Although I have some quibbles with Charles Lane’s most recent Washington Post column, I agree with his central premise. Economic good news buoys the president; bad news would harm him. I especially agree with his conclusion:
Morals of the story: Even a bizarre president can’t necessarily bring down the global economy. And, awkwardly for Trump’s opponents, it might take a really bad global economy to bring down a bizarre president.
Other than as Cheerleader-in-Chief or Wet Blanket-in-Chief the president’s effect on the economy is pretty indirect. However, if there’s a sharp downturn the president is likely to get the blame.
One of my quibbles with the column is that I wonder where Mr. Lane thinks we are in the business cycle? According to the National Bureau of Economic Research, the business cycle’s official scorekeeper, the longest period from trough to trough in the business cycle since the end of World War II is 128 months.
Follow up on that Foxconn thing. Turns out they have habit of announcing big deals, then not following through.
http://www.zerohedge.com/news/2017-07-26/foxconn-get-230000-incentives-every-wisconsin-job-created
Steve
It’s not unique to Foxconn. It’s what I mean when I say “they write a heckuva press release”. There’s something analogous to “buy on the rumor, sell on the news” going on here. I pay a lot more attention to the “Help Wanted” announcements than I do the press releases.
If it is just a press release, then my argument is even stronger. Why couldn’t democrats stage such a thing when they were in power?
Like it or not, drumming up investment or business opportunities is practical way to show you care about jobs.
Jean Chretien (a Liberal Canadian PM) mastered the art of doing it. He’d organize junkets to different countries with various CEO’s, premiers of provinces. He’d call them “Team Canada” and the whole trip would be blitz of press releases saying they have this investment or that market access creating this many jobs. I seriously doubt the press releases panned out but it was popular with Canadians.
Yeah, we’re getting due — overdue? — for another recession. Just a wild guess, but I sort of think economists will urge the government to respond with a big big tax cut. I’m confident Republicans will be capable of this. It wouldn’t much surprise me if Republican congressmen and the White House decide they should cut into Social Security and Medicaid and food stamps, to make that tax cut even bigger.
Sometimes, you gotta do, what you gotta do. Maybe Greg Minkow will find a nicer way to express this.
The only tax cut that would do a lick of good in a recession would be suspending FICA. Cutting SSRI or Medicaid would be counter-stimulative.