Trump 2.0
Overcoming an array of odds, Donald Trump won big, becoming only the second President to win after a re-election defeat. EPISODE #202
Dear Reader,
A very happy Monday to you.
Last week the noisy, vitriolic campaign for the next US President concluded. Contrary to the expectations of pollsters, the electoral outcome was not tight.
The eventual winner, President Donald Trump, won big. Not only did he win the popular vote, he won 312 electoral votes—the required number is 270. Even better, the Republican Party regained control of the Senate and hold the advantage in the race for majority in the House.
The obvious question is: What will President Trump do with all of this social capital? Will it be a repeat of the chaos of the first Presidency? How will America approach global challenges, including the ongoing war of attrition with China? Finally, where does this leave the India-US relations? This week I will try and unpack the electoral verdict and attendant implications.
Happy reading.
An Incredible Comeback
On 5 November, Donald Trump created history, by winning the contest for the White House after an earlier re-election defeat—the first in over 100 years. The only other precedent was Grover Cleveland, who claimed a similar victory in 1892.
Surprisingly, especially since all polls predicted a contest that was poised on a knife’s edge and some even leaned towards the challenger, President Trump won by a big margin against his challenger, Vice President Kamala Harris. In fact, the margin of victory improved on Trump’s record in 2016, when he beat Hillary Clinton for the top job.
In the just concluded election, President Trump polled 312 electoral votes, compared to 306 in 2016. Check out the 2016 electoral map below.
And, unlike in 2016 when Clinton won the popular vote, this time Trump captured majority of the votes polled. In that sense, it was a comprehensive win that no one anticipated.
Even better, from the point of view of the Republican Party is that they have regained control of the Senate. The fight for the House still hangs in balance—as votes are still being counted. The Republicans have their nose ahead with just five short of the majority of 218.
If the Republicans do manage to win a majority in the House, then it will be a rare moment where one party will control the executive as well as legislative arms of power in the US. The obvious question is as to what will Trump do with this abundance of social capital?
Deja Vu?
In 2016, President Trump proved to be a disruptor. Neither friend nor foe, could anticipate his next move, resulting in unprecedented chaos, both at the national and global level.
Will the fact that this is effectively the last term, rewire the Trump presidency? Wherein the focus is on establishing the Trump legacy and cement the political domination of the Republican party.
To answer these queries I turned to Ajay Bisaria, former High Commissioner to Canada and Pakistan. An accomplished diplomat he has also seen the inner workings of the Indian government, having served in the office of Prime Minister Atal Bihari Vajpayee’s from 1999 to 2004.
The conversation, which will air on StratNews Global this Thursday (7 pm), was very revealing—do watch out for it, though I will share some teasers today.
For one, Ajay believes Trump will be eyeing his political legacy and hence is likely to put more thought into his second term as President.
“We need to remember when we assess this moving target of Trump that it is also going to be his legacy term. So he will be thinking mandate, and he will be thinking legacy.”
And then added:
“And from what we know, it is America first and Making America Great Again (MAGA). So within that, what he would draw from the mandate is that what was agitating the voters: inflation, jobs and illegals.
So I think we can expect escalating tariffs, stringent immigration policies, perhaps a protectionist foreign policy and a series of economic measures, which will be largely deregulatory and focused on growth.”
The Doosra
While this may be the case, there is an unpredictability factor in the second Trump presidency: Elon Musk.
The maverick owner of the hottest and most accomplished space start up and of X (formerly Twitter) threw his entire might behind the Trump campaign—including a million dollars each to lucky Republican voters.
In a signal on his possible role and influence, Musk was part of last week’s phone conversation between Trump and his Ukrainian counterpart. According to Axios, President Trump handed the phone to Musk during his conversation with Ukrainian President Volodymyr Zelensky.
Accordingly, Axios observed:
“The new details of the call underscore how influential Musk could be in the second Trump administration, and the uncertainty over how exactly Trump will approach Ukraine.”
Similarly, Musk could also be the go-in-between with China, a country in which Tesla has huge investments. It will be interesting to see the influence Musk wields with respect to US foreign policy on China—a country Trump singled out in his first Presidency as the single biggest threat.
Howdy Modi
India on its part was quick to respond to the Trump win. Even before the final count was in, Prime Minister Narendra Modi used the social media platform, X, to congratulate President Trump and then followed up with a telephone call.
In a very carefully crafted post on X, PM Modi emphasised the need to sustain the momentum of engagement—which touched new highs in the last days of the Biden Presidency with the inking of the deal to design and manufacture a special class of semiconductors used in defence and telecom—between the two countries.
I had written about this in September. Sharing the newsletter below, in case you wish to re-read it.
India has to be watchful though.
Not just for any abrupt U-turns by President Trump on geopolitics, especially with respect to China. On the other hand, if indeed Trump does follow through on his threat to impose tariffs on Chinese products, it could lead to unexpected consequences for the Indian economy.
Facing declining domestic demand, the Chinese juggeranut is bound to weaponise trade by flooding other global markets with their goods. India, which already faces a very lopsided trade balance with China, will not be immune. While India is rapidly closing the gap with respect to logistics—a huge drag on domestic competitiveness—it still has a very long way to go on improving ease of doing business. Take the two together and it is obvious that India is vulnerable.
While this is a ponderable, India should move quickly—I am sure a plan is being worked out—to get onto Trump’s global calendar in 2025. As Ajay points out in the interview, the earlier this happens the better.
Let us not forget that despite the decisive verdict won by Trump, America is split on partisan lines—so there is a good chance that domestic troubles may distract from Trump’s global agenda.
It is still early days though. Trump will formally take over on 20 January. Till then the popular perception is that Trump’s bark may be worse than his bite.
Recommended Viewing
Sharing the latest episode of Capital Calculus.
The big tech story emerging out of India is the amazing success of Global Capability Centers (GCCs). In the last five years, over 500 of them have mushroomed. For the uninitiated, GCCs are set up by MNCs to tap resources, talent and innovation skills not available within their immediate geography.
For a host of reasons, India has emerged as the GCC capital of the world. To unpack this phenomenon I spoke to Achyuta Ghosh. He is Head-Insights at Nasscom and co-author of a research report documenting this compelling makeover.
The interview with Achyuta was very revealing. For example, the who’s who of the global corporate world operate GCCs in India:
Four out of the top-10 retail companies;
Six out of the top-10 aerospace and defence companies;
Nine out of the top-10 software companies;
Six out of the top-10 semiconductor firms.
Sharing the link below:
Till we meet again next week, stay safe.
Thank You!
Finally, a big shoutout to Shipra, Lakshmisha, Premasundaran, Rajiv and Gautam for your informed responses, kind appreciation and amplification of last week’s column. Once again, grateful for the conversation initiated by all readers. Gratitude to all those who responded on Twitter (X) and Linkedin.
Unfortunately, Twitter has disabled amplification of Substack links—perils of social media monopolies operating in a walled garden framework. I will be grateful therefore if you could spread the word. Nothing to beat the word of mouth.
Reader participation and amplification is key to growing this newsletter community. And, many thanks to readers who hit the like button😊.
With a complex situation both in the domestic and international arena, Trump will perhaps be at his unpredictable best. I feel that there will be some decoupling and alignments in international politics. The Elon Musk factor is the X factor in the cauldron of events and situations that are going to evolve in the near future. Let us hope for some solutions to ongoing conflicts and get set for a roller coaster ride. Thank you for sharing such an insightful and informative article Anil 👏 👍