As Trump’s erratic and extreme trade policy shakes the world economy, the basic question of this week is the classic question of realistic political analysis: Who benefits?
We might be overthinking it. He may have been surprised by the pushback from the markets and other governments. He may simply have wanted to announce that tariff revenue will make room for renewing his tax cut. He hoped to make it look painless. But he ran into what were for him unknowns (but knowns for others). Hence the reversals. But Republicans have announced that they have the votes to pass the tax cuts. They trusted Trump to provide cover. He has fumbled that ball. Tett is still sanewashing. Trump still has Fox to provide the cover he needs. But who knows.
Gillian Tett writes in a dispassionate observational fashion that is often maddening when she describes mad topics. Tett notes that the Trump team is embarking on a grand sociological experiment in which we are asked to take short term pain for long term gain. But you ask the right question, which is “Yeah but is that what we want?” And, further, are they even going to be able to deliver the result they are promising? All of this ignores the question of, “Ok..but for how long?”
If you tell me I will be at a healthy weight if I cut my calorie intake in half that sounds great in the abstract. But how long do I have to go on a starvation diet? When the body goes into starvation mode and I don’t achieve the weight loss I am promised, do I keep administering pain?
And we all have to suffer because we politically refuse to tax the wealthy or corporations?
Tett shows her cards a bit when comparing us to Japan - they have programs to mitigate economic pain and social cohesion to reinforce it in service of a greater goal. We have neither.
Shifting the taxation system to a nineteenth century, tariff funded system seems to be one of the key aims. Removing income taxes creates an enormous depth of social gratitude towards Trump as consumption taxes are far less obvious to people. Attacking China and starting a war, which entails emergency provisions and which then enables him to stay in office indefinitely, could be another motivation.
If the objective is to consolidate power in his person rather than institutions and particularly multilateral ones, his one man tariff show is a dramatic way to demonstrate power. Trump may not have a larger end in view. Adhocracy has been his pattern in the past and he believes it works for him. The idea that he may be taking an enormous risk may not have occurred to Trump.
Trump has the kingly power of granting or withholding tariff exemptions and discounted tariffs for select companies of his choice. And because he has the mentality of a shameless & ruthless mobster, he won't hesitate to use those powers to grant and withdraw tariff exemptions to extort payments from US and foreign companies that recognize tariffs are going to cripple their businesses. The tariffs aren't part of any coherent long-term economic plan to transform the US economy. The tariffs are a tool and vehicle for Trump to 1. enrich himself, 2. reward favored businesses 3. turbo-charge political donations to the GOP and MAGA political ecosystem and 4. threaten and punish business execs so they'll do what Trump wants them to do. Trump has succeeded in transforming the GOP into an American form of the old Eastern Bloc communist parties and their control over & exploitation of limited free enterprise and cronyism. Melania and her father would have been able to tell Trump about how all of that worked back in Slovenia in the 1960s, '70s and '80s.
Quite so. Mar-a-Lago the Green Zone, the United States ...? Trump will have to go a long way to surpass the death and destruction wrought by W, but indeed, could it be that Trump is the means by which that bill has come due? His language seems almost identical to the Joint Resolution of Congress in 2001: "Whereas acts of treacherous violence were committed against the United States and its citizens...the President is authorized to use all necessary and appropriate force...."
Yet another frontal assault on what set American-Capitalism apart in a World of Lawlessness and Authoritarianism?
"Donald Trump has issued a new executive order explicitly challenging the Administrative Procedure Act of 1946 (APA) — the law most used by the federal courts to block his other unlawful executive actions. Disguised as a trivial order about (of all things) low-flow showerheads, it is, in reality, an invitation to the Supreme Court to gut the APA. That would be a disaster for the rule of law." -- ‘Showerhead’ Executive Order Includes a Serious Surprise
If Trump continues his Russification-Americaxit campaign does one of the speculated reasons for the yield curve moves have to be finally taken seriously? Has the MAGA-Republican reactionary mindset finally resurrected the ghost of Hoover in revenge for FDR saving America from their ineptitude culminating in Smoot? Whatever the reason, whatever the cause, whatever the timeline, "something wicked comes this way":
"What could be the reasons why long-term interest rates are moving higher when the stock market is moving lower?
