They took the best growth picture in a decade and put us in danger of recession.
Why are so many key global leaders pursuing so many stupid economic policies?
As recently as January 2018, the International Monetary Fund issued one of its most upbeat economic forecasts in recent years, extolling “broad based” growth, with “notable upside surprises.”
By last month, the fund had sliced its forecast for expansion this year to 3.2 percent — a significant falloff from the 3.9 percent projection reiterated just six months earlier — and had pronounced the economic picture “sluggish.” American investors are more concerned; the bond market is sounding its loudest recessionary alarm since April 2007.
The deterioration in the economic picture is not the consequence of irresponsible behavior by banks or a natural disaster or an unanticipated economic shock; it’s completely self-inflicted by major world leaders who have delivered almost universally poor economic stewardship.
The trade war initiated by President Trump sits firmly atop the list of bad policies. But Brexit has tipped Britain into economic contraction. With European governments unwilling to pursue structural reforms, the continent is barely growing. President Xi Jinping of China has focused on standing up to Mr. Trump and solidifying his own power. After a promising start reforming the economy, India’s prime minister, Narendra Modi, has turned instead to oppressing his country’s Muslim minority.
None of this was necessary. As the January 2018 I.M.F. report indicated, the world economy was firing on all cylinders — “the broadest synchronized global growth upsurge since 2010” — as jobs were being added and inflation remained subdued.
Yes, Mr. Trump’s trade war and Brexit loomed, but amid hope that the former would prove empty and the latter would be softened.
Not so today.
Often against the recommendations of his more sensible advisers, Mr. Trump has implemented the country’s most protectionist actions since the 1930s. As a result, world trade has begun to fall for the first time in a decade, with noticeable economic impact. Last week, Goldman Sachs cut its already modest projections for fourth-quarter growth to 1.8 percent from 2 percent.
That’s a far cry from the “4, 5, 6” percent that Mr. Trump talked about just before his tax cut passed.Nor has that been Mr. Trump’s only misstep in economic policy. Instead of nurturing growth with important investments like a robust infrastructure program, Mr. Trump deployed his political capital to secure tax cuts that disproportionately favored business and the wealthy.
The “sugar high” they produced quickly wore off. And now, instead of developing better policies, the president has chosen to attack the Federal Reserve, whose independence is cherished by investors, business people and economists.
Boris Johnson, Britain’s new prime minister, abandoned his predecessor’s notion of a “soft Brexit” that would have maintained some ties with the European Union. Instead, he reaffirmed his promise that his country would leave the E.U. on Oct. 31 with or without a deal. The pound quickly fell to its lowest level against the dollar since 1985. (It has since recovered slightly.)
Then there’s China. By virtue of both its remarkably fast industrialization and its protectionist policies, the nation has long been a trade threat. But four years ago, the government issued its “Made in China 2025” economic manifesto, which put in writing China’s plans to attain a leadership position in key new sectors, including robotics, pharmaceuticals and aerospace.
The notion of China using its state power to take on important American and European industries instead of pursuing market reforms set off alarm bells across the political spectrum and provided a concrete underpinning for Mr. Trump’s trade confrontation.
Mr. Xi, rather than acknowledging China’s protectionist practices, has proved unwilling to accept a new trade agreement with effective enforcement provisions. That has raised doubts about whether China is seriously interested in reforming its unfair trade practices — keeping key markets fully or partially closed, using state subsidies to favor its companies, forcing American companies to transfer technology to China and the like.
Of course, at least in the world’s democracies, voters bear substantial responsibility for electing these inadequate leaders. The rise of populism as a reaction to disaffection about economic and social conditions has been well documented as a principal driving force.
Occasionally, good choices have been made, such as the election of President Emmanuel Macron of France. But even that has not led to progress; public support for Mr. Macron turned to opposition when he instituted the much needed policy changes that he promised.
Any chief executive officer who botched his or her job as badly as most of these leaders have would be fired. Let’s hope that voters come to that realization when given the chance.
But Mr. Trump is president of the United States, and if prudent, disciplined leadership was ever required, it is now. Rhetorically stomping his feet, as he did on Tuesday, is not just irresponsible; it is dangerous. He is no longer a businessman trying to browbeat someone into a deal. He commands the most powerful nuclear and conventional arsenal in the world, and any miscalculation could be catastrophic.
.. This is a president with no prior government or military experience who has shown no clear grasp of complex strategic issues.
.. his inflammatory words were entirely improvised and took his closest associates by surprise. Intentionally or not, they echoed President Harry Truman’s 1945 pledgeto inflict a “rain of ruin from the air” if Japan did not surrender after the first atomic bomb was dropped at Hiroshima, which made them seem even more ominous.
It is hard to believe that they would condone Mr. Trump’s risky approach, and on Wednesday, the damage control began.
- While Mr. Mattis reinforced his boss’s belligerent tone and expressed confidence that North Korea would “lose any arms race or conflict it initiates,” he more prudently focused on the North’s concrete “actions” rather than on vague threats and voiced support for a diplomatic solution.
- Secretary of State Rex Tillerson said he saw no reason to believe that war was imminent.
- Meanwhile, some White House aides reportedly urged reporters not to read too much into the president’s remarks.
.. Since Truman, presidents have largely avoided the kind of militaristic threats issued by Mr. Trump because they feared such language could escalate a crisis.
.. Mr. Trump has again made himself the focus of attention, when it should be Kim Jong-un, the ruthless North Korean leader, and his accelerating nuclear
.. Engaging in a war of words with North Korea only makes it harder for both sides to de-escalate.
While the new language removes the actual libel, it’s still irresponsible and indefensible. Since there was absolutely no link between anyone’s political rhetoric (much less Sarah Palin’s) and Loughner’s crime, why continue to mention Palin? She was irrelevant to that terrible act. The editorial board continues to go out of its way to smear people it despises, this time through slimy guilt-by-association.
.. I’m the absolute last person to believe that vicious rhetoric or acts of violence are exclusive to the Left. White supremacists have been committing acts of violence and murder at an alarming rate, but the Times just can’t resist the temptation to demonize even mainstream conservative voices. Remember, this is the same paper that tried to link Omar Mateen’s jihadist attack in Orlando to Republican policies on, for example, transgender bathroom access.
Keep in mind, last week Vice President Mike Pence, White House press secretary Sean Spicer, and the rest went out before the cameras and insisted that Ron Rosenstein’s memo was the driving force to fire FBI director James Comey… and then Trump told Lester Holt he was going to fire Comey “regardless of the recommendation.” Just last week, Trump declared on Twitter, “As a very active President with lots of things happening, it is not possible for my surrogates to stand at podium with perfect accuracy!” The president will insist his surrogates can’t be expected to get everything right, and then a few days later, insist that you trust denials from his surrogates. You can’t have it both ways.
.. The bottom line is that there is absolutely no benefit to the United States to be sharing this kind of information with the Russian government — and if it alienates a friendly government helping us fight ISIS, then it is extraordinarily damaging.
.. It does not help that so many Democrats insist that every administration misstep is justification for impeachment
.. or the insane everyone’s-a-Russian-agent conspiracy theories .. But the insanity of lefties doesn’t get this White House off the hook. Unless the entire story is made up out of whole cloth, Donald Trump still doesn’t understand his responsibilities.