Friday, July 19, 2019

Overcoming Economy Is Big Hurdle For 2020 Democrats




Despite President Trump’s unpopularity, he does have one big thing going for his re-election campaign. If history is any indicator, the Democrats may have a difficult time overcoming the president due to the continued strength of the economy.

Axios pointed out earlier this year that every incumbent president since FDR who has avoided a recession in the runup to an election has been re-elected. On the surface, that would appear to be good news for Donald Trump, who has presided over an economy that grew 2.2 percent in 2017 and 2.9 percent in 2018 and a consistently low unemployment rate. Voters have typically rated Trump’s handling of the economy much better than his overall performance as president.

A recent focus group of swing voters, also reported by Axios, showed that many voters who switched from Obama to Trump, liked Trump’s economic policies, including his tariffs, even though they were put off by his behavior.

“His antics, mannerisms, and personality I could do without,” a member of the focus group said, “but I feel like there are a lot of good things happening in the country that people don’t like to admit.”

“Our economy would have to really crash for me to vote against him,” he added.

At only 12 participants the focus group’s size was too small to represent a statistical sample of voters, but their responses do elicit a number of questions. The most obvious is why, when the economy is seen as his strong point, Donald Trump chooses to focus on immigration and picking fights with low-level Democrats, strategies that seem to be hurting his standing with most of the electorate.

Headlines recently reported that the president reached an all-time average approval rating. The buried lede was that Trump’s all-time high was an embarrassing 42.7 percent. A comparison with the approval rating of other presidents (going back to Truman) at this point in their term by FiveThirtyEight finds Trump’s approval below every other president except Jimmy Carter, who went on to lose his re-election campaign.

Interestingly, George Herbert Walker Bush, the other incumbent who failed to win re-election, had a 70 percent approval rating at this point in his presidency. In 1991, the first Bush was riding high after winning Desert Storm, the first Iraq war, but a recession from July 1990 to March 1991 sparked by high gas prices after Iraq’s invasion of Kuwait and interest rate hikes by the Federal Reserve led to his defeat the following year. Two other factors, Bush’s decision to raise taxes despite a promise of “Read my lips: no new taxes” and a third-party challenge Ross Perot, also contributed to the election of Bill Clinton in 1992.

The second important point from the focus group is that if the economy falters swing voters could quickly abandon President Trump. The most serious threat to the Trump economy is something that his supporters view favorably: his trade wars.

Already, there signs that the Trump economy is not as strong as advertised. A growing number of economists see the potential for a recession before the election. Fortune notes that “the greatest downside risk is trade policy and increased protectionism.” This is especially true since trade talks between the United States and China, one of our largest trading partners, have been unproductive.

The concern about a recession is echoed by corporate financial officers surveyed by Duke University. CNN reported that almost 70 percent of CFOs cite the trade war and a shortage of skilled workers, which is exacerbated by President Trump’s restrictive immigration policies, as reasons that there will be a recession before the end of 2020.

The recession jitters are not unfounded. New data from the Federal Reserve released this week shows that US manufacturing is already in a recession after six consecutive months of declining production. The manufacturing slump is a direct consequence of the trade war. The decline in manufacturing spells trouble for Trump’s hopes of reclaiming the Rust Belt states that pushed him to victory in 2016.

There are other indications that Trump is in trouble on the economy as well. Despite the backing of participants in the focus group, a recent poll from The Associated Press-NORC Center for Public Affairs Research found that Trump’s standing on the economy may already be slipping. The poll showed that majorities now disapprove of Trump’s handling of the economy in general as well his positions on taxes and trade negotiations. While two-thirds said that the economy was good, only 17 percent believed that they got a tax cut and only 15 percent saw the tariffs as beneficial.

As recession fears mount, Donald Trump faces a situation similar to the one that dashed the electoral hopes of the first President Bush. Trump’s tariffs, which are literally tax increases on trade, have offset the economic stimulus of the 2017 tax reform and are acting as a drag on the economy. Likewise, Trump may well have a strong third-party challenger who can siphon the votes of disaffected Republicans. If the economy slows to a recession, the situation will be very similar to the one that took down a much more popular president.

The flip side is that the Fed has indicated that it will cut interest rates in the near term. The expected cuts may goose the economy enough to drag Trump across the finish line.

Finally, there is the possibility that, as his supporters often say, that Donald Trump has created a new dynamic in Washington but not necessarily the way that they mean. Several polls over recent months have indicated that more than half of voters refuse to support President Trump for re-election for any reason. The aversion to Trump’s behavior, which one focus group member said is not “where it should be for a president,” may be strong enough that even a good economy will not assure his re-election.

With 16 months to go until the election and with no Democratic candidate holding a lock on the nomination, there are too many variables to predict how the election will turn out. Democrats should be cautious in their expectations about taking on an incumbent in a good economy. Trump’s economy might well sink into recession before the election, however, and, even if it remains strong Trump may have alienated so many voters that he loses anyway.

President Bush’s experience should be a lesson for President Trump. Clinton’s mantra during the campaign was “it’s the economy, stupid” while Bush allowed himself to be distracted. Just as importantly, Bush laid the seed of his own defeat with his tax increase, without which, the 1990 recession and the sluggish growth that followed might never have happened. Trump’s tariff taxes, which are slowing the economy, his focus on his unpopular immigration policies, and his unpresidential behavior may be the seeds of his own defeat.