1) With the yen, euro, and Canadian dollar strengthening at the same time, this could be foreigners selling US Treasuries.
Polycrisis roundtable? As a subdrack + podcast subscriber (just reminded myself to donate to the pod) I read today's Summers, Furman, Cass, Robinson roundtable in the NYT. i, for one, would love to read/hear a broader one, say Tooze. Ferguson. Nick Stern, and Mazucato (sp?) on what. if any polycrisis implications arise from Trump 2.0. Cam hitting. of course!
I'm glad you are so confident in your liberal definition as to weild that anachronistic moniker like a dagger, perhaps even in service of the evidentiary avoidance that ‘lib” seems to enable. But who buys what impugn-the-messenger policy breaks?
Nothing personal Vincent. I'm a finance geek who sees new OPM (other people's money) problems arising. Do fossil fuel beneficiaries in Texas pay for Florida hurricane damage? Do all Americans fund FEMA aid in California if they build right back where wildfire risk is high? Do US+EU pay India for mortality from high wet bulb temperatures which their high per capita emissions caused? Blaming "libs" has no effect whatsoever on the radiative forcing of co2 molecules or modeling data of who caused what effects. I'm suggesting that physics and economics deniers opinions are tolerable only with a "you break it, you buy it" proviso. Today "libs" is tossed around like a free pass to deny facts. This too shall pass, Jon
Trump speaks of the flow of wealth. Let's think about that. Trump speaks of the national balance sheet. Let's think about that. For instance, the national debt goes on the balance sheet even though popular discussion muddles debt and GDP (income statement.). Trump in brief: we are paying for purchases with assets, and that's bad. What do you think?
interesting. "The bottom line is that, for 20 years or more, including the months prior to the election, voter perception was more reflective of reality than the incumbent statistics."
re: "There simply is no mass movement clamoring for reindustrialization."
i wonder if this may be an emotional issue, "the good old day", which may not culminate in a mass movement, but still express itself as political leanings, susceptibility to populist discourse.
We might be overthinking it. He may have been surprised by the pushback from the markets and other governments. He may simply have wanted to announce that tariff revenue will make room for renewing his tax cut. He hoped to make it look painless. But he ran into what were for him unknowns (but knowns for others). Hence the reversals. But Republicans have announced that they have the votes to pass the tax cuts. They trusted Trump to provide cover. He has fumbled that ball. Tett is still sanewashing. Trump still has Fox to provide the cover he needs. But who knows.
Gillian Tett writes in a dispassionate observational fashion that is often maddening when she describes mad topics. Tett notes that the Trump team is embarking on a grand sociological experiment in which we are asked to take short term pain for long term gain. But you ask the right question, which is “Yeah but is that what we want?” And, further, are they even going to be able to deliver the result they are promising? All of this ignores the question of, “Ok..but for how long?”
If you tell me I will be at a healthy weight if I cut my calorie intake in half that sounds great in the abstract. But how long do I have to go on a starvation diet? When the body goes into starvation mode and I don’t achieve the weight loss I am promised, do I keep administering pain?
And we all have to suffer because we politically refuse to tax the wealthy or corporations?
Tett shows her cards a bit when comparing us to Japan - they have programs to mitigate economic pain and social cohesion to reinforce it in service of a greater goal. We have neither.
Shifting the taxation system to a nineteenth century, tariff funded system seems to be one of the key aims. Removing income taxes creates an enormous depth of social gratitude towards Trump as consumption taxes are far less obvious to people. Attacking China and starting a war, which entails emergency provisions and which then enables him to stay in office indefinitely, could be another motivation.
If the objective is to consolidate power in his person rather than institutions and particularly multilateral ones, his one man tariff show is a dramatic way to demonstrate power. Trump may not have a larger end in view. Adhocracy has been his pattern in the past and he believes it works for him. The idea that he may be taking an enormous risk may not have occurred to Trump.
