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Applebaum describes the accounting errors in the Trump 2017 Budget which makes unrealistic assumptions of 3% growth to show higher revenue generation of $2.1 trillion over ten years, and uses that revenue to fix higher deficits from tax cuts- counting the same number twice. A former Treasury Secretary, Lawrence Summers, calls it the most egregious accounting error he has seen in 40 years.

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Hear this America- Trumps call to end tax on social security benefits is a HUGE MISTAKE. It will result in seniors getting an average of about $560 now in exchange for a cut in social security by 25% in 2033 only 9 years from now, and Medicare insolvency 6 years from now. The insolvency dates and cuts are estimates of the Committee for a Responsible Federal Budget.

Senator Larson says Trump's plan to end tax on social security benefits is "a fatal mistake," because it does not make up for the lost revenue.The Committee for Responsible Federal Budget, bipartisan budget evaluation says it will bring forward by 6 years Medicare insolvency from 2037 to 2031 just 6 years from now, and advance Social Security Fund insolvency by 1 year from 2034 to 2033. It will lead to a cut in Social Security benefits of 25% in 2033 which would have dangerous and tragic consequences for seniors in America pushing many into poverty.

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With the arrival of Mike Pompeo as Secretary of State, and John Bolton as National Security Adviser, president Trump finds support for his own instincts on foreign policy. On North Korea, Iran, and China, president Trump takes charge of foreign policy favoring strong bargaining pressure to achieve foreign policy  goals in trade, containing nuclear weapons and reducing conflicts. He sees the peace talks with North Korea as moving in the right direction with his efforts, and makes the decision to withdraw from the Iran nuclear deal of 2015 on May 8, 2018, as he leaves the door open for new negotiations with Iran for a better deal that achieves U.S. goals.

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US House Republicans are pursuing cuts in spending of as much as 50% in many programs that are considered essential, such as a 50% cut in foreign aid at a time of global food insecurity, deep cuts in the FBI's counter intelligence budget, deep cuts in healthcare services and housing to low income Americans following the pandemic and high inflation, and other cuts to services benefiting workers and families. Democrats in Congress and president Biden oppose such cuts and hope to eliminate the deficit with cuts that do not place an unfair burden- taxes on the wealthiest with over $100 million and on stock buybacks would generate about $2 trillion to cover the whole deficit which is in the range of $1.4 trillion in 2023 moving to $2 trillion a year. Much of the Republican plan is being shaped by Mr. Trump's former Budget Director, Russell Vought, says this report in the NYT. Mr. Vought calls it an attack on the bureaucracy and woke spending. Other Republicans see this as an ideological approach that does not address today's problems. Chuck Schumer, Democrats Senate Majority Leader asks Republicans to spell out their plan. ...

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 Donald trumps economic plan would worsen the country's economy through extravagant borrowing and lower economic growth in the long run. Because it lowers taxes by 15 percent without any paired cuts Trump's plan would worsen the deficit, so that large debt would hurt the economy in the long run. Clinton's plan would increase taxes by 4  percent largely on high incomes so as not to hurt consumer spending, with paired spending to help lower income households. Because Trump's tax cuts benefits go disproportionately to higher incomes the benefits in terms of consumer spending are slight or insignificant. In the current state of weak income gains of the last ten years it would take some time for the middle and working class to recover. Clinton's plan carefully nudges that recovery forward without aggravating the debt, so that as incomes and net worth recovers across broad parts of the population, the U.S. is poised to go forward with strong growth as in the postwar years. Trump's plan frontloads tax benefits to higher incomes at the expense of worsening debt and enlarging future debt. In the process it worsens income disparities already aggravated by the 2008 financial crisis. Reducing the chances of a broad based recovery for all parts of the population, necessary for a strong recovery.                       ...