Originally posted on The Resurgent

Thursday, July 18, 2019

Nunes 'Expects Worst' From Mueller Testimony



Rep. Devin Nunes (R-Calif.), the ranking Republican on the House Intelligence Committee, says that he “expect[s] the worst” when former special counsel Robert Mueller testifies before Congress next week. Speaking to Fox News, the California congressman said that he expects Mueller to show up for the testimony and hinted that what he tells Congress could be damaging to President Trump.

“I really expect the worst, because Bob Mueller does not have to show up,” Nunes said. “So, he's doing this on his own free will. That tells me the last time he operated on his own free will, everybody forgets, (Attorney General William) Barr came out with a memo, was very clear about the decisions that he had made, and then a few days later, Mueller decided on his own to go out and hold a nine-minute press conference.”

“So I am very concerned,” Nunes continued. “I think we should expect the worst because he only has to say a couple [of] things and the rest of the media -- not saying you here at Fox, but 90 percent of the media will take one little phrase and run with it and try to run towards impeachment.”

“And look, I know there was no collusion and I know there was no obstruction, so in that sense it was fine,” Nunes added. “However, there shouldn't -- this whole investigation was an obstruction of justice trap.”

Nunes fails to point out that avoiding the “obstruction of justice trap” was a simple matter. All the president had to do was not attempt to obstruct the ongoing investigation. Per the testimony of Trump Administration officials contained in the Mueller report, however, the president did not meet this low bar.

Since the Mueller report was released last April following a summary version by Barr in March, Republicans have claimed that Mueller found no collusion and no obstruction. However, Nunes’ uneasiness with Mueller’s testimony indicates that the claim is on shaky ground. Mueller’s previous public statement in May seemed explicitly tailored to counter Republican claims that the report had exonerated the president.

“If we had had confidence that the president clearly did not commit a crime, we would have said so,” Mueller pointed out in both the written report and his public statement. “We did not, however, make a determination as to whether the president did commit a crime.”

Not making a determination is not the same thing as an exoneration.

In his statement, Mueller went on to explain why his team did not make a determination as to whether President Trump broke the law, saying, “Under long-standing department policy, a president cannot be charged with a federal crime while he is in office…. Even if the charge is kept under seal and hidden from public view, that, too, is prohibited.”

“A special counsel’s office is part of the Department of Justice, and by regulation, it was bound by that department policy,” Mueller continued. “Charging the president with a crime was therefore not an option we could consider.”

Mr. Mueller will testify in open session on July 24 before the House Judiciary and Intelligence Committees. His testimony was originally scheduled for July 17 but was moved in order to give members of both parties more time for questioning. It is also possible that the change could have been due to the fact that President Trump had scheduled a rally in North Carolina for the same day, which could have distracted from Mueller’s testimony.

At this point, no one knows what Mueller will say in his testimony, but Republicans are obviously nervous that he will undercut their claims that President Trump did not obstruct justice in his attempts to block the Russia investigation. A question that is certain to be asked is whether Mueller would have indicted Mr. Trump for his actions if he had not been president. If Mr. Mueller answers directly, it could do more serious damage to President Trump’s already shaky reputation.

Another likely line of questioning involves Mueller’s letter to Barr contradicting his public characterization of the report. In the private letter sent after the release of Barr’s summary but before his decision to release a redacted version of the report, Mueller said that the public summary “did not fully capture the context nature, and substance of this Office’s work and conclusions” and that it had led to “public confusion about critical aspects of the results of our investigation.”

The bottom line is that if, as President Trump and Republicans have claimed for the past several months, that the president did nothing wrong then there would be nothing to fear from Robert Mueller’s testimony. The fact that Republicans “expect the worst” from the author of a report that the GOP has claimed exonerates the president should make us wonder how honest Republicans have been in their defenses of the Donald Trump.  

Originally published on The Resurgent

Wednesday, July 17, 2019

Republicans Should Welcome Sanford Campaign




The Republican Party has long been a free-market party. The basic idea of free markets is that when there is competition between vendors, both buyers and sellers benefit. Competition forces sellers to be innovative and efficient and, in return, they have the opportunity to earn profits and market share with a well-run business. Buyers benefit from lower prices and a wider variety of products to choose from. So it is with Mark Sanford’s consideration of a primary challenge against President Trump.

Right now, the Republican Party is a monopoly. For years, I countered liberal claims that there was no diversity on the right by saying that Republicans had diversity of thought while the left largely engaged in groupthink. Today, however, that intellectual diversity is largely a thing of the past. Republican opinion ranges from those who enthusiastically agree with everything that Donald Trump says to those who reluctantly agree with almost everything that Donald Trump says. 

Enter Mark Sanford.

Sanford is a former governor of South Carolina who served from 2003 through 2011. In June 2009, he admitted to an extramarital affair after an unexplained absence in which he had traveled to Argentina to meet his mistress. After his divorce, Sanford staged a comeback and was elected to the House of Representatives where he served from 2013 until this year after being defeated in the Republican primary.

