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Trump Has A Sound Trade Policy, But Where Will He Get Sound Trade Policy Aides?
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Donald Trump’s speech on foreign policy on Wednesday has been widely and predictably misrepresented. The Economist, for instance, claimed to see many “errors” there, yet curiously failed to identify a single one.

In suggesting his proposed strategy is riddled with contradictions, the only substantiation the magazine offered was this:

He….vowed that his America would be a “reliable friend and ally again”. But moments earlier he explained how he would begin his presidency by summoning allied leaders for a summit to discuss how they “look at the United States as weak and forgiving and feel no obligation to honour their agreements with us.”

Pace the Economist and its compulsion to belittle the Trump phenomenon, his attitude to allies is no way contradictory. He is evidently referring to trade agreements and is saying that just because a nation like Japan or South Korea is classified as an American ally does not relieve it of an obligation to honor its trade agreements. If such nations continue to discriminate against U.S. exports, it will be they, not a Trump-led America, that will fall short on obligations of friendship.

Trump’s larger point is that for any serious future Presidential administration, trade can be a powerful lever in influencing foreign partners – and not just China, whose rivalry with the United States is now obvious and ever-present, but nations like Japan, South Korea, and Germany, which have long used saccharine-sweet professions of friendship towards the United States to try to slough off their trade obligations.

So much for the broad outline of Trump’s strategy. But if it is to work, he will need a small army of reliable aides to implement it. Although he has already named several advisors on other issues, he seems not yet to have reached out to any trade experts. Yet in trade more than almost any other area of policy, the devil is in the details and a President simply has to delegate much of the strategizing and most of the negotiating to trustworthy aides. The evidence of history is that the caliber of trade negotiators in the past has generally fallen way below what the American nation is entitled to expect.

The challenge for Trump is to find aides who cannot be either corrupted or broken (in the latter case, via, for instance, blackmail).

The traditional first port of call for administrations in search of warm bodies is, of course, the Washington think-tank industry. But far too many think-tank types are hired guns whose only loyalty is to their own pocketbooks. In any case, almost without exception think-tanks are on the wrong side of the issues. So too for the most part are Washington law firms and Ivy League universities.

A major part of Trump’s problem will be transforming the culture at the Office of the United States Trade Representative (USTR). Hitherto the USTR seems to have been peopled largely by an amoral breed of young lawyer for whom, in typical revolving door fashion, government service is just a stepping stone towards the real deal, a big paying job in the private sector. For such people, and their likely future employers in the Washington foreign trade lobby, a reputation for standing up for the U.S. national interest is not considered an asset.

Yet Trump is right to prioritize trade. It is not only a field that has long cried out for strong presidential leadership, but it is one where, given aides of appropriate commitment and strength of character, a future President Trump could aim for large early victories.

As a practical matter, however, people of the appropriate caliber are not thick on the ground. Some of the most clear-sighted trade economists moreover are left-leaning Democrats like Robert Kuttner, Jeffrey Madrick, and Robert Scott who will probably not be available to a President Trump.

Meanwhile some key figures who in a previous life came to national attention as trade hawks have long since tiptoed away from their former positions and have even in some instances cosied up to persistently protectionist nations (it may not be a coincidence that such nations are noted for big-budget attempts to subvert intelligent American criticism of their trade policies). In the nature of things, such experts are better left unnamed but a useful litmus test is the extent to which they have written about, say, Japan’s globally crucial car market. That market remains as closed as ever and provides the Japanese car industry with a high-profit sanctuary from which to “target” world markets.

A further problem is that many people with deep knowledge of the issues (acquired typically in the 1980s and 1990s, when trade was last a hot-button issue) are now in their late 60s or older. Whether they will be as enthusiastic as the 69-year-old Trump for a new challenge is anyone’s guess.

All that said, let’s name some appropriate names. Two people Trump should call immediately (if he hasn’t already done so) are Patrick Buchanan and Pat Choate.

Buchanan ran for President as a third party challenger in both 1992 and 1996 and among his top issues were America’s ill-advised trade strategy and trade’s role in American industrial decline. A familiar face to the American public from a long career as a television commentator, Buchanan is an erudite historian who first came to prominence as a senior advisor to Richard Nixon in the 1960s.

