What’s At Stake This November
By Thom Amdur
4 min read
In a little more than a month, voters (or, at least, that minority of the eligible electorate that actually casts a ballot) will go to the polls and exercise their franchise. This year the major party candidates could not be more different in style, demeanor, experience and politics. Both Hillary Clinton and Donald Trump have unique political strengths, as well as significant personal liabilities that make this a difficult election to call from the top of the ticket to the bottom. This month I’d like to explore two issues that will be decided on the ballot this year – tax reform and climate change.
The specter of Tax Reform has been floating on the horizon for a number of years now and it looms ever closer at this juncture. If either candidate gets elected with a significant mandate, I believe there will be a real attempt to overhaul the tax code in the next President’s first term. While there are a few themes they share in common (they both have proposals to eliminate tax inversions and limit carried interest), overall, Hillary Clinton and Donald Trump have very different priorities on the tax code. Donald Trump’s plan promises growth through tax cuts – he proposes reducing tax rates for all individuals, limiting the taxation on business income to 15%, and eliminating the estate tax. It is hard to imagine how this plan could be implemented without eliminating most, if not all tax expenditures (like our tax credits), as well as reducing federal spending dramatically across the board. On the other hand, Hillary Clinton’s economic plan calls for tax cuts for working families and an expansion of many tax incentives (including the LIHTC and Solar Credit), while raising new revenues through the implementation of the “Buffett Rule” and tweaks to the estate tax.
It will come as little surprise to our readers that I am not a climate change skeptic. I believe it is real, is caused by humans and is the defining global and political issue of our time. It is a difficult political issue because to adequately address it in our lifetime we will need to retool both our built environment and our economy. This will cause significant economic disruption in some sectors of our economy and hardship in the communities that cannot easily adapt to a low carbon industry. But the consequences of not acting are dire – we need only look at the recent flooding in Louisiana, the droughts and wildfires across the west and super storms that have battered the South East and North East over the past few years to see what the future has in store. This is not an abstract issue for owners of real estate – we are invested in real estate for the long-term, so climate change has long-term financial implications both in regards to operating costs (e.g. insurance premiums will only increase as the effect of climate change increases,) and long-term value. And when catastrophe strikes, the economic and human costs to owners and residents alike are devastating.
So where do the candidates stand on climate change? Donald Trump and Hillary Clinton could not be further apart. Mr. Trump is a proud climate change skeptic and views the effects of climate change as essentially a non-issue. He is not opposed to renewable energy generation as part of a plan to make America “Energy Independent,” but only if it is financed entirely by private capital. In contrast, Secretary Clinton has made climate change one of her defining issues, with extensive plans to cut greenhouse gasses through a combination of significant investments in energy efficiency in the built environment, a massive expansion in renewable energy generation, cleaner fuels and more efficient cars, boilers, ships and trucks. Even if you don’t like Secretary Clinton’s policy proposals (I’ve seen criticisms that they don’t go far enough and others that criticize them for their costs) at least it acknowledges the problem and proposes realistic solutions.
Beyond the Presidency, the Senate majority hangs in the balance and perhaps even the majority in the House of Representatives. The political scientist in me is fascinated by the unlikely chain of events that have marked this electoral season and on November 8th we collectively will make a series of decisions that could possibly upend the political establishment, the international economic order and the global security landscape. The one thing that is clear is that at least on the issues the candidates are clearly defined. It’s up to us to make our choice.