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U.S. frustration with China as coronavirus toll reaches 300,000 deaths worldwide. President Trump says- "They could have stopped it in China where it came from. But it didn't happen that way. " Worst hit are countries in Asia and Africa with food security threatened. After the coronavirus he says of the trade deal he signed in January- So, I make a great trade deal and now I say this doesn't feel the same to me.The ink was barely dry, and the plague came over. And it doesn't feel the same to me." Under that trade deal the China agreed to buy $250 billion in additional goods and service for 2 years in an effort to correct a huge trade imbalance - built up on the advice of American economic theorists and experts who advised American presidents for three decades that it was of no consequence - in exchange for a roll back of American tariffs in stages of part of the tariffs. 

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The 2017 Budget presented by the Trump administration has a serious problem in that it assumes 3% growth, and 2% inflation, low interest rates, to generate $2.1 trillion in additional tax revenues over 10 years. Hilsenrath in the WSJ has questioned whether 3% growth is a safe assumption. Then the Trump 2017 budget resorts to double counting which analysts called egregious and wrong by using the unsupported $2.1 trillion in extra revenues to fill holes in the deficit. By doing this it comes up with debt to GDP ratio dropping from about 75% to 65%, whereas the Congressional Budget Office does the math and says it would jump from 75% to about 85%. Such a mistake is called the "most egregious accounting error" by Lawrence Summers, a former Treasury Secretary, from what he has seen over 40 years. The irony is that the budget is called "The New Foundation for American Greatness," because of the lack of a firm foundation in the numbers. Deep cuts in social programs makes the math riskier politically and socially.   ...

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In the end only concerted pressure from the U.S. including the personal intervention of president Trump, calls from Republican senators to Prince Abdulaziz, Saudi energy minister, salvaged a deal for OPEC+ oil cuts. The Saudis insisted Mexico cut production by 300,000 barrels a day, Mexico stood firm at 100,000 barrels a day. As the Mexican energy negotiator Ms Nahle withdrew to call Mexican president Lopez Obrador, the Saudi energy minister called this "disrespectful." Then president Trump intervened with calls and offered to make up with additional 300,000 barrels a day of cuts from the U.S. North Dakota senator called Prince Abdulaziz and stated that it could affect the U.S.-Saudi relationship if the Saudis did not come to an agreement. The agreement is for 23 countries to in total withdraw 9.7 billion barrels a day from the market, or 13% of world production. Oil production is expected to fall by as much as 30 million barrels a day in April 2020 as a result of the pandemic so it is not clear how much this will raise oil prices, yet it averts a complete collapse of oil prices from the $22 today when markets open on Monday April 13, 2020.  The U.S. Canada, Brazil and G20 countries outside OPEC will make a combined 3.7 million barrels a day in cuts. Saudis, Kuwait and United Arab Emirates combined will cut 2 million barrels a day above their quota.  In addition to warning both sides Saudis and Russia to come to an agreement, president Trump threatened to retaliate to protect U.S. producers from very low oil prices sending many into bankruptcy. Prince Abdulaziz took a tough stand with Mexico and other OPEC countries to present a unified stand. He is the son of the Saudi king and took the energy ministry in fall 2019. He has had difficulty in managing OPEC plus Russia called OPEC+ as its new chief with divergent views from small producers such as Angola and large producers such as Russia. At a conference in February he continued the standoff with Russia saying Russia would regret not making the production cuts he was calling for. The split with Russia after a 3 year collaboration for cuts ended in an all out price war right in the middle of a pandemic.  The Russians underestimated the size and impact of the pandemic. The Saudis took a firm position. Only president Trump's swift and active intervention and offering to make up Mexico's share of cuts saved the day for all oil producing countries, who would all be severely hurt by sinking oil prices below $20 a barrel.     ...

