Professor Emeritus of Marketing
Historians have concluded that – as a result of short-sighted decisions – five U.S. Presidents (i.e., William Taft (Republican), Herbert Hoover (Republican), Gerald Ford (Republican), Jimmy Carter (Democrat), George H.W. Bush (Republican), created a recessionary economic environment and their eventual one term of office.
America’s prominent economists, corporate gurus, financial wizards and political scientists are now claiming Trump’s temperament, following questionable economic advisors’ recommendations and off-the-cuff Twitter-uttered and not-well-thought-out short-term policy edicts may get him into a heap of trouble come November 3, 2020, becoming statistic number six.
Let’s examine a few of Trump’s policies that could, very likely, lead America toward economic chaos and a new 46th president.
On international trade, Trump’s withdrawal from the Trans-Pacific Partnership; renegotiating NAFTA; scolding NATO, the United Nations, and the World Trade Organization; demeaning multiple foreign leaders; and reversing historic trade relations via a trade war with China, Mexico, Canada, and 28 European countries may appease his political base but will ultimately cost America in multiple ways.
Tariffs, which evolve into an add-on tax to purchase goods, hurts consumers, damages America’s businesses, and lowers investor confidence. Trump’s trade war has forced companies to cut back on hiring, innovation, and expansion. If the trade war continues, many economists expect unemployment numbers to reach seven percent, the stock market to plummet about 30 percent, and U.S. businesses to lose $85 billion. The Federal Reserve’s recent reaction to Trump’s actions and disappointing results reveals a recession is in the wings.
The resulting add-on cost of Trump’s imposed tariffs on multiple countries and retaliation tariffs from 32 countries equals $174.5 billion – or $533.40 per living baby to centenarian. Additionally, Trump’s trade war has created a $7.8 billion loss to the USA’s gross domestic product. A rising U.S. dollar will do much more to hinder exports and increase imports than any trade agreement, thereby causing further rising trade deficits.
Trump’s short-term thinking international policy has caused America to lose its 240-year global trade leadership position with 75 predominant trading partners. Ian Bremmer, president of the Eurasia Group, a firm that specializes in analyzing large-scale global hazards, said, “If you look at people who support Trump internationally, it’s really only people in countries that want the United States to fail.”
With Trump’s after-me-you-come-first trade policy, allies realize they are now playing second fiddle. With the USA’s most recent turn-coat trade relationship behavior, more and more countries are collaborating with other countries they can trust.
Trump’s short-term thinking tax cuts have already added $1.5 trillion to the USA’s ballooning federal deficit ($22.8 trillion). Trump’s tax cuts to corporations also created a $1.5 trillion corporate tax giveaway that ensured less tax revenue to the U.S. Treasury. Instead of companies taking their tax cut to create jobs and raise wages, they purchased their own stock (a record-breaking $436.6 billion), which boosted earnings and CEO bonuses.
Trump’s immigration policy, while appealing to his base, will chase away well-educated immigrants that, heretofore, have created more business startups and generated more patents for U.S. companies than the average American. Other immigrants who would easily take back-breaking jobs (literally) most Americans detest will also go elsewhere, causing eventual havoc to the USA’s agriculture sector and the price of groceries.
Trump’s policies are costing every American an arm and a leg. Evidence is replete Trump’s short-term policy-making might well be perceived as a gain for Trump’s shrinking political base, but they are creating long-term economic pains for the remaining 65 percent of America.
The next time you hear any politician tout a policy, use your critical thinking skills to ponder its long-term effect. Your analysis may be quite sobering, causing you to reconsider the politician’s intellectual breadth and depth.