Trade Cases

Leibowitz: Trade Deals Could be Clouded by US Election Uncertainty

Written by Lewis Leibowitz

Last week’s indictment of former president Donald Trump has ignited a blizzard of commentary. Not much of it has looked at the implications for the global trade order.

Over the next year and a half, major trade and strategic initiatives will be negotiated with adversaries as well as allies: everything from the steel and aluminum negotiations with the EU to the war in Ukraine.

Could uncertainties surrounding Trump’s court proceedings affect international relations and trade negotiations? Also, will other governments know which US administration they will dealing with in a timely manner after the 2023 election?

The indictment alleges that Trump engaged in a conspiracy to defraud the United States by claiming, falsely, that the presidential election of 2020 was stolen from him. The former president has pleaded not guilty to all charges. These allegations, if proven, could lead to prison terms for the former president and as-yet unidentified alleged co-conspirators.

It adds another element of uncertainty to a US election process that was marred by violence on Jan. 6, 2021. If there is extended controversy over which candidate has won, stability in the world would be the loser. Is this likely to occur? I think not, because of the relative strength of our electoral system.

The United States has stood for 247 years as a model for the world of the peaceful transfer of power. With a few notable exceptions, it has worked every time. However, a world in which the United States does not promptly install leadership based on fair elections would be dangerous, roiling both domestic and international affairs.

The events of 2020 and 2021 allowed a glimpse into this uncertain world. The failure to certify the Electoral College vote before Inauguration Day could have created just a situation. When has that prospect been raised before, and could it happen again?

In 1876, the presidential election was decided only two days before Inauguration Day. Three states sent dueling slates of electors to Congress. An Electoral Commission to decide which slates were legitimate ruled that the Republican, Rutherford B. Hayes, was entitled to the disputed Electors. He won by one vote, 185-184. But even then, the winner was declared before Inauguration Day.

In 2000, the Supreme Court decision in Bush v. Gore was handed down only eight days before the meeting of the Electoral College. Florida awarded its votes to George W. Bush before the deadline.

In 2022, Congress amended the Electoral Count Act of 1887 to protect against anything similar to the 2020/21 mess. The new law makes clear that the vice president has no authority to call into question the certified tallies of the states. The likelihood that Congress would need to decide the outcome of state-certified votes is also less than it was in 2020. In short, the likelihood of a dispute dragging on until after Inauguration Day has been reduced.

The president, like all Americans, has the right to speak his mind. The upcoming trial might affect who is nominated by the two major parties (and whether there will be one or more candidates outside the two major political parties). Regardless of the outcome of the Trump case, we can expect that the country and the world will know who the next president is before January 20, 2025.

But between now and then, the uncertainty of who might be the next president could affect many negotiations and initiatives. Any big agreement between the Biden administration and other governments might be difficult to achieve. That’s because foreign governments might fear that a change in administrations could see any such pact unceremoniously scrapped. That uncertainty might affect (or prevent) deals on steel, climate action, and even war and peace in Europe.

Lewis Leibowitz, SMU Contributor

Lewis Leibowitz

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