We are about 18 months into the presidency of Donald Trump. Surprising as his election victory was, there are some key promises and themes of his campaign that ultimately swayed many independent voters or even led people who had voted Democrat in successive cycles to vote for him. Now that he’s had plenty of time to settle in, let’s take a look at how he has performed on those key areas.
Drain the swamp
Trump liked to get his supporters to chant “Drain the Swamp” at his rallies. The substance of this mantra is supposed to be something like “Washington is full of corrupt politicians, lobbyists, and special interest groups that make back room deals to enrich themselves instead of working for the American people”. And that is something that is probably true to a great extent, and that resonated with many voters, and it is certainly an admirable goal to root out corruption in our elected officials.
Performance check – Tom Price. Scott Pruitt. Wilbur Ross. And those are just the guys in his Cabinet. For reference, there are 15 members of the Cabinet, not counting the vice president and chief of staff; that means a full 20% (3 divided by 15) of Trump’s top officials, personally selected by the president, have either been forced to resign over corruption or been the subject of “Swamp Watch” on Fox News. In 18 months.
Meanwhile, Trump has also continued to personally profit from his hotels, including from occupancy driven by foreign officials. Jared Kushner seems to be using official White House meetings to secure financing for his family business.
Champion the working class
It has always been baffling to think that a man who literally is a billionaire and lives in a tower in Manhattan with his name on it is somehow a man of the people. But he did campaign as a populist, tapping into the same anti establishment, anti elitist energy that Bernie Sanders did with his “1%” message. How have his policies impacted the lives of average Americans?
Performance check – the tax cut and tariffs on certain industries can have a positive impact on certain segments of the population. However, underneath the headlines there are more complex effects that will be felt for years to come.
The tax cut, always a good move politically, will have some short term benefits for middle income Americans. Here is a more detailed analysis of the numbers. However, the main take aways are 1) middle income tax rates go down by 4% or less 2) Corporate tax rates go down by 14% (from 35% to 21%) 3) the corporate tax cuts are permanent, but the middle income tax cuts expire at the end of 2025, conveniently just long enough for Trump and Republicans to use it as a political victory. 4) Over 10 years, the tax cuts will add $2.3 TRILLION to the deficit.
How about tariffs? Specifically on steel and aluminum imports, it will benefit the roughly 145,000 workers employed in the steel and aluminum industry in the US. Their companies can then afford to raise prices, potentially hiring more workers with the increased profits.
But what about the 6.5 million workers in industries that use steel & aluminum to make their products? That includes American auto makers like Ford and GM, companies that make components in the auto, aerospace, energy, and construction industries, not to mention consumers that will see increased prices on the end products from these companies.
Reagan, the conservative hero, said in his 1988 State of the Union address: “One of the greatest contributions the US can make to the world is to promote freedom as the key to economic growth. A creative, competitive America is the answer to a changing world, not trade wars that would close doors, create greater barriers, and destroy millions of jobs. We should always remember: Protectionism is destructionism. America’s jobs, America’s growth, America’s future depend on trade–trade that is free, open, and fair.” While it might be tempting to attempt to protect America’s workers with tariffs and restrictive trading policies, it is much more likely that these policies will end up damaging our economy.
As with many of Trump’s promises, they look good on the surface. But for anyone willing to look at actual data and think about long term consequences, it becomes clear that they are more about sounding good and scoring political points with the right groups of people than they are about actually fixing long term problems.
Stay tuned for Part 2.