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Jack Horton of BBC Verify screens the former president Trump's speech at the Republican National Convention. “Our crime rate is going up, while crime statistics all over the world are going down".  Fact: FBI data shows crime down 6% and a drop in the murder rate by 13% in 2023. For the First Quarter of 2024 crime down by 15% and recorded murder rate down 26%. "We've had the worst inflation we've ever had under this person [Biden]. I will end the devastating inflation crisis immediately, bring down interest rates and lower the cost of energy . We will drill, baby, drill."  Fact: Inflation went up to 9.1% from 1.4% at the end of the Trump term in the first 2 years of of the Biden Administration by June 2022. Biden and Federal Reserves Powell brought this down to 3%. Explained: This inflation jump to 9% would have happened from supply chain in China for Trump administration as well. Trump's last year was 2019 the Covid pandemic started in January the lockdown by midyear meant sharp drop in demand and little room for inflation. The concentration of supply chain in China was the cause of the surge in inflation as China shut down and restarted late into 2022 causing shortages in factory parts and supplies. Biden focused on vaccination in 2020-2021. This inflation would have happened under Trump- this concentration of supply chain started with Reagan economic philosophy to ship production (and jobs) overseas, Clinton Bush Obama and Trump did little about it. Biden invested heavily in Make in America manufacturing and jobs at home. Biden and Powell did a good job of bringing this inflation down by 2023 to 3% before the European Union and UK. Younger voters don't know this they get their news from the internet and show little interest, see only that the low inflation under Trump and the higher inflation during the pandemic recovery under Biden and blame Biden. will Trump do better on inflation in 2024-2028. The WSJ does not think so its analysis shows inflation higher under Trump than Biden because of a planned 60% tax on imports from China. Trump follows Reagan/Friedman theory of the old Republican party of higher tax cuts for the wealthy, so no money is left for investing in American manufacturing and jobs as Biden free of this theory is able to do, leading to slowing growth with inflation under Trump.        ...

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The Editorial Board of the WSJ says in this editorial that president Trump showed his negotiating skills to arrange the oil deal with the Saudis and Russia for cuts in production of 9.7 million barrels a day, including cuts by non OPEC G20 countries. The drop in U.S. production, cuts by Canada and the effects of sanctions on Venezuela and Iran should take out about 20 million barrels a day. Demand has fallen by 30 million barrels a day from the pandemic. This should help 11 million workers in the U.S. oil industry.

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This report by Timiraos in WSJ describes the tussle between supply siders led by Mike Pence and David Malpass with the zero sum advisors who advised Trump on trade during the campaign. The zero sum advisors are focussed only on how to turn trade to improve the U.S. position and cut trade deficits. The supply siders are trying to show that trade can benefit the U.S. only that it needs to be adjusted so that it works better for the U.S.

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There are hidden dangers in Trump's plans for ending Social Security taxation. The Committee for a Responsible Federal Budget which evaluates independently budget plans to educate the public has studied this proposal. It can be seen here by clicking on this Article. It says it will advance the insolvency of Medicare from 2037 to 2031 just 6 years from now. it will advance the insolvency of Social Security from 2034 to 2033 by 1 year, just 9 years from now. The law requires that once the Social Security fund is insolvent that it will lead to cuts in benefits of 21 percent, ending taxing social security benefits will make that cut 25 percent says CRB.  

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At 79 years, Wilbur Ross will be one of the oldest people serving in any administration, as he serves as Commerce Secretary in the Trump administration. Wilbur Ross is best known for the turnaround efforts in the steel industry. In 2002 he acquired LTV Corp, a third largest steel producer in the U.S. facing tough times and legacy costs, for $125 million in cash and $200 million in environmental liabilities. In 2005 he sold his International Steel Group to Arcelor Mittal for $4.5 billion, and is still an independent director on the Arcelor board. Ross's earlier experience was as a bankruptcy specialist at Rothschild Inc. in the 1970's working on restructurings at Texaco, TWA and Continental Airlines. Analyst Charles Bradford is cited in this report by WSJ's John Miller, who competed with Ross in restructuring proposals for failing assets, and describes Ross as working harder and being tougher to make the deals. Some of these restructurings involved cutting pensions and large layoffs. The entire U.S. steel industry faced problems from foreign competition and legacy costs at the time. This included representing bondholders for Taj Mahal Casino in Atlantic City. At the time Ross told creditors considering seizing the asset for a possible missed payment that it would be better to keep Trump in charge for Trump properties as they would be worth more with Trump inside. This led to Ross later providing critical backing for the Trump campaign and raising money from the business community. Mitt Romney had similiar work at Bain Capital in turnaround of failing companies, later turning to politics as Governor of Massachusetts, and 2012 Republican nominee for president. Both Romney and Ross have come under criticism for their role in cost cuts at companies involving layoffs and cutting worker benefits. ...