As a congressman, Sanford backed Trump in 2016 but became “one of the president’s most eloquent critics” per the Washington Post. Despite his criticism, FiveThirtyEight noted that Sanford had one of the strongest pro-Trump voting records in the House. He lost the 2018 Republican primary election after Trump attacked him on Twitter and endorsed his opponent, who ultimately lost the seat to a Democrat in the general election.


Sanford is likely to be a stronger contender against Donald Trump than William Weld, the former Massachusetts governor and Libertarian candidate who has already launched a primary challenge against President Trump. Weld, who has so far run a stealth campaign, is a fiscal conservative but holds views on social issues that are outside the Republican mainstream. Sanford, on the other hand, has a 93 percent rating from Freedom Works. Conservative Review lamented his primary loss, noting that he was defeated because he had opposed President Trump’s trade war, allowing his opponent to label him a “Never Trumper” despite his strong pro-Trump voting record.

Sanford’s primary loss in 2018 is emblematic of the current state of the GOP. No matter how strong a candidate’s conservative record, any criticism of President Trump will get them labeled as a “Never Trumper,” which is the trendy new way attack a candidate’s character that has apparently replaced “RINO” since Trump, a long-time Democrat has assumed control of the Republican Party. As I said earlier, intellectual diversity is a rarity in today’s Republican Party.

Even though Sanford will have an uphill battle against the incumbent president, his primary campaign should be welcomed by Republicans. After Trump’s offensive tweets over the weekend, it should be obvious that the president has a problem with moderates and minorities. A USA Today/Ipsos poll found that 68 percent of Americans found Trump’s tweets offensive and 2018 exit polls showed that the GOP had lost ground among virtually every demographic. Further, the president’s trade war has eroded support in farm states that are typically solidly Republican as well as the Rust Belt states that propelled Trump to victory in 2016.

Mark Sanford gives Republicans a choice. If Sanford decides to run, Republican voters can opt between a candidate that preserves the best of Trump’s policy but who does not have the baggage of off-the-wall comments and the tariff war, which has almost completely offset the benefits of tax reform.

The problem for Sanford is that Republicans don’t necessarily want a conservative who is not controversial. A new Reuters poll found that Republican support for Trump increased by five points after his weekend tweetstorm. A March poll from Morning Consult found that only 20 percent of Republican primary voters said that they wanted a candidate other than Donald Trump.

Nevertheless, a Sanford candidacy would offer conservatives in the Republican Party an alternative to Trump. In contrast to 2016, when Republicans reluctantly accepted Trump in the general election out of necessity to defeat Hillary Clinton, if the party voluntarily embraces the president in the 2020 primary it will mean that Trump has fundamentally changed the nature of the Republican Party, perhaps irrevocably, from a conservative party to something else. Republican voters should at least have a choice in the direction of their party.

The Republican resistance to any challenger to Trump is indicative of the president’s weakness. The Republican establishment realizes that President Trump’s support is likely to be both shallow and fragile. They fear that a primary battle that shines the light on Trump’s personal flaws and poor record of achievement outside of tax reform and judicial appointments could expose the fundamental differences between the base that follows Trump’s personality and the traditional Republican conservatives who are more concerned with a principled platform. The illusion of party unity depends on no one questioning the president.

On the other hand, with Republican fortunes are tied to an increasingly unstable incumbent and Republican luminaries such as Rush Limbaugh embracing trillion-dollar deficits and proclaiming that fiscal conservatism is a thing of the past, the debate over the future of the Republican Party is not only necessary, it is long overdue. Reintroducing diversity of thought and holding an honest and serious debate about President Trump’s character and record can only strengthen a party that has been hemorrhaging voters since 2016. For that reason, conservatives should welcome a campaign by Mark Sanford even if it ultimately fails.



Originally published on The Resurgent

Republicans Should Welcome Sanford Campaign




The Republican Party has long been a free-market party. The basic idea of free markets is that when there is competition between vendors, both buyers and sellers benefit. Competition forces sellers to be innovative and efficient and, in return, they have the opportunity to earn profits and market share with a well-run business. Buyers benefit from lower prices and a wider variety of products to choose from. So it is with Mark Sanford’s consideration of a primary challenge against President Trump.

Right now, the Republican Party is a monopoly. For years, I countered liberal claims that there was no diversity on the right by saying that Republicans had diversity of thought while the left largely engaged in groupthink. Today, however, that intellectual diversity is largely a thing of the past. Republican opinion ranges from those who enthusiastically agree with everything that Donald Trump says to those who reluctantly agree with almost everything that Donald Trump says. 

Enter Mark Sanford.

Sanford is a former governor of South Carolina who served from 2003 through 2011. In June 2009, he admitted to an extramarital affair after an unexplained absence in which he had traveled to Argentina to meet his mistress. After his divorce, Sanford staged a comeback and was elected to the House of Representatives where he served from 2013 until this year after being defeated in the Republican primary.

As a congressman, Sanford backed Trump in 2016 but became “one of the president’s most eloquent critics” per the Washington Post. Despite his criticism, FiveThirtyEight noted that Sanford had one of the strongest pro-Trump voting records in the House. He lost the 2018 Republican primary election after Trump attacked him on Twitter and endorsed his opponent, who ultimately lost the seat to a Democrat in the general election.


