Following the recent election of Donald Trump to be the 57th President of the United States, the AmCham.lu team has been reviewing and analyzing the data and the media reporting on that data in the United States to gain an understanding on what happened, where we are at, where the U.S. is going and that will be the impact on Luxembourg, Europe and the world. This report is the result of that analysis. We present it to you, our readers in the AmCham community, to inform you so you can better understand and make better decisions for the benefit of yourselves, your companies and your countries. After reading this report and discussion it with your colleagues and friend, we welcome you to come back with us sharing other information or asking questions.
How does the U.S. election process work?
The United States is a republic composed of a national government mirrored by a state government system. 50 sovereign states share authority deliberately divided between the states individually and the national government with each entity having an executive branch (the U.S. president with his cabinet and staff or Governors and their elected cabinets and staff), a legislative branch (the U.S. Senate and the House of Representatives and their state equivalents), and a judicial branch (the U.S. Supreme Court and subordinate federal courts as compared to state court systems).
In two-year cycles, the United States holds elections to give the people the opportunity to renew or change mandates for their elected representatives at all levels. The President is elected every four years. The lower house of Representatives is fully elected every two years. The upper house of representatives, the Senate, is partially elected with one-third of its members renewed every two years and each serving for a six-year term of office. This is done deliberately to ensure a measure of stability and moderate against radical change.
Presidential elections are managed at state level via an electoral college system, which apportions winner-take-all state votes allocated depending on the populations of each state. This electoral college is deliberate to ensure a balance of power between city populations and rural areas.
270 electoral college votes are required for election of the U.S. President. In this just completed election, Mr. Trump received 312 electoral college votes while Mrs. Harris received 250. So, Mr. Trump has been elected and will begin his service as the 47th President being inaugurated on the 20th of January 2025. The present President Joe Biden will continue to be the U.S. President until that date.
How do Presidential candidates get on the ballot?
In total there were five candidates running for President of the United States in this just-completed election, with candidates from the Republican and Democratic parties having the strongest chance of election because they represented the largest electoral groups in each of the states. In the US, 34% of the registered voters identified (this time) as Republican party affiliated, 31% identified as Democratic party affiliated and 35% identified as Independents.
Candidates must register with a certain weight of declared voter support to get on each state ballot.
How are campaigns financed?
Campaigns are financed via private donations via individual contributions. Companies may not contribute. Both mega donors from very rich people, political pacts which are collective groupings generally based focusing on specific issues and objectives and small donors are involved.
Mrs. Harris raised 1.1 billion USD for her campaign and spent 1.2 Billon USD ending up 25 million USD in debt for her political party at the end. Mr. Trump raised and spent less than 1 billion USD.
What were the key points of Mr. Trump’s campaign strategy?
Stopping illegal migration into the United States; reducing living costs caused by inflation; restoring prosperity for the common man; reducing government regulations and cost. Mr. Trump made himself open to wide-ranging interviews and press conferences, so his positions were well known and well vetted in the eyes of the public. He had multiple surrogates including prominent Democratic party former members with strong followings.
What were the key points of Mrs. Harris’s campaign?
Mrs. Harris did not prioritize policy issues but rather focused on attacking Mr. Trump accusing him of being an authoritarian threat to Democracy. She also focused on future aspirational goals without giving substantiative details. Mrs. Harris did not do any press conferences at all and only very few interviews, relying instead on celebrity endorsements.
Was Mr. Trump’s victory a landslide?
While Mr. Trump gained a decisive victory in the electoral college, plurality in the popular vote and Republic control over the Senate and House of Representatives, the election outcome was very close and the individual victories narrow, often below 3% difference in voter support.
The election outcome was driven by the decisions of the 35% of the voters who self-identified as independents.
Mrs. Harris gained voter support from an increased number of women university graduates, but loss voter supports among black men, Latinos and young male voters.
What is going on now?
Mr. Trump has effectively rebranded the Republican party into being a political party of the common man (and woman) regardless of race or color. He will try to reduce government size, reduce government regulations, and influence to return power over personal lives and company business to individuals and companies. He proposes to increase U.S. energy production to reduce the cost of energy and hence to reduce prices paid by individuals and companies, tax more simply and with less impact by exempting overtime, tips and social security income from taxation; he likewise proposes to deport illegal residents with an emphasis on deporting criminals.
If Mr. Trump is successful with his goals, he will have moved the U.S. slightly to the right politically and forged a new alliance of interests that has the possibility to have staying power for a significant time period.
The Democrats will need to do some serious soul searching, pick new leaders and define a new strategy of engagement.
What will be the impact on Luxembourg and Europe?
The U.S. is likely moving to the right of center of the current European body politic. Mr. Trumps election will likely encourage European politicians to move in his direction.
Mr. Trump and his team will want the U.S. to be respected, appreciated and treated fairly. This means European nations paying more to keep NATO strong and helping to share the burdens of the world, and fair economic trade relations.
At the same time, the U.S. appreciates and considered NATO important to its own self-interest, so there will be no rush to leave NATO.
He will threaten to impose tariffs on countries that do not trade fairly with the U.S. However, the Trans-Atlantic alliance of bilateral trade and investment is the strongest and most successful economic cooperation in the history of the world with enormous benefit for Europe and the U.S. (for more information about this register and join the AmCham event at Deloitte on the evening of 27 November for our presentation of the details of the 2024 AmCham Europe annual transatlantic trade and investment report). Consequently, the strength of the U.S. European Transatlantic Trade and Investment partnership (with the U.S. being the largest investors in Europe and European companies the largest investors in the U.S.A.) is very important to build and ensure prosperity to both the U.S. and Europe. Further strengthening this partnership is vital to ensure this historic cooperation continues to guarantee and underpin our common achievements ensuring freedom, democracy and the economic prosperity of all of our people on both sides of the Atlantic.
Final thoughts.
The United States and Europe are family. We both are primarily Judeo/Christian in religion. The solid majority of U.S. citizens come from European family heritage. We all believe in democracy and capitalism. We all understand we live in a dangerous world and need friends. We have a long history of friendship and mutual support. We need each other and the world is better, safer, more prosperous, and free when we are aligned together in common cause. The U.S. is the best friend of Europe and has no intention to abandon this friendship.
