Economic Interests

If you owe the bank £100, that's your problem. If you owe the bank £100 million, that's the banks problem.

The Final Debate


For the last presidential debate in America, the subject was focused on Foreign Policy. Though if you consider all the foreign issues America has to deal with, it was a shame that the questions were fully focused upon just the Middle East and China. Iraq was mentioned, Iran was debated, Afghanistan was agreed on, Iran was debated some more, Syria received some sympathy, China was criticised and Libya was touched upon in parts (though Libya had already been discussed somewhat in the last debate).  The Euro crisis didn’t even get a sound bite despite having a large impact on the future of the American economy, the troubles in Africa and South America were hardly mentioned (though at least Mali’s troubles with an Al Qaeda based group taking over half their country were referred to) while the futures of possible danger countries like North Korea, Russia and China were largely ignored.

A touchy subject is avoided.

This didn’t come as a major surprise really, the debate was always going to be focused upon the latest media stories and the candidates can only answer the questions put in front of them (though they rarely stayed on subject anyway). But some more varied debate could have seen the American public learn more about how each candidate plans to lead America in the future.

Getting back to the debate, it seemed to end in a draw with some positives for each candidate, though both remained expectedly cautious. Barack Obama perhaps got in some “zingers”, like when he caught Mitt Romney out on his criticism of America’s decline in the size of the navy by pointing out America also had less horses and Bayonets and that their current navy was measured more on their capabilities than number of boats. But how did each candidate do respectively?

Starting with Barack Obama, he managed to perform a good debate; avoiding mistakes (a consistency he manages well), appearing experienced in his Commander-in-Chief role and providing a clear answer to the big Iran question. But it wasn’t all rosy, as he didn’t manage to catch out Mitt Romney on any major issues and surprisingly managed to become too aggressive at times (at stark contrast to his timid first debate). He did state clearly that he wouldn’t allow a nuclear Iran during his next term in office, would back Israel if attacked and would pull out soldiers from Afghanistan in 2014. But he was less clear on how he planned to stop President Assad from slaughtering his own people and didn’t offer any detail on how he was going to prevent Iran from gaining Nuclear weapons without using military intervention (with economic sanctions yet to have the required effect). He managed some cheap shot at Mr Romney’s past connections with Chinese companies stealing American jobs and at Mr Romney’s lack of experience in foreign policy. But when you consider this was Mitt Romney’s weakest area of debate, that Barack Obama had the killing of Osama Bin Laden to parade about and had 4 years of experience as Commander-in-Chief, then it was disappointing he didn’t win by a more convincing amount like Mitt Romney had managed in the economic debate.

The chaos in Syria continues, with neither candidate having a clear solution. 

Mitt Romney, as stated before, was facing his hardest debate. He doesn’t have any experience with the armed forces, chose a running mate with similar inexperience and has based his election campaign on America’s economy. So it was little surprise that he tried to bring the subject around to the economy when answering tough questions. He repeatedly suggested America was looking weak to the rest of the world because of its weakened economy and high debt, stating China didn’t respect America because of the amount of money America owed them. This wasn’t a bad argument, but his second point to try and suggest that Obama’s policies were appearing weak and apologetic, did not work quite as well. The argument lacked evidence when you consider Barack Obama had managed to play a hand in toppling Gadaffi (though he overstated America involvement) and had authorised the killing of Osama Bin Laden. Mitt Romney was persuasive though when he managed to direct the argument towards the economy, bringing up a good argument for investing more time with South America as their economy on the whole is as big as China’s and also again pointing out Barack Obama’s increase to the budget deficit. On other subjects Mitt Romney decided to stay conservative, vague and basically agree with Barack Obama, which may not have pumped up Republicans, but could have ensured undecided voters keep him in mind. In fact he managed to completely change his opinion on Afghanistan by agreeing that the troops should leave by 2014 (perhaps based on the heavy criticism Paul Ryan received in the vice presidential debate) and seemed reluctant to attack Barack Obama on the Libya fiasco (again maybe after the criticism he received in the previous debate). The only subject he mainly differed from Barack Obama was on China, where he surprisingly remained consistent in stating he would call them a currency manipulator. There could be drawbacks to this action, with some suggesting it could start a trade war, but again when confronted with this he managed to bring the argument back to economic terms and provide a convincing argument that the current trade deficit with China means it is in China’s favour to refrain from doing so.

Chart showing the trade deficit America has with China. 

So what have these debates resulted in?

The first debate saw Mitt Romney gain a big turnaround in the poles. His performance was good, but the real cause of the boost was the lack of confidence displayed by Barack Obama and the lowly position Mitt Romney had previously held (giving him an almost underdog status). Such low expectations meant that his good performance was perceived as a great one, with vice versa for Barack Obama. The second debate saw Barack Obama act more like his old self, challenging Mitt Romney on his tax numbers and goading him into some costly mistakes (like for example challenging Mr Obama’s word on how he described the killing of an American ambassador – resulting in Mr Romney looking petty). Barack Obama probably edged a victory, though again it was more in the context of his previously poor performance. That brought us to this final debate, where both candidates were rather cautious and nothing new was found out. It was probably a draw, with Barack Obama getting the more headline worthy lines, but Mitt Romney perhaps looking more attractive to the undecided voters than he had previously.

It’s hard to know the effect these debates will have on the actual election in two weeks time, though history suggests they can have a big effect, with Al Gore famously losing to George Bush after being outperformed in the election debates. But despite Mitt Romney probably doing better out of these recent debates (with his polls numbers decisively better off than before the first debate), Barack Obama is still just edging the race, which is how many had predicted the race to be previous to the debates, a tight and narrow win for Mr Obama.

Comparison of Registered Voters' Presidential Preferences, Before and After First Presidential Debate, 2012

Gallup found that after the first debate, Mitt Romney drew even with Barack Obama in the polls.

So while each debate was entertaining, I suspect not many have actually changed their mind on who they are going to vote for (if at all). Mitt Romney promises a better economy based on his vast experience in the private sector, but remains frustratingly vague on his budget plan and flips flops between policies. While Barack Obama promises more clear policies but continually has to defend a poor economic record during his first term. I believe Obama will win as his main weakness can still be blamed on the previous president and his policies, but he will have a lot to prove in his next term if he is to leave the White House with a respectable legacy.

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