Sanford is likely to be a stronger contender against Donald Trump than William Weld, the former Massachusetts governor and Libertarian candidate who has already launched a primary challenge against President Trump. Weld, who has so far run a stealth campaign, is a fiscal conservative but holds views on social issues that are outside the Republican mainstream. Sanford, on the other hand, has a 93 percent rating from Freedom Works. Conservative Review lamented his primary loss, noting that he was defeated because he had opposed President Trump’s trade war, allowing his opponent to label him a “Never Trumper” despite his strong pro-Trump voting record.

Sanford’s primary loss in 2018 is emblematic of the current state of the GOP. No matter how strong a candidate’s conservative record, any criticism of President Trump will get them labeled as a “Never Trumper,” which is the trendy new way attack a candidate’s character that has apparently replaced “RINO” since Trump, a long-time Democrat has assumed control of the Republican Party. As I said earlier, intellectual diversity is a rarity in today’s Republican Party.

Even though Sanford will have an uphill battle against the incumbent president, his primary campaign should be welcomed by Republicans. After Trump’s offensive tweets over the weekend, it should be obvious that the president has a problem with moderates and minorities. A USA Today/Ipsos poll found that 68 percent of Americans found Trump’s tweets offensive and 2018 exit polls showed that the GOP had lost ground among virtually every demographic. Further, the president’s trade war has eroded support in farm states that are typically solidly Republican as well as the Rust Belt states that propelled Trump to victory in 2016.

Mark Sanford gives Republicans a choice. If Sanford decides to run, Republican voters can opt between a candidate that preserves the best of Trump’s policy but who does not have the baggage of off-the-wall comments and the tariff war, which has almost completely offset the benefits of tax reform.

The problem for Sanford is that Republicans don’t necessarily want a conservative who is not controversial. A new Reuters poll found that Republican support for Trump increased by five points after his weekend tweetstorm. A March poll from Morning Consult found that only 20 percent of Republican primary voters said that they wanted a candidate other than Donald Trump.

Nevertheless, a Sanford candidacy would offer conservatives in the Republican Party an alternative to Trump. In contrast to 2016, when Republicans reluctantly accepted Trump in the general election out of necessity to defeat Hillary Clinton, if the party voluntarily embraces the president in the 2020 primary it will mean that Trump has fundamentally changed the nature of the Republican Party, perhaps irrevocably, from a conservative party to something else. Republican voters should at least have a choice in the direction of their party.

The Republican resistance to any challenger to Trump is indicative of the president’s weakness. The Republican establishment realizes that President Trump’s support is likely to be both shallow and fragile. They fear that a primary battle that shines the light on Trump’s personal flaws and poor record of achievement outside of tax reform and judicial appointments could expose the fundamental differences between the base that follows Trump’s personality and the traditional Republican conservatives who are more concerned with a principled platform. The illusion of party unity depends on no one questioning the president.

On the other hand, with Republican fortunes are tied to an increasingly unstable incumbent and Republican luminaries such as Rush Limbaugh embracing trillion-dollar deficits and proclaiming that fiscal conservatism is a thing of the past, the debate over the future of the Republican Party is not only necessary, it is long overdue. Reintroducing diversity of thought and holding an honest and serious debate about President Trump’s character and record can only strengthen a party that has been hemorrhaging voters since 2016. For that reason, conservatives should welcome a campaign by Mark Sanford even if it ultimately fails.



Originally published on The Resurgent

Just Say 'No' To The 'Book Of Trump'




Sometimes Trump supporters are compared to cultists. In many cases, the comparison is unfair, but sometimes, as an outside observer looking in on the MAGA movement, you have to shake your head in amazement. That was the case last week when Miriam Adelson, wife of billionaire Republican political donor, Sheldon Adelson, called for the addition of the “Book of Trump” to the Bible.

In an op-ed for the Las Vegas Review Journal, Mrs. Adelson celebrated President Trump’s pro-Israel policies. In her piece, which stops short of extolling his godly virtues, she compares Trump to Esther, the Biblical queen who saved the Jews from a genocide at the hands of Haman, an evil advisor to the king of Persia.

Noting that Trump is still not widely supported by American Jews, Adelson writes, “Scholars of the Bible will no doubt note the heroes, sages, and prophets of antiquity who were similarly spurned by the very people they came to raise up.”

“Would it be too much to pray for a day when the Bible gets a ‘Book of Trump,’ much like it has a ‘Book of Esther’ celebrating the deliverance of the Jews from ancient Persia?” she asks. “Until that is decided, let us, at least, sit back and marvel at this time of miracles for Israel, for the United States, and for the whole world.”

The answer to that question is, of course, yes. It would be much too much to amend the Bible so that it sings the praises of Donald Trump. The very fact that the question is asked seems to indicate that something is deeply amiss within the Republican Party. There are many reasons why there will never be a Book of Trump, not least of which is that the Old Testament canon was established hundreds of years before the time of Christ. More than that, making Donald Trump the object of holy devotion seems antithetical to the teachings of the Bible.