As for Choate, he was Ross Perot’s running mate in a 1996 presidential campaign in which they strongly challenged Bill Clinton’s trade policies. An institutional economist positioned on the moderate right, he is a noted expert on the shortcomings of extreme laissez-faire. He is also the author of Agents of Influence, a bestseller on the Washington trade lobby, and in recent years has served as an advisor to corporate America on international patent problems.

Here are a few other well-informed and reliable trade experts whom Trump should seek out at the first opportunity:

Dan DiMicco. In his former capacity as chief executive of the Nucor steel company, DiMicco fought many trade battles and is an expert on East Asian dumping.

Ralph Gomory. A noted applied mathematician and former head of research at IBM, he is the author, with William Baumol, of Global Trade and Conflicting National Interests. In this book and follow-up papers, Gomory has challenged the theoretical foundations of textbook free trade theory.


Kevin Kearns. Head of the U.S. Business and Industry Council, an organization representing domestic manufacturers, Kearns formerly served as a foreign service officer in Germany, Korea, and Japan, and in that capacity observed first-hand the obstacles faced by US companies in trying to export to key foreign markets. In Japan, he opposed the give-away of American taxpayer funded aerospace technology to the Japanese FSX program.

Robert Lighthizer. A partner in the Skadden Arps law firm and a former deputy United States Trade Representative (USTR), he divides his time between traditional trade litigation, policy advice, and legislative initiatives. He represents heavy manufacturing, agricultural and high-tech companies and has been lead counsel in countless antidumping and countervailing duty cases.

Richard McCormack. Publisher of Manufacturing & Technology News, a well-regarded newsletter, McCormack is an expert on the practical problems faced by U.S. industry in competing in rigged global markets.

Peter Morici. A professor of international business at the University of Maryland and a former advisor to the U.S. International Trade Commission, he is one of the few prominent academic economists who forthrightly challenges his colleagues’ ivory tower commitment to unilateral free trade.

Patrick A. Mulloy. A lawyer who served five two-year terms on the bipartisan United States-China Economic and Security Review Commission, he currently serves as a consultant to non-profit groups interested in reforming U.S. trade and economic policies.

Michael Sekora. A noted physicist, he founded Project Socrates, a classified U.S. Defense Intelligence Agency program established in 1983 within the Reagan administration. He holds that the cause of U.S. industrial decline is that U.S. decision-makers abandoned technology-based planning and adopted economic-based planning at the end of World War II.

Alan Tonelson. As research fellow at the U.S. Business and Industry Council Educational Foundation, he has written extensively on free trade and globalization and their role in U.S. industrial decline.

How realistic is it to hope that a future President Trump can bring America’s now persistently disastrous deficits under control? Many observers are daunted at the scale of the undertaking. Kevin Kearns, for instance, believes that the organizational effort required will be monumental.

“ Trump will need to formulate a comprehensive plan to fulfill his promise to bring back jobs to America,” Kearns comments. “It will involve not just USTR and the Commerce Department, but also Treasury, Defense, Energy, Labor and other departments and agencies. He will have his work cut out finding people who share his vision and are willing to man the various federal government positions to carry out his plans. They exist, but they are few and far between. And certainly, there are legions of lobbyists, think-tankers, and academics who would be only too glad to take a job and subvert his program.”

Eamonn Fingleton is the author of In Praise of Hard Industries: Why Manufacturing, Not the Information Economy, Is the Key to Future Prosperity (Boston: Houghton Mifflin, 1999).

• Category: Economics, Ideology • Tags: 2016 Election, Donald Trump, Free Trade 
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  1. Pat Buchanan is 80
    Pat Choate, 75
    Ralph Gomory, 86
    Richard McCormack, 75
    Peter Morici, 68
    Alan Tonelson,63

    The rest I can’t find their ages although you can get a hint, for example for Michael Sekora ‘a classified U.S. Defense Intelligence Agency program established in 1983 within the Reagan administration’.

    Would they want/be able to have full time jobs?

  2. Dan Hayes says:

    Very important to have the quantitative naming of the names of well-informed and reliable trade experts such as those that appeared in this article. But there is one notable name missing in action, that of the author.

    • Replies: @Eamonn Fingleton
  3. anonymous • Disclaimer says:

    Clyde Prestowitz is still in the game.

