I have no idea whether Donald Trump believes in bigger government or smaller government. Higher taxes or lower taxes. More intervention or less. Sometimes he says things I like. Sometimes he says things that irk me.
Politicians are infamous for being cagey, but “The Donald” is an entirely different animal. Instead of using weasel words that create wiggle room, he simply makes bold statements that are impossible to reconcile.
Consider his views on government debt.
Here’s an interview with Dana Loesch of Blaze TV from earlier this week. I was in Zurich and it was past midnight, so I was a tad bit undiplomatic about Trump’s endlessly evolving views. Simply stated, it’s not a good idea to default. And it’s not a good idea to monetize debt either.
For what it’s worth, while Trump is oscillating between different position on debt, one of his top advisers is claiming that his plan will produce a multi-trillion dollar surplus.
Sigh.
The sensible approach would be for Trump to make simple points.
- Debt is a symptom and the real problem is too much spending.
- The solution is to follow the Golden Rule.
- Therefore, impose a Swiss-style spending cap.
But he hasn’t asked me for advice, so I’m not holding my breath waiting for him to say the right thing.
It’s also a challenge to decipher Trump’s position on tax policy.
He actually put forth a good tax proposal, but nobody takes it seriously since he doesn’t have a concomitant plan to restrain spending.
So his campaign supposedly designated Larry Kudlow and Steve Moore to modify the plan, but then said the original proposal would stay unchanged.
This does not create a sense of confidence.
Trump also is getting pressure on his personal tax situation. He said he would release his tax return(s). Now he says he won’t. I speculated on what this implies in an essay for Time, listing five reasons why he may decide to keep his returns confidential.
The first two reasons deal with a desire for privacy and a political concern that he may appear to be less wealthy than he’s led folks to believe.
First, he may resent the idea of letting the world look at his tax returns for reasons of personal privacy, which is an understandable sentiment. …Can Trump get away with stonewalling on his returns? Perhaps. President Barack Obama refused to release his college transcript and didn’t seem to suffer any political damage. …Second, Trump’s tax return will probably show a surprisingly low level of income, and he might be concerned that such a revelation would erode the super-successful-billionaire aura that he has created.
I also suspect he’s worried that his tax return will make him look like…gasp…a tax avoider.
Third, to the degree that Trump’s return shows a lower-than-expected amount of taxable income, this will probably be because his accountants and tax lawyers have carefully plumbed the 75,000-page internal revenue code for deductions, credits, exemptions, exclusions and other preferences… Since we all seek to legally minimize our tax liabilities, that shouldn’t be a political problem. …That normally would be a persuasive answer, but voters may look askance when they learn that Trump is taking advantage of mysterious provisions dealing with things they don’t understand, like depreciation, carryforwards, foreign tax credits, muni bonds and deferral. …Fourth, for very wealthy individuals and large companies, the complexity of the tax code means there’s no way of knowing if a tax return is accurate. …Given Trump’s persona, he presumably pushes the envelope.
Last but not least, I imagine Trump has “offshore” structures.
Fifth, it’s highly likely that Trump does business with so-called tax havens. For successful investors and entrepreneurs with cross-border economic activity, this is almost obligatory because jurisdictions like the Cayman Islands have ideal combinations of quality governance and tax neutrality. …But in a political environment where the left has tried to demonize “offshore” tax planning, any revelations about BVI companies, Panama law firms, Jersey trusts and Liechtenstein accounts will be fodder for Trump’s many enemies.
Needless to say, I greatly sympathize with Trump’s desire to minimize his tax burden and I applaud his use of so-called tax havens (which are routinely utilized by wealthy Democrats).
And I even sympathize with his desire for privacy even though divulging personal financial information is now a routine obligation for politicians.
The point I should have made in my essay is that Trump would be in a stronger position if he said from the start that his tax returns are nobody else’s business.
And shifting back to policy, he’ll be in a stronger position if he picks a message and sticks to it (though ideally not the same message as Hillary Clinton).
P.S. Since I mentioned Obama’s still-secret college transcript, I may as well share this very clever mock transcript that explains a lot about his misguided approach to policy.
