As Trump Wrecks the Economic Expansion He Inherited, He is Starting to Look for Scapegoats
Because of the slowing economy and recent Wall Street woes, Donald Trump is starting to look around for a scapegoat and you almost have to feel sorry for him...almost. He inherited a thriving economy from President Obama, got Congress to pass a massive corporate tax reduction package, and pumped up Federal spending and still there are signs that the economy is slowing and might enter a recession during his reelection year. So, he needs someone and/or something to blame before the conventional wisdom settles on his completely unnecessary trade war with China as the culprit.
Trump has attacked the Federal Reserve and its Chairman Jerome Powell recently, arguing that they shouldn't have raised rates so aggressively last year and should cut them faster now that the economic expansion has slowed. The Fed lowered rates recently, but not as much as the President had suggested, so expect more attacks on Powell.
Washington Post: "Trump has relentlessly bludgeoned Fed Chair Jerome H. Powell over interest rates and has told aides and allies that he would be a scapegoat if the economy goes south."
Yesterday, Trump found a new target; actually, it's an old target, just something new to blame them for.
Twitter: "The Fake News Media is doing everything they can to crash the economy because they think that will be bad for me and my re-election. The problem they have is that the economy is way too strong and we will soon be winning big on Trade, and everyone knows that, including China!"
The reality is that the media is talking to farmers, investment managers and CEOs and everyone is saying the same thing; Trump's trade war is hurting business and consumers, and the stimulative effects of the corporate tax cuts have run their course.
Trump acknowledged this week that his trade war is harming consumers when he postponed many of the new Chinese tariffs until after the Christmas buying season. But there isn't much else he can do to jump-start the economy unless he swallows his pride and backs off on the other tariffs, and he isn't going to get any fiscal stimulus out of Congress with the deficit mushrooming quarter by quarter.
So, he's stuck and he is worried, as he should be. His wealthier allies have generally ignored his lies, America first blather, and chaotic foreign policy, because they supported his economic policies, specifically, tax cuts and fewer environmental regulations. But, if the President's ill advised trade war tanks the economy, many of this rich fans may decide he's not worth all the trouble he stirs up.
By: Don Lam & Curated Content