The campaigns are over, the polls are closed, the votes are in, and Barack Obama has been re-elected as President of the United States of America.
The news has come as a relief for some and as a shock to others, and the focus now will be on the future of America and on how the President’s campaign promises will be put into action.
For the defence industry, the re-election is perhaps not the outcome many might have liked, given that with it comes Obama’s pledge to cut defence spend, reduce the number of troops in Iraq and Afghanistan, and slowly end the decade-long war on terror.
Obama’s policies came in stark contrast to those of his opponent, Mitt Romney, who instead campaigned on military reinvestment and a desire to make sure that American military might was so strong “no one in the world would ever think of testing it.”
While a commitment to military strength and increased defence investment would certainly have appealed to defence contractors around the world given America’s huge presence in the global industry, the American people were instead swayed by Obama’s defeat of Osama Bin Laden and his commitment to ‘bring the troops home’ after ten years of war.
The world will now be looking to America and its defence plans for the next four years. In his campaign, Obama promised a 2.5% decrease in Pentagon budgets, 100,000 fewer troops deployed in Iraq and Afghanistan, and a $487 billion cut in Department of Defense spend over the next ten years.
While these figures may not be as appealing to defence markets as Mitt Romney’s did, the future is not quite as bleak as some in the defence industry may believe.
Despite his promise that ‘a decade of war is ending’, Obama has frequently promised a so-called ‘pivot’ in defence focus, shifting efforts away from the Middle East and towards Asia to adjust to the growing strategic importance of the region.
In addition, despite Obama’s ten-year defence spending being significantly lower than that promised by Mitt Romney, his outlined spend will still place America as the largest customer in the defence industry by a considerable margin. Indeed, in his victory speech in Chicago last night, the President was keen to point out America’s presence as “the most powerful military in history”.
Questions will also be raised regarding Iran. If Iran is found to be developing nuclear weapons despite repeated warnings, President Obama will have to decide whether or not to attack.
With the world’s focus again on the US and the so-called ‘most powerful office in the world’, and with four years already gone on the clock, President Barack Obama will have perhaps even more pressure to perform than he had when first taking office in 2008.