[…] for that one year. Which is contrary to what a lot of people have suspected – including me in the column I wrote on this topic last year for […]
[…] for that one year. Which is contrary to what a lot of people have suspected – including me in the column I wrote on this topic last year for […]
[…] for that one year. Which is contrary to what a lot of people have suspected – including me in the column I wrote on this topic last year for […]
[…] time. So it’s easy to see why I like this bit of satire that combines the controversy over Trump’s undisclosed tax returns and the controversy over Clinton’s illegal (and vulnerable) email […]
[…] I’ve specifically criticized his views on protectionism, on bailouts, on entitlements, monetary policy, tax policy, and (just yesterday) distorting tax […]
[…] …his views on major economic issues are eclectic. He promises a big tax cut, but it’s probably not very serious since he has no concomitant plan to restrain the growth of government spending. He threatens to impose steep tariffs, which would risk triggering a trade war, but he claims protectionism would merely be a stick to extort concessions from trading partners. ….He makes noises about potentially defaulting on debt but then pivots and says the debt can be financed by printing money. …either approach causes angst among most economists. […]
[…] the simple reason that he probably doesn’t have deep thoughts about public policy (look at his flailing response to the question of debt). Even when he’s been specific, does anyone think he’s philosophically committed to […]
[…] Since I don’t know what actually motivates Trump or his voters, I have no idea whether the above passage is fair, but it is true that Trump’s policy agenda oftentimes doesn’t make sense. […]
To that I agree. However there is another factor to add in, that Trump has a vested interest in being a successful President in order that his multi-billion brand is strengthened. And that would necessitate a successful America.
Of course, what Trump thinks is best for America might not necessarily be the objective, factually-based best – or might be flustered by conditions or events.
To understand Trump, you must realize that first and foremost he is NOT your usual politician. Rather, he is one of the world’s most skilled business negotiators. Whatever he says on the campaign trail must be taken at face value, because he is intentionally and shrewdly saying what he calculates will give the best returns – not necessarily what he really believes.
Creator of the Dilbert comic strip, Scott Adams, has plenty of deduction and praise for Trump’s methods of persuasion. Take a short read and I believe you’ll have a paradigm shift in interpreting Trump’s actions: http://blog.dilbert.com/post/139541975641/the-trump-master-persuader-index-and-reading-list
2 examples:
By declaring he will build a huge wall, force Mexico to pay for it and deport all 11 million illegal immigrants, Trump is capturing the public’s favour, controlling the conversation and forcing everyone else to use his plan as the baseline. When the time is right, he can negotiate away parts of his ‘high starting offer’ and will seem like a reasonable fellow while getting what he really wants (smart immigration policy).
By suggesting all Muslim immigration be stopped temporarily, again he is getting free airtime and making everyone suggest plans as an ALTERNATIVE TO TRUMP’S. But when anothe terror attack or rapefugee case hits the new (and they will), the public will remember the raw basics: TRUMP HAD A PLAN.
So whatever he says about economics and taxes, we have to wait and see when he’s actually President and no longer merely using his words to round up public support.
That said, I encourage you to try and install yourself as Trump’s economic advisor from the start. From his past experience with the Woller skating rink and his more recent foreign policy speech promises, he seems to be fully willing to hire and listen to people with more experience than himself. So hopefully he will be convinced by the hard, factual evidence
(Far better than the current ‘I’m a better speechwriter than my speechwriters, better at foreign policy than my foreign policy advisors’ guy.)
Trump has always been a “wheeler-dealer”. In the past, there has been little need for accountability. He would say anything to hide his true intentions. This would include the strategy of “anchoring”, whereby he would take an extreme position, with every intention of negotiating down to look more reasonable as the deal got close.
His overall strategy is similar to the “Alinski” tactics for community organizing: Say anything or do anything that achieves the objective. Hope ‘n change worked for Obama, so obfuscation is an obvious approach for the next politician, since the country votes on emotion rather than logic.
Hillary is, in her own way, doing the same thing; but she is a known-unknown.
As with Obamacare, we’ll have to vote before we get to see what we voted on.