Donald Trump: America First !

When we talk about Donald Trump, the first things that come to mind are threats, madness, uncertainty, protectionism, etc. Let’s see what Donald Trump says about himself and maybe we can find some opportunity from all the above.

Before talking about Trump, I suggest you visit his website: in order to see his proposals and try to find what dangers and opportunities may turn up for companies, countries and society in general.
The first thing that draws your attention is his so-called Donald Trump’s Contract with the American Voter, which highlights what he plans to do in the first 100 days of his mandate: his electoral program, so to speak. In Spain, the PP electoral program contains more than 200 pages, the one of PSOE almost 400, and Podemos explains his policies in 394 points, C’s 350 proposals are detailed in 46 pages. And what about Trump? Just 2 sheets (!!) with 18 actions and 10 legislative measures which, and this is highly merit-able, are perfectly understandable (link to contract). Among them, and apart from those highlighted by many medias, there are actions such as proposing a constitutional amendment that limits the duration of the mandate of judges or that by which any new law or regulation must replace two old ones, or prohibiting members of the Congress or high rankings in public administration to work for private sectors related to the administration itself and even lobbyists for 5 years after leaving their public function.


From a European point of view, a significant demand of the State on society is considered reasonable. However, the same society is realizing that this demand has to be linked to  an efficient use of the resources they use and criticizes that their only merit for sitting on the companies’ boards of directors is their political experience and, obviously, the benefits of business deals received or expected to be received. This new trend does not look at politics as a profession, but as a service. There is a clear negative perception of the so-called “professional politician”, no one forces anyone to enter politics and it should not be something permanent. Could a positive effect be taken out from Trump’s proposals that would give the definitive impulse to the inflexible European transatlantic governed by nineteenth-century professional bureaucrats? “Wake up and smell the coffee!”

The same contract mentions the identification of the trade agreements with countries that (in his opinion) threaten the interests of the American workers and need redirecting. It mentions concrete names. In a few days Trump has already canceled the Asia-Pacific treaty (Trans-Pacific) and is reviewing the Canada-Mexico one (NAFTA). He said he would remove President Obama’s obstacles to the building of an oil pipeline (Keysone Pipeline) and he did it. He warned he would restructure the so-called “Obama Care” and he did. I am not saying these measures are good or bad. This would require a much deeper analysis and it also depends on whether it is analyzed in its domestic or international impact. What is remarkable, and perhaps unusual in the political style, is that he does what he says. Fancy that!

To close this chapter, Trump (and his team) thought of it, put it on paper, publicized it and it was widely spread around by many people in favour of it and against, then finally voted on. Many believed they were “boasts” more than real intentions, that American people would not support them or, in the worst scenario, once in power, he would not implement them. The moral is: maybe we just have to read more and vote for what they expose. Not to do it would seem unwise. There is also another point of view, they did read and supported it; something to think about.

We could go on evaluating his proposals, but I would like to try and see if other countries can get any opportunity out of all this. It is not just about debating on Trump’s “yes” or “no”: this is already over. Trump is here, and unless an impeachment takes place, he will be here for the next 4 years. This is a fact, and we’d better understand how this “Trump Time” will influence our lives and act accordingly. Let’s minimize the risks and let’s seize the opportunities. I would like to mention four of them:

Infrastructure: Trump announced an investment of one American trillion dollars during the next ten years. This means  one Spanish billion, one million millions dollars, i.e. 100.000 million dollars per year, for ten years. We are talking about 60.000 bridges that infrastructure-breakdownneed to be updated, water purifying systems (more than 2.000 inefficient plants in 50 States). We are talking about airports, motorways, water treatments and infrastructure for raw material transport (oil pipelines). Many Spanish companies lead in these sectors and a lot of them have plants in the United States.

The measures can have a direct impact on us and they may also impact indirectly. It is clear that new employments will not be necessarily created here because of the work done over there, but if all goes well for our companies the result is not bad. Analyzing the possible indirect impact, let’s not forget that Trump’s program speaks about tax incentives and ways of financing public and private investments. Some of these ideas could then be applied in order to obtain more efficient results. Watch it: Wall Street is already doing it.

