The George W. Bush Presidential Center, whose progenitor knows a thing or 5.849 trillion about deficit spending, updates us on the current administration’s progress on the national debt. Trump is making great progress… in increasing our debt:
According to Congressional Budget Office (CBO) projections, the government’s deficit will hit $804 billion this year, or 4 percent of GDP, up from $665 billion last year. Assuming current policy remains intact, the deficit will balloon to $1.3 trillion, or 5 percent of gross domestic product (GDP), by 2022, and to more than $1.8 trillion, or 6 percent of GDP, by 2028. The deficits of coming years are far larger in relation to the economy than we’ve ever experienced outside of major wars and recessions [J.H. Cullum Clark, “America’s Debt: Returning Soon to the Top of the Nation’s Agenda,” George W. Bush Presidential Center, 2018.06.28].
Trump has no idea what to do, but Bush’s people recommends “changing the way the Social Security system calculates benefits,” “Slowing the growth in benefits for wealthier families, while improving them for lower-income seniors,” and “rethinking… the structural inefficiencies and perverse incentives in Medicare.” But the chances of Congress taking serious action on, well, anything seem pretty slim when they take off for a long Fourth of July holiday without taking action on immigration, even after months of the Trump Administration holding children hostage. If an urgent human rights crisis of our own making can’t get Congress to act, what can?
I doubt a recession will help, but the yield curve, the gap between interest rates on long-term and short-term bonds, one of the most reliable indicators of economic downturns, says one is coming:
Bad stuff happens when the yield curve inverts—Michael D. Bauer and Thomas M. Mertens, “Economic Forecasts with the Yield Curve,” Federal Reserve Bank of San Francisco, FRBSF Economic Letter, 2018.03.05, p. 2.
On Thursday, the gap between two-year and 10-year United States Treasury notes was roughly 0.34 percentage points. It was last at these levels in 2007 when the United States economy was heading into what was arguably the worst recession in almost 80 years.
…Every recession of the past 60 years has been preceded by an inverted yield curve, according to research from the San Francisco Fed. Curve inversions have “correctly signaled all nine recessions since 1955 and had only one false positive, in the mid-1960s, when an inversion was followed by an economic slowdown but not an official recession,” the bank’s researchers wrote in March [Matt Phillips, “What’s the Yield Curve? ‘A Powerful Signal of Recessions’ Has Wall Street’s Attention,” New York Times, 2018.06.25].
If you thought Trump’s tax cuts for the wealthy would stimulate us away from any looming recession, too bad—it’s not living up to its promises:
His tax cut isn’t producing the promised surge in business investment, let alone the promised wage gains; all it has really done is lead to a lot of stock buybacks. Reflecting this reality, the tax cut is becoming less popular over time [Paul Krugman, “Trump’s Potemkin Economy,” New York Times, 2018.06.30].
…and his reckless trade war may gobble up any economic boost from fiscal policy:
On Thursday, the Department of Commerce announced the nation’s gross domestic product for the first three months of the year grew by 2 percent, a downgrade from earlier estimates but still higher than the same period in the previous two years. Wall Street firms are predicting the stimulus of GOP tax cuts that passed in December will boost second-quarter GDP by as much as 4.5 percent.
…“The Trump administration’s dealing with trade policy could erode confidence in the American economy and, more importantly, created a great deal of uncertainty,” Paul Wachtel, professor of economics at the New York University Leonard N. Stern School of Business, told Salon. “Why would any business invest domestically or invest abroad when it doesn’t know what the rules of the game with regard to trade are going to be?”
The threat of an escalating trade war on multiple fronts is coming just as confidence in the longer-term economic growth in the U.S. economy seems to be waning. The GOP tax cuts, which among other measures reduced the corporate tax rate from 35 percent to 21 percent, has been described as a “sugar high” that won’t stop slower growth in 2020 and beyond [Angelo Young, “That May Not Be the Recession Looming out There in November, But We Can See It from Here,” Salon, 2018.06.30].
With his tariff war threats, attacks on free trade agreements and more recent lambasting of the American motorcycle-maker Harley-Davidson, Trump has affirmed what many experts feared as he ran for president: He really doesn’t know how companies function in a global market.
