Guest Post by Star Parker
Donald Trump achieved the presidency telling the American people he would “Make America Great Again.”
Given that during eight years of Barack Obama’s presidency there was not a single year in which national satisfaction, as measured by Gallup, averaged above 30 percent, tapping into Americans’ general dissatisfaction with the state of the nation was good campaign strategy.
This February, national satisfaction reached the highest its been under Trump, 36 percent. However, in March it plunged back down to 28 percent. And this big drop was fueled by a big drop among Republicans. National satisfaction among Republicans dropped from 67 percent in February to 52 percent in March.
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Maybe there’s reason to believe that Trump’s own Republican constituency is not buying that tariff saber-rattling and trade protectionism is what is going to make America “great again.”
The stock market surged some 30 percent from Trump’s election until the beginning of 2018. However, since the beginning of this year, with all the trade war rhetoric, it’s now down 8 percent.
Estimated overall value of the U.S. stock market early 2018 was around $30 trillion. So 8 percent deterioration means a loss of wealth of $2.4 trillion.
A price tag of $2.4 trillion in lost wealth to allegedly combat a $376 billion trade deficit with China with tariffs suggests that this might not be the best course of action.
The trade deficit is the supposed boogeyman. In 2017, we sold $130 billion in product to China and bought $506 billion from them — a $376 billion trade deficit. Suppose China just decided to stop selling to us and just bought from us? We’d have a $130 billion surplus with them. Would that be good?
Americans are buying $506 billion in raw materials and consumer goods from China because we want this stuff. It makes us better off. We like the low-priced products from China we find in our department stores. And the raw materials we buy from them result in cheaper finished products that we manufacture here in the U.S.
According to economics blogger Mark Perry, “38 Americans work in industries using steel and aluminum for every worker making steel or aluminum.”
Veronique de Rugy of George Mason University’s Mercatus Center reports that when George W. Bush imposed tariffs on steel in 2002, 200,000 workers in industries using steel lost their jobs the following year — more than the total number of jobs in the steel industry that year.
What was the 30 percent stock market gain from Trump’s election until early 2018 telling us? I believe these gains reflected the deregulation over this period, capped off with passage of the tax bill in December 2017.
These are the kind of measures that “Make America Great Again.” Measures that advance our economic freedom and move control of politicians and government out of our lives.
We lose when politicians start picking winners and losers, whether domestically or internationally. Let the marketplace pick winners and losers.
Where should we be directing our priorities now?
A group of Hoover Institution economists, including former Secretary of State George Shultz, just published an op-ed in The Washington Post about the dire implications of the looming debt crisis in our country.
They write that soon the national debt will reach $20 trillion — equal to the size of our entire GDP. This poses a serious threat to our economic well-being.
New projections from the Congressional Budget Office forecast unprecedented trillion dollar federal budget deficits as far as the eye can see.
Unrestrained spending produces these huge deficits, which we finance with debt. The main culprit, according to the Hoover experts, is entitlement programs — Medicare, Medicaid and Social Security.
I think the president should focus attention and energy on this debt crisis, rather than on the dubious benefits of a trade war. Getting America’s fiscal house in order will make America great again.
“The main culprit, according to the Hoover experts, is entitlement programs — Medicare, Medicaid and Social Security.” Hoover experts? Like, Uncle Tom Sowell? How about this you dumb negro. Before we touch start talking about taking a cent of social security from hard-working Americans, we take every penny that we waste on foreigners who never paid into the system away? How about we cut welfare to the bone, instead of financing upper-middle-class lifestyles? People like you are why people hate Republicans. Yes we got to deal with the debt. But let’s start with the parasites. And the main reason we have a deficit and a debt is because the trade deficit sucks us dry. Globalization is sucking a trillion dollars a year out of the United States. The trade deficit is where we need to start.
The debt will not be dealt with except by letting it grow massively to milk as much last minute value from fiat creation as we can; the race to the bottom is game theory run amuck. This is why Cheney said “Deficits don’t matter.” Should any given country act prudently while others are massively printing, or join the party and fare well during the inevitable jubilee?
Jubilee? So debtors win again?
Part of the “debt crisis” that no one wants to consider is the balance of payments deficit with those we run a trade deficit with. We get goods from them on credit instead of paying for them and we owe them money instead of trading even steven our products for their products. It’s like buying on a credit card and then making only minimum payments on a personal level.
Trump can’t fix i. Nobody can fix it. The best any of us can do is to prepare for an economic meltdown. That is the minimum. Could be Civil War 2. Good luck to all.
There is a debt crisis thou not in any way I’ve read recently.
We, and most of the world, are burdened with a debt-money monetary system; which means the only way new money gets created is when someone takes out a loan. If you and I don’t keep borrowing money from a bank no new “money” gets created. As proof, what was the first thing the gov did during the last monetary crisis??? remember ‘cash for clunkers’ and ‘first time home buyers tax credit.’ Those two programs were simply an effort to get us to BORROW more money. Because when we don’t borrow enough money to keep the Oligarchs in mansions and Bentleys the debt-money monetary system begins to fail. And fail it did so the FED was forced to buy government and agency debt from the banks in order to shove “money” into them. This provides the illusion of growth and recovery… but it’s backed up by nothing.
The problem is the debt-money monetary system. It must be replaced with honest money and I don’t mean gold and silver. Honest money originates with an honest governmental system, which we’ve never had… primarily because we humans have failed to replace the master/slave mentality that has been our lot for thousands of years – you really think we’re so far removed from the days of ancient Egypt?
“you really think we’re so far removed from the days of ancient Egypt?”
That thought has crossed my mind for many years – one of the reasons I have been storing grain (and everything else) like Joseph .