{"id":10829,"date":"2024-10-23T09:43:00","date_gmt":"2024-10-23T08:43:00","guid":{"rendered":"https:\/\/hamiltoncourtfx.com\/?p=10829"},"modified":"2024-10-23T09:44:02","modified_gmt":"2024-10-23T08:44:02","slug":"us-election-update","status":"publish","type":"post","link":"https:\/\/hamiltoncourtfx.com\/it\/us-election-update\/","title":{"rendered":"US Election Update"},"content":{"rendered":"
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Word of the Week Wednesday<\/strong><\/p>\n

Electoral College:<\/strong> “The president and vice president are selected through the electoral college system, which gives each state the same number of electoral votes as it has members of Congress. The District of Columbia gets three electoral votes. Of the total 538 votes available, a candidate must receive 270 to win”. Source US Embassy.<\/p>\n<\/div>\n <\/div>\n <\/div>\n <\/div>\n<\/div>\n\n\n

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US Election Update<\/strong><\/p>\n

With just 12 days to go until the American electorate heads to the polls, the forthcoming US elections remain heavily in focus.<\/p>\n

Recent polling suggests that Harris is holding a marginal lead on Trump in relation to voter intentions. While Race to the WH and 270toWin put Harris 2% and 1.3% percentage points ahead of Trump, the electoral collage could be considerably closer, given where these votes could lie. Swing states like Pennsylvania, Wisconsin, Michigan, Georgia and Arizona remain heavily in focus therefore, as does North Carolina which pollsters say could sway the Presidential Election. In 2020, Trump took North Carolina\u2019s 16 electoral collage votes with a majority of just 74,000 votes.<\/p>\n

An interesting article in this week\u2019s issue of The Economist surrounds US economic performance and productivity this side of the millennium, in addition to political considerations which threaten growth. Against the backdrop of the forthcoming election, the article considers how in 1990 the US accounted for around 40% of the G7\u2019s GDP, but has risen to 60% today. Staggeringly, productivity when measured in output per person is 60% higher than in Japan.<\/p>\n

Indeed, according to the most recent data from the ONS (2023), UK productivity (accounting for purchasing power parity) also lagged some 18% behind the US (while being 15% and 14% behind that of Germany and France, respectively).<\/p>\n

The article considers how some of the drivers of US growth, including \u201clight touch regulation\u201d\u201d and \u201cspeedy and generous spending when a crisis hits\u201d. It also points to the US use of natural resources, specifically shale-oil, which the author says has \u201cdriven perhaps a tenth of [the country\u2019s] economic growth since the early 2000s\u201d.<\/p>\n

Nevertheless, politicians on Capitol Hill threaten to undermine the trajectory of US outperformance, according to this piece. For example, it argues that neither side have a plan to tackle the budget deficit.<\/p>\n

This comes as US debt-to-GDP rose to $33.17tn or 121% of GDP during the 2023 fiscal year (with it rising well past $35.6tn) today.<\/p>\n

Sticking with this issue, earlier this month, we investigated the Committee for a Responsible Federal Budget\u2019s report which analysed the impact that either Harris or Trump could have on the nation\u2019s finances.<\/p>\n <\/div>\n

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The report warned that \u201cthe next President will face significant fiscal challenges upon taking office, including record debt levels, large structural deficits, surging interest payments, and the looming insolvency of critical trust fund programs\u201d.<\/p>\n

According to the CRFB\u2019s central estimate, Harris\u2019 plans could raise the US\u2019 national debt by $3.5tn compared to Trump\u2019s $7.5tn. On a high estimate, the report further indicated that Harris\u2019 plans could increase national debt by $8.1tn, against Trump\u2019s whose plans could increase it by a colossal $15.15tn.<\/p>\n

Back to The Economist\u2019s article, the author argues that a continued increase in spending and rise in the federal deficit could \u201ccrowd our private investment and erode faith in American debt as a risk free asset\u201d.<\/p>\n

Away from the deficit, the article shares concerns over how the election result could lead to further US protectionism, particularly if there is a Trump victory.<\/p>\n

In a previous WTFX article, we considered the impact that Trump\u2019s calls to increase tariffs could have. Trump has long lamented over the US\u2019 trade gap, saying that such a \u201cdeficits hurt the economy very badly.\u201d Here, the former president argues that hopeless trade deals have cost American jobs through flooding the country with cheap imports, many of which are subsidised by foreign states.<\/p>\n

Trump now intends to impose a 60% tariff on all Chinese goods. Trump has also floated the idea of a 10% tariff on all of the US\u2019 $3.2tn imports.<\/p>\n

Keen to win over the swing state of Michigan \u2013 which for decades was the heart of the American automotive industry \u2013 Trump has also earmarked a 20% tariff on European car imports and 100% tariff on cars from Mexico.<\/p>\n

As we have looked at, according to the Peterson Institute for International Economics, such tariffs would cause \u201csignificant collateral damage on the US economy\u201d. Their modelling indicates that the wider cost to consumers would total no less than $500 billion (three quarters the size of the Michigan economy). All told, the institute forecast this could cost the US economy 1.8% of GDP, causing nearly five times the impact of Trump\u2019s 2019 tariffs.<\/p>\n

Next month\u2019s election will therefore mark a critical juncture in the story of US growth, with political actions likely having a major impact on economic activity. While a split Congress could act as a counterweight to either a President Trump or Harris, the White House continues to have tremendous power through the use of executive orders \u2013 a power which will is at the President\u2019s disposal the moment they are sworn in.<\/p>\n <\/div>\n <\/div>\n <\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"

With just 12 days to go until the American electorate heads to the polls, the forthcoming US elections remain heavily in focus.<\/p>","protected":false},"author":15,"featured_media":8566,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"rp-language":[16],"class_list":["post-10829","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-morning-updates","rp-language-en_gb"],"_links":{"self":[{"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/posts\/10829","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/comments?post=10829"}],"version-history":[{"count":4,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/posts\/10829\/revisions"}],"predecessor-version":[{"id":10833,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/posts\/10829\/revisions\/10833"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/media\/8566"}],"wp:attachment":[{"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/media?parent=10829"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/categories?post=10829"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/tags?post=10829"},{"taxonomy":"rp-language","embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/it\/wp-json\/wp\/v2\/rp-language?post=10829"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}