Trump’s economic steroids

To sing good economic white house

In the face of the US two-year and ten-year national debt last Monday, interest rate upside down, the stock market fell sharply, the White House can be described as a man, and sing the economy for a few days. First Trump last Thursday (August 15th) said that “If the 2016 presidential election is not won by him, the US stock market has already collapsed,” he said more bluntly: “So, whether you love me or hate me, you It is inevitable to vote for me.”

Then again, White House economic adviser Larry Kudlow and White House trade consultant Peter Navarro sang in front of the media on Sunday (August 18). The former said that “there is no economic recession” and called on everyone not to be afraid of optimism. The latter continued to deny that the Sino-US trade war is damaging the US economy. The greater the economic policy of Zampump created the “world’s best game.” “.”

Vice President Mike Pence gave a speech on Monday (August 19) that Trump had fulfilled his election pledge to make “the US economy grow strong” and “every American can realize the American dream again.”

In addition to pointing to the monetary policy of Federal Reserve Chairman Jay Powell’s “terrible lack of vision”, Trump himself also raised the tax cuts on Tuesday (August 20), acknowledging that he is considering reducing the salaries tax. Even by administrative means to bypass the Congress to reduce the asset value-added tax (that is, the constant tax rate is linked to inflation).

He also forwarded comments on Twitter, praising “superhuman power” to keep the economy going, and accused the Democratic Party of speculating on the economic downturn only to defeat him.

Is it dangerous to race back to the economy?

Such a sing-along ensemble, in conjunction with Trump’s first public criticism of “white supremacism” in early August, has already overwhelmed him’s call for four minority Democratic women’s congressmen to “roll back to their country” since mid-July. A dispute over ethnic issues.

The thematic shift of these political propaganda is actually without data support. According to a poll published by Reuters on Monday, 82% of voters who believe that blacks and whites are equal, said they have a strong willingness to vote in 2020, which is 7% higher than voters who think whites are superior to blacks. The same number in 2016 rose by 12%.

At the same time, after Trump’s two-and-a-half years of rule, the white Americans’ fear of their racial status was much worse than that during Obama’s administration. For example, the proportion of whites who support illegal immigrants’ access to the United States is comparable to that of 2015. It has risen by 19%; the proportion of whites who agree that “the United States must protect and maintain its European white tradition” is 9% lower than the August 2018 survey, and the proportion of Republican white voters who agree that “whites are oppressed in their home countries” It is 8% lower than a survey in 2017.

Some scholars with ethnic issues pointed out that Trump’s entry into the White House itself has caused some people to feel that “the status of white people has been rebuilt”; therefore, if he wants to use the race card as the main flag, he will re-apply his 2016 Amnesty Mexican. It is also a “rapist” and a shouting of “building a wall”, and it is difficult to achieve the same effect.

As a result, the election propaganda has returned to the economy.

“Improved” economic policy

However, the current US economy does have a slowdown in growth. In the second quarter of 2019, US gross domestic product (GDP) grew by 2.1% year-on-year, 1% lower than the first quarter; non-residential fixed investment fell by 0.6%; and exports of goods and services fell by 5.2%. In July, the Purchasing Managers’ Index (PMI) fell 0.5% to 51.2 from the previous month.

The better data comes from consumption, and personal consumption expenditure rose by 4.3% in the second quarter of 2019. However, the University of Michigan’s consumer sentiment index in August fell 6.4% to 92.1 from the previous month, the lowest since January.

The outside world often attributed the slowdown of growth to the delay in the Sino-US trade war, and Trump “does not recognize the need to recognize it,” in addition to delaying the consumption peak of the Christmas season, delaying the purchase of some Chinese goods. In addition to the tariffs imposed in September, the exemption to restrict US companies from continuing to supply Huawei’s existing products or services is extended for another 90 days, hoping to reduce trade wars to US technology companies and communication service providers in the short term.

However, Trump also knows that the economic blows of the Sino-US trade war have never been able to get rid of it, and it is not a long-term solution to continue to adopt similar “drawing words”, so he said on Tuesday that “regardless of the short-term Whether it is good or bad, in the long run, there must be someone (to deal with China), and change its past saying that “the trade war itself is good for the United States.”

These expectations of management, as well as the rationalization of trade wars, certainly cannot replace the immediate economic benefits. So Trump urged the Fed to cut interest rates again – the current interest rate futures price has been estimated that the Fed will cut interest rates by 25 more points in mid-September – the other side will have various tax cuts in an attempt to make the US economy Re-create the enthusiasm driven by the tax cuts in December 2017, so as to lay a good foundation for the economic card of the 2020 general election.

These short-term stimulus economic policies driven by political considerations will not help the US’s fundamental economic structure. Just like athletes taking steroids to increase explosiveness and endurance, they can only play an active role in the US economy. Of course, for Trump, this is a good turn in 2020, but the US’s own structural problems cannot be solved by a single dose of steroids.