U.S. elections

Clinton's Business Challenge

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  • Why it matters

    Why it matters

    Whoever becomes the new U.S. president will have a big influence on trans-Atlantic trade and the economic fortunes of the United States and Europe.

  • Facts

    Facts

    • The U.S. presidential elections will take place in November 2016.
    • Hillary Clinton is currently the frontrunner among Democratic Party candidates to contest the election.
    • Current relations between President Barack Obama and Republican-controlled Congress are at a low.
  • Audio

    Audio

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Should Hillary Clinton win the U.S. presidential elections in 2016, she will be facing huge challenges after the lost years of the Obama administration. Her task will be made all the more difficult if she finds herself up against a Republican-controlled Congress.

To overcome this problem, a President Clinton will first have to revitalize a political style centered on compromise – especially to reach and engage the right-wing Tea Party element of the Republican Party and left-wing Democrats.

To do this, she must bring the White House out of its Washington isolation and strengthen communication across all political parties in both the House of Representatives and Senate.

As well as the political obstacles this presents, Ms. Clinton will also have to meet the growing expectations among the American public of the country’s social systems. At the same time, she must be careful not to endanger the pronounced entrepreneurial spirit that has made the country so strong.

This will be no easy task, as the gulf between rich and poor has grown in recent years, with an increasing number of Americans being unable to care for themselves despite the economic upswing.

On top of that, the employment rate remains below that enjoyed before the 2008 financial crisis, just as the recent surge in job creation begins to subside. This is aggravated by stagnating wage increases, particularly among the middle class. As a result, a strong focus on job creation will be more important than in the past.

Overall, I hope for a pragmatic and less dogmatic economic policy in the United States.

In addition, U.S. companies must continue to increase their competitiveness among other countries. Although at first glance a strong U.S. dollar seems like a negative factor, we have seen in Germany how a strong euro practically forced German companies to become more efficient and produce products of the highest quality.

Government can help with this by helping to make firms more economically attractive, a job it has already started. Part of this is addressing the unfair competition that results from the dumping of imported goods. This is increasingly putting American jobs at risk. But officials should be wary of over-regulation to ensure it does not become the burden it has for the European economy.

Overall, I hope for a pragmatic and less dogmatic economic policy in the United States. The belief, as promoted by Mr. Obama for example, that Wall Street is bad from the ground up is counterproductive from a business perspective.  

In addition, Ms. Clinton should dedicate herself to the task of stabilizing the flow of trade with stagnating or less-developed economies and reduce the imbalance that prevails in many cases. The present situation could increasingly impede the growth of the U.S. economy.

Equally, Ms. Clinton should continue to back the U.S. ratification of the free trade agreement with Europe called Transatlantic Trade and Investment Partnership, or TTIP, because both sides stand to gain considerable opportunities through the harmonizing of standards and the dismantling of trade barriers.

But for TTIP to be successfully implemented in the United States, Europeans must first further stabilize the euro zone.

An equally important measure would be to continue to support the re-industrialization triggered by comparatively low energy prices. A tax reform that offers better investment conditions for both private individuals and companies could contribute to this.

Another major opportunity I see for the U.S. and Europe is the progressive digitalization of entire branches of the economy. In order to maintain the present dynamic, and at the same time maximize cooperation between the two digital economies, U.S. data protection rules must be harmonized with those of Europe.

That would strengthen customer confidence when shopping online, which would ultimately benefit all market participants. In addition, the potential for innovation should not be constricted by too rigid restrictions.

 

To contact the author: gastautor@handelsblatt.com

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