…With his sudden announcement of tariffs on foreign steel and aluminum, Trump acted on his decades-old belief that other countries take advantage of the United States in trade because prior presidents were weak leaders. He bypassed the kind of careful study that those same cautious presidents devoted to policy and confirmed that he is an abjectly poor student of economics.
Did Trump know that the world has changed in the last few decades when he made comments about the automotive industry that would have made sense in the 1980s? When considering a tariff on steel and aluminum, did he consider how prices would be affected by higher manufacturing costs incurred by US firms using these materials? Did he have a sense of how many jobs could be lost if these costs were to make manufacturing certain products in the United States an impracticality? [Michael D’Antonio, “Trump Is Clueless About the Global Market,” CNN, 2018.06.29]
But a billionaire doesn’t have to be curious or thoughtful or deliberate or empathetic to anyone else. He has all the money and bodyguards and gated mansions he needs to insulate himself from whatever chaos his decisions wreak. Someone else (hint: Democrats) will clean up for him later.
Related Reading: More on Trump, moron:
It’s really worth reading the submission by General Motors to the Commerce Department, urging a reconsideration of a tariff policy that “risks undermining GM’s competitiveness against foreign auto producers” and “will be detrimental to the future industrial strength and readiness of manufacturing operations in the United States.” In other words, “Don’t you understand global supply chains, you idiot?” [Krugman, 2018.06.30]
Trump’s approach to America’s European allies “is a fundamental shift,” said Julianne Smith, an associate fellow at the Chatham House think tank and expert on U.S. relations with Europe. Trump is “very antagonistic toward the European Union,” she told Newsweek, and “virtually everything he has said about [the bloc] since he’s come into office and during the campaign has been very negative.”
Smith—who served as the deputy national security adviser to Vice President Joe Biden—said Trump’s stance on institutions such as the European Union and NATO has left Europeans concerned about the future of the transatlantic relationship.
“Even though we’ve had policy differences with Europeans over the years—and we’ve had many—this now is calling into question the fundamentals,” she explained.
Though leaders like Macron have tried to impress upon Trump the importance of the relationship and its long and successful history, “Trump pretty much is incapable of learning, and even if he is learning he is not willing to change his mind on his views,” Smith said [emphasis mine; David Brennan, “Trump Told Macron France Should Consider Leaving the EU: Reports,” Newsweek, 2018.06.29].
Trump insists upon an “extraordinarily well qualified” nominee with a superlative résumé. The president is especially drawn to contenders with name-brand degrees, such as from Ivy League universities such as Harvard or Yale. He also wants to see a portfolio of solid academic writing, though this adviser acknowledged that Trump does not care to read it; he simply wants to know it exists [Philip Rucker and Seung Min Kim, “‘We Have to Pick a Great One’: Inside Trump’s Plan for a New Supreme Court Justice,” Washington Post, 2018.06.30].
At his rally last night, Trump took the next step, and declared not only that he is richer than his enemies, but that so, too, are his supporters:
“We got more money, we got more brains, we got better houses, apartments, we got nicer boats … we’re the elite.”
This is not, of course, how populism works. It trades on either cultural or economic grievance. One’s enemies possess all the privilege, and we the people must take it back. Once you have declared that you already possess the privilege, the whole basis for it disintegrates. While Trump performed perfectly well among the rich, most of his supporters are not rich (because most Americans are not rich) and would have trouble recognizing themselves in his portrait of lavish apartments and boats.
Trump does not have a clever strategy behind this new rhetorical tic. He is simply not intelligent or sophisticated enough to understand that, in politics, unlike the business world he came from, “elite” is a term of abuse [Jonathan Chait, “Trump Calls His Supporters ‘Elite,’ Doesn’t Understand How populism Works,” New York Magazine, 2018.06.28].
Larry, he should’ve been a cable guy, Kudlow tells the Weekly Standard the deficits are coming down rapidly. The Weekly Standard basically calls him a liar of Drumpfian proportions.
