Election 2014  
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We're Living in an Obama World -- Here's Why

People outside the U.S. would vote for Obama if they could. There’s a reason for that.

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As for financial regulation, while the recent crisis has highlighted the need for stricter rules, agreement on many issues has proven to be elusive, partly because the Obama administration is too close to the financial sector. With Romney, though, there would be no distance at all: metaphorically speaking, he  is the financial sector.

One financial issue on which there is global agreement is the need to close down offshore bank havens, which exist mainly for purposes of tax evasion and avoidance, money laundering, and corruption. Money does not go to the Cayman Islands because sunshine makes it grow faster; this money thrives on the absence of sunshine. But, with Romney unapologetic about his own use of Cayman banks, we are unlikely to see progress even in this area.

On trade, Romney promises to launch a trade war with China, and to declare it a currency manipulator  on Day 1—a promise that gives him little wiggle room. He refuses to note the renminbi’s large real appreciation in recent years, or to acknowledge that, while changes in China’s exchange rate may affect the bilateral trade deficit, what matters is America’s multilateral trade deficit. A stronger renminbi would simply mean a switch in the U.S. from China to lower-cost producers of textiles, apparel, and other goods.

The world has a lot riding on America’s election. Unfortunately, most people who will be affected by it—almost the entire world—will have no influence on the outcome.

 

Joseph Stiglitz, a Nobel laureate, is a professor of economics at Columbia University.
 
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