Liam Dann 's Opinion

Business editor of the NZ Herald

Liam Dann: Great gonzo journalism needed

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Hunter S. Thompson cast a critical eye over American politics which inspired passion and ferocity in his writing. Photo / Supplied
Hunter S. Thompson cast a critical eye over American politics which inspired passion and ferocity in his writing. Photo / Supplied

Superstorm Sandy barrelled into the New Jersey shore like the crazed banshee ghost of an all-American surfer girl.

Drunk and spinning she threw up on an election campaign that was nodding off on a cosy sofa of mediocrity.

Mitt and Barack cuddled up, neck and neck in visionless embrace ...

Hmmm, sorry about that.

Ever since the New York Times described Sandy as "mammoth and merciless" I've been hankering to channel the spirit of Hunter S. Thompson.

We could have used a few words from the late great gonzo journalist this week.

American politics should be big and brutal, savage and salacious but this year it has had all the fire of a tax symposium.

Which is not to say fiscal policy shouldn't be at the heart of political debate - just that it doesn't make great television.

Perhaps that's being unkind to economists.

The austerity versus stimulus debate doesn't have to be dull. The recent spat between the fiscally liberal Paul Krugman and conservative Niall Fergusson has had more life in it than what we've seen from the presidential candidates.

This year promised plenty. The cultural divide in the US may never have been greater.

The Mormon bishop and private equity business baron could have been duking it out with the Al Green-singing, liberal academic President on abortion and gun control and all those things that divide America into red and blue states.

But neither candidate appears to have had the heart for that kind of battle. This has been a fight for the middle ground.

From the moment Obama started mumbling about maths in the first presidential debate it was apparent that neither of them had the stomach for a fight about the essence of the American dream.

New Zealanders want to care about American politics just like we want to care about Halloween and the Superbowl.

These days any excuse for an American celebration has the pubs around town touting blackboard deals on BBQ ribs and Budweiser.

We enjoy their politics because it so often has more weirdness than our own and comes without the worrying reality of immediate influence on our personal circumstances.

It is also easier to out yourself politically with regards to American politics.

I haven't seen any polls but I'm pretty sure Obama would win a landslide in this country.

The starting point for the US political spectrum is already so much further to the right than ours.

You'd have to work your way to the Act Party or at least the most neo-liberal extremes of the National Party to find local politicians that couldn't find a home with the Democrats.

John Key might be pushing for a few neo-liberal reforms here and there but he's okay with public health care and social welfare in general - by Fox TV standards he's practically a dirty socialist.

We can kid ourselves that the outcome of the election has big implications for global financial markets and the local economic outlook.

But empirical research doesn't back that up.

Massey University finance lecturer Jeff Stangl did his PhD looking at US elections and the impact on markets.

The traditional view which sees Republican presidencies as good news for the defence industry, fossil fuels, and financial markets just isn't borne out by the data, says the expat American.

Looking back as far as 1924 he found no evidence of any material impact on markets or key industries stemming from either Republican or Democrat wins.

A number of studies have found the financial markets actually performed about 9 per cent better under Democrat presidents, Stangl says.

While you will get a few days of "noise" - often whipped up by media coverage and market analysts - it never amounts to anything that would justify basing an investment decision on, he says.

A lot of the misconception seems to be due to an overestimation of the influence a President can have on markets.

Ultimately it is the lower house of Congress that controls the flow of budget spending for the US Federal Government.

Also, particularly outside of America, we tend to overestimate the influence of the Federal government itself.

The individual states have a great degree of fiscal autonomy and also a lot of control of their own social and cultural legislation.

In New Zealand we naturally tend to focus on the implications for trade with the usual assumption that Republicans are more like to be in favour of freer trade.

While that might be true in theory, in practice US state politicians are more focused on the specific demands of their constituents, Stangl says.

America is a big and diverse country with a party system much looser than ours. It is far more common there to see politicians from the same party voting against each other on issues.

To our eyes a Texan Democrat might seem further to the right than a New York Republican and vice versa.

The strict limits of presidential power were built in by America's founding fathers to guard against tyrants and as much as they can make for disappointing and seemingly ineffectual presidencies they also provide a safety net.

This Wednesday (NZT) the media circus and the pageantry of election day will make it an unmissable event for anyone with a political bone in their body.

But those of us who loved the passion and ferocity it inspired in Hunter S. Thompson will quietly pine on his behalf.

If he was still here you can bet he'd be drinking Wild Turkey and remembering his arch-enemy Richard Nixon - of whom he wrote: "He was a foul caricature of himself, a man with no soul, no inner convictions, with the integrity of a hyena and the style of a poison toad.

"The Nixon I remembered was absolutely humourless, I couldn't imagine him laughing at anything except maybe a paraplegic who wanted to vote Democratic but couldn't quite reach the lever on the voting machine."

We can only imagine the kind of diatribe this week's winner would have inspired.


Twitter:@liamdann

- NZ Herald

Liam Dann

Business editor of the NZ Herald

Liam Dann is the Business editor of the New Zealand Herald, overseeing all our business content in print and online. He has been a journalist for 20 years, covering business for the last 14 of them. He has also worked in the banking sector in London and travelled extensively. His passion is for Markets and Economics, because they are the engine of the New Zealand economy.

Read more by Liam Dann

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