Trump has the kingly power of granting or withholding tariff exemptions and discounted tariffs for select companies of his choice. And because he has the mentality of a shameless & ruthless mobster, he won't hesitate to use those powers to grant and withdraw tariff exemptions to extort payments from US and foreign companies that recognize tariffs are going to cripple their businesses. The tariffs aren't part of any coherent long-term economic plan to transform the US economy. The tariffs are a tool and vehicle for Trump to 1. enrich himself, 2. reward favored businesses 3. turbo-charge political donations to the GOP and MAGA political ecosystem and 4. threaten and punish business execs so they'll do what Trump wants them to do. Trump has succeeded in transforming the GOP into an American form of the old Eastern Bloc communist parties and their control over & exploitation of limited free enterprise and cronyism. Melania and her father would have been able to tell Trump about how all of that worked back in Slovenia in the 1960s, '70s and '80s.
Quite so. Mar-a-Lago the Green Zone, the United States ...? Trump will have to go a long way to surpass the death and destruction wrought by W, but indeed, could it be that Trump is the means by which that bill has come due? His language seems almost identical to the Joint Resolution of Congress in 2001: "Whereas acts of treacherous violence were committed against the United States and its citizens...the President is authorized to use all necessary and appropriate force...."
Yet another frontal assault on what set American-Capitalism apart in a World of Lawlessness and Authoritarianism?
"Donald Trump has issued a new executive order explicitly challenging the Administrative Procedure Act of 1946 (APA) — the law most used by the federal courts to block his other unlawful executive actions. Disguised as a trivial order about (of all things) low-flow showerheads, it is, in reality, an invitation to the Supreme Court to gut the APA. That would be a disaster for the rule of law." -- ‘Showerhead’ Executive Order Includes a Serious Surprise
If Trump continues his Russification-Americaxit campaign does one of the speculated reasons for the yield curve moves have to be finally taken seriously? Has the MAGA-Republican reactionary mindset finally resurrected the ghost of Hoover in revenge for FDR saving America from their ineptitude culminating in Smoot? Whatever the reason, whatever the cause, whatever the timeline, "something wicked comes this way":
"What could be the reasons why long-term interest rates are moving higher when the stock market is moving lower?
1) With the yen, euro, and Canadian dollar strengthening at the same time, this could be foreigners selling US Treasuries.
..." -- The Daily Spark ( https://www.apolloacademy.com/the-daily-spark/ )
Brilliant
Polycrisis roundtable? As a subdrack + podcast subscriber (just reminded myself to donate to the pod) I read today's Summers, Furman, Cass, Robinson roundtable in the NYT. i, for one, would love to read/hear a broader one, say Tooze. Ferguson. Nick Stern, and Mazucato (sp?) on what. if any polycrisis implications arise from Trump 2.0. Cam hitting. of course!
need more marxist v keynesian / post keynesian / mmt discussions about polycrisis, no shortage of liberals in the commentariat
I'm glad you are so confident in your liberal definition as to weild that anachronistic moniker like a dagger, perhaps even in service of the evidentiary avoidance that ‘lib” seems to enable. But who buys what impugn-the-messenger policy breaks?
bro what are you even talking about hahaha
Nothing personal Vincent. I'm a finance geek who sees new OPM (other people's money) problems arising. Do fossil fuel beneficiaries in Texas pay for Florida hurricane damage? Do all Americans fund FEMA aid in California if they build right back where wildfire risk is high? Do US+EU pay India for mortality from high wet bulb temperatures which their high per capita emissions caused? Blaming "libs" has no effect whatsoever on the radiative forcing of co2 molecules or modeling data of who caused what effects. I'm suggesting that physics and economics deniers opinions are tolerable only with a "you break it, you buy it" proviso. Today "libs" is tossed around like a free pass to deny facts. This too shall pass, Jon
Trump speaks of the flow of wealth. Let's think about that. Trump speaks of the national balance sheet. Let's think about that. For instance, the national debt goes on the balance sheet even though popular discussion muddles debt and GDP (income statement.). Trump in brief: we are paying for purchases with assets, and that's bad. What do you think?
re: strong economy, i found
----
https://www.politico.com/news/magazine/2025/02/11/democrats-tricked-strong-economy-00203464
----
interesting. "The bottom line is that, for 20 years or more, including the months prior to the election, voter perception was more reflective of reality than the incumbent statistics."
re: "There simply is no mass movement clamoring for reindustrialization."
i wonder if this may be an emotional issue, "the good old day", which may not culminate in a mass movement, but still express itself as political leanings, susceptibility to populist discourse.
oops meant Cam" hosting" of course
Thinking of Trump 1.0 let us not forget that he did not win the Popular vote, so did he really win?