  4. @anony-mouse

    A reply to Anony-Mouse:

    Many of America’s most knowledgeable and trustworthy trade experts are, of course, in their 60s or older, and this point was prominently flagged in my article. But you set up a straw man in suggesting that I am proposing that all these people should be tapped for day jobs. Some on the list could certainly undertake long hours and heavy responsibilities; but even those who are less vigorous can still make major contributions merely as occasional sources of counsel. Ralph Gomory, for instance, may be 86 but that does not gainsay the fact that he is America’s leading trade theoretician. An hour of his time would serve Trump infinitely better than a year of Paul Krugman’s.

  5. @Dan Hayes

    A reply to Dan Hayes:

    If you are suggesting my name should be included in the list, I am flattered but I should make clear I am not a contender. If I were, I would not have undertaken this article.

  6. Tiger says:

    “chief executive of the Nucor steel company, DiMicco fought many trade battles and is an expert on East Asian dumping.”

    Was he victimized by dumping or simply going up against competitors who were providing a better value product (cheaper and of comparable or better quality)? Because of the tendency of CEOs to conjure up ways of not having to compete, I am going to assume the latter unless it can otherwise be proven.

    • Replies: @Big Bill
  7. Anonymous • Disclaimer says:

    Pace the Economist and its compulsion to belittle the Trump phenomenon, his attitude to allies is no way contradictory.

    Of course there’s a contradiction. America’s postwar foreign policy is fundamentally based on its military presence in Europe and Asia in exchange for the carrot of open markets for exporters. Without the carrot, there’s no reason for Germany or Japan not to remilitarize or seek rapprochement with Russia and China, which would reduce the US to a regional power.

    • Replies: @Eamonn Fingleton
  8. @Anonymous

    A reply to Anonymous:

    In claiming that there was a contradiction in what Donald Trump said on Wednesday, you seem to suggest he somehow is in sympathy with America’s postwar foreign policy. Far from wanting to perpetuate that highly extravagant and intellectually flawed policy, Trump wants to end it. Instead he wants the allies (1) to pay for their own defense and (2) to honor their trade agreements with the United States. Not only is there no contradiction in Trump’s policy but it is little more than plain commonsense.

    • Replies: @Anonymous
  9. Anonymous • Disclaimer says:
    @Eamonn Fingleton

    That’s the contradiction. He’s invoking prewar “America First” isolationism in which the US was limited to regional hegemony at best, while at the same time invoking postwar America’s superpower position and promising a return to postwar “strength”.

    Without the carrot of export markets and the stick of US military presence, why wouldn’t a remilitarized Germany just dominate Europe or seek rapprochement with Russia, effectively removing the US from the European beachhead of Eurasia and reducing the US to a regional power? The same with respect to Japan and Asia.

  10. fnn says:

    Without the carrot of export markets and the stick of US military presence, why wouldn’t a remilitarized Germany just dominate Europe or seek rapprochement with Russia, effectively removing the US from the European beachhead of Eurasia and reducing the US to a regional power? The same with respect to Japan and Asia.

    Germany is of course busy committing suicide. Meanwhile, neocons/Russophobes contradict themselves by ridiculing Russia as a declining power with a tiny economy dependent on natural resource extraction while at the same time characterizing it as a major threat to Europe. But you may be right about East Asia.

  11. I’ve read the great “Economist” for over a decade. It provides insight but has become unhinged as its economic theory, promoting empire, open borders, and free trade has proven stupid, so it now attacks Trump for exposing it. I recently let my print subscription end.

    May I suggest another old guy — Paul Craig Roberts

    His recent short summary of American economics is brilliant:

    Although he is skeptical of Trump’s motives, which is reasonable caution.

  12. TG says:

    Excellent points.

    But here is one thing to consider: underneath the level of politically-appointed whores, our government still has a large number of very smart and patriotic professionals in government. They have been suppressed and cowed and forced to toe the party line, but they are still there. It is possible (only possible, mind you) that a president Trump, if he housecleans the sellouts, might find more than few very smart and very capable trade experts who would be THRILLED to once again work in the national interest.

  13. Wally says: • Website


    The old “isolationism” straw man.
    There’s nothing ‘isolationist’ about reciprocity in trade and expecting our allies to pay their way.

    And what’s wrong with Germany seeking rapprochement with Russia?
    What’s wrong with the US or anyone else for that matter seeking rapprochement with Russia? Trump sees no problem there.

