Chartbook 361 Flooding the zone: The first 54 days of the second Trump administration and the end of the world as (we thought) we knew it.

Yeah, I had to check.

Reeling from the first seven and a half weeks of the Trump Presidency, here are a few preliminary conclusions.

#1

Trump 1.0 was clearly no more than an overture. For radical right-wing forces in the USA, it was a missed opportunity and a disappointment. Stunned by his own victory in 2016, Trump in office relapsed into the most minimal version of himself, reveling in tax cuts and the prospect that a buoyant economy would carry him safely to a second term.

#2

The shock of defeat in 2020, the legal campaign against Trump, the dominance of MAGA within the GOP and advanced planning done by radical right-wing groups led to a radicalization of Trump and the Trump camp.

#3

In its early months, Trump’s second administration is highly dynamic. But it is also very messy. Far messier than the Biden administration that preceded it, or even thatn Trump 1.0.

#4

There is a wing, associated with the technocratic idea of a Mar-A-Lago currency accord (Gillian Tett, FT) that can be seen as a continuation and escalation of the post-neoliberal, “new Washington” consensus announced by Bidenomics, Jake Sullivan etc. This is derived from Michael Pettis’s ideas about taxing capital inflows to the US as a way of redressing chronic trade deficits. As Tett puts it:

Pettis sees these capital inflows as not “just” the inevitable, and beneficial, corollary of America’s trade deficit, but as a debilitating curse. That is because inflows boost the dollar’s value, foster excessive financialisation and hollow out America’s industrial base, he says, meaning that “capital has become the tail that wags the dog of trade”, driving deficits. Pettis wants curbs, like taxes, therefore. And six years ago, Democratic senator Tammy Baldwin and Josh Hawley, her Republican counterpart, issued a congressional bill, the Competitive Dollar for Jobs and Prosperity Act, which called for taxes on capital inflows and a Federal Reserve weak-dollar policy. The bill seemed to die. But last month American Compass, a conservative think-tank close to vice-president JD Vance, declared that taxes on capital inflows could raise $2tn over the next decade. Then the White House issued an “America First Investment Policy” executive order that pledged to “review whether to suspend or terminate” a 1984 treaty that, among other things, removed a prior 30 per cent tax on Chinese capital inflows. This did not grab headlines, since Trump was “flooding the zone” with other distractions, notably on tariffs. But it spooked Asian observers and probably contributed to recent US stock market falls, as some investors preemptively flee.

As Tett notes:

Pettis’s ideas seem to be influential among some advisers, such as Treasury secretary Scott Bessent, Stephen Miran, the chair of the Council of Economic Advisers, and Vance. This trio appears minded to reset global trade and finance, via a putative Mar-a-Lago accord, although their ambitions are on a grander scale than the 1985 Plaza accord. The latter “merely” weakened the dollar via joint currency intervention but Miran’s vision of a Mar-a-Lago accord includes a possible US debt restructuring too, which would force some holders of Treasuries to swap them for perpetual bonds.

Back in November 2024 in the LRB this is what I called “MAGA for thinking people”. It remains to be seen how influential this current is.

#5

The predominant forces around the Trump camp are the four that Tett identifies: Trump himself, plus nationalist populists (such as Stephen Bannon), techno-libertarians (like Musk) and pro-Maga congressional Republicans. It is not clear at this point which grouping or coalition of groupings will win out. The technocratic current of “MAGA for thinking people” is weakly anchored in these powerful groups and some might well oppose the idea of taxing capital inflows, especially if the stock market remains as weak as it has been in the last few months.

#6

What unifies the more ideological side of the Trump coalition are not so much specific policy ideas, but the promise of a rupture of the status quo, a break into freedom.

As Judith Butler spells out in this clip, one key element of Trump’s appeal is that he promises many of his supporters the “right-wing thrill” of “being free to hate. Being free to be irrational.”

Though I like this interpretation when Butler confidently invokes the baselessness of Trumpian rhetoric, it leaves me worried.

First of all the stark contrast between “fact-based us” and “fact-free them” underestimates the thoroughly irrational drives motivating the Biden crew, which I sought to unpick in the Chartbook newsletter last weekend.

Furthermore, it does not do justice to the radicalism of a Musk, a Bannon, or the “Mar-a-Lago Accord” crowd, to suggest that they want to free themselves from rationality or evidence. Far from it. They think reason has been falsely monopolized by folks like the readers of this newsletter, or folks like Judith Butler, or orthodox neoliberal economists of the Clinton and Obama era, the sort that are horrified by the proposals made by Michael Pettis. They positively revel in our shock at the outlandishness of their ideas, seeing our shock as a proof of the veracity of their own claims.