The consecration of Donald Trump is not limited to Adelson, who is Jewish, but also occurs in evangelical circles as well. I described several months ago how Baptist pastor Robert Jeffress led his church in a “Make America Great Again” hymn and attacked Christians who were not on the Trump train. Likewise, Franklin Graham has called upon Christians to pray for Trump to triumph over his enemies and said that “God was behind the last election.”

In some cases, Trump supporters go beyond equating Trump with Esther or King David and make him equal to Jesus himself. Just ahead of the 2018 election, a billboard in St. Louis pictured Trump with the caption, “The Word became flesh - John 1:14,” a messianic reference to Jesus Christ. The first chapter of John begins with the statement, “In the beginning was the Word, and the Word was with God, and the Word was God.” An ebook on Amazon is titled “Donald 'MESSIAH' Trump: The Man, the Myth, the Messiah?” and asks if the president is the “Last Trump of God.”

The message is also carried forth by many rank and file Trump supporters. If you have ever frequented pro-Trump social media groups, you have probably seen memes like this one depicting Christ guiding President Trump’s hand as he signs documents in the Oval Office or this photo of a Trump supporter wearing a shirt that reads, “Jesus died for you, Trump lives for you.” Some of the social media content is satirical, some is not, and it is often difficult to tell the difference. The tendency of the Trump movement to deify the object of its obsession is so widespread and so transparent that it has inspired articles in GQ and Psychology Today as well as on Christian sites such as Red Letter Christians.

Just last week, a Michigan couple held a MAGA-themed, July 4 wedding in which the groom wore his Marine dress uniform and the bride wore a wedding gown crafted from a “Make America Great Again” flag. Bridesmaids wore red MAGA hats with the exception of the maid of honor, a Democrat who wore a plain red cap instead. While the article does not identify the religious beliefs of the couple, marriages have traditionally been a covenant between man, woman, and God rather than man, woman, and president.

While some on the right have argued that Democrats have become secular and replaced God with quasi-worship of the state or an environmental religion centered on climate change. Now it seems that some Republicans, either because they are either secular themselves and lack a focus for the innate human need to worship God or because they are simply misguided and perhaps Biblically illiterate, have replaced God with Donald Trump.

I am not going to spend time itemizing Donald Trump’s continuing unchristian behavior or rehash the fact that, as recently as the 2016 presidential campaign, Donald Trump was at best a nominal Christian who said he had never prayed for forgiveness and who was simultaneously lying about hush money payments to a porn star with whom he had cheated on his pregnant wife. I am also not going to suggest that every Trump supporter literally worships the president, although some certainly seem to do so.

What I am going to do is point back to the first of the Ten Commandments, “You shall have no other gods before me” (Exodus 20:3). Putting President Trump on par with God and Jesus is literally placing a false god before the real one. Even putting partisan politics ahead of worshipping God is worshipping an idol. Further, Jesus himself warned against false prophets. In his Mount Olivet discourse, Christ said that at the end of the age “false messiahs and false prophets will appear and perform great signs and wonders to deceive, if possible, even the elect” (Matthew 24:24). That day may have come.

As Bobby Azarian wrote in Psychology Today, “No one is infallible, no one is free from bias, and no one is honest all of the time, no matter how hard they may strive,” a statement that echoes the Christian doctrine of the depravity of man, the idea that “all have sinned and fall short of the glory of God” (Romans 3:23).

“When you believe that someone is truly a godsend, you can excuse anything,” Azarian warns. “It all becomes ‘for the greater good.’ And when that happens, it is a slippery slope to gross abuses of power that continuously increase in magnitude.”

If such adoration was aimed at Barack Obama or Hillary Clinton, conservatives and Republicans would rightly ridicule it and those who practice it. The response should be no different because the object of affection of these Trump supporters is a Republican president. No American should bend a knee before a leader of either party and Christians should only kneel to worship Christ. Whether Trump-worship is an actual cult or merely a cult of personality, worship of a president does not bode well for either the Republican Party or the American Republic.


Friday, July 12, 2019

Under Record Spending, The Deficit Is Great Again



A popular meme from a few years ago was based around Heath Ledger’s portrayal of the Joker in the 2008 film, The Dark Knight. In the movie, the Joker contrasts the different reaction to threatening different people.  

“If, tomorrow, I tell the press that, like, a gang banger will get shot, or a truckload of soldiers will be blown up, nobody panics, because it's all 'part of the plan,'” Ledger’s Joker opined, “But when I say that one little old mayor will die, well then everyone loses their minds!”


These days the deficit is a lot like that.

Currently, it’s easy to imagine (as I memed on my Facebook page) the Joker saying, “A Democrat runs a trillion dollar deficit and everyone loses their minds; a Republican does it and no one cares.”

The Treasury Department announced yesterday that the federal budget deficit for the fiscal year to date was 23 percent higher than for the same period last year. The deficit for the current fiscal year, which began last October, stands at $747.1 billion and is forecast to top $1 trillion by the end of the fiscal year.

As some Republicans have noted, the 2017 tax reform bill was followed by record-high federal revenues, but this was not enough to prevent the massive deficit for two reasons. The first reason is that federal spending also reached a record high, $3.36 trillion for the period. Per the Office of Management and Budget, federal spending has increased dramatically under President Trump. In 2016, federal outlays were $3.852 trillion and this year the government is expected to spend $4.529 trillion.