    You seem to think the US military is going seize any government of the major powers which decides to do their own bidding in international relations. Won’t happen. In fact many occupied countries want US troops out, not in.
    The US military is a paper tiger except against defenseless Third World countries. That’s obvious to everyone.

    It’s the US taxpayers cash that the military throws around in numerous countries that some fine attractive, not the US troops, weaponry, or faux ‘security’.
    Trump is on to all of this, pay attention.

    • Replies: @Anonymous
  14. Clyde says:

    Mr Fingelton. What Donald Trump must do is appoint some of the fair trade seniors that you mention in whatever capacity they can serve. Full time or as consultants. They will know the dedicated young people who can work under them. Some will have to learn on the job which is not a problem when you are young and non-cynical.
    For a long time I have been disgusted by the buzzards in the Office of the United States Trade Representative, starting with the weird looking alien life form Zoellick.

  15. Anonymous • Disclaimer says:

    A “remilitarized Germany”, assuming Germany could somehow come up with the money to remilitarize, would be either friendly to the U.S., in which case great! they are finally pulling their weight. Or hostile to the U.S. — plausibly so if its Arab and Pak Muslim population continues to swell at the rapid pace of the past twelve months, but in that case the threat to the U.S. would be low, as an Arabized Germany would have much lower human capital on average than before and Germany would be soon turning into the same kind of sh*thole society the Muslims were leaving behind before they invaded Germany.

    Either way, not an existential threat to the U.S.

  16. Quercus says:

    1) why shouldn’t Germany seek rapprochement with Russia and 2) why shouldn’t the US be reduced to a regional power? If your answer is because we’re the Exceptional nation which has answers to all problems my response would be “nonsense”. We’re doing a piss poor job of managing our own internal affairs so how could anyone possibly believe we can manage the affairs of others.

    • Agree: Bill Jones
  17. @Carlton Meyer

    A reply to Carlton Meyer:

    Thank you for correcting my oversight on Paul Craig Roberts. I have not seen him in many years but he ranks with Ralph Gomory in the clarity and incisiveness of his critique of trade and his commitment to the US national interest is rock-solid.

  18. CanSpeccy says: • Website

    If Trump wants someone with a real understanding of trade policy and economic development he should call on Erik Reinert, author of How Rich Countries Got Rich, and Why Poor Countries Stay Poor, who is an outstanding scholar rusticated to Estonia for his timerity in pissing on the Washington Consensus.

  19. The Richman scaled tariff concept has merit, and Trump might be well advised to consult with its proposers:

    • Replies: @Eamonn Fingleton
  20. Anonymous • Disclaimer says:

    I’m not using “isolationism” pejoratively or concerned with what’s “right” or “wrong” here. I’m trying to examine these states as competing entities with different geopolitical interests. I don’t have a problem with you expounding on your personal or ideological preferences with respect to international affairs, but try not to do so in direct reply to my comments, as it tends to derail and muck up the thread.

  21. Anonymous • Disclaimer says:

    Mr. Trump should immediately recruit the brilliant young economist Ian Fletcher–the author of Free Trade Doesn’t Work: What Should Replace It and Why, The Conservative Case Against Free Trade, and other works. Fletcher shatters many myths–such as the claim that free trade is always beneficial to both sides (actually there are often winners and losers), the idea that globalization is inevitable (it isn’t, it is a choice), and that tariffs are something evil (a tariff is simply a tax and other taxes can be reduced to keep overall taxation the same). Fletcher shows how Alexander Hamilton saw that for the US to build its industry it needed to be protected. And tariffs accomplished this, allowing the US to become the world’s leading economy. But free trade has been undoing this and allowing industry after industry to be taken away by competitors. Fletcher shows that future innovations come from the place where products are made–so that if a production is moved overseas, future products will also be lost. Contrary to popular belief, there are literally hundreds of forms of protectionism and our competitors use many methods to insure that American products don’t penetrate their markets, while their own products rake in trade dollars from America. If America is to have a future as a strong and prosperous nation, we must stop the economic bleeding of huge trade deficits. Fletcher understands what works and anyone concerned about the future of our country needs to read his books.

