A View from Interel and the Interel Washington Group (IWG)
Below we have gathered initial reactions and perspectives on the recent U.S. and Congressional elections and its implications from the practice leaders of the Interel Washington Group (IWG), a bi-partisan partnership of Interel and U.S.-based government and public affairs firms which advise a broad array of companies, associations and professional societies on engagement in Washington and U.S. state capitols.
We are entering uncharted territory in this historic transition, and much more remains to be seen on what will shape the new administration and its policies. What is known now, though, is there are big changes ahead and public affairs executives need to begin preparing for them.
More information and analysis to come, so please continue to check back with us and contact us with any questions.
Jason C. Jarrell
U.S. Director and Head of Global Practice | Interel
Partner, Gavel Resources
Interel Washington Group (IWG)
“A great opportunity if managed correctly.”
In what was perhaps America’s Brexit vote, and certainly the most “anti” election ever in the United States, Donald Trump was right and the polls were wrong. The pollsters suffered an industry-shattering embarrassment as President-elect Trump swept states not even on their internal radars. Of the eleven national polls to be released on the final week, only 2 showed Trump in the lead. White working-class voters swarmed for him on Election Day, particularly in the rust-belt states. Although there were, of course, a multitude of other significant factors, the pollsters will now have to go back to the drawing board to re-establish any sense of credibility after such a dismal showing.
But now what? So what if the pollsters were wrong? We nevertheless now face the reality that Donald Trump, as a Republican, was elected the next President of the United States. His policies and influence will shape important issues in both the short term and long term. And coupled with his own election, he will enjoy a Republican-controlled U.S. Senate and U.S. House of Representatives. In fact, this is only the second time since 1929 that Republicans will control Congress and the White House. The last time was 2005-2007 during the final term of President George W. Bush. This gives President Trump and the Republican Party a unique opportunity to address an ambitious agenda. While there are certain procedural checks and balances in place, much of the Republican agenda will shift from defense to offense, and the GOP is well positioned to do just that, with the White House working closely with the House and Senate.
So what’s likely to be on that ambitious agenda? Certainly the pro-business agenda is likely to pick up steam – tax reform, trade, regulatory reform, infrastructure. But President-elect Trump will be tackling some of the direct campaign promises he made – a new Supreme Court nominee, the repeal of “ObamaCare,” border security, rescinding many of President Obama’s Executive Orders on issues like climate change, health care, financial regulations, immigration, and gun control. He will look at trade deals like NAFTA, Iran sanctions, re-building the military, and many other extremely important issues. It will be an intensely busy time – and certainly a time to be completely engaged.
From a public affairs standpoint, sophisticated and experienced strategic approaches will be needed to successfully support direct advocacy. Precise messaging, grassroots and grasstops engagement, correct techniques of public relations – all will be needed to successfully manage the multitude of issues that can impact an organization. There is great opportunity if managed correctly.
Principal, Peyser Associates
Interel Washington Group (IWG)
“A stunning blow to the political establishment.”
American voters dealt a stunning blow to the political establishment on Tuesday by electing Donald Trump as President. While it appears Hillary Clinton garnered about 200,000 more votes than the President-Elect, he won the election by winning enough states to gain the required majority in the electoral college. Mr. Trump’s victory also helped Republicans retain control over the United States Senate and House of Representatives, so for the first time since 2006 the GOP will control both the legislative and executive branches of Government.
Mr. Trump’s victory comes in an election where about 7 million fewer voters came to the polls than in 2012. This demonstrates that the tenor of the race — with all its vitriol and drama — caused a number of voters to decide to sit this one out. It is a time honored truth that negative campaigning tends to discourage turnout and this election bore that out.
So what does this mean in terms of policy changes?
The President-elect has promised to repeal and replace the nation’s health insurance laws, tear-up trade agreements, build a wall on the southern border, invest in infrastructure and cut corporate taxes. The United States Senate will stand as a potential barrier to that, due to its rules requiring 60 votes to pass legislation. The GOP will have 51 seats in the Senate in the next Congress. So the President’s ability to achieve his agenda will require some work to bring at least some Democrats along to achieve his goals.