Meanwhile, republican controlled government, does nothing. Not a damn thing. It is interesting to see how this all works and plays out with the rural crowd who feel angry and are having a sad. Tax cuts, higher gas prices, atmospheric costs for health insurance, boy, we are looking like a drunk driving with a blindfold on.
jerry
2018-07-01 22:50
And now the FED has it’s forecast “The Fed forecasters’ median prediction is that the federal funds rate is headed to 3.4 percent by the end of 2020 from the current 1.9 percent. This means you’ll be paying more to get a mortgage, a new-car loan or to carry a balance on your credit card. How much more? Possibly enough to absorb whatever extra income you might be enjoying from lower tax rates or higher wages.” New York Times 07/01/2018
NOem, Thune and Rounds have signed off on the biggest con job ever to the American taxpayer. Dusty Johnson looks to keep this shakedown going in Washington, while NOem wants to act like she didn’t do a thing to break the piggy bank. If you don’t have debt right now, stay that way. There is a storm coming.
Debbo
2018-07-01 23:07
The Economic Idiot-in-Chief and his GOP minions are working hard at destroying every aspect of the USA.
It’s up to the Democrats, N.Y. state courts and Mueller to save us. Most of all, it’s up to US.
Votevotevotevotevotevptevotevotevotevotevote
OldSarg
2018-07-02 05:26
What a “blooming idiot”! The really sad thing is if one were to look back just one year your would see the many victories your “blooming idiot” has won. He won an election FIXED by the democrats to be a win for who the democrat leadership picked FOR YOU. you said nothing. . . He turned the economy around: the economy is booming. All indicators, including economic growth rates, unemployment rates, manufacturing growth, and stock market gains, are rising to levels unseen in your Obama years. . . you credit Obama. . . Dumping of needless bureaucratic regulations, freeing the burden from our Nation’s employers. . . you panic over the removal of duplication. . . Tax reform and extra money in YOUR paycheck. . . You cry about the loss in tax revenue as if it was yours. . . North Korea at the bargaining table, we are safer as a world. . . You what?
And when the “blooming idiot” wins the trade wars you will say what?. . . . crickets
And when the “blooming idiot” builds the wall you will say what?. . . . crickets
What you may see as an idiot sure seems to know what he is doing, putting the professionals in charge and has been highly successful. Show us what the democrats have done lately besides: protest, cry and wail. . . 70 people. . . what a success. . .
I’m certainly glad we have OS to provide comic relief from the ongoing, impending disaster.
mike from iowa
2018-07-02 06:35
Thanks OldS—ferbrains. Your posts from yesterday made me realize I had the perfect name for you- OldS—ferbrains. You just proved beyond any reasonable doubt you have s—ferbrains.
mike from iowa
2018-07-02 07:27
Trey Gowdy, noted HRC hater with a passion for wasting taxpayer dollars and time used 150k of taxpayers money to pay off a lawsuit brought by former employee.
Fat jammy boy Blake Farenthold, a Texas sfw resigned from congress for using 88k to settle a suit. He promised to pay it back and now refuses to do so. Is Gowdy likely to step down?
mike from iowa
2018-07-02 07:45
Subway announced it is closing 500 US locations and sending more overseas.I t’s planning to open a thousand new locations beyond North America and focus on locations in the U.K., Germany, South Korea, India, China, and Mexico.
I can’t hardly stand all this winning.
Porter Lansing
2018-07-02 08:16
All those wins you mention are wonderful for USA, OS. If both parties work together we can create some really good times for all.
jerry
2018-07-02 09:28
The bad part about all of the success that President Obama put into play will be that it will take some time for the existing inventory to be shipped on the existing contracts. When this tariff situation comes into play, the crap will hit the fan. A quarter or maybe two, and then the train wreck.
(Again, lacking evidence to the contrary, OS resorts to wishful thinking, hypotheticals, and, his preferred mode, political bullying, demeaning and belittling others. Sad and non-refutatory.)
OldSarg
2018-07-02 11:35
Oh gee Cory, where did you read bullying into my last post? Help me out there big guy. How’d I bully someone this time?
I’m eye-rolling. . . .
mike from iowa
2018-07-02 12:26
OldSferbrains, whose beaver you taking? Someone is paying you to lie for Drumpf. Who the hell would waste a dime on a pathetic whining, blind person like you?
