What Biden’s presidency means for us
In looking to what new US President Joe Biden plans and how much that may affect or benefit New Zealand, there’s one simple answer: the opposite to Donald Trump.
Much of the change we will see out of Washington will simply reverse Trump policies. But, as with all glib one-liners about US politics, there’s much more nuance.
Some of Trump’s policies gained acceptance across the political field and rolling them back will meet resistance.
Markets responded favourably to the election confirmation, most likely — as Herald business editor at large Liam Dann points out — due to Democrat control of the Senate, which means more economic stimulus is likely to be greenlit.
“From a New Zealand perspective, an end to the worst ravages of the pandemic and a strong economic recovery in the US can only be a good thing,” Dann writes. “When the US economy booms, the world usually follows.”
Americans with money in their hands would be a handy fillip for New Zealand tourism, once it reopens the gates in the not-too-distant future. The America’s Cup and, oddly, Trump’s occasional outbursts about New Zealand have kept this little Pacific outpost on the US people’s radar.
A broader base of Americans with disposable income is one likely outcome of tightened financial regulations by former Federal Reserve Governor Janet Yellen, a “progressive” taking over the top job at the US Treasury. Yellen will be in charge of Biden’s $1.9 trillion stimulus proposal to provide more direct payments to individuals, expand jobless benefits and money for states and cities.
She has stated an aversion to the loose regulations which have allowed corporations to press for greater profit as average citizens were left behind. “The past few decades of widening inequality,” Yellen, as Federal Reserve chairwoman, noted in 2014, “can be summed up as significant income and wealth gains for those at the very top and stagnant living standards for the majority”, two trends, she added, that “greatly concern me”.
In trade — the big question for New Zealand — Dann believes there may not be as much of a policy shift as some might think. Trump’s China tariffs are expected to be left in place, for now.
Still, the rhetoric from a Biden administration is expected to be more diplomatic. For the Office of the US Trade Representative (USTR) Biden has nominated Katherine Tai, a former Chief Counsel for China Trade Enforcement who speaks Mandarin.
In dismantling barriers to trade, Biden looks likely to have a mandate. A Gallup survey in February 2019 — midway through the Trump term — found a large majority of Americans saw international trade as an opportunity for economic wealth.
Biden also has warm ties with New Zealand. As Vice-President, he met with members of the then opposition
Americans with money in their hands would be a handy fillip for New Zealand tourism, once it reopens the gates in the not-too-distant future.
Labour Party in Auckland in 2016 where they affirmed shared values, deepening partnership, and growing economic ties between the United States and New Zealand.
As a young senator, he and his brother once followed the All Blacks on tour through Ireland. “There was nothing but carnage left behind,” he said. “But I am a real fan.”
Biden also called Prime Minister Jacinda Ardern in November to offer congratulations on her re-election and express an intention to strengthen the US-NZ partnership.
Trade resumption isn’t expected to come anytime soon, however. His focus during his early presidency will be on immediate measures for the domestic economy and control of the pandemic.
If we can continue our fortuitous run with keeping the virus out, and sustain a continued recovery, Biden’s success on his home fronts will have New Zealand back on a very good footing.