Oct 18th 2016

The Price the World May Pay for America’s Presidential Election

by Daniel Wagner

Daniel Wagner is CEO of Country Risk Solutions, a Connecticut-based cross-border risk advisory firm and author of the book Managing Country Risk. CRS provides a range of services related to the management of cross-border risk. He is also Senior Advisor with Gnarus Advisors.

The damage that has been done to the American psyche as a result of this circus of an election is disastrous and will have lingering consequences. The American political process has been reduced to sound bites filled with idiocy, insults, superficiality and non-sequiturs. It does not say much good about America’s people, government, or media that they have allowed their electoral process to descend to such depths. Does a person’s looks, race, ethnicity, religion or sexual orientation really matter more to the majority of Americans than a person’s life story, ambitions, values, work ethic or knowledge about the world? A great many people in the U.S. and around the world must be asking this very question, and rightly so.

America’s founding fathers would surely be spinning in their graves if they were able to witness the depravity and vacuous rhetoric of this presidential campaign. America has gone from the era of Lincoln and fireside chats to reality TV and soap operas. How sad that America’s political process is no longer one that other countries may wish to aspire to, and that so many Americans appear to have embraced this descent into the mundane and the profane. If the U.S. can no longer be the guiding light that represents the aspirations of billions of people around that world, what country may take its place? Can another country take its place?

Although it now looks as though Hillary Clinton will indeed ascend to the presidency in January, and many people around the world will be genuinely relieved, there is also reason to be greatly concerned. She will preside over a terribly broken political system and greater divisiveness on a variety of levels than America has seen in many decades. There is serious doubt about whether she has either the incentive, inclination or ability to be the type of change agent that propelled Donald Trump to the Republication nomination – which America very much needs.

That is America’s problem, but if America cannot fix it -- and soon -- not only does its ability to help solve the plethora of issues that plague the world stand to be severely impaired, the U.S. may no longer necessarily be sought out to help do so. It is already the case that the geopolitical sands are shifting well beyond the Middle East. Russia and China are flexing their muscles with success far beyond their borders, and unforeseen alliances are taking shape (such as between China and the Philippines and between Russia and Turkey), with unknown consequences for Washington or the rest of the world. As a result of this, and America’s current orientation toward isolationism, the U.S. stands the risk of becoming even less relevant on the global stage, and less able to effectively project its power abroad.

The U.S. is being challenged economically, politically and militarily as some emerging countries and former super powers seek to establish or re-establish their place in the world, and other countries continue march to their own tune. The Chinese yuan has recently been added as a reserve currency in the IMF – the first time a new currency has been added to the Fund since 1999. Many countries no longer use the U.S. dollar as the currency of choice for cross-border trade. America’s military ‘pivot to Asia’ is ringing increasingly hollow as the Philippines slowly drifts away from the U.S. orbit, North Korea marches toward having full nuclear military capability, and the South China Sea controversy continues to swirl. And America’s previous supremacy in multilateral institutions is regularly and successfully superseded.

The U.S. has plenty of challenges at home, but an equal number of challenges abroad. Somehow, this has gotten lost in all the noise of this election. While Americans continue to be mesmerized and sickened by the course of this presidential election, many appear to have lost sight of the bigger picture, which is that as the world continues to convulse, the U.S. is becoming less able to meaningfully influence it. That did not used to be the case, but is becoming the new normal. While many around the world may think that is a good thing, it has not been the case for more than a century. There are a great many risks involved in transitioning away from a world dominated by the U.S. There are too many unknown unknowns, and America is becoming too ill prepared to lend a hand. That has implications for everyone.

Daniel Wagner is Managing Director of Risk Cooperative and co-author of the new book “Global Risk Agility and Decision Making”.

This article first appeared in the South China Morning Post.




Daniel Wagner is Managing Director of Risk Solutions at Risk Cooperative, a Washington, D.C.-based specialty strategy, risk and capital management firm. He was previously CEO of Country Risk Solutions -- a cross-border risk advisory firm he founded -- and Senior Vice President of Country Risk at GE Energy Financial Services.

Daniel Wagner began his career at AIG in New York and subsequently spent five years as Guarantee Officer for the Asia Region at the World Bank Group’s Multilateral Investment Guarantee Agency in Washington, D.C. During that time he was responsible for underwriting political risk insurance (PRI) for projects in a dozen Asian countries. After serving as Regional Manager for Political Risks for Southeast Asia and Greater China for AIG in Singapore, Daniel moved to Manila, Philippines where he was Guarantee and Risk Management Advisor, Political Risk Guarantee Specialist, and Senior Guarantees and Syndications Specialist for the Asian Development Bank’s Office of Co-financing Operations. Over the course of his career Daniel has also held senior positions in the PRI brokerage business in London, Dallas and Houston.

He has published more than 500 articles on risk management and current affairs and is a regular contributor to the Huffington Post, South China Morning Post and The National Interest, among many others. His editorials have been published in such notable newspapers as the New York Times and Wall Street Journal. Daniel is also the author of three books: "Political Risk Insurance Guide", "Managing Country Risk", and "Global Risk Agility and Decision Making" (co-authored with Risk Cooperative CEO, Dante Disparte).

He holds master’s degrees in International Relations from the University of Chicago and in International Management from the American Graduate School of International Management (Thunderbird) in Phoenix. He received his bachelor’s degree in Political Science from Richmond College in London.

Daniel Wagner can be reached at: dwagner@riskcooperative.com or 1-203-570-1005.




 


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