- Carlos Barria/Reuters
- With Gary Cohn out at the White House, President Donald Trump can run the economy like the slapstick show he’s always wanted.
- The stars are Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, and Trump’s top trade adviser, Peter Navarro.
- These three stooges will surely provide the protectionist antics that make their boss laugh, but they’re a danger to the US economy.
Treasury Secretary Steve Mnuchin is a sycophant.
Commerce Secretary Wilbur Ross is a sycophant.
The White House trade adviser Peter Navarro is a sycophant.
And now, in an effort to please the president of the United States, they will put on a show in the White House, billed as one about the US economy, of which they are all now in charge.
But it will really be a show about victimization, revenge, and some really good sound bites. That’s the kind Donald Trump likes.
There will be no facts. There will be fewer figures. They’ll tell Americans that trade wars “are easy to win” and have no consequences. They’ll say debt and deficits don’t matter. They’ll say whatever Trump, who thinks people still get milk from the “local milk people,” tells them to say.
The healthy debate Trump claims to foster in his White House is part of the joke. The debates will all end in agreement with him, and that means we’re in danger of starting a trade war that could spike prices at a time when the economy is already inflating.
Nyuck, nyuck, nyuck.
The 3 stooges
All of these men are ridiculous for their own reasons. I can’t even rank them.
Despite his lightly used Harvard Ph.D. in economics, Navarro is what economists would impolitely call “a crank.” The Trump administration apparently found him after Jared Kushner, most likely thirsting for knowledge, searched for books about China on Amazon. There, he found Navarro’s “Death by China.”
To give you a sense of its contents: An expert interviewed in the documentary made from the book said that “China is the only country in the world that is preparing to kill Americans.”
So when Gary Cohn, the administration’s soon-to-be-erstwhile economic adviser, sidelined Navarro last year, Wall Street cheered. According to The Daily Beast, Navarro could be seen wandering the halls of the White House with a copy of his own book in hand.
“The thing about Peter Navarro is that he was never a part of the group of economists who ever studied the global free-trade system,” Lee Branstetter, an economist at Carnegie Mellon, told me last year.
- Andy Kropa/Getty Images
With Navarro elevated and Cohn out, expect the administration to take aggressive action – especially against China – every chance it gets. Navarro, like Trump, sees the US, the richest country in the world, as a global victim.
Despite his years making money all over the world as a private-equity globalist, Ross has taken up that mantle as well. He spearheaded the White House’s investigation into aluminum and steel, which resulted in the market-scaring tariffs the administration is set to impose.
The investigation frustrated Cohn and other members of the administration, according to the news website Axios. That’s because Ross left out all the bad repercussions of steel and aluminum tariffs – he wrote the narrative Trump wanted to hear. And now we’re here.
It’s unclear why Ross is doing what he’s doing, but we do know he has deep ties to the steel industry. In 2004, he made $2 billion selling his steel businesses to ArcelorMittal. He sold his stake in the company and stepped down from the board last year.
ArcelorMittal executives, however, contributed heavily to the testimony leading up to Ross’ report. Naturally, they were in favor of steel tariffs.
It is here that we should also note that Trump and Ross have been friends for years. One thing they have in common is their tendency to grossly exaggerate their wealth. Trump sued a journalist who said it was about $250 million (not the billions he claims) and lost. Ross was recently caught in his lie – his financial disclosures showed he had been inflating his wealth to make Forbes’ billionaires list for years.
This kind of deep-seated insecurity should be examined by a psychologist, not a journalist.
Finally, there’s Mnuchin.
Relying on him to counter Trump is like relying on a wet blanket to keep you warm on a camping trip through Siberia. He comes from a line of rich Wall Streeters, and his résumé includes a solid contribution to the mortgage crisis, as well as production credits on movies like “The Lego Batman Movie” and “Suicide Squad.”
Despite being groomed at the free-trade global-facing firm Goldman Sachs, he has been parroting Trump’s nonsense on trade, just as he was the administration’s nonsense on deficits and tax cuts.
He’s also married to this woman, so I imagine he hasn’t practiced saying “no” in a long time.
This is for the cheap seats
Republicans, desperate to win an election, have fallen in line behind Trump. Their foolishness has a price. They thought they could have their base and eat it too – that is to say, they could keep the mass of Trump voters in their bloc but legislate to their detriment (see: tax cuts that benefit the wealthy more than anyone else).
But that was not the deal they made. They voted for a showman who basks in the adoration of his base, and now they have a show where he will respond in kind.
That means his populist rhetoric will now take center stage. It doesn’t matter that the content lacks any kind of substance or disagrees with the GOP’s leadership.
The result of this will be an extension of lost years. When the bottom fell out in 2008, the world was forced to put progress on hold and row in the same direction toward recovery just to stay afloat. Ten years later, we’ve begun to turn the corner. We can invest in growth and progress again. But that’s not what we’re doing.
Instead, we’re fighting with our allies and denying climate change. We’re supporting dying industries and starving growing ones.
The clearest illustration of this waste and regression comes from comparison.
In August, the White House initiated an investigation into China’s theft of US intellectual property. It’s a real problem that requires a globally coordinated solution.
No matter – with Navarro at the helm, we will go it alone, most likely putting tariffs on a swath of Chinese goods in the next few weeks, resulting in a trade war.
China’s foreign minister has vowed to retaliate in the event of a trade war, but that’s just half the story. The other half is what China is already doing. On Monday, the country kicked off its Communist Party meeting of the year, the National People’s Congress, during which its leaders outlined their goals for the future.
Their goals make our goals look stupid.
While our president is extolling the virtues of “beautiful, clean coal” and “loving” trade action, China is vowing to cut down on air pollution and investing in teaching young people about artificial intelligence. We are not even competing with that, which is almost to say we’ve already lost.
Mnuchin, Navarro, and Ross are hardly the men to set this right. They are clowns performing slapstick economic policy for an audience of one.
It’s a joke that never had any intention of being funny.