Increased spending is only half the equation, however. While federal revenues are at a record high, they have grown at a slower rate than federal spending. This is due in large part to tax reform. While tax receipts did increase after tax reform, they fell far below the Congressional Budget Office projection. The OMB tables show flat revenues between 2017 and 2018 when tax reform took effect, followed by a modest increase projected for 2019.

In 2017, I saw corporate tax reform as necessary to keep American companies competitive in a world economy where the US corporate tax rate was among the highest in the world. However, President Trump’s decision to launch numerous tariff wars in the wake of tax reform has almost totally offset the benefit of the lower income tax rates, resulting in sluggish growth and flatter tax revenues. In any case, the dramatic increases in federal spending, including billions to aid farmers hurt by the unnecessary and ill-advised trade wars, was the wrong policy prescription after a tax cut.

Under President Obama, Republicans took a hard line on the deficit and the federal debt limit. Speaker John Boehner, much maligned by conservatives, used the sequester to cut federal spending in real dollars, not merely reducing the amount of increases. Increases to the debt ceiling were paired with cuts to spending. The OMB data shows that federal outlays declined in 2012 and 2013. One must look back to the Eisenhower Administration to find similar spending cuts in consecutive years.

Now, as the government approaches the debt ceiling yet again, there is no sign of fiscal restraint from the Trump Administration. Mr. Trump’s proposed budget for 2020 is the largest ever at $4.75 trillion. In March, Treasury Secretary Steven Mnuchin asked Congress to pass a clean bill, one with no spending constraints, to increase the debt ceiling. Earlier this week, White House Economic Advisor Larry Kudlow said of the $22.5 trillion national debt, “I don't see this as a huge problem at all right now.”

But the debt and the deficit do represent a huge problem, even if the Trump Administration and Republicans now fail to recognize them as such. When the deficit tops $1 trillion this year, it will be in the midst of peacetime and a strong economy. The last time that the deficit exceeded $1 trillion it was in 2012, in the wake of President Obama’s stimulus spending after the Great Recession. With President Trump’s massive deficits in good times, there is absolutely no realistic plan to reduce the deficit at any point in the near future, especially if the economy sours.

While the debt limit must ultimately be increased to avoid the financial chaos of a default, it should be paired with spending cuts under the successful Boehner strategy. However, Speaker Nancy Pelosi is pushing in the opposite direction. Fortune reported that House Democrats were advocated for a vote that would pair the increase to the debt limit with a spending bill that would increase the deficit by as much as $300 billion.

Even the House Freedom Caucus has been silent about the looming increase to the debt limit. The group has instead focused on rebuking Rep. Justin Amash for his stance on impeachment. A search for recent comments about federal overspending and borrowing from caucus members yielded nothing.

It seems that if there are any fiscal hawks left in Washington that they are in full retreat.

Originally published on The Resurgent

Wednesday, July 10, 2019

Biden's New Feisty Campaign



Joe Biden’s campaign is undergoing a shift in strategy. Following the candidate’s lackluster performance in the first round of Democratic primary debates, supporters are calling on the former vice president to take a more aggressive stance with the other candidates. Rather than staying above the fray, Biden and his surrogates are about to come out swinging.

At first, Biden could afford to avoid getting his hands dirty. After his announcement in April, his share of the Democratic voters rose above 40 percent in the Real Clear Politics average. But after a heated exchange with Kamala Harris in the June debate, Biden plunged to the mid-20s. At this point, he is still the frontrunner but momentum is not on his side.

“There are people that are all over Joe to get more aggressive,” a Democratic source told Politico. “People are very nervous.  If he doesn’t come out strong and swinging, you’re going to see a lot of people leaving him.”

Under the new strategy, Biden is more directly referencing his record as Barack Obama’s vice president, often referring to the former president as “Barack,” and his surrogates are making more direct attacks on Harris. Biden, who rarely does interviews, even sat down with CNN.

In a reversal, Biden also apologized to a cheering black crowd in South Carolina for citing segregationists Herman Talmadge of Georgia and James Eastland of Mississippi as people that he worked with in Congress. Noting that Congress was “was full of segregationists” at the time and that he felt he was right to work with “those who we find repugnant to make our system of government work for all of us,” Biden nevertheless said that he was “wrong a few weeks ago, to somehow give the impression to people that I was praising those men who I successfully opposed time and again” and that he was “sorry for any of the pain or misconception that I caused anybody.”

“Until the debate, nobody had attempted to land a critical punch,” said former state Democratic Party chair Dick Harpootlian, a Biden surrogate. “They’re responding to deal with issues that arise from someone attacking the vice president’s record.”

Now Biden is trying to defend his record as well as establish himself as the presumptive challenger to Donald Trump. In addition to defending his record on civil rights and health care, Biden will also deliver a speech on Thursday in New York that will lay out his foreign policy goals and critique President Trump’s performance on international relations. The Biden campaign seems to realize, however, that it must go through Harris to face Trump.

