His proposals are a series of puzzle pieces that don’t fit together into a coherent whole, according to experts on both sides of the aisle.
Donald Trump’s bare-bones tax plan would cut rates — but add more than $10 trillion to the debt. His goal to trim the national debt to zero in eight years would require slashing all federal spending by two-thirds, even if he ditched the proposed tax cut. And he’s got no plans to trim Medicare or Social Security, the main drivers of spending
.. And like most Republicans, Trump has pledged to repeal the Affordable Care Act to save money, but the nonpartisan Congressional Budget Office has said doing so would increase budget deficits by $137 billion over the next decade — and, according to a Robert Wood Johnson Foundation study in June, would also cause 24 million people to lose their health insurance.
.. The main drivers of economic harm, Moody’s said, would be increased debt, higher interest rates, a contracting labor force — due to mass deportation of undocumented immigrants — and the impact of proposed tariffs on Chinese and Mexican imports.
.. “Trump repeatedly, blatantly and knowingly makes up or gravely distorts facts to support his positions or create populist divisions,” Paulson wrote in an op-ed in The Washington Post, in which he announced his intention to vote for Hillary Clinton. “Simply put, a Trump presidency is unthinkable.”
.. “The last super successful businessman elected to be president on that credential was Herbert Hoover,” said Holtz-Eakin. “Things didn’t go very well for him.”
How China Fell Off the Miracle Path
China is now a threat to the United States not because it is strong but because it is fragile.
.. The economy is now slowing and will decelerate further when the country is forced to reduce its debt burden, as inevitably it will be. The next step could be a deeper slowdown or even a financial crisis
.. If China were eating America’s lunch, its people would not be rushing to buy safe-haven apartments in New York or San Francisco. Far from conspiring to cheapen its currency, as Mr. Trump charges, Beijing is struggling to keep the weakening renminbi from falling more
.. Lehman Brothers filed for bankruptcy in the United States, tipping the global economy into recession. Demand collapsed across the world, crushing export growth in China. The leadership in Beijing panicked, apparently fearing that if the recession reached its shores, social unrest would follow.
.. Mr. Wen reversed course and doubled down on the old industrial model — fueling investment in factories with trillions in state lending and spending.
.. But this spree spread on conviction that Beijing, obsessed with hitting its growth target, would not let lenders or borrowers fail.
.. That 80-percentage-point increase is also more than three times the increase in the United States before its bubble collapsed in 2008.
.. It ordered people not to sell or even to speak critically of stocks.
.. The sputtering global economy is one shock away from slipping into recession. In the postwar period, every previous global recession started with a downturn in the United States, but the next one is likely to begin with a shock in China.
Satyajit Das about his new bookThe Age of Stagnation
In Extraenvironmentalist #91 we first speak with Satyajit Das about his new bookThe Age of Stagnation: Why Perpetual Growth is Unattainable and the Global Economy is in Peril which questions the assumption that never ending economic growth is possible, or desirable. Das questions the ability of political leaders to enact the tough structural changes needed to avoid social chaos in a low growth world. Then, in the second half of our show we speak with Michael Hudson about his book Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy. Hudson describes how debt deflation is imposing austerity on the U.S. and European economies, siphoning wealth and income upward to the financial sector while impoverishing the middle class.
Separate productive and unproductive economic activity
German Economic Miracle (debt writedown)
Cult of Measurement (to be gamed)
The debt and entitlements will have to be written down (savers punished)
Trump Ignorance is often Bombastic version of Republican Policy
finally revealed his plan to make America great again. Basically, it involves running the country like a failing casino: he could, he asserted, “make a deal” with creditors that would reduce the debt burden if his outlandish promises of economic growth don’t work out.
.. federal interest payments are only 1.3 percent of G.D.P., or 6 percent of total outlays.
.. So why is Mr. Trump even talking about this subject? Well, one possible answer is that lots of supposedly serious people have been hyping the alleged threat posed by federal debt for years. For example, Paul Ryan, the speaker of the House, has warned repeatedly about a “looming debt crisis.”
.. how can he imagine that it would be O.K. for America to default? One answer is that he’s extrapolating from his own business career, in which he has done very well by running up debts, then walking away from them.
But it’s also true that much of the Republican Party shares his insouciance about default. Remember, the party’s congressional wing deliberately set about extracting concessions from President Obama, using the threat of gratuitous default via a refusal to raise the debt ceiling.
And quite a few Republican lawmakers defended that strategy of extortion by arguing that default wouldn’t be that bad, that even with its access to funds cut off the U.S. government could “prioritize” payments, and that the financial disruption would be no big deal.
.. when Mr. Trump talks nonsense, he’s usually just offering a bombastic version of a position that’s widespread in his party.