Kim Jung Un stole drumpf’s lunch at the bargaining table. Kim got everything he wanted and Drumpf got played for the sucker we already knew he was.
Kim is making more, not less, nukular weapons fuel. How does that make the world safer? No clew, right. He is expanding his nukular sites, not de-nuking. How does that make the world safer?
Just keep yer head up your sandtrap and maybe loser boy in the WH will sand wedge it out for you.
The only turnaround you and Drumpf have accomplished is turning smaller deficits into trillion dollar deficits.
OS, care to refute the yield curve/recession correlation? Care to refute the impact of tariffs on business? Care to refute Donald Trump’s lack of understanding of or curiosity about important economic and political concepts?
jerry
2018-07-02 13:18
They are all standing up to us the US and are seeing that trump has made us a paper tiger. We have been defeated in of all places, trade! Trade, for goodness sake, republicans have long declared that they were the business people, while we taxpayers have to bail their sorry behinds out time after time. It annoyed me in the past, but now, it is beyond any reason how they could screw up a deal with Canada or with the EU, hell, even Mexico is drinking our milkshake. Send a guy to Washington to help clean the crap up and not the dusty one to replace the dust bunny. Geesh, already.
Roger Cornelius
2018-07-02 13:53
OS can’t refute Cory or the article, he obviously didn’t read it, if he had he would have found a reputable way to disprove each and every item discussed.
The only thing OS has to offer are more of Trump propaganda and saluting a false Trump economy.
mike from iowa
2018-07-02 16:38
More Drumpf winning according to OS-
According to data from the Bureau of Labor Statistics, the labor force participation rate has actually fallen from 62.9 percent in January 2017 to 62.7 in May of this year. So Ivanka’s claim about workers “coming back off the sidelines” thanks to the Trump administration’s economic policies is false.
CREDIT: BLS
CREDIT: BLS
Ivanka wasn’t the only Trump administration official to spread misinformation in TV interviews that aired on Fox Business over the weekend. As ThinkProgress detailed, National Economic Council Director Larry Kudlow bragged to Bartiromo that the federal deficit is “coming down rapidly.” In fact, the opposite is true — thanks in part to Trump’s tax cuts, the deficit is increasing, and is projected to do so well into the future.
CREDIT: SCREENGRAB
Trump’s top economics adviser lies about ‘rapidly’ falling budget deficit
When Trump administration officials weren’t gaslighting, they were obfuscating. During a CNN interview on Friday evening, White House Council of Economics Advisers Chair Kevin Hassett was pressed on how only four percent of the American workforce has received a raise since Trump’s tax cuts were signed into law six months ago. Hassett replied by pointing out that workers at Walmart, at least, have gotten raises that amount to $4,000 per year.
Not looking good on the winning side, OS. But you’ll just ignore the truth and go about trolling.
OldSarg
2018-07-02 17:35
Sorry, I was at work. I’m back home and will have the chance to read your “expert” economic opinions in a few minutes.
mike from iowa
2018-07-02 18:05
Huckabee Sanders sez Drumpf is going after Canada for treating us bad in the past on trade.
Walrus Bolton claims Drumpf has a plan to dismantle Li’l Kim’s nukes inside a year. This could get A) interesting or B) deadly for kids not of the Drumpf name, or both.
Debbo
2018-07-02 21:32
BTW Cory, love your headline. Rhythm and rhyme. Cory the rapper.
m
2018-07-03 07:25
From Juanita Jeans OldSferbrains-
The result is that the stock market is now in negative territory FOR THE YEAR, manufacturers are fleeing the US for foreign shores (taking the jobs with them), debt to GDP has now exceeded our debt level at the end of WWII, the dollar is being displaced by the Renminbi for global trading, Trump has pissed off all of our trading partners and handed our export markets over to both former allies and competitors, and all this has been done while french kissing Vladimir Putin and Kim Jong Un to our political and economic disadvantage.
Tired of winning? I also learned the Cato Institute was founded and funded by the koch bros. I had no clew.