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Strident tone of Treasury Secretary Scott Bessent defending tariffs, the economy, and affordability. Bessent defends the DJT administration's tariffs plan, its effort to bring back jobs, its policies on gas prices that have cut inflation, and the president's Big Bold Beautiful Bill with it's provisions for Businesses to expand investment in the economy using a rapid depreciation provision. He has called the critics as having "Trump Derangement Syndrome." Part of this is based on his economic experience and understanding of how tariffs can be used to level the playing field where the EU, Japan, China, Mexico and other countries have taken advantage of trade policy for their own gains to the detriment of the US and communities in the Nation that lose jobs and factories. One of the assets to the current administration of DJT is Bessent's grasp of financial markets, his extensive experience in the field as a business person. He was able to convince the president to withdraw tariffs or mitigate tariffs to adjust for the effects on financial markets in the US and worldwide.  ...

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Krugman points out that the federal tax rate for the top 1% is 34% in 2013, according to the Congressional Budget Office, because president Obama let the high end Bush tax cuts to expire. It is the number to remember says Krugman- 34. In 2008 the figure was 28.2. Under Hillary Clinton the average tax rate for the top 1% would go up by 3.4 percentage points, according to the Tax Policy Center. Some of this would help pay for the tution plan to provide access to the middle class to public universities. Under populist Trump, Krugman points to the elimination of the inheritance tax and tax rates going down substantially, and no such programs to promote the upward mobility that everyone is talking about, and no way to pay for a big infrastructure building effort for growth and jobs- upward mobility that is the focus of every candidate's election campaign including Sanders, Trump in appealing to older white working class families, Clinton, Ryan, Bush, and others in both parties.   ...

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A Trump-Vance nomination with its huge tariffs inside a Republican shell with its preference for tax cuts is with a large degree of certainty likely to put America further behind China, slipping even further by a decade. And slipping in renewable energy and in meeting the aspirations of ordinary Americans. Most of the public does not realize that Trump-Vance 60% tariffs and Republican preference for tax cuts over infrastructure spending would create inflation and lack of growth in a Trump-Vance second term. Things would get worse because of the contradictions existing in the choice of tariff preferring Trump in a Republican party that sees tax cuts not infrastructure spending -even when desperately needed- as the answer to every economic problem. Without a clear policy of making the trillion dollar investments in the US economy, in manufacturing, in renewable energy, in chips and science, as it has under Biden the US under Trump-Vance policies would have two serious problems- first it would revive inflation. 60% tariffs on Chinese imports and 10% tariffs on other nations proposed by Trump-Vance would increase inflation. In the absence of the infrastructure investment that Biden has put in place it would create both a lack of growth for the jobs missing that come from infrastructure that is badly needed in a aging dilapidated infrastructure economy, and the inflation that the high tariffs would engineer. The benefits would not be great if China chooses to find other ways to conduct business and continues to keep its currency at levels that promote its exports. Even today Chinese products enter the US through other countries or when China builds factories in the US as Japan has done. The Republican aversion to tackling Chinese industrial challenges in the same way that China does by actively supporting American manufacturers would give China another decade of advantage as America slips even further behind in chips, science and manufacturing. This is the real problem in mixing Trump-Vance to the Republican philosophies on the economy which are not right for this point in time whatever their merits may have been in the 1980's when America was the industrial leader in the world.   ...

