IT’S ALL ABOUT THE ECONOMY

This blog should come with a warning label.  If you are a Trump-hater, you will not approve of it.  But, to paraphrase the late singer Leslye Gore, “it’s my blog, and I can write what I want to.” All I ask is that you read it with an open mind.  As always, I welcome your comments.

We all know that President’ Trump’s job approval rating has been at historic lows.  According to the latest Harvard CAPS/Harris poll it is at 42%. The latest NBC News/WSJ survey had it even lower at 39%, the lowest for any “modern” president after one year in office.   But, I believe those approval ratings are more reflective of his personality, than his policies.  I will stipulate that, at times, he can be boorish, combative, irreverent and “non-presidential.”  His obsessive tweeting can be inappropriate and embarrassing.  His opponents have called him everything from a racist to a misogynist to a white supremacist and compared him to despicable figures, such as Hitler and Stalin.  However, like most Trump supporters, I focus on what he does, not what he says.

I maintain that, in just one year, he has accomplished at least as much as any other president, and more than most.   For purposes of this blog, however, I will focus solely on the economy and border security.  I will analyze his other accomplishments at another time.

I T E S.  (It’s the economy, st – – -d.)   History tells us that, with few exceptions, such as a war or a 9/11-type terrorist attack, the most important issue for most voters is the economy.  That popular refrain, “Are you better off today than you were four years ago” is very effective.  Voters tend to ascribe, perhaps, too much credit or blame to the president based on whether they are better or worse off than they were when he took office.

That said, let’s take a quick look at the economy for the last year:

  1. Unemployment/Job Creation – According to the Bureau of Labor Statistics the December 2017 unemployment rate was 4.1%, for the third month in a row. When Mr. Trump took office the rate was 4.8%.  Moreover, the BLS reported nearly 1 million jobs had been created during that period.  In addition, the areas of greatest growth were in the blue collar, working class fields of construction, manufacturing and healthcare.  Thus, at least in this area, the greatest benefit has gone to the very constituency that Mr. Trump’s critics have been maintaining his policies would hurt.
  2. Stock Market –  According to Market Watch the Dow Jones Industrial Average gained 32% during the past year and closed on January 18 at a record high of 26,017.  What is the significance of this for the country?  First of all, some 43 million households, most of them consisting of working class people, own one or more IRAs.   So, those results are relevant to the abovementioned “Are you better or worse off…” question.  Secondly, the stock market is a leading indicator.  Therefore, the investment community is betting on a further improvement in the economy.  As the late president JFK famously intoned, “a rising tide lifts all boats.”  One could question whether or not this level of optimism is due to President Trump’s policies, but, in my opinion he should get the lion’s share of the credit.
  3. Tax Reform – President Trump and his supporters have been extolling the benefits of his tax reform package for months, and his critics have been doing their best to discredit it as a huge giveaway for the rich.  I urge you not to assume it will be detrimental to you.  Run the numbers; you may be pleasantly surprised.  Perhaps, the most significant part of his package was the reduction of the corporate tax rate from 35% to 21% (with a special lower rate for repatriated funds).  A recent World Economic Forum survey identified high tax rates as the most problematic factor in doing business.  (One does not have to be a tax expert to realize this.)  I expressed my opinion of the tax package in an earlier blog, and there is no need to repeat myself now.  However, an objective person would have to concede that the early returns have been very positive.  Firstly, many international companies have announced their intention to repatriate profits currently being held in foreign locations to avoid the onerous 35% corporate tax rate.  The Business Insider characterized this as a “tidal wave of internationally-held cash.”  According to Citigroup this amounts to some $2.5 trillion.  Goldman Sachs estimates that approximately $250 billion of that amount is likely to be repatriated to take advantage of the lower tax rate.  The expectation is that this cash will be used to (a) reinvest in the business, (b) increase employment, (c) pay bonuses, and/or (d) buy back company stock.  Any of these would have a beneficial effect on the economy.  Indeed, several major corporations have already weighed in.  For example, Apple, which has reported it has some $250 billion stashed overseas, announced it expects to repatriate most of those funds, expand its physical plant and create 20,000 new jobs; AT&T has paid $1,000 bonuses to in excess of 200,000 employees and pledged to invest $1 billion domestically; Comcast also paid $1,000 bonuses and announced it intends to invest “in excess of $50 billion” on infrastructure over the next five years; Fifth Third BankCorp and Wells Fargo announced they will increase their minimum wage to $15.  Workers should already be seeing the benefits of the reduced tax rates for individuals in their paychecks.
  4. Border Security – I have blogged about this many times.  Mr. Trump has been steadfast and adamant on this issue.  Everyone is focusing on The Wall, but there are other elements to his plan, such as e-verify, ending chain migration, enhancing vetting procedures, increasing border patrol personnel, and identifying, capturing and deporting felonious illegal aliens.  Contrary to what his critics have been saying he is not seeking to deport law-abiding DACA persons.  Many, if not most, Dems have been opposed to these policies, labeling them as “racist.”  (A good rule of thumb: whenever someone uses the “R” word, it is because they have no other comeback.  They have already lost the debate.)   The Dems’ fervent defense of illegal immigrants, even to the extent that they seem to be willing to provoke a government shut-down over the DACA issue, leads one to believe they actually favor illegals over their core working class constituency.  The obvious reason for that would be the hope that some day these immigrants would show their gratitude by voting Democratic.

CONCLUSION

Based on the foregoing, I believe any objective person would conclude that Mr. Trump is on the right side of the crucial issues.  After all, who wouldn’t want to feel safer and have more money in their pocket.  Yes, I wish Mr. Trump’s personality were more “presidential,” but assuming you can’t have both, which would you want?

Please answer the following two questions:

  1.  If you had to choose a surgeon to save your life, would you select a nice, polite, professional-appearing doctor who is an average surgeon or a nasty, arrogant, SOB who is an exceptional surgeon?
  2. Do you lock your doors and turn on your security system when you leave your house or go to sleep or do you open your doors and turn off the system so that  anyone can enter?

I think the answers are obvious.  Remember, many of the celebrities and politicians who lecture the rest of us about borders and other issues live in gated communities with 24/7 security and ride in chauffeured limos or private jets.   For them, it’s “do as I say, not as I do.”

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