Larry, he should’ve been a cable guy, Kudlow tells the Weekly Standard the deficits are coming down rapidly. The Weekly Standard basically calls him a liar of Drumpfian proportions.
https://www.weeklystandard.com/holmes-lybrand/fact-check-is-the-deficit-coming-down-rapidly-as-larry-kudlow-claimed
I must admit the WS has been pretty truthful and not apologists for Drumpf, so far.
The EU, has informed dear leader, idiot trump, of the other shoe dropping. China on one side, and our allies since, like forever, on the other side. Oh, and Canada, our beloved Canada, retaliating against Nazism as well. https://www.irishtimes.com/business/economy/eu-warns-trump-retaliation-for-car-import-tariffs-may-cost-us-300bn-1.3550375?mode=amp
Meanwhile, republican controlled government, does nothing. Not a damn thing. It is interesting to see how this all works and plays out with the rural crowd who feel angry and are having a sad. Tax cuts, higher gas prices, atmospheric costs for health insurance, boy, we are looking like a drunk driving with a blindfold on.
And now the FED has it’s forecast “The Fed forecasters’ median prediction is that the federal funds rate is headed to 3.4 percent by the end of 2020 from the current 1.9 percent. This means you’ll be paying more to get a mortgage, a new-car loan or to carry a balance on your credit card. How much more? Possibly enough to absorb whatever extra income you might be enjoying from lower tax rates or higher wages.” New York Times 07/01/2018
NOem, Thune and Rounds have signed off on the biggest con job ever to the American taxpayer. Dusty Johnson looks to keep this shakedown going in Washington, while NOem wants to act like she didn’t do a thing to break the piggy bank. If you don’t have debt right now, stay that way. There is a storm coming.
The Economic Idiot-in-Chief and his GOP minions are working hard at destroying every aspect of the USA.
It’s up to the Democrats, N.Y. state courts and Mueller to save us. Most of all, it’s up to US.
Votevotevotevotevotevptevotevotevotevotevote
What a “blooming idiot”! The really sad thing is if one were to look back just one year your would see the many victories your “blooming idiot” has won. He won an election FIXED by the democrats to be a win for who the democrat leadership picked FOR YOU. you said nothing. . . He turned the economy around: the economy is booming. All indicators, including economic growth rates, unemployment rates, manufacturing growth, and stock market gains, are rising to levels unseen in your Obama years. . . you credit Obama. . . Dumping of needless bureaucratic regulations, freeing the burden from our Nation’s employers. . . you panic over the removal of duplication. . . Tax reform and extra money in YOUR paycheck. . . You cry about the loss in tax revenue as if it was yours. . . North Korea at the bargaining table, we are safer as a world. . . You what?
And when the “blooming idiot” wins the trade wars you will say what?. . . . crickets
And when the “blooming idiot” builds the wall you will say what?. . . . crickets
What you may see as an idiot sure seems to know what he is doing, putting the professionals in charge and has been highly successful. Show us what the democrats have done lately besides: protest, cry and wail. . . 70 people. . . what a success. . .
I’m certainly glad we have OS to provide comic relief from the ongoing, impending disaster.
Thanks OldS—ferbrains. Your posts from yesterday made me realize I had the perfect name for you- OldS—ferbrains. You just proved beyond any reasonable doubt you have s—ferbrains.
Trey Gowdy, noted HRC hater with a passion for wasting taxpayer dollars and time used 150k of taxpayers money to pay off a lawsuit brought by former employee.
Fat jammy boy Blake Farenthold, a Texas sfw resigned from congress for using 88k to settle a suit. He promised to pay it back and now refuses to do so. Is Gowdy likely to step down?
Subway announced it is closing 500 US locations and sending more overseas.I t’s planning to open a thousand new locations beyond North America and focus on locations in the U.K., Germany, South Korea, India, China, and Mexico.
I can’t hardly stand all this winning.
All those wins you mention are wonderful for USA, OS. If both parties work together we can create some really good times for all.
The bad part about all of the success that President Obama put into play will be that it will take some time for the existing inventory to be shipped on the existing contracts. When this tariff situation comes into play, the crap will hit the fan. A quarter or maybe two, and then the train wreck.
