While mitigated by wink-wink private consultations with our trading partners, union leaders who are committing hundreds of millions of dollars to this election may not be in a wink-wink mood if their candidates are victorious.
The primary campaigns in several states were marked by speeches and advertising emphasising the negative impacts of foreign trade and investment into and out of the US, and ignoring the fact that international earnings enable US business growth and that nearly 5% of private sector workers in the US are (mostly) happily employed by foreign direct investors.
International acquisitions of US companies also create flashpoints. At $255bn, 2007 had the largest level of foreign acquisitions in the US since 2000, and represented 90% of inbound FDI. Anecdotally at least, this will have led to synergy consolidations and lay-offs. In addition, many US firms have sought to rebuild their balance sheets by soliciting sovereign wealth funds. In exchange, these firms are committing to locate ‘American jobs’ in petro capitals. Taken together, globalisation’s impacts may offer ripe targets for demonisation, especially in the ‘battle ground’ states and when polls report that only one in seven Americans say increasing trade is ‘very good’ for the country.
The language of presidential campaigns may be refined later, but unions are also extracting commitments from congressional candidates, who stand for re-election every two years. How or whether these commitments find their way into policy, legislation and regulation creates conditions that Washington’s lobbyists long for – clients uncertain as to what comes next.
Daniel Malachuk works with business and government leaders on global direct investment strategies. He has advised many of the world’s leading companies and served in the public sector as director of White House operations.