This is where practitioners in the public affairs arena will have their opportunity for an impact. The leverage enjoyed by moderate Democrats in the Senate will give them the potential to have a significant impact on major policy debates. Tailoring messages that appeal to them will be an important part of any strategy for success.
The next year promises to be a jolting one for the political establishment in the U.S. It remains to be seen how the wave that started with Brexit and continued here will effect upcoming elections in France and beyond.
“Winning is easy; governing is harder.”
In the hit Broadway musical Hamilton, George Washington counsels Alexander Hamilton “Young man, winning is easy; governing is harder.” George Washington was of course talking about winning the American Revolutionary War and telling Hamilton that he needed to get the votes from Congress for approval of his brilliant financial system. The message is relevant to us today.
Waking up on the morning of November 9th to what many thought was unimaginable, we now must confront what’s next. No one knows, including the winning candidate who for 18 months has been tapping into the worst fears and the incredible anger that has divided this country. If this was not a revolution in a conventional sense, it was a signal rejection of the status quo. It was a national cry for an end to business as usual in Washington. It was a desperate plea for change.
Donald Trump promised change. Repeal Obamacare; reverse the opening to Cuba and the treaty with Iran; renegotiate trade deals and alliances; create jobs; and ‘Make America Great Again.’ What he never said was how. What would replace all this? What’s the program? What’s the plan?
We never heard any answers to these question from the Republican establishment either. Now the Republicans will control the White House and the Congress, which will give them an unprecedented opportunity to bring about change.
From a public affairs perspective, this is not all bad. If we do our job, we too have an unprecedented opportunity to affect the direction of that change for our companies and society. This will require three things:
- Analyze and interpret the results of the election. A wise friend summed it up this way: The people have spoken. Now we must listen. We can do this by reaching out to new stakeholders and engaging with people who are not in our familiar circles. People may not know how to fix a problem, but they know when the system isn’t working for them
- Evaluate our corporate objectives and strategies in light of the new socio-political environment, which is dynamic. To say that Republicans control Washington is looking at politics from 50,000 feet; it doesn’t tell us how that will play out on any given issue
- We have to re-imagine the tools and processes at our disposal to be effective. This will require both a personal commitment to being open to new ideas and well as a collective endeavor by the public affairs community to test and share best practices
Director, Transatlantic and South America
“Strengthening the transatlantic relationship is
now more important than ever.”
European Commission President Juncker and President of the European Council Donald Tusk did not waste any time and sent a joint congratulatory letter to President-Elect Trump soon after the result was clear. Referring to the deep and broad relationship based on shared values (not to mention the €620 billion a year in trade between the two blocks), they stated that strengthening the transatlantic relationship is more important than ever. Trade Commissioner Malmstrom has also made hopeful remarks about the prospect for TTIP negotiations. Other European leaders including Merkel and May sent similar messages calling for continued cooperation.
These formal reactions could of course not hide the surprise about Trump’s victory and the anxiety and concern about his future policies and attitudes, fed by candidate Trump’s comments about NATO (U.S. support not guaranteed if European countries do not pay their fair share), international trade (trade deals need to be re-negotiated in favor of U.S. interests, threats to withdraw from the WTO) and climate change and the environment (threats to pull out of the Paris agreement, comments supportive of oil and coal exploration). Add to that the fear that Trump’s victory may boost the electoral chances of extreme right wing candidates in several European countries that will have elections in 2017 (Netherlands, France, Germany) and it is easy to explain the feelings of uncertainty in Europe.
In the next few months, European leaders and policy experts will be watching closely for any more detailed comments on these issues (and appointments for key Cabinet positions) by the President-Elect, his team and the Republican congressional leadership. No doubt hoping that worldly realities and the responsibility of office will replace the bold and extreme intentions expressed during this wildest of presidential campaigns.
U.S. Director and Head of Global Practice
“A divided United States.”
The campaign journey has come to an end, but the governance journey now begins.
