Trump elected, Wall Street, New Zealanders react


This video from the USA says about itself:

U.S. Aerospace And Defense Industry Welcomes Trump Victory

13 November 2016

U.S. aerospace companies and lobbying groups embraced Donald Trump’s presidential victory on Wednesday.

By Nick Beams:

The 19,000 Dow: Markets soar on prospects for profiteering under Trump

24 November 2016

US stock indexes reached record highs again on Wednesday on expectations that the policies of the incoming Trump administration, based on “America first” economic nationalism, the removal of all regulations restricting corporate profit-making, and huge business tax cuts, will provide a major boost to the bottom lines of banks and corporations.

The Dow Jones Industrial Average continued its rise after closing above 19,000 for the first time ever on Tuesday. The Standard & Poor’s 500 index and the Russell 2000 were also in record territory. Only the tech-based Nasdaq index was slightly down after hitting a record high on Tuesday.

All four major indexes reached record highs on Tuesday, something that had not occurred since New Year’s Eve in 1999, at the height of the dot.com bubble.

The market rise is being led by two groups of stocks, banks and those involved in construction and infrastructure.

Bank stocks are being propelled by the prospect of interest rate increases, which will boost their profits, and indications that the Trump administration will wind back regulations, including some of the limited restrictions imposed under the 2010 Dodd-Frank Act. The rise in bank stocks is the main reason for the jump in the S&P 500.

The other major boost to the market was provided by construction firms. Shares in John Deere jumped by more than 10 percent, resulting in a boost to the S&P 500 index. Shares in other industrial stocks, including Caterpillar, were responsible for a major part of the rise in the Dow.

Stocks in these companies have been boosted by Trump’s commitment to initiate an economic stimulus package program of tax cuts and infrastructure spending. The tax measures include a reduction in corporate taxes from 35 to 15 percent, as well as a reduction in the top tax levels for the ultra-wealthy. Companies repatriating profits from overseas may have to pay as little as 10 percent.

But it is the infrastructure program, which has been put at $1 trillion, that has sent the markets soaring on the ever-stronger smell of money. It is not a plan for the government to borrow money and use it to finance much-needed improvements on roads, bridges and other basic facilities.

Rather, it is based on a privatisation scheme, in which firms will receive massive tax cuts for undertaking such projects. By means of tax breaks, they will receive back as much as 82 percent of the money they invest. As the owners of the projects they initiate, they will then be able to collect tolls or user fees in perpetuity. In many cases, the projects will involve profitable ventures to which companies would have been attracted anyway.

The same modus operandi applies to deregulation of the energy and pharmaceutical industries. In his brief video announcement on Monday, Trump said that for every new regulation that is introduced, two existing regulations will have to be eliminated. This is a program aimed not at increasing jobs and wages or improving social conditions for the masses of working people, but at providing a profit windfall for corporate America.

Trump’s economic plan for the US economy bears a striking resemblance to the business model of his real estate and casino empire: a mixture of tax evasion, scams and outright swindling, coupled with the exploitation of low-wage workers.

It has been estimated that the tax cuts and infrastructure spending increases will lead to an increase in US budget deficits from 3 percent of gross domestic product to 6 percent. Trump is also planning an immense increase in military spending. Who is to bear the burden of this debt explosion? The working class.

Trump is planning to cut non-defense discretionary spending by 1 percent a year, which will mean further reductions in food stamps, home heating assistance, unemployment benefits, health programs and the enforcement of job safety and environmental standards.

He is targeting federal workers for immediate attack, calling for mass layoffs, the gutting of job protection provisions, the elimination of automatic raises and the imposition of 401(k) plans instead of pensions for new-hires.

During the election campaign, Trump sought to attract voters suffering cuts in their wages and living standards with the promise that Medicare, Social Security and other entitlements would not be touched by his administration. But the budget process is in the hands of the Republican-controlled Congress, where House Speaker Paul Ryan has reiterated his plan to privatize Medicare. Since the election, Trump has said he is “open” to such a plan.

The Trump agenda has major implications for financial markets and international economic relations. The rise in the stock market has been accompanied by a significant rise in bond yields—up from around 1.7 percent before the election to around 2.3 percent today on the benchmark 10-year US Treasury note. This means a sharp fall in bond prices, which move in the opposite direction of yields.

Coupled with the near certainty that the Federal Reserve will lift its base rate at its meeting next month, the rise in interest rates could have a major impact on a financial system in which the bond market has been described as a bubble. Increased interest rates could bring about significant losses on financial deals made on the basis of rates remaining at their previous record-low levels.

The prospect of rising rates has already seen a rise in the value of the dollar, which has reached its highest point in 13 years as measured against a basket of international currencies. This means that US corporations that rely on international markets will face increased competition.

The Trump agenda of “America first” economic nationalism represents a major shift in US economic policy. It is being adopted under conditions in which the previous policy of near-zero interest rates and central bank money-printing is widely recognized to have exhausted its usefulness and failed to resolve the crisis that erupted with the Wall Street crash of 2008.

While the American ruling class has always pursued its own interests, US economic policy in the post-war period was based on the assumption that the interests of American capitalism were bound up with the expansion of global markets and trade. Now the free trade mantra has been thrown aside, threatening to set off a wave of retaliatory trade and economic warfare that sooner rather than later will rebound on the American economy.