    • Replies: @Anonymous
  22. Leftist conservative [AKA "Make Great Again"] says: • Website

    fingleton, trump ought to offer you a position in his cabinet…I am sure trump has read some of your stuff…your writing intrigued me years ago, although I am not totally on board with trump’s positions on trade, or with yours.

    I like being able to buy cheap computerized devices and etc from china, cheap clothing…etc…I can buy cheap eyeglasses on line that are made in china, thus busting the eyeglasses cartel here in america. That’s a good thing, right?

    are those jobs in textiles and computer assembly really that great, anyway?

    But as you have pointed out for years, the really good jobs in manufacturing are in making parts from ore and making heavy equipment, as opposed to mere assembly. Bring back steel makers and parts manufacturing and heavy equipment, etc, but computers and clothing and….cheap chinese eyeglasses to order? Let it stay over there, in my opinion.

    • Replies: @Eamonn Fingleton
  23. edNels [AKA "geoshmoe"] says:

    Trade policy has been forgotten, as Wall St. Financialized everything.

    Similar to the way the old Stock Brokers would generate their income by ”Churning Accounts”, calling up clients to get them to either sell or buy, change out of whatever holdings that they may have, that might be doing fine, because every time there is a buy or sell, the broker/brokerage gets commission. He make \$ no matter!

    Similar because, good old companies that wanted to remain loyal to the country, and to their employees and pensioners, were made a target by Financial Warfare. Acquisition by different means that sought to drive take over and destroy native businesses (Spear companies… hahaha) No! just the real companies that were on the level, were targeted because of the unbridled lust of Wall street predators, with ZIRP! at their damned service!

    ZIRP… zero int. rate percent for these crooks. They got into the gov. to make it blind to the problem. This is typical parasite modus operandi in biology.

    Financializers are an occupier, a destroyer. Really something like to those SiFi aliens that come to Earth to absorb all the resources so they can thrive, like some big Blob or some shit.

    It’s time to stop it with Trade rules. Tariffs, and if that doesn’t work, scale back down to a sovereign country again and etc. etc. including some serious ”jawboning” of the crooks, before they are… ”taken to the woodshed… !”

    A monumental task. as we choke on the fumes from the freighters burning the dirty fuel.
    Bunker fuel is a convenient place to get rid of the bad stuff, but the air is getting mighty dirty… world wide. So stop it.

  24. @Leftist conservative

    A reply to Make Great Again (Are you allowed to use a moniker like this? There should be a law against it!):

    I refer to this passage in your contribution:

    But as you have pointed out for years, the really good jobs in manufacturing are in making parts from ore and making heavy equipment, as opposed to mere assembly. Bring back steel makers and parts manufacturing and heavy equipment, etc, but computers and clothing and….cheap chinese eyeglasses to order? Let it stay over there, in my opinion.

    Although you profess to espouse the case I have made for advanced manufacturing, you seem to have completely misunderstood what advanced manufacturing is. I am not sure what you mean by making “heavy equipment” or “parts from ore” but I have a feeling that for the most part whatever you have in mind does not constitute advanced manufacturing. By contrast (and pace your across-the-board dismissal of the computer industry as mere assembly activities), many areas of electronics, such as making advanced components, highly rarefied materials, and the manufacturing equipment needed to make such components and materials, count as advanced manufacturing. The key point is that the jobs involved should be both highly capital-intensive and highly knowhow-intensive (in the latter case, the knowhow is typically incorporated by top engineers into semiautomated production processes that are honed through years of learning by doing).

    Please consult my books if you want to be accurate in presenting my analysis in this forum. I suggest moreover that you use direct quotes rather than attempting to paraphrase points that often require some precision in the use of language.

  25. Anonymous • Disclaimer says:

    What about Peter Navarro? Navarro (Ph.D., Economics, Harvard University) is a Professor of Economics at U. Cal-Irvine. Navarro is an expert on trade with China (wrote many books on subject) and has been on business networks saying good things about Trump’s ideas on trade. He a Republican too (not that that should be a disqualifier as some of Trump’s big supporters, e.g., Carl Icahn, Steve Wynn, are not).

  26. Leftist conservative [AKA "Make Great Again"] says: • Website
    @Eamonn Fingleton

    well, I stand corrected on the issue of what exactly constitutes ‘advanced manufacturing’ and should thus be moved back to the USA if possible. That’s fine with me, whether it means making parts or whatever….but won’t you agree that for some sort of things, such as computers and similar devices, their value is so great to consumers that the price should be as low as possible because cheap prices in such devices puts a lot of economic power in consumer hands.

