If the Trump economy were so wonderful, why would the speaker of the House feel the need to traffic in disingenuousness? Because the Trump economy isn’t actually so wonderful. For most Americans, it is downright mediocre, and it has deteriorated somewhat since President Trump took office, despite the healthy G.D.P. and unemployment statistics.
.. Let’s start with the good news. The unemployment rate keeps falling, and economic growth is solid. These headline numbers are the ones that Republicans emphasize
.. As a result of the growth, nominal wages — that is, the numbers people see in their paychecks, before taking inflation into account — are growing. You can see the pickup in the gentle upward slope of the chart’s solid gray line. Over the past year, the average hourly nominal wage has risen 2.7 percent.
.. Prices matter, too. When the prices of good and services are rising faster than nominal wages, people end up with less buying power. And that is exactly what’s happening now.
.. Events in the Middle East, Russia and Venezuela have reduced the supply of oil, even as a growing global economy is increasing demand. Trump has aggravated the situation by pulling out of the Iran nuclear deal, further raising oil prices.
.. My best guess is that real wages will do modestly better over the next year, barring another oil spike or an unexpected recession. But there is no reason to think that most Americans are on the cusp of truly healthy pay increases
.. They face too many obstacles:
- Companies that are larger and more powerful than they used to be;
- unions that are weaker; and,
- thanks in large part to Trump, a federal government that keeps siding against workers, be it on
Right now, Trump is presiding over precisely the wage growth that he deserves: zero.
How the Trump Tax Cut Is Helping to Push the Federal Deficit to $1 Trillion
Corporate income tax collections are near a 75-year low, as a share of the economy, after a new law reduced rates and allowed companies to deduct investments immediately.
In the trough of the Great Recession in 2009, as companies laid off hundreds of thousands of workers each month, the amount of corporate income taxes collected by the federal government plunged by almost a third. It was the largest quarterly drop since the Commerce Department began compiling the data in the 1940s. No other period came close.
Until this year.
In the first half of 2018, corporate tax collections dropped to historically low levels as a share of the economy, according to data from the Bureau of Economic Analysis. That is pushing up the federal budget deficit much faster than economists had predicted.
.. The reason is President Trump’s tax cuts. The new law introduced a standard corporate rate of 21 percent, down from a high of 35 percent, and allowed companies to immediately deduct many new investments.
.. The growing deficit has forced the Trump administration to adjust its claim that the tax cuts would pay for themselves by generating increased revenue from faster economic growth. The White House’s Office of Management and Budget said this month that it had revised its forecasts from earlier this year to account for nearly $1 trillion of additional debt over the next decade — almost $100 billion a year in additional deficits, on average.
.. That is hindering the government’s ability to stabilize its balance sheet before the next recession hits or maintain spending programs that could help blunt the pain of future downturns. Economists equate that process to refilling the city water tower during periods of heavy rain, in order to prepare for the next drought. It’s not happening this time around.
.. Over time, that repatriation should generate tax revenue.
But, as Ms. Clausing noted, companies can spread the bill over the next eight years, which is why we’re not seeing that money lifting corporate tax payments in the near term.
.. provisions of the new tax law, which allow companies to write off new investments immediately, could prove more popular than some forecasters anticipated.
.. Multinationals could also be shifting money — on paper, basically — into the United States solely to take advantage of the expensing provision and reduce their American tax bills.
It’s also possible, but far too soon to tell, that changes to multinational taxation, including what is considered a de facto minimum tax on certain income earned overseas, will not raise as much revenue as expected.
David Frum: Trumpocracy & The State of Western Democracy
The donors believe that Trump would be the vehicle for getting what they want and that the price would be bearable.
People drawn to authoritarians as a way to achieve and punish what/who they want.
It was not Trump’s cunning that allowed him to achieve .. it was the complicity
They got the:
- tax deal,
- reduction of environmental restrictions,
- Obamacare relief/stabotage,
- Financial Regulation dismantalment,
- Stop Financial Protection,
- Neil Gorsuch is more important to the rank and file than donor class.
It has long been a debate about who pays the corporate income tax. The rise of the stock prices shows that the market thinks the corporations will benefit most.
In the cold war, the presidency was respected and partisanship restrained.
Big Legislation: Tax Cuts and Health Care repeal were passed/attempted without hearings.
Autoimmune disorders: military leaders might be tempted to protect the country by escaping civilian control
How informative do you think the President’s Daily briefing is, knowing that the president is not very curious and gets most of his information from Fox and Friends?
John Kelly: If you have not served, you have no right to ask me questions. (Un-American)
Modern Authoritarianism is not 1933, it attempts to stop 5-6% of people to take power.
Quote: A Democracy only lasts so long as the people realize they can vote themselves benefits.
Reality: Asset holders are fearful and contemplate radicalism.
Americans don’t realize how out of date they are — the plans they have are solutions to different problems. (not inflation: 1970s). You can’t fetishize policy.
Conservatives will not abandon conservatism, they will abandon democracy. (43 min)
Women’s suffrage was enabled by the conservative idea that the women would suppress drunkenness, etc
You address broad-based radicalism by repressing the few and making concession to address the factors which make people sympathetic. (48-49 min)
He’s taking everything you out to be working on and putting it to a dead end.
The dissolusioned young men facing declining wages need a bigger answer than they’ve got to address their privilege.
Facebook has a business model that is very sensitive to government pressure: if they were ruled to be a “publisher”, they would have to hire human editors. They have
Trump’s Potemkin Economy
According to legend, Grigory Potemkin, one of Catherine the Great’s ministers (and her lover), created a false impression of prosperity when the empress toured Ukraine.
.. the legend has become a byword for the general idea of prettifying reality to please a tyrannical ruler.
.. But Trump’s actual policy initiatives aren’t doing so well. His tax cut isn’t producing the promised surge in business investment, let alone the promised wage gains; all it has really done is lead to a lot of stock buybacks. Reflecting this reality, the tax cut is becoming less popular over time.
.. the trade war that was supposed to be “good, and easy to win” isn’t generating the kinds of headlines Trump wanted... Instead, we’re hearing about production shifting overseas to escape both U.S. tariffs on imported inputs and foreign retaliation against U.S. products... making stuff up is actually standard operating procedure for these guys... Trade policy itself is being driven by claims about the massive tariffs U.S. products face from, say, the European Union — tariffs that, like the immigrant crime wave, don’t actually exist... he declared that the head of U.S. Steel called him to say that the company was opening six new plants. It isn’t, and as far as we can tell the phone call never happened... the Council of Economic Advisers did an internal report concluding that Trump trade policy will cost jobs, not create them; Kevin Hassett, the chairman, pressed on these reports, said that he could neither confirm nor deny them; in other words, they’re true... Hassett is declaring that last year’s corporate tax cut has led to a “massive amount of activity coming home” — which is just false. Some companies are rearranging their accounting, producing what looks on paper like money coming back to the U.S., but this has no real effect on investment or employment... declaration by Larry Kudlow, the administration’s top economic official, that the budget deficit is “coming down rapidly” as “those revenues come rolling in.”.. reports that Trump wants to withdraw from the World Trade Organization... The best hope for breaking the cycle of retaliation would be for Trump to realize that the trade war is going badly, take a deep breath, and step back from the brink... But who will tell him how things are really going?.. Trump will dismiss reports of problems as fake news. Reality will take a long time to break through, if it ever does. And by then the world trading system may be broken beyond repair.