The Myth Lives On

​ In June, 2020 the U.S. was suffering through the early stage of the Covid-19 pandemic. At that time the Democrats were poised to nominate former Vice President Biden to run against then President Donald Trump who was seeking re-election. Polling data showed Biden had an overall 9 point lead although those same polls showed Trump with an equal a 9 point lead over Biden on the question as to who could best manage the nation’s economy. That dichotomy prompted me to write an article which I entitled “The Myth of Republican Economic Managerial Superiority.”  Therein I presented the data which revealed that since World War II the nation’s economy had grown at an average annual rate of 4.4% during Democratic administrations and only at an average annual rate of 2.5% during Republican administrations.

​ The poorer economic results achieved by Republican administrations was not because they were bad businessmen or even because they did not understand the differences between managing a business and managing an economy. They were simply the result of Democratic and Republican administrations having different economic goals. Whereas Democratic administrations were focused on maximizing the nation’s overall economic growth, Republican administrations were focused on channeling the nation’s growing wealth to their donor base. They did that by (a) reducing taxes primarily on corporations and wealthy individuals, (b) reducing business regulations that cut into corporate profits and (c) minimizing social welfare programs funded by taxpayer dollars that primarily benefitted those at the bottom of the nation’s income scale.

In that article I also explained why most Americans nevertheless seemed to be under the misconception that Republican administrations would be better stewards of our nation’s economy. The Republicans achieved this feat of financial legerdemain by constructing an underlying rationale for their economic policies that favored the wealthy whom they characterized as the nation’s “job creators.” Their explanation was that those corporations and wealthy individuals would use the financial benefits they received as a result of the Republican economic policies to build more factories and create new jobs and this would inure to the benefit of all Americans.

Of course, this was a wholly false narrative as most of the new tax savings flowing to corporate America was simply be used to increase dividend payments to their shareholders or to repurchase their outstanding shares. More importantly (particularly to Republican legislators), a significant portion of their enhanced profits would flow back (in the form of campaign contributions) to those politicians that had made this windfall possible.

For those working class Americans who were concerned that large tax cuts might have adverse economic affects, they offered assurances that their tax cuts would be revenue neutral (i.e., they would not result in increasing our nation’s fiscal deficit) and could even increase the revenues of the federal government. In support of this bogus contention they argued that with more Americans working the federal government would receive an increase in income tax revenues which would equal, if not exceed, the loss of tax revenues stemming from those tax cuts. This representation was also fraudulent as their tax cuts had a virtually undetectable impact on expanding employment.

To help sell this whole charade, Republican politicians employed the services of a small coterie of economic charlatans (whom I dubbed “the Four Of-Course-Men of the Apocalypse”) who would enthusiastically vouch for the soundness of their economic agenda. Also ready to help sell the Republican economic agenda were a number of the nation’s business leaders who just coincidentally happened to be the primary beneficiaries of that agenda. From the perspective of working class Americans, if the nation’s most successful corporate executives supported the Republicans’ economic agenda, it must be sound. After all, to them all economic policies sounded like a foreign language which required an interpreter to understand.

Trump’s success in the 2016 election had largely been the result his tapping into the discontent of working class Americans who had been left out of the nation’s economic growth over the previous 40 years. Although they were well aware that their lives had not been improving even though they were working harder and longer, they did not realize why or how that had happened. What was apparent to them, however, was that they seemingly had no path to improve their situations and that their government was dysfunctional and either unable or unwilling to help them. Thus, Trump appeared to them (at least on TV) as a successful businessman and someone who was not associated with the malaise that was plaguing our federal government. To working class Americans, it seemed like Trump couldn’t do any worse than the lying politicians that had been running our federal government.

When he ran for re-election in 2020, working class Americans were no longer willing to give Trump the benefit of the doubt. He had enacted his proposed tax cuts which had done little, if anything, to improve their lives. His trade war with China had caused price increases on many consumer goods and declines in U.S. agricultural exports. His promises to bring back heavy industries that had moved abroad were never realized; and his continuing promises to improve the nation’s infrastructure had never materialized. Similarly, his promise to improve our nation’s healthcare system came to naught when it was sabotaged by a stalwart of his own political party. Equally disconcerting was his mishandling of the Covid-19 pandemic which had led to more per capita deaths than had been experienced by all other developed nations.  It was these factors that had left him 9 percentage points behind Biden in June 2020 going into the presidential election. The result was that Trump lost the 2020 presidential election by 7 million votes even though to this day he has refused to acknowledge it.

It's important to understand that Trump had spent most of his term in office seeking to enhance his image as a strong man who could get things done. The opening of his first Cabinet meeting was televised and featured all of his Cabinet officers seated around a table dutifully reciting what an honor it was to be able to serve in the administration of such a strong leader. It was truly a surreal event. Trump organized a similar display of groveling at the first press conference of his Covid-19 taskforce. Trump was able to stage such displays of fealty by terminating and publicly attacking any member of his administration who acted against his wishes or spoke unfavorably of him. Such was the fate of eleven Executive Branch departmental Inspector Generals as well as a few dozen high level members of his administration.