    And other issues, such as the healthcare extortion scheme ongoing in the USA, shouldn’t we be making it as easy as possible for americans to go overseas and get cheap medical treatment? And likewise, what about cheap medical/healthcare devices that can be obtained from overseas?

    I am onboard with moving advanced manufacturing back to america, but in some cases americans are being held hostage to high prices via cartels in america, such as healthcare and related areas.

  27. iffen says:

    One should not overlook a simple solution to the problem of someone being to old to get the job done. Go to that person and tell them that you need them. If they tell you that their health and age does not allow them to accept, then ask them to name a younger “you” and get that person.

  28. @CanSpeccy

    A reply to CanSpeccy:

    Erik Reinert’s book is, as you suggest, an important corrective for American globalists and as such deserves a place on Donald Trump’s reading list.

    • Replies: @CanSpeccy
  29. iffen says:
    @Eamonn Fingleton

    I suggest moreover that you use direct quotes rather than attempting to paraphrase points that often require some precision in the use of language.


  30. @Crawfurdmuir

    A reply to Crawfurdmuir:

    As you point out, the Richman family — Raymond, Howard, and Jesse — have done important work on trade. It certainly deserves Donald Trump’s attention and he should note in particular their quotation from the late Andrew Grove on the fact that, in its indiscriminate outsourcing, the United States is committing economic suicide.

  31. Anonymous • Disclaimer says:

    The pillar of America’s postwar geopolitical “strength” and superpower status that Trump invokes has been its domination of Europe and Asia. It’s hard to see Trump reversing this mainstay of postwar American foreign policy considering that Trump is not very ideological or committed to isolationism on principle and is concerned with restoring or maintaining American strength.

    ” The European Union always was a CIA project, as Brexiteers discover ”

    Brexiteers should have been prepared for the shattering intervention of the US. The European Union always was an American project.

    It was Washington that drove European integration in the late 1940s, and funded it covertly under the Truman, Eisenhower, Kennedy, Johnson, and Nixon administrations.

    While irritated at times, the US has relied on the EU ever since as the anchor to American regional interests alongside NATO.

    There has never been a divide-and-rule strategy.

    The eurosceptic camp has been strangely blind to this, somehow supposing that powerful forces across the Atlantic are egging on British secession, and will hail them as liberators.

    The anti-Brussels movement in France – and to a lesser extent in Italy and Germany, and among the Nordic Left – works from the opposite premise, that the EU is essentially an instrument of Anglo-Saxon power and ‘capitalisme sauvage’.

    France’s Marine Le Pen is trenchantly anti-American. She rails against dollar supremacy. Her Front National relies on funding from Russian banks linked to Vladimir Putin.

    Like it or not, this is at least is strategically coherent.

    The Schuman Declaration that set the tone of Franco-German reconciliation – and would lead by stages to the European Community – was cooked up by the US Secretary of State Dean Acheson at a meeting in Foggy Bottom. “It all began in Washington,” said Robert Schuman’s chief of staff.

  32. SteveM says:

    As an aside, Ralph Gomery formulated “cutting plane” algorithms for linear programming (LP) and mixed integer linear programming (MILP) problems back in the 1950’s.

    Those seminal insights create massive economic value in real world applications.

    The guy’s a genius…

  33. CanSpeccy says: • Website
    @Eamonn Fingleton

    And while Andy Grove is no longer around to advise, Trump must read (he probably already has) Grove’s brilliant 2010 essay: How America Can Create Jobs.

  34. Anybody looking for expertise concerning a sane nationalist trade policy should be looking to hire a few sons of Nippon.

    • Replies: @Clyde
  35. @Eamonn Fingleton

    The ultimate in value added is in making the machine tools that make the machine tools.

    To get a 1/1,000″ tolerance on the latter you need at least 1/10,000″ on the former.

    It’s what Switzerland, Germany and Austria do.

  36. Isn’t a government policy just an informal variant of the central planner’s five-year plan?

    A conga line of failed expectations.

