{"id":15024,"date":"2025-07-23T03:47:11","date_gmt":"2025-07-23T03:47:11","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/15024\/"},"modified":"2025-07-23T03:47:11","modified_gmt":"2025-07-23T03:47:11","slug":"dont-bet-on-the-trump-economy","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/15024\/","title":{"rendered":"Don’t bet on the Trump economy"},"content":{"rendered":"

The Trump White House took a victory lap on Monday, declaring in its newsletter<\/a> that the American economy is back \u2013 back\u00a0bigger and better than ever. Core inflation is down. Industrial production is up. Claims for unemployment dropped. Tariff revenue rose. The newsletter even cites the Wall Street Journal\u2014otherwise in bad odor in the Trump White House \u2013 for decreeing that the American economy is \u201cregaining its swagger.\u201d<\/p>\n

Is it time to\u00a0splurge on a fancy vacation? As it happens, I\u2019m currently\u00a0visiting Vermont where the number of tourists is\u00a0distinctly lower than in previous years. Trump\u2019s immigration policies are deterring Canadians from traveling to America\u00a0and the Washington Post reports that more\u00a0Americans are embracing the \u201cstaycation\u201d in anticipation of economic turmoil and headwinds.<\/p>\n

The calm before the storm argument rests on the common sense proposition that Trump, for all his skills at prestidigitation, cannot repeal the laws of economics \u2013 specifically, David Ricardo\u2019s theory of comparative advantage. Ricardo was the original free trader. His insight was that each nation should specialize in trading the\u00a0goods it can produce most efficiently. Trump, by contrast, appears to be something of a mercantilist. Like Fafner in Wagner\u2019s Ring Cycle, he wants to sit atop of his horse of gold, breathing fire at anyone who tries to disturb it. Trump\u2019s\u00a0idol is thus\u00a0the\u00a0late nineteenth century\u00a0President\u00a0William McKinley, who called himself the \u201ctariff<\/a> man.\u201d Trump praised him in his second inaugural address as a visionary who transformed America into an economic El Dorado.<\/p>\n

Now Trump himself is promising a new\u00a0golden age but the glitter seems mostly confined to his ghastly redecorating\u00a0efforts in the Oval Office, which is starting to resemble a Las Vegas casino. It is hard not to feel a sense of foreboding as Trump, willy-nilly, imposes a raft of tariffs on America\u2019s allies and rivals alike. The effective tariff rate currently exceeds 20 percent, the highest since the Great Depression.\u00a0<\/p>\n

With August 1 as the deadline for concluding any tariff deals,\u00a0Trump does not appear particularly eager to stifle what might be called the Guns of Navarro \u2013 his longtime economic adviser Peter Navarro has long contended that the most efficacious route to ensuring industrial dominance is to slap punitive tariffs on a variety of nations, foremost among them China. So far, however,\u00a0Beijing isn\u2019t budging,\u00a0much to the Trump camp\u2019s surprise.<\/p>\n

To create a potential scapegoat for economic tumult,\u00a0Trump has been bludgeoning Federal Reserve chairman Jay Powell, claiming that he has been tardy in lowering interest rates. But Powell\u2019s term is drawing to a close. Now that Congress has passed his big beautiful bill, it\u00a0is Trump, and Trump alone, who will take the blame, or enjoy the accolades, for the performance of the economy in coming months. The notion that he will risk it all simply\u00a0to tax goods coming into America remains tarrifying.<\/p>\n

\"\"<\/p>\n

Jacob Heilbrunn<\/a><\/p>\n

Jacob Heilbrunn is the editor of the National Interest and a Spectator contributing editor. He is also the author of They Knew They Were Right: The Rise of the Neocons.<\/p>\n","protected":false},"excerpt":{"rendered":"The Trump White House took a victory lap on Monday, declaring in its newsletter that the American economy…\n","protected":false},"author":2,"featured_media":15025,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164,176,5626,1073,180,4688,576,16522],"class_list":{"0":"post-15024","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-au","9":"tag-australia","10":"tag-business","11":"tag-economy","12":"tag-federal-reserve","13":"tag-interest-rates","14":"tag-jerome-powell","15":"tag-jobs","16":"tag-tariffs","17":"tag-trade","18":"tag-trade-deal"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/15024","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=15024"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/15024\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/15025"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=15024"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=15024"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=15024"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}