David R. Henderson  

Incentives Matter for Politicians Too

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In a Facebook comment on my recent post on Peter Thiel and Donald Trump's foreign policy views, my friend Stephen M. Jones wrote (I quote with his permission):

Tyler Cowen had an important post linking this article about Trump and Putin. It appears the Ukraine decision/NATO pronouncement is not driven by a non-interventionist Foreign Policy stance but by linkages between Trump and Putin such that they often have mutual interests.

He then provided this link.

I recommend reading the whole article that's linked, but the gist is that Donald Trump and some of his advisors are financially connected to Vladimir Putin or to people close to Putin.

These allegations do sound troubling.

But there's another way to look at them.

When I have posted on Facebook about some of the non-interventionist statements Trump has made, friends who share my non-interventionist views caution that Trump will say anything and that you cannot take his statements as indicators of what he would do if President. Co-blogger Scott Sumner made a similar point in his comment on my post. I share this concern. As I have said in many conversations with friends, Trump is a wild card.

But incentives matter, even for politicians. One of my biggest concerns is that Hillary Clinton as President would purposely or accidentally get the United States into a war with Putin. The New York Times editors, in their Sunday editorial "Trumpworld vs. Clintonworld," pointed out just how interventionist Clinton is. (They liked it; I don't.) When both countries have thousands of nuclear weapons, that is scary.

So if even some of the allegations about close financial connections between Trump and Putin and Putin's allies are true, that would mean that Trump would have much to lose personally from making war on Putin or, as one of Trump's competitors, John Kasich, put it, "punch the Russians in the nose."

What if you see a potential war that you don't want the United States to get in? You might love it if the U.S. president avoided getting into the war on principle. But it's a surer thing to depend on a U.S. president not getting into a war because his own financial interests would be badly hurt.


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CATEGORIES: Foreign Policy , Incentives




COMMENTS (10 to date)
MikeDC writes:

Troubling, but for most these allegations were only troubling when the Republican did it. When it is Clinton taking millions from Russians (and exposing classified and embarrassing documents for the Russians and everyone else to blackmail her with), it's not so troubling.

Jeff writes:

David,

You're right, I would not go to war if it would hurt my financial interests but I may go to war after my financial partner screwed my over and, say, expropriated my financial interests--especially if I was a petty, impetuous, and vain sort of person.

pg writes:

I'm skeptical that Hillary or Trump or Putin wants a war between the US and Russia given the potential for MAD. I don't consider war with Russia a meaningful factor in this election decision.

If you buy the Putin-Trump connections in that TPM article, I think you should be much more nervous about Trump. Putin is extremely anti-freedom, pro-corruption, and has been increasingly aggressive with his military in his region (Ukraine invasion, firing his generals for allegedly refusing to harass Western ships).

At best Putin is (allegedly!) using Trump to weaken NATO commitments in Putin's region so that he can exert political or worse military control, the latter being an INCREASE in violence in the world. Ending sanctions I'm sure is another major consideration.

At worst all of that is true AND Trump views Putin as an ally and an inspiration and could move America in the same anti-freedom direction.

Like you, I dislike the idea of a Hillary presidency and I favor non-intervention. However given the US' current foreign policy (world hegemon), I'm skeptical that the US can withdraw and become a non-interventionist actor without significant short-term violence in Eastern Europe and Asia as Russia and China fill in the power vacuum.

Benjamin Cole writes:

Trump is a cipher but appears patriotic.

I prefer non-interventionism.

Clinton is an occupationist and warmonger in pantsuits.

Tough to cast a vote this year.

Scott Sumner writes:

The most likely cause of a major war in Europe is a Russian invasion of NATO.

The most likely cause of a Russian invasion of NATO is uncertainty as to whether NATO would defend its members.

Trump is creating uncertainty as to whether NATO would defend its members.

That's really, really bad. And it's not just about business interests, some of Trump's top advisors are Putin supporters. You can't make this stuff up.

