5 Questions: Economist Sharyn O’Halloran on the Role of Money

Sharyn O’Halloran, the George Blumenthal Professor of Political Economics and Professor of International and Public Affairs, has been focusing on the role of money in politics this year, in particular the presidential elections. “This is going to be a very tight race, it’s going to be a race about money, where money matters, and the candidates are going to have to speak not only to unnatural parts of their different constituencies, but they’re going to have to pick up the moderates within the electorate.

O’Halloran, a political scientist and economist who writes extensively about issues of economic growth, international trade and finance, regulation, democratic transitions, and the political representation of minorities, is also senior vice dean and chief academic officer at the School of Professional Studies. She came to Columbia in 1993 with a Ph.D. from the University of California, San Diego.

Q. What are some of the unusual twists and turns you have seen this year?

A. In the primaries, the same lobbyists, the same groups that supported the Cruz candidacy also supported the Clinton candidacy. That says there was a lot of uncertainty over who was going to win either the Republican primary and who was going to win the general. Once Cruz fell out of the race, everyone moved over to Clinton. The money came from finance, different types of businesses, real estate, all some of the largest donors. This was something we hadn’t seen previously.

Q. How does this compare to previous years?

A. In previous years you would see Republicans getting most of their support from businesses. Democrats, even the moderate Democrats, could attract some business support, but you would never see businesses lining up and contributing to both sides of the ledger, almost equally and at the same time, especially not in the primary stage. Businesses are hedging their bets, and it suggests that they are looking for the moderate to win.

Q. Where is the betting right now?

A. It’s with Clinton, even though popular opinion looks so even, because of the way votes get aggregated through the Electoral College. This is a case where you have extreme votes, or preferences, that coalesce around a candidate. The Electoral College is a balance that gives states an equal weight in the vote, a means to aggregate those extremes and have a more moderate view come through.

Q. How are the markets responding?

A. You’re not seeing the stock market responding to this election, even though there’s been so much concern around a Trump presidency, and in some cases a Clinton presidency. The reason, especially with regard to a Trump presidency, is that it looks like the Democrats might gain seats in both the House and the Senate, so a Trump presidency could be faced with a divided government. So Trump’s ability to pursue some of the more extreme policies that he has proposed would be limited. It’s called checks and balances.

Q. What are you looking at in the remaining weeks before Election Day?

A. It’s time for the candidates to start putting their agendas out there in a very concrete way that captures the 25 percent of voters who are uncommitted. This time the white male is the swing voter. Clinton and Trump will have to speak very clearly to their concerns, which have been their inability to gain from this global economic system, their inability to maintain a standard of living, their inability to make sure that there are paths and different types of opportunities going forward. They care about education, they care about different types of civil liberties, but not in the same way women do. That’s going to be an interesting challenge for both candidates.

—Interviewed by Bridget O'Brian

October 05, 2016