This video from the USA says about itself:

Dishwashers, Plumbers, Waiters & Lawyers: Hundreds Accuse Trump of Failing to Pay for Their Work

16 June 2016

A new USA Today exposé finds hundreds of former employees and contractors have accused Republican presidential presumptive nominee Donald Trump and his businesses of failing to pay them for their work. Victims have included a dishwasher in Florida, a glass company in New Jersey, a carpet company, a plumber, 48 waiters, dozens of bartenders at his resorts and clubs, and even several law firms that once represented him in these labor lawsuits. We speak to Steve Reilly, an investigative reporter and data specialist for the USA Today Network. His new exclusive is called “Hundreds Allege Donald Trump Doesn’t Pay His Bills.”

By correspondents of the World Socialist Web Site in New Zealand:

New Zealand: Auckland youth and workers concerned over US election result, danger of war

24 November 2016

Over the past week-and-a-half members and supporters of the Socialist Equality Group (New Zealand) have been campaigning in Auckland for its public meeting this coming Sunday. …

SEG supporters have spoken to workers about these vital issues in the city centre and working-class suburbs, such as Onehunga, Mangere, Avondale and New Lynn. We have met hospitality workers, stevedores, truck drivers, teachers, retail workers and many others, including dozens of immigrants and students from the Pacific Islands, India, China and other countries. Auckland is one of the most diverse cities in the world, with 39 percent of the population born overseas.

There is widespread concern over the victory of Donald Trump, particularly his extreme nationalist plans for trade war with China and his intention to deport millions of immigrants and attack the rights of Muslims and other minorities. Several people remarked that the US presidential election had increased the danger of World War III.

Auckland is currently hosting naval contingents from the US and dozens of other countries as part of the NZ Navy’s 75th anniversary celebrations. The first visit by the US navy in 33 years marks the complete restoration of the US-NZ military alliance and New Zealand’s integration into Washington’s war preparations against China. There is deep-seated opposition among workers and youth to the promotion of militarism and New Zealand’s ties with US imperialism.

Thomas, a Chinese student who bought a ticket to the SEG meeting, said Trump’s threat to build a massive wall between the US and Mexico was “really, really crazy.”

“I think his policy on immigration is very bad, especially toward people from Asia and Muslim people. He’s very anti-China. Chinese people are very nervous about him, including my friends in America. They plan to move to New Zealand because of the election.”

Thomas denounced the US military build-up and encirclement of China, saying: “I think America should not be in the South China Sea.” He added that if China positioned its navy off the coast of California the US would respond with “world war.”

Jonas, 20, arrived in Auckland from Germany a week ago. He is on a break after finishing high school. “I think that Trump’s campaign was very populist

The word ‘populist’ should be reserved for the nineteenth century United States farmers’ leftist movemeent of that name.

,” he said. “His opinions on women, on immigrants are really terrible. He said he would ‘make America great again,’ and provide jobs and more money for the poor. Except that he didn’t say how he would do it.”

Commenting on Trump’s attacks on China, Jonas said: “I said before the election that if Trump got elected it would mean World War III. I think there actually is a real chance.”

Doug, who works as a septic technician, denounced “the elite in the US” who supported Hillary Clinton. He described Trump as “a buffoon” but added that the Democrats had “managed to put 15 percent of the entire population out of their minds, as if to say ‘they don’t vote anyway, so they don’t matter.’ So 15 percent of the population stood up and voted for Donald Trump.

Hillary Clinton turned up to a rally with someone who gets paid $18 million a year to sing a song, while people are having to go to food banks to feed their children. People thought: ‘You obviously don’t even know we exist, and you want to be our president’.”

Vijay

Vijay, a young hotel worker who moved to New Zealand from India, also bought a ticket to the meeting. Hillary Clinton lost, he said, because of her pro-war policies. “She wanted to make Syria a no-fly zone. If any plane flies, she’s going to shoot it down. That’s horrible; and then she would go to war against Russia! How many people will die if there’s a world war?”

Vijay said both US presidential candidates represented the rich. He went on to describe the worsening social crisis in New Zealand, which parallels the situation in the US, including the lack of affordable housing and the exploitation of migrant workers in the hospitality sector. “More than half of my friends work for $10–$12 an hour,” he said. “They get paid in cash. I work two jobs just to pay the rent. I’m lucky because I work in jobs where I’m paid above the minimum wage ($15.25 an hour).”

Vijay opposed the attempts by New Zealand’s political establishment to scapegoat immigrants, saying: “I don’t blame the Chinese workers. They’re looking for jobs. They’re desperate. Imagine you come to a country with $2,000 in your pocket, and your rent is $600 a month. It’s so hard to find work.”

Sogra, whose family had emigrated from South Africa, also denounced both candidates and said Trump had won because there was “nobody else” to vote for. She blamed the collapse in support for the Democrats on the US military interventions in the Middle East and said: “There are people being killed in Syria, all over. Clinton is responsible. Not only her, but also Bush, all the other administrations are responsible for the war.”

Sogra voiced her concerns about Trump. “He doesn’t like black people, he doesn’t like brown people. He’s against immigrants. I’m from South Africa and we went through the racism of the apartheid system, so we know what it’s like.”

Like many other workers who spoke to the SEG, she said social inequality played a large part in the election result: “The rich are getting richer and the poor stay poor, all over the world. In the US they are funding the military while the poor stay poor and there’s people living on the street. I haven’t been to America but I’ve seen polls showing that people are really struggling there.”

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