Trump's lavish praise of Putin should completely disqualify him for the presidency. But then he's also issued dozens of other statements that should immediately disqualify him, so perhaps it's all beside the point. Voters seem increasingly determined to elect a demagogue.

Mark Bahner writes:
Tough to cast a vote this year.

Piece of cake. Gary Johnson is on the ballot in all 50 states.

Toby writes:

David,

I am sure that Hillary loves Chelsea enough that she has every incentive to avoid a nuclear war with Russia. I don't think any additional incentives will change her behavior much.

When it comes to a proxy war and standing up to the Russians, then Trump has much more to lose than Hillary does. What do you think happens if Trump stands up to the Russians and a deal falls through or is frustrated because of that? His incentives are much stronger to not stand up to the Russians for all probable scenarios, whereas for the least probable scenario of an all out nuclear war I doubt that Trump and Hillary's incentives differ.

This is, of course, assuming that Trump and Hillary both have the same view of the world. Trump's mercantilist views are much more likely to cause conflict than Hillary's views are. Hillary is not great, but her views seem more in line with how the world actually works than Trump's. Trump seems irrational in his views and this can much easier be exploited by others.

MikeDC writes:
What do you think happens if Trump stands up to the Russians and a deal falls through or is frustrated because of that? His incentives are much stronger to not stand up to the Russians for all probable scenarios

This is unclear since Clinton has her own million dollar ties. And has the spectre of further embarrassing (or worse) hacked email links floating out there.

It's also unclear that "standing up to the Russians" is the right thing to do. What happens if Clinton draws one of the lines in the sand she frequently did as secretary of State and gets us in a shooting war with a nuclear power?

Trump's mercantilist views are much more likely to cause conflict than Hillary's views are.

This seems unlikely since Trump's views tend to reduce down to a faith in negotiation and a skepticism of armed conflict. While Clinton's has repeatedly demonstrated a preference for violent conflict.

Trump seems irrational in his views and this can much easier be exploited by others.

No, a truly irrational view would be unexploitable because it would be unpredictable.

pg writes:

Our law-and-order non-interventionist peace-loving presidential candidate just asked Russia to hack Cliton's e-mail servers and release them to the US press:

“Russia, if you’re listening, I hope you’re able to find the 30,000 emails that are missing,” Mr. Trump said, staring directly into the cameras. “I think you will probably be rewarded mightily by our press.”

I'm sure he'll be very successful at international diplomacy.

Toby writes:

MikeDC:

No, a truly irrational view would be unexploitable because it would be unpredictable.

Let's say that you're coming to my house every day and sometimes you wish to sell me $20 for $5 and sometimes you wish to sell me $20 for $35. I never know when you come to my house and what you'll offer. You're completely unpredictable.
What I do know, however, is that you sometimes will believe that $20 to be worth $5 and sometimes you'll believe it to be worth $35.
This is enough for me to be able to exploit you.

The same holds for Trump's mercantilist views. He'll make a dumb offer at some point that I'll accept. Reagan (almost?) did something similar with quotas on Japanese cars. He let them collude to voluntarily restrict the quantity that they would sell to the American market raising their profits in turn. I can already imagine Trump doing something stupid like that.

This seems unlikely since Trump's views tend to reduce down to a faith in negotiation and a skepticism of armed conflict. While Clinton's has repeatedly demonstrated a preference for violent conflict.

Trump has very often chosen conflict in response to minor slights. Both in his private as in his public life. I don't expect that to change. The only thing changing is that he will have more tools at his disposal.

This is unclear since Clinton has her own million dollar ties. And has the spectre of further embarrassing (or worse) hacked email links floating out there.

It's also unclear that "standing up to the Russians" is the right thing to do. What happens if Clinton draws one of the lines in the sand she frequently did as secretary of State and gets us in a shooting war with a nuclear power?

Clinton seems to be far less money obsessed than is Trump, and I don't believe Trump is any more immune from blackmail based on embarrassing communications.

What happens if it doesn't happen? Your hypothetical scenario applies to all presidents since the 1950s and all the presidents to come.

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