President-elect Trump made many promises during his campaign, few of which were actually based on substantive policy study and research (or even supported by his own party). It remains to be seen which of these will or even can become policy in the new administration, but this is what we can expect for public affairs moving forward into 2017:
- Congress is Relevant Again. After years of gridlock that made the U.S. Congress ineffective and almost inoperative, a Republican administration will make the Republican-controlled House and Senate a rule-making body and policy workhorse once again. With Vice President-elect Mike Pence, a former Congressman and governor, President-elect Trump will look to forge strong political ties with Congress from day one to help support and advance his agenda while Congressional leaders will expect to pass legislation that had been previously blocked by President Obama. Congressional engagement programs will take on a whole new role in public affairs strategies with a flush Republican Congress and administration.
- A Divided United States. The election of Trump has exposed deep divisions in American society along lines of geography (urban vs. rural), class, and race. While Trump’s campaign platform was certainly not based on unity, his acceptance speech has already signalled an acknowledgement of the need – and perhaps a willingness – to create a higher degree of political and social unity. The fact that the election results were quite close (with Clinton winning the popular vote) and unexpected, perhaps even to Trump himself, is likely not lost upon him in terms of the political reality he will need to navigate as a first-time politician in the nation’s highest elected office. Clinton and her supporters – as well as Sanders and his supporters – are a movement that will continue to grow and be politically influential. Also, more women were elected to Congress this year than in any other election before. Whom Trump decides to surround himself with in the new administration and inner circles will reflect whether or not he truly is committed to unifying rather than continuing to divide the U.S.
- Building Trust in the Establishment When You Were Anti-Establishment. The election campaign was defined more by perceptions of trust and anti-establishment sentiment rather than actual policy discussions. Gaining the public’s trust as U.S. President and not just as a candidate will be a whole new challenge, and one which the White House will need to tackle. One potential avenue for this will be the creation of opportunities for new alliances such as public-private partnerships and infrastructure investment to deliver on his campaign promise to “Make America Great Again.”
- S. Foreign Policy. Trump’s election not only shocked domestic experts and pollsters, but the whole world. It may be premature to speculate on Trump’s specific foreign policy priorities, but his populist “America First” rhetoric and “re-evaluate and re-negotiate” stance on international agreements show he’s ready to re-define America’s role in globalization. Trade policy, climate change, NATO, and foreign military engagement are all on the table. His proposed appointments of Secretary of State and Secretary of Defense over the next few weeks (which will likely sail through Republican Senate approval next year), and his first chosen overseas visit destinations, will reveal his foreign policy cards in due course. Given his vocal friendly stance towards Putin, we may also see an easing of the current sanctions on Russia early in the Trump presidency.
Interel (New York)
“We must plan for the future, not just try to predict it.”
The U.S. Presidential election is the latest example of the growing challenge for political experts, the media, and pollsters to forecast politics. Polls have been increasingly wrong: consider the recent UK Brexit referendum and the failed FARC peace deal referendum in Colombia. The nuts and bolts of what drives political outcomes is complex. We do not fully understand what drives voter behavior and what influences voter turnout. The interplay between numerous independent and dependent variables is fluid and while correlations are abundant, clear instances of causation are not. Second order effects complicate expert analysis as these resonate back through the system and influence those independent and dependent variables.
Predicting the future is not the point. Business leaders only need to develop assumptions about what the future may look like and be diligent in developing and accessing scenarios around possible paths forward. Once organizations determine the potential paths, no matter how likely or unlikely, they should then assign back of the envelope probabilities to these scenarios, and most importantly, prepare strategic responses to proactively engage and manage the situation. A quick rule of thumb: for any potential high impact event with a likelihood of at least 15%, leaders should prepare and plan. And with the aim to adapt our business to either capture upside opportunities or mitigate downside risks, companies have to prepare and begin engaging key stakeholders sufficiently ahead of the event. Act months ahead, not weeks ahead. The estimated likelihoods may have differed for both Brexit and the Trump upset scenarios, but the severity of the impacts were the same. Companies should have planned for each.
Forecasting alone is ultimately an academic exercise. Forecasting combined with preparedness planning and strategic engagement is a powerful tool to proactively manage events and issues versus simply react. Public affairs plays a critical role in guiding organizations through robust issues management. Looking forward to the new U.S. government and other major political events in 2017, instead of predicting, let’s be prepared.