Barack Obama looks certain to beat John McCain and become the next US president. Most Indians will be delighted. An Obama victory will symbolise the vanquishing of racism and the dismal Bush legacy.
Besides, McCain is a military hawk, especially on Iraq. Obama is not exactly a dove, but is far less a military adventurer than McCain, and is preferred by Indians on this score too.
Yet, a look at the voting record and campaign content of the two candidates suggests that McCain might in many ways be better for India than Obama, especially on economic issues.
A nasty global recession has begun. Nouriel Roubini of New York University predicts we will suffer the worst economic downswing since the Great Depression. So, pressures will mount for protectionist measures and beggar-thy-neighbour policies in the US, hurting countries like India. Apart from erecting import barriers and subsidising dumped exports, US politicians will seek to curb the outsourcing of services to India. Visa curbs will slow the movement of skilled workers and their dollar remittances back to India.
McCain is one of the few American politicians in either party with the courage and conviction to stand up to protectionist populism. By contrast, Obama embodies protectionism.
Look at the accompanying chart. It shows that McCain has voted 88% of the time against bills creating trade barriers, and 90% of the time against export subsidies for US producers. Few other senators have such a splendid record.
Obama has served a much shorter time in the Senate, and avoided voting on many key issues. He has voted against trade barriers only 36% of the time. He supported export subsidies on the two occasions on which he voted, a 100% protectionist record in this regard.
In 2007, he voted to reduce visas issued to foreign workers (such as Indian software engineers), and to ban Mexican trucks on US roads. He sometimes voted for free trade - he supported the Oman Free Trade Act and a bill on miscellaneous tariff reductions and trade preference extensions. More often he voted for protectionist measures including 100% scanning of imported containers (which would make imports slower and costlier), and emergency farm spending.
In 2005 he voted to impose sanctions on China for currency manipulation, and against the Central American Free Trade Agreement (CAFTA). He voted for the Byrd amendment, a disgraceful bill (later struck down by the WTO) that gifted anti-dumping duties to US producers who complained, thus making complaining more profitable than competitive production.
Obama says the North American Free Trade agreement is a bad one, and must be renegotiated. He has opposed the US-Colombia Free Trade Agreement on the bogus ground that Colombia is not protecting its trade union leaders from the drug mafia. In fact, such assassinations have fallen steadily from 205 in 2001 to just 25 last year. Obama is cynically twisting facts to woo the most protectionist US trade unions. This cannot but worry India, which may also be subjected to bogus slander and trade disadvantages.
By contrast, McCain has consistently voted for open trade. He has opposed federal curbs as well as private curbs on outsourcing to countries like India. He opposed the disgraceful Byrd amendment on anti-dumping duties. He voted against farm subsidies and labour standards for imports (which are not necessarily bad but could become a disguised form of protectionism).
Unlike Obama, McCain voted against imposing trade sanctions on China for supposedly undervaluing its currency to keep exports booming and accumulate large forex reserves. India has followed a similar policy, though with less export success than China. But if indeed India achieves big success in the future, it could be similarly targeted by US legislators and, will need people like McCain to resist.
Obama favours extensive subsidies for US farmers, hitting Third World exporters like India. This has been one of the issues on which the Doha Round of WTO is gridlocked. McCain could open the gridlock, Obama will strengthen it.
Obama also favours subsidies for converting maize to ethanol. The massive diversion of maize from food to ethanol has sent global food and fertiliser prices skyrocketing, hitting countries like India. But McCain has always opposed subsidies for both US agriculture and ethanol. While campaigning, he had the courage to oppose such subsidies even in Iowa, an agricultural state he badly needs to win if he is to become president.
Okay, some readers will say, McCain may be better for India on economic issues, but will be a disaster on foreign policy issues. I'm far from sure. All Iraqi political parties want the US to withdraw most troops within a year and all troops by 2011, so a US withdrawal is certain regardless of who becomes US president. McCain is a hawk on Iran while Obama says he will talk without preconditions. But the difference may not mean much, since Iran refuses to talk before withdrawal of US support for Israel and US troops from the Middle East.
So when Obama wins, don't cheer too loudly. It will be great to have a black US president. It would be even greater if he followed McCain's economic policies.
