Getting down to action: Obama re-elected for second term
Shaili Chopra reports from Boston on how Obama's second term will impact his approach in fixing the mess at home and America's image overseas
For the United States of America (US), re-election of President Barack Obama is a vote for continuity and another chance for him to put together a job he started out with ambitious promises. For the rest of the world, another term for Obama would mean that his global image will be put to test on foreign policy and economic force.
Despite the victory, Obama cannot afford to ignore the fact that half of America really did not want him as President, which was proven by Romney's popular vote. His narrow win has been nothing like the triumphant celebrations four years ago in 2008 when the world saw the election of America's first black President as a turning point in not only American but world politics. If anything, the re-election has put Obama under massive pressure. The victory trumpets have been short-lived because now the spotlight is on how Obama is planning to execute the changes he campaigned about, how he will avert an impending financial crisis that could put America back into recession and more importantly, build consensus with the Republicans and the Congress on issues of national and international importance.
The biggest challenge the American President now faces is to deal with a massive $600 billion austerity plan to cut down public spending and increase taxes to control the deficit. Termed 'the fiscal cliff', this has, according to global economists, the potential to put the US recovery back into recession. Republicans call this an extreme stand and so the question is whether Obama will be able to garner consensus before the January 2013 deadline.
In his attempt to create jobs, Obama will probably need to fix his rebuke for big businesses and realise that private sector can also be a job creator. Depending on public infrastructure alone cannot bring the present 7.8% unemployment rate lower. The business world wants to engage with a less-isolated Obama.
Foreign Policy Watch:
Obama is widely expected to continue his policies towards Middle East, South Asia and the broad region. The presence of American troops in Afghanistan is expected to be over by 2014. However, he may choose to strengthen ties around the borders of China and in Asia Pacific to find an ideal deterrent for the rise of the Communist giant.
The big question over this term could also be — if Obama will be able to make a deal with Iran? The sanctions are seen to be working, given the crippling impact they have had on Iran's economy and currency.
In the Middle East, a Saudi cleric reportedly tweeted,"Obama isn't good, he is the lesser evil."
Obama's re-election is not going to change a lot for India. The country of a billion plus remains an attractive market, there will be higher trade expansion to push for American investment in India, outsourcing will remain part of rhetoric though not in reality, thus one can expect more of the same.
With Obama's re-election, Starbucks and Wal-Mart may soon become ubiquitous in the subcontinent. Obama’s second term would ensure that America and its brands are indeed on the move in emerging markets. As Sunil Mittal of Bharti Enterprises has gone on record to say there will be "continuity for India."
On the outsourcing front where Indian tech firms get nearly 50 per cent of the revenue from the US market, there is concern that Obama would remain cautious. No doubt the tough visa regulations and higher visa fees will continue to hurt giants like Infosys, TCS and others but most companies have since 2010 (when the visa laws were first changed) learned to factor this obstacle in.
As for foreign policy, India will be monitoring America's role in China. Obama is already pushing China to let their currency appreciate so American goods can become cheaper for the billions of Chinese to buy and has raised issues around Chinese data insecurity in connection with large companies such as Huawei.
On the more tenuous issue of Indo-Pakistan, Obama is expected to remain non-interfering as he has been so far, even though India will remain interested in America's independent policies towards curtailing terror in Pakistan and Afghanistan.
Capital Market Watch:
On regulation, India will be watching out for how Obama's efforts to fix the economic mess will change the fabric of the US financial sector. The rocky relationship of the US government with Wall Street has been tracked by the rest of the world. Any effort towards tighter regulation, more government interference in private sector and capital markets, more rules (such as the Frank Dodd Bill) have the potential of sending tremors through global markets.
The US President has a plethora of issues to sort. He campaigned for his re-election on the plan of finishing what he had already started. On Tuesday night, Obama said in his acceptance speech that people vote for 'action' and not 'politics' but now more than ever, people of America and around the world want to see Obama put that action into real results and people before politics.