Trump also used this same technique on journalists, verbally attacking those who criticized him or simply had the audacity to ask a follow-up question when he had given an unresponsive answer to their initial question. He even denied White House access to reporters whom he deemed hostile. This, in large measure explains why even today most mainstream media outlets are simply willing to ignore when Trump confuses individuals (like Barack Obama for Joe Biden) or mistakenly refers to his White House physician as “Ronny Johnson” or even tells an egregious lie like Nancy Pelosi turned down his offer to send members of the National Guard to the Capitol on January 6th.

In short, even though Trump’s record as president was unremarkable prior to the Covid-19 pandemic and a total disaster during his final year in office, he had nevertheless successfully made the transition from being a candidate offering working class Americans a hope for a better future into a cult leader who could do no wrong and whose every word must be believed. Thus, when he claimed that the 2020 election had been stolen from him, his MAGA followers believed him even though his own Attorney General and sixty judges had found that there was no evidence that the election had been tainted by fraud. Similarly, when his four criminal indictments were announced in 2023, his MAGA followers accepted his assertions that the charges against him were both false and the product of a weaponized Department of Justice. Equally important, those Republican legislators who didn’t accept his explanations kept quiet. Gone were the days when even a rumor of an extra-marital affair was enough to derail a political candidacy; and forgotten was the fact that the nation’s fiscal deficit had increased by $7 TRILLION (or roughly 25%) during his administration.

By contrast, the Biden administration had been quite successful. The nation’s economy had bounced back; unemployment fell from 15% to less than 4%,  bipartisan infrastructure legislation was enacted and the nation began to fight climate change. Still, Biden was already in his 80s and was showing increasing signs of diminished physical and mental health, problems that Trump and right-wing media were quick to point out. By contrast, even though Trump himself (only three years younger) was regularly displaying some of those same traits (and worse), a chastened media was largely willing to ignore them. The issue of Biden’s aging culminated on June 27, 2024 when he performed poorly in the first of two scheduled televised debates with Trump. This ultimately caused Biden to discontinue his candidacy and recommend that Vice President Harris be substituted in his place, a recommendation that quickly became a reality.

That brings us back to the current polling data which now reveals a very tight race with Trump and Harris in a virtual toss-up race in each of the nation’s seven “battle-ground states.” Nevertheless, Trump is polling 2% higher than Harris when it comes to who can best guide the nation’s economy. Certainly, this assessment is not warranted by Trump’s record in office. When he left office the nation’s economy was in free-fall and his trade war with China had been a disaster. By contrast, the nation’s economy was again growing and inflation that had risen as a result of supply chain disruptions caused by the pandemic had largely been brought down to a level below increases in wages.

So why does the American public still think that Trump will better manage the nation’s economy? To start with, the answer it’s NOT because Trump has laid out an economic agenda that’s likely to improve the nation’s economy. He has promised to extend the tax cuts he signed into law in 2017 which are due to expire in 2025 even though that proposal is estimated to add another $4.6 trillion to the nation’s cumulative deficit. In addition, he has separately proposed to further reduce the corporate tax rate from 21% to 15%. By any standard this would simply be another give-away to those Americans in the top 10% of the income scale.

Trump has also promised to impose a 10% tariff on ALL imports into the U.S. Although this might help reduce the amount of goods imported into the U.S. and raise badly needed revenues for our federal government, its principal effect would be to raise the costs of imported items and thereby reduce the purchasing power of all Americans. In addition, much like a national sales tax, it would have a disproportionate impact on those at the bottom of the income scale because they are forced to spend every dollar they earn. Trump’s tariff increases would also invite retaliatory tariffs imposed on U.S. exports and ramp up inflation which the Federal Reserve Board ( the Fed) would have to counter by increasing interest rates. That, in turn, would make buying a house more expensive, putting home ownership out of reach for many young Americans.

Trump has also called for him to be able to exercise some control over the actions of the Fed. In particular, he wants to compel the Fed to keep interest rates low. This would not only allow inflation to move upward (and conceivably spiral out of control), but it would also weaken the U.S. dollar in relation to other currencies, making imported goods more expensive and foreign sales by U.S. companies less profitable. These proposal raise the questions whether Trump has any understanding of macro-economics and whether he even listens to those who do.

The answer as to why more Americans nevertheless believe that Trump would be a better manager of our economy than Vice President Harris seems to be because Trump and his acolytes in the Congress and right-wing media have been verbally attacking Harris’ ability to do so. Last Monday (before the stock markets even opened for trading) Trump asserted that the “stock markets are crashing, job numbers are terrible . . .and we have the two most incompetent leaders in history.” Later in the day, he sought to blame the stock markets’ 3% drop on Harris who is yet to wield presidential power, dubbing the markets’ retreat the “KamalaCrash.” Trump is thus trying to convince voters to believe that our economy is on the brink of catastrophe and that Biden and Harris are the blame.

Verbal hyperbole has been one of the mainstays of Trump’s campaign repertoire. He similarly warned in 2020 that if Biden were elected, the stock markets would crash and nation’s economy would “sink into the worst depression ever.” While we are still waiting for this to happen, from Trump’s perspective, the truth is simply what he can get voters to believe.