“Coming out of the debates, something the campaign felt strongly about is, we needed to be assertive on what his record was, both in terms of moving forward but to also demonstrate to the political world at large that we weren’t going to take that sort of thing without a response,” a senior Biden adviser said in Politico. “We went out and tried to, best we can — especially with a slick and slippery person — try to pin Kamala Harris down on her own record.”

For now, Joe Biden remains at the top of the heap despite numerous predictions of his impending failure. In a race where the other top candidates are far-left radicals such as Bernie Sanders, Kamala Harris, and Elizabeth Warren, Biden benefits from being the only major candidate in the moderate lane while the other top-tier candidates split the progressive vote.

Nevertheless, if he wants to be president, Joe Biden has to stop the bleeding of his support t. To do that, he has to show voters that he is quick on his feet and strong enough to fend off both Kamala Harris and Donald Trump. The next debate will be a make-or-break moment for Joe Biden.

Originally published on the Resurgent

Wednesday, July 3, 2019

Trump Shelves Citizenship Census Question


After an unfriendly Supreme Court ruling last week, the Trump Administration has dropped its controversial attempt to add a citizenship question to the 2020 census. A spokesman for the Trump Administration said on Tuesday that they would not appeal the Supreme Court’s decision. President Trump had said as recently as Monday that he would consider delaying the census to appeal the ruling.

“We can confirm that the decision has been made to print the 2020 decennial census questionnaire without a citizenship question and that the printer has been instructed to begin the printing process,” Justice Department attorney Kate Bailey wrote in an email to groups opposing the census question.

In a statement, Commerce Secretary Wilbur Ross also confirmed, “The Census Bureau has started the process of printing the decennial questionnaires without the question,” also stating, “I respect the Supreme Court but strongly disagree with its ruling regarding my decision to reinstate a citizenship question on the 2020 Census.”

In fact, even though the immigration status of people living within US borders is clearly within the legitimate interests of the federal government, the Supreme Court ruling written by Chief Justice John Roberts seems to have been the correct decision. The question for conservatives and constitutionalists is how Roberts got from his observation that the “Enumeration Clause permits Congress, and by extension the Secretary, to inquire about citizenship on the census questionnaire” to his ultimate decision that the Trump Administration violated the law adding the question.

While many pundits are quick to point out that citizenship questions have been asked on the census before, few look to Roberts’ written decision for an answer to the seemingly contradictory statements in the decision. In his justification, the chief justice cited the Administrative Procedures Act, a 1946 law that requires courts to strike down government actions that are “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”

“The Census Act confers broad authority on the Secretary, but it does not leave his discretion unbounded,” Roberts wrote.

“The Secretary’s decision was supported by the evidence before Him,” Roberts continued. “He examined the Bureau’s analysis of various ways to collect improved citizenship data and explained why he thought the best course was to both reinstate a citizenship question and use citizen-ship data from administrative records to fill in the gaps. He then weighed the value of obtaining more complete and accurate citizenship data against the uncertain risk that reinstating a citizenship question would result in a materially lower response rate, and explained why he thought the benefits of his approach outweighed the risk. That decision was reasonable and reasonably explained, particularly in light of the long history of the citizenship question on the census.”

However, Roberts continued, “In order to permit meaningful judicial review, an agency must ‘disclose the basis’ of its action.” This is where Secretary Ross and the Trump Administration ran into problems.

“Viewing the evidence as a whole, this Court shares the District Court’s conviction that the decision to reinstate a citizenship question cannot adequately be explained in terms of DOJ’s request for improved citizenship data to better enforce the VRA [Voting Rights Act],” Roberts stated.

Roberts goes on to describe how enforcement of the VRA seemed secondary to other considerations, despite the government’s claims to the contrary. Ross tried to involve the Justice Department in the census question, but “DOJ’s actions suggest that it was more interested in helping the Commerce Department than in securing the data.”

“Altogether, the evidence tells a story that does not match the Secretary’s explanation for his decision,” Roberts said. “Unlike a typical case in which an agency may have both stated and unstated reasons for a decision, here the VRA enforcement rationale—the sole stated reason—seems to have been contrived.”

In other words, the addition of the citizenship question was not illegal except for the fact that Secretary Ross lied about the reason for wanting to ask the question. Since the Administrative Procedures Act charges the courts to “ensure that agencies offer genuine justifications for important decisions, reasons that can be scrutinized by courts and the interested public,” the Supreme Court had a duty to strike down the question when it became apparent that Ross’s justification for asking it was dishonest.

The citizenship question was not struck down because an activist Court wanted to prevent data from being collected about the number of illegal immigrants in the United States (although it is certainly possible that this was the motive of the liberal wing of the Court). The government lost its case because of the reflexive dishonesty of members of the Trump Administration. Given the latitude with which the government is given in conducting the census and the history of census questions about citizenship, there seems to have been no reason for Ross to have lied about the rationale for the question, yet lie he did.

For conservatives and those who wish to abide by the rule of law, the position should be that the government must adhere to the law, even when the law restricts policies that we would favor. If the Court had ignored the Administrative Procedures Act’s requirements for an honest bureaucracy, that would have been an example of judicial activism. To be intellectually and morally consistent, we have to abide by laws that we don’t like as well as those that we do (such as those against illegal immigration).