  37. Anonymous • Disclaimer says:

    Trump’s economic proposals seem to be standard Keynesianism: massive fiscal stimulus and low taxes to increase aggregate demand, coupled with trade policy fashioned to limit “demand leakage”, which is how Keynesianism conceives of trade deficits. This was general American policy until around 1980, which is why the US maintained relatively balanced trade until the late 70s. Beginning in the 80s, US policymakers generally abandoned standard Keynesianism and stopped caring about “demand leakage” i.e. trade deficits. Furthermore, supply side economics replaced traditional Keynesianism in the 80s, and because supply-side economics is focused on promoting the supply side of the economy and mitigating inflation, trade deficits were no longer seen as the negative they had been under Keynesianism.

    About a month ago, I urged the presidential candidates to explain what policies and leadership they would like to see at the Federal Reserve. So I was glad to see Trump address Fed-related issues in an interview with Fortune magazine last week.

    His key comments: “We have to rebuild the infrastructure of our country. We have to rebuild our military, which is being decimated by bad decisions. We have to do a lot of things. We have to reduce our debt, and the best thing we have going now is that interest rates are so low that lots of good things can be done that aren’t being done, amazingly.”

    I read this as calling for two forms of fiscal stimulus. One is more spending, especially on the military and on infrastructure such as roads and bridges. The second is maintaining low taxes despite high levels of government debt (in other remarks, Trump has favored tax reduction).

  38. Clyde says:
    @Bill Jones

    Anybody looking for expertise concerning a sane nationalist trade policy should be looking to hire a few sons of Nippon.

    Korea too. I doubt you can find much free trade ideology being taught in the economics departments of universities of Korea and Japan.

    Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism Paperback – December 23, 2008 | 123 customer reviews at Amazon
    Author Ha-Joon Chang who was born in South Korea.
    Ha-Joon Chang is a South Korean institutional economist specialising in development economics. Currently a Reader in the Political Economy of Development at the University of Cambridge, Chang is the author of several widely-discussed policy books.

    Donald Trump could bring in this Ha-Joon Chang guy who also has taught at University of Chicago.

  39. Big Bill says:

    EVERYONE is trying to find ways “not to compete”with the lowest global bidder, particularly when the lowest global bidder uses slave labor.

    I would rather pay an “inefficient” wage to Americans even if it is cheaper (and I doubt that it is) than giving Americans soul-destroying welfare and paying slave wages to foreigners.

    • Replies: @Anonymous
  40. Big Bill says:

    I wouldn’t consider it evil “isolationism”. I consider it “learning from our Jewish elder brothers”.

    Is it “isolationism” when Israel (rightly) follows an “Israel First” policy? Of course not. Don’t be silly.

    It is nationalism, which (as the Jewish Nation teaches us by its stellar example) is a wonderful thing!

    Frankly, I am happy to settle for “regional hegemony” rather than “global hegemony” any day!

  41. big bill says:

    Thank you for your thoughtful essay. I have been concerned about Trump’s first tier of advisors as well.

  42. woodNfish says:

    In the nature of things, such experts are better left unnamed…

    No, it is better to have these traitors exposed for what they are. The shadows are what have allowed these cockroaches to exist. It is past time for a purge.

  43. woodNfish says:
    @Carlton Meyer

    The Economist is leftist crap, and far from “great”. Those morons can’t see past their ideology. There does not exist a socialist program they wouldn’t champion.

    • Replies: @CanSpeccy
  44. Anonymous • Disclaimer says:
    @Big Bill

    You wouldn’t be paying the wage yourself. I think what you mean is that you would rather have a policy of consumers subsidizing the wage level.

    • Replies: @CanSpeccy
  45. woodNfish says:

    How do you know Trump hasn’t already read it. Also, Trump runs a global business, as Trump has said repeatedly, he has more practical, real world foreign trade experience than any other candidate. Hillary Clinton’s foreign trade experience is limited to selling off national interests in return for large bribes. That is a fact.

    • Replies: @CanSpeccy
  46. CanSpeccy says: • Website

    I think what you mean is that you would rather have a policy of consumers subsidizing the wage level.

    Your preference being, what? That consumers be taxed to provide welfare for the unemployed? Or would you have the unemployed starve?

    • Replies: @Anonymous
  47. CanSpeccy says: • Website

    How do you know Trump hasn’t already read it.

    If you read what I said properly you would have seen that I did not suggest that Trump had or had not read anything. I suggested he might call on Erik Reinert, seemingly one of the Western world’s few realist economists, for advice.

