but he can sack executives.

The executive branch’s job is to administer the law. Congress makes the law, provided both House and Senate agree. The Supreme Court throws out laws which breach the constitution. This is the separation of powers, or system of checks and balances. President Trump cannot introduce any bill to Congress, he can only recommend them. But his congressional supporters can do so. He can veto any law passed by the legislature. But his veto can be overturned by a two third majority in both the House and Senate. That may prove difficult.

The presidential campaign descended from the gutter to the sewer, determined by hate, not hope. It demonstrated a deeply divided society. Outrageously, Trump broke all conventional rules by appealing to the alienated. He knew better how to win than the political elite, media and pollsters. But he remains a consummate deal-maker, which is what US politics is all about. Trump is now the establishment. Insiders have become outsiders, but not in Congress. Republicans retained or lost their jobs by supporting or rejecting Trump. The divide remains dominant.

Extreme positions Trump espoused to win the White House will be watered down, though the US is likely to become more isolationist and protectionist. Abroad it could escalate action against ISIS, but is likely to avoid confrontation with Russia. The Transatlantic Trade and Investment Partnership is probably doomed. Keynesian spending and tax cuts, regardless of the budget, seem possible, with all the implications for the dollar and bonds. Trump’s vague tax and spending policies appealed to the have-nots, and Congress may support them.

Trump is clever and more astute than most professional politicians. He has no ideology. His battle is now with members of the Republican establishment, most of whom will concede defeat, provided he realises that moderation will win it. Impeachment is off the agenda in view of congressional results, unless he continues to act as obnoxiously as when seeking election. He can’t and won’t lock up Hillary Clinton. He can’t and won’t build a wall on the Mexican border or stop all Muslims from entering the US. And he cannot remove the independence of the Federal Reserve System. But he will change the direction of foreign and economic policy. There are some grounds for saying this will be a good thing. Americans voted for change. For better or worse, Trump will deliver that.

Brian Reading was an Economic Adviser to Prime Minister Edward Heath and is a Member of the OMFIF Advisory Board.

Tell a friend View this page in PDF format

0 Comments -