Catching “Catch 22”
If one asks others what they understand “Making America Great Again” means, what do you think the answer would be? Would it be about more good paying jobs? Would it be about returning social norms to a more conservative period? Would it be victories in foreign encounters? Or, would it be simply a return to the “Guilded Age”?
It might very well be all of these. The phrase elicits answers which are specific to individuals. President-elect Trump has never applied any specifications to “Make America Great Again” Consequently, the phrase could mean any or all of these conditions, or none of them. As the Pied Piper-in-chief, President Trump is likely to keep moving the target and assuring everyone that we are just months away from America being Great Again.
So what is the “Catch 22” aspect?
President-elect Trump has got to begin quickly to deliver results to his base. For these Americans, good paying jobs are the goal and at the minimum is no further erosion of legacy jobs. Most probably President Trump hopes to achieve this by stimulating the economy with large tax cuts which would (supply siders predict) create demand for goods and services. As more goods and services are consumed, the economy will grow to meet this new demand. Once started, supply siders reason, the economy blossoms.
But there is a “catch 22” problem. The Republican Party’s conservative wing are mostly deficit hawks and do not support unfunded policies. Tax cuts, they feel, are wonderful but not the loss of tax revenues. While supply siders will promise that a stronger economy will “self fund” these cuts, history has not supported this concept. Cuts in other spending (read job loses) seems inescapable.
So… our conservative budget hawks see a grand opportunity to cut entitlements and slash away at government employee rolls. Hmmm.
Cutting government employees might seem related to “draining the swamp” and should be very popular with Trump’s supporters. Will that be a free lunch, that is, allowing President Trump to give large tax cuts to the wealthy while turning out thousands of federal employees? Or, will “catch 22” make him hold up on dismissing so many government workers?
And just in case one doesn’t recall 2008 and 9, when the US economy fell into a severe recession, these same conservatives called for “austerity” measures. Not only were jobs reduced at the Federal level, but additional jobs were cut in many State governments. What these actions did together was to increase the national unemployment rate at the same time President Obama was attempting to stabilize the economy. The country was in a hole but these conservatives just wanted to keep digging.
So, what is the message?
Challenging each Federal Agency to demonstrate continued needs for their services as well as the number of employees needed to provide the services should be encouraged. Maybe there are areas where substantially less employees are needed. But wouldn’t it make sense to lay these workers off at a time when the economy is growing briskly and displaced workers could more easily find work?
The looming battle pits a GOP/Trump encouraged Administration and co-accomplice, Congress, ready to tear down all sorts of Federal programs, against the reality that there will be consequences. Rather, the GOP seems poised to do it all at once, stimulating job growth with one hand and destroying jobs with the other. The knock-on social consequences can only be imagined at this time and appear of little interest to the GOP.
President-elect Trump now predicts 4% sustained GDP growth is just around the corner. There are concrete reasons to doubt his number, even for a short run of 2-3 years. On January 20th, the Trump era will begin. I wonder how long the honeymoon will last?