By Dan Steinbock
After the bizarre 2016 election, Washington faces a slate of investigations and a gridlock. Internationally, threats include new Cold War(s). Depending on the outcome, the election could even be contested.
If Hillary Clinton wins, she will flash her broad smile like Alice in the Wonderland, with Vice President Tim Kaine, Bill and Chelsea on her side. The conventional story will be that her victory built on her egalitarian economic policy, gender concerns, international relations, strong defense policy and good ties with Europe and Japan.
But that’s just the facade – a carefully orchestrated result of an estimated $6.6 billion elections, her $700 million campaign financing, good ties with super PACs, skillfully maneuvered electoral college, shrewd PR, collusion with nation’s leading media organizations, and a long series of political miscalculations by Donald Trump.
Americans will vote on November 8. However, the battle will ensue soon thereafter. The winner will face a split Congress, a divided Democratic Party , and badly-fragmented Republican party. To defuse their meltdown, Republicans are likely to challenge Clinton every step of the way. And the election could – and perhaps should – be contested.

Clinton Photo by Georgia National Guard

Clinton

Photo by Georgia National Guard

Lawsuits, investigations, special prosecutors
Last July, FBI Director James Comey closed the Clinton probe and decided not to pursue charges, which resulted in broad criticism. Recently, Comey re-opened the case following a discovery of new emails. The disclosure allowed the FBI to reopen a criminal investigation only days before the election. It took place against the stated opposition of the Department of Justice (DOJ) but reflected the frustration of FBI agents over Comey’s previous decision not to prosecute Hillary Clinton. Ultimately, the debacle may undermine or boost the Clinton campaign.
Yet, the FBI activities are just the latest twist in a bizarre reality show, which has potential for a flood of lawsuits, congressional investigations and special prosecutors. In addition to the Benghazi and FBI debacles, these efforts are likely to include some 50,000 emails from Wikileaks, particularly those of John Podesta, Clinton campaign manager and chair of the Center of American Progress (CAP), which is very close to the White House.
The questions will center on Clinton’s private email server; her special assistant Huma Abedin and her ex-spouse (who is under FBI investigation for ‘sexting’ with underage girls); the many lucrative pay-for-play allegations about Hillary Clinton’s office and Bill Clintons’ speeches; the Clinton Foundation and the alleged coordination between the Democratic National Committee, the Clinton campaign and various big money lobby groups (super PACs), including mega financiers, such as George Soros – and recruited groups, such as the notorious ‘Democracy Partners,” to incite violence and chaos in Trump rallies.
These events were then recorded by mainstream media, which is now in trouble as well. As a CNN talking head, Donna Brazile, currently DNC chair (her predecessor was fired – though belatedly – for bias against presidential candidate Bernie Sanders and for Clinton), shared questions of the CNN town hall debate with Clinton in advance. Reportedly, her campaign also gave leaks to CNN before other media, which subtle collusion. In turn, Google had a strategic plan to help democrats win the election by tracking voters via smart phones. And other media debacles are under scrutiny as well.
The system has been effective. According to a recent Suffolk University/USA Today poll, most Americans believe that the media wants Clinton to win.

Washington’s post-election gridlock
Republicans want investigations about the role of the State Department, the DOJ and the FBI, even President Obama, due to a “cover-up to protect Hillary Clinton,” as the Republican National Committee (RNC) chairman Reince Priebus says. Speaker Paul Ryan has promised “aggressive oversight work” of a “quid pro quo” deal between the FBI and the State Department over emails. As chair of the House Oversight Committee, Jason Chaffetz is pushing for a slate of “new hearings.”
House Republicans are demanding a special prosecutor to investigate the Clinton Foundation for possible conflicts of interest. There is enough evidence, says former New York City mayor and Trump supporter Rudy Giuliani, for a RICO case against the Foundation as a “racketeering enterprise.” In the 1970s, RICO was used to prosecute the Mafia and organized crime figures. More recent cases range from Gambino and Lucchese crime families to the 80’s junk bond king Michael Milken, Catholic sex abuse cases and Los Angeles Police Department.
In the past three months, Republicans have issued some 20 subpoenas and over 50 letters of inquiry probing Clinton. New ones will be fueled by tens of thousands of Clinton emails courtesy of Wikileaks. It doesn’t really help that, as Secretary of State, Clinton wanted to silence both Julian Assange and Wikileaks and once stunned her colleagues by asking: “Can’t we just drone this guy?”
Assuming that markets perceive a Clinton victory as signal for continuity (which is no longer certain), the Fed is expected to hike rates in December. If not, the ultra-low rates will continue to pave way to asset bubbles. In order to overcome secular stagnation, America needs structural reforms that Clinton is neither willing nor able to execute. In the 1980s, the Congress legislated some 700 laws annually. After three decades of political polarization, that figure has plunged close to 300.
Currently, the Senate and the House are under Republican control. The Democrats have a good chance of taking over the Senate. If Congress remains divided after the election, Clinton must rely on limited legislation and executive action. But if Democrats could control the Senate and the House, She could push for immigration reform, and expansion of Social Security. A Democratic Senate could make Chuck Schumer the majority leader; in the House Nancy Pelosi could take over. The former is a trade hawk who favors retaliation; the latter is a human rights advocate who backs liberal social plans; and Hillary Clinton is the architect behind US pivot to Asia.
In Beijing, such political consolidation could mean triple pressures in defense, trade and US views of human rights; unless the Congress remains divided,or returns to Republican fold after the 2018 mid-term election. Or, what’s now likely, Clinton will fail to achieve any political consolidation and a gridlock is the benign scenario.
In economy, Clinton will push for infrastructure spending for some $275 billion in the course of a decade. But the bill should be paid with tax revenues, which could lead to Republican opposition. In the financial sector, Clinton will support greater oversight of ‘shadow banking,’ moderate enforcement of financial regulation and increasing attention to high drug prices. Since she is for tougher anti-trust policy, America has seen record mergers and acquisitions activities in the past few months – including a record level of Chinese M&As in the US.
Clinton’s economic program will resolve neither America’s income polarization nor its sovereign debt burden, which will soon exceed $20 trillion (107% of GDP). In the absence of bipartisan, credible and medium-term debt program, the challenges are likely to deteriorate in the coming years.
Trade policy is the real test of Clinton’s international engagement. During her campaign, she often said that she would block the US-led Trans-Pacific Partnership (TPP). “I oppose the TPP now, I’ll oppose it after the election, and I’ll oppose it as president.” If she

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