Opinion | For all his bluster, Donald Trump’s approach to economics has three basic flaws. Look to 2020 for their impact
- From corporate tax cuts to the trade war and pressuring the Fed, Trump has ignored the lessons of history and failed to grasp the link between budget deficits, tariffs and monetary policy. Even all his policy spin won’t hide the consequences of the blunders
Blinded by a surging stock market and a 50-year low in the unemployment rate, few dare to challenge the wisdom of US economic policy. Instant gratification has compromised the rigour of objective and disciplined analysis. Big mistake.
Politicians and pundits can always be counted on to spin the policy debate. For US President Donald Trump and his supporters, the art of the spin has been taken to a new level.
Apparently, it doesn’t matter that federal deficits have been enlarged by an estimated US$1.5 trillion over the next decade, or that government debt will reach a post-World-War-II record of 92 per cent of GDP by 2029.
Nor are tariffs viewed as taxes on consumers or impediments to global supply-chain efficiencies; instead, they are portrayed as “weaponised” negotiating levers to force trading partners to change their treatment of the United States.