#7

A key element of the Trump-MAGA challenge, of its bid for freedom, is not so much an attack on truth or reason as such, but rather an attack on the hegemony of the Professional Managerial Class, the social formation that has in recent decades claimed a monopoly of truth and rationality. That the PMC conflates an attack on itself, with nothing less than an attack on truth and reason as such, just serves to confirm the Trumpite sense of mission. As I argued in Chartbook 359, it should give us pause that the way that many leading Dems are processing the shipwreck of their project is so solipsistic.

I picked up the anti-PMC theme back in November 2024, in the wake of the election.

For Foreign Policy I did a longer piece on the topic.

Cam and I took up the theme again in the podcast this week.

As I argued in the podcast. Bidenomics can be imagined as a tussle within the PMC, within the real and imagined seminar rooms of America’s elite universities and within the offices of the Washington think tank “blob”, over the terms of a “new Washington consensus”. MAGA 2.0 had radicalized this into a battle over the role of the PMC as such, its hegemonic apparatuses and its common sense.

The reaction of the Economist, one of the house journals of actually existing neoliberalism, is telling. They were no fans of Bidenomics. But what they object to most profoundly in Trump 2.0 is that it is (to paraphrase) the government of unreasonable people, by unreasonable people, for unreasonable people.

Since DOGE was unleashed and the attack on the Universities began, for many of us this is no longer an academic or intellectual matter. As public servants, or teachers, or students at Universities, we are directly under attack.

#8

With regard to US foreign policy, Trump is a break that has been long in the making. The Biden-era effort to craft a new majority to support American globalism, which sailed under the banner of “foreign policy for the middle class”, failed.

Trump has certainly set about smashing the conventions of “the blob”. But rather than any kind of critical reflection or reform project, the result is a grotesque scatter shot of initiatives ranging from the proposal for the ethnic cleansing of Gaza to the wild twist away from Ukraine and towards Russia, the annexation of Canada and Greenland and “taking back” the Panama canal.

If liberal hegemony has run out of steam, Trump’s answer seems to be to rally US public opinion around a naked imperialism last scene in the late 19th century.

In critiquing the idea of “interregnum” in the Maeder lecture at the New School back in November, I envisioned various unhinged versions of power and political communication that might shape the future.

What might power and communication look like, I asked, if we dispensed with the conventional view of history inherited from 19th and 20th-century social theory? I suggested two possibilities: hyperagency (unhinged visions of the exercise of power) and nihilism (a descent into empty and incoherent speech, as exemplifed by the Presidential debates over Trump and Biden’s golf games).

Back in November, with regard to hyperagency, the surreal visions of Gaza reconstruction that had been circulating since 2023, were one of the examples that were on my mind.

And then came the grotesque AI-generated vision of “Trump-Gaza shining bright” and Trump’s recycling of it.

With its unabashed celebration of narcissistic, imperial masculinity this leaves nothing to the imagination. It is “West Wing for deplorables”. No surprise that the President loves it.

#9

I, no more than anyone else, know how to end this list of remarks. And this seems an important point in its own right.

We don’t know whether checks and balances will operate. The Dems seem to have their fingers crossed that there will be a recession and that this will allow them to win back control of the House. They certainly don’t seem minded to use Congress to throw a spanner in the works, as the GOP most certainly would have done.

The anti-Trump segment of the population, is left torn between horrified doomscrolling, unavailing protest and resignation and withdrawal. The latter option being a privilege of those who enjoy some degree of security.

You might be tempted to say: “How can you say that this is the end of the world as we thought we knew it. Isn’t this what it means to inhabit a world beyond interregnum, a world of polycrisis?”

I can only agree. However, I would add that those terms were not meant as settled descriptions, or shorthand answers, but as reminders to face new, challenging and unimaginable realities, every day. And that hurts.

It takes an intellectual, emotional and physical effort to keep up with Trump-time, and this is if you are riding this out as comfortably tenured faculty, not as a civil servant who has been fired, a protestor being threatened with terrorism charges, or an immigrant facing deportation.

To convey the feeling to those not in the crosshairs right now, the analogy that comes to my mind is the open-ended uncertainty and fear of pandemic times.

I’m reminded of 2020, when the Trump Presidency was melting down and before we had the vaccine. But grim as it was, that was the end of Trump’s first term and the clinical trials were under way. Democracy and science were going to save us. Today, this is just the beginning of Trump’s second term and this time it is the labs that they are shutting down.

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