The ruling also underscores the importance of voting for honest and competent candidates, not just those who say what we want to hear. The addition of the citizenship question could have been accomplished by the administrations of any number of Republicans. Immigration concerns are not unique to the administration of Donald Trump. However, it seems likely that the culture of dishonesty that permeates the Trump Administration from the top down is what ultimately killed the attempt to learn more about noncitizens living within the United States.  

Character matters.

Originally published on The Resurgent


Monday, July 1, 2019

Trump Tariffs Are Making Canada Great Again




My family and I took a vacation to visit friends in the Canadian province of New Brunswick recently. New Brunswick, which is located to the northeast of Maine, is a long drive from Georgia so we took the opportunity to explore the area while we there. While we shopped at a lobster and seafood shop in the seaside village of Alma, I had an interesting conversation with the proprietor.

As we browsed, the owner asked me what I thought of Donald Trump. As I usually do, I replied noncommittally that I wasn’t a huge fan of the president.

“Well, he’s been good for us,” the Canadian shop owner replied.

He went on to explain how President Trump’s trade war had helped Canadian lobstermen. Like many farmers and fishermen, the lobstermen of Maine exported much of their catch to other countries, including China.

At least they did before the trade war. Seafood Source reported that 2018 had started as a bumper year for Maine lobster, but the implementation of tariffs quickly changed that. After China raised retaliatory tariffs on American imports, lobster shipments declined by 84 percent.

Canadian lobster exporters, unaffected by the US-China trade war, have picked up the slack. The shop owner explained that many importers who had previously bought US lobster were turning to Canada. The Canadian fishermen were benefitting both from increased volume demand for their product as well as higher prices.

While we were in Canada, the going rate for local lobster was CAD $12.99 per pound. Lobster meat was CAD $38.99 per pound. An internet price search of Maine lobster found whole lobster prices slightly lower at about $8.99 per pound (about CAD $11.80)  but lobster meat more expensive at $50-60. The higher price for US lobster meat may be due to the difficulty in finding immigrant labor. (I discussed the shortage of immigrant work visas in an article last year.)

American buyers benefitted from a favorable exchange rate in which one Canadian dollar was equal to about 75 US cents. Customers from China and other countries also benefit from the softer Canadian dollar when they buy lobster from Canadian companies. Taxes on American imports and the better exchange rate have combined to sharply boost Canadian exports.

“Our sales to China have increased dramatically this year – around 30 to 40 percent – compared to last year,” David Xu, China representative for lobster exporter ZF Max International, told Seafood Source.

Canada has also benefitted from a new free trade agreement with Europe. In 2017, Canada and the EU signed the Comprehensive Economic and Trade Agreement. One of the provisions of this treaty is that Canadian lobsters can be imported to Europe without a tariff. In contrast, European buyers must pay an eight percent tax on American lobster. US lobster shipments to Europe fell 47 percent as a result of the deal reported the Portland Press Herald. To protect themselves, many American companies are moving at least part of their operation to Canada.

Adding insult to injury for American lobstermen, Canadian lobster is often shipped through the United States to buyers in China and elsewhere. There are far more flights out of Boston and Maine than Canada’s maritime provinces so lobster that is landed and sold in Canada is often trucked to US airports where it is then flown around the world. Because the lobster came from Canada and was not sold in the US, it isn’t subject to Mr. Trump’s (or Mr. Xi’s) tariffs.

The plight of Maine’s lobstermen may not concern President Trump because most of them didn’t vote for him. In 2016, the coastal districts where the fishermen live voted for Hillary Clinton, giving her three of the state’s four electoral votes. However, the same story is being played out in American agriculture around the country, including in many red states. American farmers are losing export opportunities while foreign competitors such as Australia, Brazil, Canada, Chile, and New Zealand take over markets that were formerly dominated by the US.

Maybe those exports from the US will resume after the trade war is resolved, but maybe they won’t. Business relationships are being forged between America’s competitors and our former customers. If President Trump is re-elected then foreign customers will be leery of doing business with American companies due to the president’s habit of implementing new tariffs on short notice.

A major complaint of businesses during the Obama Administration was the unstable regulatory environment in which it was difficult to make long-term plans. That problem is worse for many businesses under President Trump. As a businessman, Donald Trump should know that business partners value reliability.

At the same time that I was on my trip, China reduced its tariffs, not on US imports but on those from competing countries. In a move calculated to further reduce American exports, China eased the import tax burden on products from countries that compete directly with American goods.

The trade war goes on and American lobstermen and farmers and manufacturers wait to see if they will be able to sell what they produce while they operate at a disadvantage in one of the world’s largest markets. In the meantime, our neighbor to the north is among the countries reaping the benefits of Donald Trump’s tariff policy.

So, if you happen to be in Canada’s maritime provinces, you can enjoy a good deal on some very fresh lobster. While you’re there, take in the beautiful scenery along the Bay of Fundy, benefit from a favorable exchange rate, and enjoy Canadian hospitality, which is a lot like Southern hospitality without the 90-degree temperatures and oppressive humidity.

And while you’re there, take just a minute to think about President Trump’s gross misunderstanding of international trade, eh?


Originally published on The Resurgent