    • Replies: @woodNfish
  48. CanSpeccy says: • Website

    The Economist is leftist crap

    The Economist is crap, agreed, which is presumably why they are offering subscriptions currently at 91% off.

    But it is certainly not leftist (owned by the Cadbury, Rothschild, Schroder, Agnelli and other family interests plus staff such as senior editor and crazed Russophobe and Estonian citizen, Edward Lucas). It is a mouthpiece for the Money Power, intent on the destruction of the sovereign nation state for the benefit of the global corporations that will rule through subordinati0n of nation states to so-called trade agreements, which are in fact, instruments for the surrender of national sovereignty.

    • Replies: @Anonymous Nephew
  49. Anonymous • Disclaimer says:

    I don’t have a strong preference at the moment. I’m not really a fan of welfare or subsidies to labor and industry as make work schemes. I am in general a fan of federalism and think that these issues should be more explicitly formulated and decided by people directly in states and localities. States that wish to implement jobs programs via subsidies to labor and business should be able to put it to a vote and decide to do so. Others that would have rather have welfare should be able to decide for themselves. This would allow the various costs and benefits to be explicitly discussed and decided upon, rather than obscured as they tend to be today.

    • Replies: @CanSpeccy
  50. CanSpeccy says: • Website

    I take it you are undecided as to whether there should be welfare for the unemployed or job subsidies to ensure that everyone who needs to is able to earn a living wage (i.e., not whether the unemployed should be left to “die in the street”). In which connection, your idea of leaving the decision to the public is probably not as crazy as leaving it to the experts, i.e., those Nobel Prize winning economists who think Ricardo’s more or less nonsensical theory of comparative advantage is the last word on international trade and justifies policies that destroy jobs wholesale and reduce tens of millions of Americans to poverty.

    • Replies: @Anonymous
  51. Anonymous • Disclaimer says:

    Personally, I’m more a fan of basic income than welfare or labor and industry subsidies, which are ultimately public and private sector rent-seeking schemes, respectively. And I support the basic income on grounds of principle, rather than as a means to help the unemployed or to prevent them from dying on the street.

    I’m a strong proponent of federalism and think these issues should be decided by states and localities.

  52. woodNfish says:

    You did say write that. Maybe Trump will refer to Reinert. Trump is no fool and he understands economics better than any of the dimwits opposing him. I think he knows a great many people who will do well by us. That is my hope anyway.

  53. Anonymous • Disclaimer says:

    Michael Sekora is 58 and still fully in the fight.

  54. @CanSpeccy

    “it is certainly not leftist…it is a mouthpiece for the Money Power”

    But the money power IS leftist as far as social leftism is concerned. Split a society into different interest groups defined by race, sexuality, gender (and now ‘gender identity’) and having divided, rule.

    As someone put it – “you get gay marriage, and we get a ‘flexible labour market’”

    • Replies: @CanSpeccy
  55. CanSpeccy says: • Website
    @Anonymous Nephew

    But the money power IS leftist as far as social leftism is concerned. Split a society into different interest groups defined by race, sexuality, gender (and now ‘gender identity’) and having divided, rule.

    If you are saying that today’s leftists are virtually all agents or dupes of the Money Power intent on leading the people to their own destruction, then we agree.

    I was taking it for granted that a leftist works for the real interests of the people, e.g., as an opponent of their racial submersion through mass immigration, and their impoverishment through globalist trade policies. By that definition, Trump is a leftist (to judge by his rhetoric), unlike the Economist, which advocates policies that have genocidal consequences for the European people, wherever they may live.

  56. LondonBob says:

    Dan DiMicco now advising Trump.

  57. Anonymous [AKA "Nexus789"] says:

    Like all economists there is no real understanding how a national economy drives and generates ‘economic wealth’. His analysis is no different and fails to answer this fundamental question. What is required is an ability to generate a ‘competitive’ national economy that continually, in a resource constrained and competitive world, out-competes other nations. This is the only way to generate industrial capacity, jobs and balance trade. Anything else is a fools errand. This is done via acquiring, manipulating and managing technology more effectively that competitors. Things like R&D/Innovation, funding, training/skills, tax structures, etc. all flow from this capability. (See Sekora and Project Socrates –

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