(Again, lacking evidence to the contrary, OS resorts to wishful thinking, hypotheticals, and, his preferred mode, political bullying, demeaning and belittling others. Sad and non-refutatory.)
Oh gee Cory, where did you read bullying into my last post? Help me out there big guy. How’d I bully someone this time?
I’m eye-rolling. . . .
OldSferbrains, whose beaver you taking? Someone is paying you to lie for Drumpf. Who the hell would waste a dime on a pathetic whining, blind person like you?
Kim Jung Un stole drumpf’s lunch at the bargaining table. Kim got everything he wanted and Drumpf got played for the sucker we already knew he was.
Kim is making more, not less, nukular weapons fuel. How does that make the world safer? No clew, right. He is expanding his nukular sites, not de-nuking. How does that make the world safer?
Just keep yer head up your sandtrap and maybe loser boy in the WH will sand wedge it out for you.
The only turnaround you and Drumpf have accomplished is turning smaller deficits into trillion dollar deficits.
Everything I said remains unrefuted.
OS, care to refute the yield curve/recession correlation? Care to refute the impact of tariffs on business? Care to refute Donald Trump’s lack of understanding of or curiosity about important economic and political concepts?
They are all standing up to us the US and are seeing that trump has made us a paper tiger. We have been defeated in of all places, trade! Trade, for goodness sake, republicans have long declared that they were the business people, while we taxpayers have to bail their sorry behinds out time after time. It annoyed me in the past, but now, it is beyond any reason how they could screw up a deal with Canada or with the EU, hell, even Mexico is drinking our milkshake. Send a guy to Washington to help clean the crap up and not the dusty one to replace the dust bunny. Geesh, already.
OS can’t refute Cory or the article, he obviously didn’t read it, if he had he would have found a reputable way to disprove each and every item discussed.
The only thing OS has to offer are more of Trump propaganda and saluting a false Trump economy.
More Drumpf winning according to OS-
According to data from the Bureau of Labor Statistics, the labor force participation rate has actually fallen from 62.9 percent in January 2017 to 62.7 in May of this year. So Ivanka’s claim about workers “coming back off the sidelines” thanks to the Trump administration’s economic policies is false.
CREDIT: BLS
CREDIT: BLS
Ivanka wasn’t the only Trump administration official to spread misinformation in TV interviews that aired on Fox Business over the weekend. As ThinkProgress detailed, National Economic Council Director Larry Kudlow bragged to Bartiromo that the federal deficit is “coming down rapidly.” In fact, the opposite is true — thanks in part to Trump’s tax cuts, the deficit is increasing, and is projected to do so well into the future.
CREDIT: SCREENGRAB
Trump’s top economics adviser lies about ‘rapidly’ falling budget deficit
When Trump administration officials weren’t gaslighting, they were obfuscating. During a CNN interview on Friday evening, White House Council of Economics Advisers Chair Kevin Hassett was pressed on how only four percent of the American workforce has received a raise since Trump’s tax cuts were signed into law six months ago. Hassett replied by pointing out that workers at Walmart, at least, have gotten raises that amount to $4,000 per year.
Not looking good on the winning side, OS. But you’ll just ignore the truth and go about trolling.
Sorry, I was at work. I’m back home and will have the chance to read your “expert” economic opinions in a few minutes.
Huckabee Sanders sez Drumpf is going after Canada for treating us bad in the past on trade.
Walrus Bolton claims Drumpf has a plan to dismantle Li’l Kim’s nukes inside a year. This could get A) interesting or B) deadly for kids not of the Drumpf name, or both.
BTW Cory, love your headline. Rhythm and rhyme. Cory the rapper.
From Juanita Jeans OldSferbrains-
The result is that the stock market is now in negative territory FOR THE YEAR, manufacturers are fleeing the US for foreign shores (taking the jobs with them), debt to GDP has now exceeded our debt level at the end of WWII, the dollar is being displaced by the Renminbi for global trading, Trump has pissed off all of our trading partners and handed our export markets over to both former allies and competitors, and all this has been done while french kissing Vladimir Putin and Kim Jong Un to our political and economic disadvantage.
Tired of winning? I also learned the Cato Institute was founded and funded by the koch bros. I had no clew.