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A second term Trump-Vance will face uphill risks and a mess in economics from a Trumpian Republican party and Congress, says WSJ. WSJ Editorial Board says a second Trump term is not without risks. Tariffs cost 1.1% in annual growth in the Trump first term says WSJ, and it did have an impact on inflation. It would have had greater impact on inflation with the supply chain crisis of Biden's first term, had this supply chain crisis happened in Trump's first term. A second term Trump-Vance support tariffs as high as 60% on Chinese imports which would have a bigger effect on inflation and economic growth than of the first term. The key difference is that with tax cuts a basic rule for Republican policies Trump-Vance second term would not invest in infrastructure the way Mr. Biden has done and Biden will do so in a second term. As a result the economic growth is likely to be greater and inflation smaller under a Biden administration. Trillions of dollars in investment in the economy and infrastructure under Biden in a second term will be missing in a Trump-Vance tax cuts administration policy. And with it hundreds of thousand of jobs created each quarter will be missing in Trump-Vance second term. Add to this the level of clarity of stable economic policy under a Biden second term and contrast it with some of the chaos in economic policy of a Trump-Vance second term. The basic contradiction between tax cuts policy and the nation's need for infrastructure spending/rebuilding under a Republican under Trump administration will not go away, present a huge stumbling block. Chaotic policy could come from Project 2025 that says consider abolishing the US central bank Federal Reserve. This kind of erratic and unwise policy proposals are clearly not happening under Biden and Yellen. Another key difference is the cost to the economy of delays of several years in doing nothing for climate in Trump-Vance 2024-2028. Severe effects on climate if nothing is done could cause acceleration of climate negative costs which a future economy under Democrats would face, in reality the Nation would face. America's Business has taken a short term approach to climate change, when the time comes to pay the costs of short term thinking it assumes it is somebody else's problem- this happened with supply chain concentration in China the burden falling on the middle and lower classes, it would happen again with missing climate change action under Trump-Vance second term. ...

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Krugman in the NYT cites president Trump's reference in an interview with the Economist magazine to the expression "priming the pump." Trump in that interview in May 2017 said he had come with the expression and feels good about it. "Priming the pump" is an expression used by president Franklin Roosevelt during the Depression period. During the depression and in 2009 the economic crisis needed a stimulus response and priming the pump. The economy today with lower unemployment is not the time to increase deficits with tax cuts for the wealthy, says Krugman. Only infrastructure spending with a long term return justifies increasing the deficit. He is critical of Speaker Ryan for supporting deep cuts into Medicaid for poor people, and yet supporting the tax cuts weighted more towards helping higher income people.

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Hillary Clinton attacks Trump's policies in an address in Warren, Michigan, saying this was another version of failed trickle down economics. She called Trump's idea of taxing pass through entities such as small business reporting business income on individual tax returns at 15%, as a "Trump loophole." On trade policy Hillary Clinton said she would oppose the TPP or Trans- Pacific Partnership Trade Agreement that president Obama has supported. She put it flatly- " I oppose it now. I'll oppose it after the election, and I'll oppose it as president." And pointed out that too many companies have moved jobs overseas and "moved operations overseas and sold back into the U.S." after pushing for trade deals. The answer she said 'is not to rant and rave- or to cut us off from the world," in reference to protectionist policies Trump has supported. 

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The WSJ provides an excellent summary of the positions of the candidates in the U.S. presidential election of 2016 on key issues, education, healthcare, immigration, taxes, national debt, infrastructure spending, and economic growth. Clinton is clear on specifics, Trump has not made clear the details of policies and talks in general terms. On immigration the 2 candidates are far apart, on issues of infrastructure Clinton plans a $275 billion effort to repair the country's infrastructure and Trump says he would make a big effort. On taxes Clinton plans to pay for spending with higher taxes on the rich. Trump says he would provide huge tax cuts, yet make large infrastructure spending without clarifying how this would be done with sharply lower taxes. Both candidates oppose the TPP and oppose trade agreements that lead to loss of U.S. jobs.