Is Donald Trump telling it like it is, or just telling us what he thinks we want to hear?
In Boca Raton, Florida last Sunday he said, "We're gonna bring the jobs back .. I'm working for you folks .. I'm self-funding my campaign". That's all they needed to hear.
It doesn't matter that Trump can't just slap a tariff on imported goods from Mexico, or countervailing duties on products from China, without support from other parts of the US government or without triggering a trade war. Maybe that's why he also said at that same Boca Raton venue, "We're probably gonna have free trade".
Say what? I wonder how many people in the audience picked up on that one.
Maybe he meant that his dream team negotiators, which would include guys like Carl Icahn (who at age 80, is probably more interested in enjoying some time at the club than sitting in a room with a dozen Japanese trade experts), would call the other countries' bluff and cause them to suddenly increase the value of their currency which would make American products more competitive which, in turn, would lead to more American jobs. Or maybe he meant that the threat of tariffs on Mexican products would cause companies like Carrier Corporation, which manufactures air conditioners, which he also mentioned in his Boca Raton speech, to cancel their plans to relocate their Indianapolis, Indiana factory to Mexico.
Who knows? Because Trump leaves out the details.
Even if Trump did somehow impose tariffs on imported goods, in today's highly interconnected global economy, the consequences would be higher prices for everything; i.e. more inflation. Inflation leads to higher interest rates. That can't be good for fragile home mortgages. And house prices. And consumers. Who would have less disposable income. Which would mean less consumption, and a shrinking economy. A recession, by another name. But that would mean layoffs and fewer jobs, wouldn't it?
Wait, what?
The point is, in the global economy of today, tough trade talk and tactics may bring economic consequences that are far more depressing than the ones we are in today. At least the economy is growing. At least hundreds of thousands of new jobs are being added every month, despite what Donald Trump would have you believe. At least we can afford Vietnamese-made shirts and Chinese-made shoes and Mexican-made Fords.
Of course, Trump prefers not to get bogged down in details about any of his promises, and his supporters don't bother to go there. Because, as the wise American author, Upton Sinclair, who wrote many aphorisms, stated, "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!". Trump's supporters believe their jobs depend upon placing their faith in Donald Trump and upon not trying to understand his opponents' rational arguments.
If Trump were truly earnest about helping the bottom 75% he would stop promising to cut taxes, which would benefit Trump and the rest of the top 25% a hell of a lot more than the bottom 75% (since nearly 80% of federal income taxes are paid by individuals earning over $100,000 a year, according to public sources like this one which means that any cuts would not benefit the bottom 75% that much).
No, Trump is interested in one thing: getting elected to be president. To do that he knows he must also be competitive in attracting the top 25% as well; hence, the need to cut taxes.
Trump says he's not a politician? He's the best politician out there in the worst sense of the word.
In Boca Raton, Florida last Sunday he said, "We're gonna bring the jobs back .. I'm working for you folks .. I'm self-funding my campaign". That's all they needed to hear.
It doesn't matter that Trump can't just slap a tariff on imported goods from Mexico, or countervailing duties on products from China, without support from other parts of the US government or without triggering a trade war. Maybe that's why he also said at that same Boca Raton venue, "We're probably gonna have free trade".
Say what? I wonder how many people in the audience picked up on that one.
Maybe he meant that his dream team negotiators, which would include guys like Carl Icahn (who at age 80, is probably more interested in enjoying some time at the club than sitting in a room with a dozen Japanese trade experts), would call the other countries' bluff and cause them to suddenly increase the value of their currency which would make American products more competitive which, in turn, would lead to more American jobs. Or maybe he meant that the threat of tariffs on Mexican products would cause companies like Carrier Corporation, which manufactures air conditioners, which he also mentioned in his Boca Raton speech, to cancel their plans to relocate their Indianapolis, Indiana factory to Mexico.
Who knows? Because Trump leaves out the details.
Even if Trump did somehow impose tariffs on imported goods, in today's highly interconnected global economy, the consequences would be higher prices for everything; i.e. more inflation. Inflation leads to higher interest rates. That can't be good for fragile home mortgages. And house prices. And consumers. Who would have less disposable income. Which would mean less consumption, and a shrinking economy. A recession, by another name. But that would mean layoffs and fewer jobs, wouldn't it?
Wait, what?
The point is, in the global economy of today, tough trade talk and tactics may bring economic consequences that are far more depressing than the ones we are in today. At least the economy is growing. At least hundreds of thousands of new jobs are being added every month, despite what Donald Trump would have you believe. At least we can afford Vietnamese-made shirts and Chinese-made shoes and Mexican-made Fords.
Of course, Trump prefers not to get bogged down in details about any of his promises, and his supporters don't bother to go there. Because, as the wise American author, Upton Sinclair, who wrote many aphorisms, stated, "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!". Trump's supporters believe their jobs depend upon placing their faith in Donald Trump and upon not trying to understand his opponents' rational arguments.
If Trump were truly earnest about helping the bottom 75% he would stop promising to cut taxes, which would benefit Trump and the rest of the top 25% a hell of a lot more than the bottom 75% (since nearly 80% of federal income taxes are paid by individuals earning over $100,000 a year, according to public sources like this one which means that any cuts would not benefit the bottom 75% that much).
No, Trump is interested in one thing: getting elected to be president. To do that he knows he must also be competitive in attracting the top 25% as well; hence, the need to cut taxes.
Trump says he's not a politician? He's the best politician out there in the worst sense of the word.
