William McKinley, 25th president (1897-1901).
By Todd Lassa
Right and left have plenty to argue over after just 60+ days of the Trump 47 administration, not the least of which is existential fear about our democracy. But for voters who swung the 2020 election for Democratic candidate Joe Biden and then four years later for Republican candidate Donald J. Trump, it comes back to that famous quote by Bill Clinton’s campaign chief, James Carville: “It’s the economy, stupid.”
Thirty-three years later, President Trump’s infatuation with Gilded Age president Number 25, William McKinley and his tariff policy, have Number 45/47’s staunch MAGA supporters on the defensive (if that’s possible) as swing voters wonder what happened to cutting inflation on Day One.
McKinley “made our country very rich through tariffs,” Trump has said (per Fortune).
The Gilded Age, roughly 1870 to the end of World War I, 1918, brought great wealth and power to the Rockefellers, Carnegies, Vanderbilts and Mellons, just as Musk, Bezos, Zuckerberg and Gates stand to expand their political and economic power under a Trump Gilded Age. And just like current times, the original Gilded Age was a time of a deepening gulf between the 0.01% and the poor and lower classes in America.
America’s billionaires are now worth $6 trillion-plus, more than twice the wealth they held prior to President Trump’s tax cuts from his first administration in 2017, USA Today reported last July, quoting Americans for Tax Fairness. Approximately 800 billionaires hold more wealth than half the nation, while the bottom-half of the US holds just 2.5%.
Tariffs will prompt global corporations to build more factories in the US, Trump claims, and extended tax cuts will trickle down to the masses.
Let’s connect the economic dots. “Trickle-down” is the argument President Biden repeatedly rejected, as his policies were designed to reverse President Reagan’s supply-side economics, which in turn was a reversal of LBJ’s Great Society and FDR’s New Deal. The New Deal was President Franklin Delano Roosevelt’s response to The Great Depression, which was triggered by the Wall Street crash of 1929, which came off the laissez-faire capitalism that followed the Gilded Age.
A recession is defined as lower gross domestic product, versus depression, which is negative GDP. In this week’s meeting of the Federal Reserve Open Market Committee, its members projected a GDP growth-range for the year between 1% and 2.4% (growth last year was 2.5%). The median projection for Fed Market Committee members is +1.7%, which clearly would be a recession, far from anything starting with a ‘d.’
But some economists have revived a word from the Ford and Carter administrations that spilled into the first couple of years of the Reagan administration: Stagflation. This is defined as the painful combination of high inflation and high unemployment.
We’re not anywhere near that now, and in fact the Fed’s projections for the coming year are for a slight increase in inflation, but still historically low unemployment.
In this page’s debate, Rich Corbett, in the right column, and Hugh Hansen, in the left column, have very different opinions of where all this is heading.
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