International Commerce: President Trump has already cancelled the Trans Pacific treaty and is already reviewing the NAFTA. He has declared China as a currency manipulating country to subsidize the costs of its exported products. How does this affect us? There are many points to be analyzed, but let’s start with the first one: when one leaves, his/her place can be occupied by somebody else. This is called the “fill the gap” effect. China is already starting to “fill the gap” existing in its nearest area of influence. Even Australia has declared that the USA are not necessarily their only “preferred partner” in the area. The same is happening in the American continent. The first one was Mexico, but it is not going to be the only one. The whole of South America will have to reconsider its economical politics because of these changes. For American manufacturers, who want to obtain lower costs by manufacturing, for example, in Mexico, the  perspective of being obliged to pay taxes on those products they want to sell to the USA, can make them reconsider whether it is worth manufacturing abroad or not. For a non-US Company, the question is whether to build its factories and facilities in the United States (there are many already), or abroad. For LATIN AMERICAN countries, the true reality will be having to convince these companies that their conditions are better and their markets attractive enough to invest there. Beware of the social impact of all this.

trump-trading-japan-chinaLet me give you some data of his analysis. When president Obama signed the Commerce Agreement with South Korea, he predicted that exports to Korea would rise up to 10.000 million dollars and create 70.000 new jobs in the USA. The data show that exports to Korea did not increase, while commerce in the other direction, i.e. from Korea to the USA, increased by 15.000 million dollars. His analysis is that not only new jobs were not created, but almost 100.000 were destroyed. Starting from here already President Trump makes his well known conclusions.

In the field of international commerce, there are those who say the most important is to start because time will equalize everything. However, to follow the same commercial ideology could be dangerous, when there are not the same social, health, salary, economical, legal rules, etc. And if moreover there are no agreements (or the existing ones are not fulfilled) to shorten that distance, there could be the risk to create a dysfunctional basis, the result of which (meaning the creation of wealth there and/or destroying wealth here) is not coming from higher efficiency but from other elements that are not clearly ethically correct. It is then reasonable to have to check these points. I believe many diplomatic ways have been explored. President Trump seems to have a more executive approach, but I do not know if it will be more effective.

Education: According to the Pisa report, at the time of the “Trump Contract”, American students were situated in the 28th and 18th position in math and reading respectively. According to the last report dated December 2016, they are now in the 39th and 23rd. Well, in comparison, we are in the 32nd and 25th respectively. In the USA, education is much more expensive for a student than it is in Spain. The difference comes from the fact that in Spain it is financed by tax payers. In the USA, the city of New York spends the average amount of 20.226 $ per student in the public school, Chicago 11.976 $ or Los Angeles trump-school-of-choice10.602 $. What Donald Trump  is proposing is to give poor children the opportunity to choose the school they would like to go to (“School Choice”). We are speaking about 11 million children. The budget for this project would be 20.000 million dollars from the State and 110.000 million dollars from the different States. This means approximately 12.000 $ per child per year. It is clear that education is the best tool for reducing social differences and one of the best existing ways for meritocracy. Is this proposal of Trump a way to promote the reduction in the social gap? Could this be applied here too? Let’s imagine a scenario in which parents had the economical guarantee not only to be able to send their children to school, but also to choose the school they prefer: what do you think they would decide for? I would select the best ones. And what about the schools?  Wouldn’t they compete to be attractive to the students, working to be better, more efficient and to give better results? What do you think of this scenario?

Cyber-Security: Our life is becoming more and more digital and internet orientated. And this is not going to stop, but it will go further. These new ways must be as safe as the physical ones. This does not only mean that the same facts or words should be regulated under the same legal frame of responsibility whether on the street, on paper or in Twitter. We are talking about all our life in general. In the case of the USA an example of a known such impact is the attack to  Government or Private Systems. We are talking of hackers obtaining data on 20 million persons being investigated by the Federal Government for some reason. JP Morgan Chase’s information on 76 million clients with mortgages was compromised. 150 million passwords from e-Bay clients were hacked, etc.

trump-cyberThis fact is remarked in Trump’s proposal, announcing that he is going to create a Cyber-Security team formed by military professionals, lawyers and the private sector, with the object to reviewing and identifying the possible vulnerabilities of the systems related to the Administration (military, defense, healthcare, Public Administration), to be protected from such attacks and to react suitably against such threats.

This is not a joke. I do not believe anybody likes to lose his/her own identity because of a hacker, or his/her money or medical history to be revealed. But not only this, when natural disasters occur such as fires, tsunamis, hurricanes (Katrina), etc., a lot of documents in civil or religious registers are destroyed and lost forever, the same as birth and matrimonial certificates and also public deeds. Creating systems preventing such situations is not a minor matter. We are talking about crypto-coins, block-chain technology and other cyber-security measures. To promote both implementation and development of this technology will not only provide us peace of mind, but it will be also a source of development and business.

Is Trump’s approach the most appropriate? It seems that he did not start well with the CIA, although now it seems it was a misunderstanding caused by journalists, you know, those people “among the most dishonest people I’ve ever met”.

President Trump is a mystery. This is something unprecedented. His intentions can be summarized as “America First”. We can ignore it, but it is a fact that is already here. To understand him, to anticipate him, to see his initiatives without prejudice judging them by their own merits (or lack of them) and to detect the emerging opportunities is, in my opinion, a challenge that cannot be ignored and that will keep us busy for a good while.

Madrid, February 3 2017

Francisco Canos


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